Press Releases
The Andersons, Inc.
Net income for the first six months of the year was $6.5 million, or $0.88 per diluted share, with revenues at $495.5 million. Net income for the first half of 2000 amounted to $7.9 million, or $1.04 per diluted share, on revenues of $467.7 million. Excluding non-recurring items that occurred in the first quarter of each year and an accounting change that was described in the company's first quarter 2001 earnings release, year-to-date net income was $6.4 million, or $0.87 a share, this year, compared to $7.3 million, or $0.96 a share, in 2000.
The Andersons, Inc. is a respected leader and prominent regional player in grain merchandising. Its strong position in this basic business has enabled the company to diversify into other agribusiness operations, railcar leasing, turf care product manufacturing and general merchandise retailing. The company has been in business since 1947.
Agriculture
The company's Agriculture Group operates grain elevators, fertilizer distribution terminals and farm centers in Ohio, Michigan, Indiana and Illinois. Collectively, these facilities handle more than 150 million bushels of grain and 1.3 million tons of dry and liquid agricultural fertilizer products annually.
The group's grain, wholesale fertilizer and farm center businesses all achieved higher operating income in the second quarter and the first six months of 2001 vs. the comparable periods last year. Volume and margin increases were achieved by all three businesses, and income generated by the group's grain storage facilities remained strong.
Rail
The Rail Group leases and markets railroad cars and locomotives. It also repairs railcars and operates a custom steel fabrication business. The group's railcar marketing segment has grown significantly in the past few years and now controls a fleet of 4,940 railcars and 30 locomotives that are leased to shippers, railroads and fleet owners in a wide range of industries in the U.S. and Canada.
Because of a slowdown in demand for many types of rail equipment throughout the past two years, this group continues to focus primarily on short-term leasing opportunities rather than car sales or long-term leasing commitments. While there are indications that the cyclical downturn may be easing, the group incurred a loss for both the quarter and first half of 2001. Included in the second quarter result was a $1 million non-cash charge to recognize the lower value of certain assets.
Processing
The Processing Group manufactures turf and ornamental plant fertilizer and control products. With a national production and logistics infrastructure, it serves major retailers throughout the country and is the industry leader in premium fertilizer products for golf courses and other professional turf care markets. The group also produces chemical and feed-ingredient carriers, animal bedding, cat litter and ice-melter products.
Revenues were higher during the period because of an acquisition made last year. However, the group's operating results for the quarter and first six months were down. The consumer lawn industry was influenced negatively this year by several factors -- higher raw material prices, general economic uncertainty and unusual weather patterns in several regions of the U.S. this spring that curtailed homeowners' lawn care activities. At the same time, a downturn in the number of golf rounds played has caused golf course owners to reduce their costs wherever possible, including purchases of fertilizer and other turf care products. In response to these factors, the group has begun taking steps to significantly reduce the breakeven volume level in this business.
Retail
The Retail Group operates six large stores in Ohio. With a theme of More For Your Home™, these stores offer traditional home center merchandise including hardware, plumbing, electrical and building supplies, but also feature indoor and outdoor garden centers, extensive lines of housewares and domestics, automotive supplies, pet supplies, sporting goods, wine and a unique specialty food offering.
Same store sales were 2.6% higher in the second quarter this year compared to the same three-month period of 2000. Because of labor and other store operating cost increases, however, the group's second quarter operating income declined slightly. Given the softness experienced during the first quarter of 2001, the group's first half revenues and operating income both still trail last year's performance.
Company
According to President and Chief Executive Officer Mike Anderson, "Several of our businesses have a strong seasonal orientation that makes the second quarter a key period for The Andersons. Frequently, the lion's share of our full-year income is generated during these three months. Our agriculture business is really on a roll, achieving excellent top and bottom-line growth. However, two other units are not having the same degree of success at the present time. Our rail business continues to work through the cyclical downturn we've described for some time, although there are indications that this business is beginning to rebound. Our biggest challenge is the double whammy the lawn business is experiencing this year with extremely tough economic circumstances in both the professional and consumer industry segments. The earnings growth we achieved overall for the second quarter once again demonstrates the benefit of our business diversification."
Recently, The Andersons paid a quarterly cash dividend of 6.5 cents per share to shareholders of record as of July 2, 2001. The company is authorized by its board of directors to continue to repurchase shares from time to time.
The company will host a webcast on July 26, 2001 at 11:00 A.M. EST, to discuss these second quarter results and the full-year earnings outlook. The webcast can be accessed at the company's website http://www.andersonsinc.com/ under the heading "Financial Information" or at http://www.videonewswire.com/event.asp?id=177 .
This release contains forward-looking statements. These statements involve risks and uncertainties that could cause actual results to differ materially, including, without limitation, economic, weather and regulatory conditions, competition, and the risk factors set forth from time to time in the company's filings with the Securities and Exchange Commission.
The Andersons, Inc. is located on the Internet at www.andersonsinc.com .
The Andersons, Inc.
Consolidated Balance Sheets
(Unaudited)
June 30 December 31 June 30
(in thousands) 2001 2000 2000
Assets
Cash and cash equivalents $9,255 $13,138 $5,332
Accounts receivable (net) and
margin deposits 56,234 55,475 58,513
Inventories 147,932 209,706 131,812
Other current assets 18,313 24,505 20,683
Total current assets 231,734 302,824 216,340
Other assets 7,312 10,020 11,111
Railcar assets leased to others (net) 23,448 22,281 20,767
Property, plant and equipment (net) 96,058 98,071 95,414
Total $358,552 $433,196 $343,632
Liabilities and owners' equity
Current liabilities:
Notes payable $50,300 $71,300 $52,200
Other current liabilities 119,767 176,264 117,531
Total current liabilities 170,067 247,564 169,731
Deferred items, long-term liabilities
and minority interest 15,874 15,637 12,441
Long-term debt 79,370 80,159 71,836
Shareholders' equity 93,241 89,836 89,624
Total $358,552 $433,196 $343,632
The Andersons, Inc.
Consolidated Statements of Income
(Unaudited)
Three Months ended Six Months ended
June 30 June 30
(in thousands, except for per
share amounts) 2001 2000 2001 2000
Sales and merchandising revenues $275,248 $263,105 $495,480 $467,712
Cost of sales and merchandising
revenues 226,988 218,247 412,105 387,800
Gross profit 48,260 44,858 83,375 79,912
Operating, administrative and
general expenses 35,473 33,269 68,825 65,726
Interest expense 2,867 2,594 6,481 5,270
Other income/gains:
Other income 792 1,112 1,377 2,122
Gain on insurance settlement - - 338 -
Gain on sale of business - - - 907
Income before income taxes and
cumulative
effect of accounting change 10,712 10,107 9,784 11,945
Income taxes 3,438 3,389 3,140 4,005
Net income before cumulative
effect of accounting change 7,274 6,718 6,644 7,940
Cumulative effect of accounting
change, net of income tax benefit - - (185) -
Net income $7,274 $6,718 $6,459 $7,940
Per common share:
Basic earnings $1.00 $0.89 $0.88 $1.05
Diluted earnings $0.99 $0.89 $0.88 $1.04
Dividends paid $0.065 $0.060 $0.13 $0.12
Weighted average shares
outstanding-basic 7,305 7,524 7,338 7,597
Weighted average shares
outstanding-diluted 7,319 7,533 7,351 7,605
Segment Data
(In thousands)
Quarter ended June 30, 2001 Agriculture Processing Rail
Revenues from external customers $177,262 $33,537 $9,440
Other income 310 80 (25)
Total $177,572 $33,617 $9,415
Operating income (loss) $10,186 $(1,783) $(628)
Quarter ended June 30, 2000
Revenues from external customers $169,132 $31,259 $9,078
Other income 308 100 17
Total $169,440 $31,359 $9,095
Operating income (loss) $6,210 $80 $358
Six Months ended June 30, 2001
Revenues from external customers $314,774 $75,783 $17,411
Other income 498 176 (14)
Gain on insurance settlement 338 - -
Total $315,272 $75,959 $17,397
Operating income (loss) $13,515 $(2,026) $(923)
Six Months ended June 30, 2000
Revenues from external customers $294,178 $66,668 $15,552
Other income 574 192 153
Gain on sale of business - - -
Total $294,752 $66,860 $15,705
Operating income (loss) $7,625 $1,780 $839
Segment Data
(In thousands)
Quarter ended June 30, 2001 Retail Other Total
Revenues from external customers $55,009 $ - $275,248
Other income 199 228 792
Total $55,208 $228 $276,040
Operating income (loss) $3,785 $(848) $10,712
Quarter ended June 30, 2000
Revenues from external customers $53,636 $ - $263,105
Other income 211 476 1,112
Total $53,847 $476 $264,217
Operating income (loss) $3,864 $(405) $10,107
Six Months ended June 30, 2001
Revenues from external customers $87,512 $ - $495,480
Other income 334 383 1,377
Gain on insurance settlement - - 338
Total $87,846 $383 $496,857
Operating income (loss) $792 $(1,574) $9,784
Six Months ended June 30, 2000
Revenues from external customers $88,825 $2,489 $467,712
Other income 317 886 2,122
Gain on sale of business - 907 907
Total $89,142 $3,375 $469,834
Operating income (loss) $1,695 $6 $11,945
SOURCE: The Andersons, Inc.
Contact: Gary Smith of The Andersons, Inc., +1-419-891-6417
Website: http://www.andersonsinc.com/