SEC Filing Html Data
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report: March 30, 2005
COMPX INTERNATIONAL INC.
(Exact name of Registrant as specified in its charter)
Delaware 1-13905 57-0981653
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) No.)
5430 LBJ Freeway, Suite 1700, Dallas, TX 75240-2697
(Address of principal executive offices) (Zip Code)
(972) 233-1700
(Registrant's telephone number, including area code)
(Former name or address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition.
Item 7.01 Regulation FD Disclosure.
Pursuant to Items 2.02 and 7.01 of this current report, the registrant
hereby furnishes the information set forth in its press release issued on March
30, 2005, a copy of which is attached hereto as Exhibit 99.1 and incorporated
herein by reference.
The information, including the exhibit, the registrant furnishes in
this report is not deemed "filed" for purposes of section 18 of the Securities
Exchange Act of 1934, as amended, or otherwise subject to the liabilities of
that section. Registration statements or other documents filed with the
Securities and Exchange Commission shall not incorporate this information by
reference, except as otherwise expressly stated in such filing.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
Item No. Exhibit Index
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99.1 Press Release dated March 30, 2005 issued by the
registrant.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
COMPX INTERNATIONAL INC.
(Registrant)
By: /s/ A. Andrew R. Louis
----------------------
A. Andrew R. Louis
Secretary
Date: March 30, 2005
INDEX TO EXHIBITS
Exhibit No. Description
- ----------- --------------------------------------------------
99.1 Press Release dated March 30, 2005 issued by the registrant.
[LOGO GOES HERE]
PRESS RELEASE
FOR IMMEDIATE RELEASE: CONTACT:
CompX International Inc. David A. Bowers
5430 LBJ Freeway, Suite 1700 President & CEO
Dallas, Texas 75240 Tel. 864-286-1122
COMPX REPORTS FOURTH QUARTER AND FULL YEAR 2004 OPERATING RESULTS
Dallas, TEXAS ... March 30, 2005 ... CompX International Inc. (NYSE: CIX)
announced today sales from continuing operations of $46.6 million for the fourth
quarter of 2004 and income from continuing operations of $1.4 million, or $0.09
per diluted share. Sales increased 2% from $45.7 million from the comparable
2003 quarter. For the fourth quarter of 2003, the Company also reported income
from continuing operations of $1.4 million, or $0.09 per diluted share. Due to
an increased proportion of foreign-sourced dividend income taxed at a higher
effective tax rate, the results for the fourth quarter of 2004 were negatively
impacted by an increase in the Company's effective income tax rate as compared
to the effective tax rate for the same period of 2003. Net sales for the year
ended December 31, 2004 increased 5% to $182.6 million compared to $174.0
million the previous year. Income from continuing operations for 2004 increased
64% to $9.5 million, or $0.63 per diluted share, compared to $5.8 million, or
$0.38 per diluted share in 2003. The sales increases were primarily related to
increases in certain precision slide and ergonomic products surcharges and
prices to recover the dramatic rise in raw material prices for steel during the
year, and to a lesser extent the positive impact of the strengthening of the
Canadian dollar in relation to the U.S. dollar.
"We are extremely pleased with the improvement in earnings from continuing
operations this year," commented David A. Bowers, President & CEO. "The hard
work of our employees over the last several years in addressing market
challenges and cost reduction initiatives paid off in 2004 as we made
significant progress in improving operating results."
Operating income increased from $2.2 million in the fourth quarter of 2003 to
$3.5 million in the fourth quarter of 2004. Operating income for the year ended
December 31, 2004 increased to $15.7 million as compared to $9.5 million for
2003. The improvements in operating income were due to the favorable impact of
cost improvement initiatives, partially offset by the negative impact of
increases in the cost of steel, the primary raw material for the Company's
products.
During the fourth quarter of 2004, CompX formalized a plan to dispose of its
Thomas Regout precision slide and window furnishings operations conducted at its
facility in the Netherlands. Such operations met all of the criteria under
accounting principles generally accepted in the United States of America to be
classified as an asset held for sale at December 31, 2004, and accordingly the
results of operations of Thomas Regout have been classified as discontinued
operations for all periods presented, and the related net assets of Thomas
Regout are classified as "held for sale." In classifying the net assets of
Thomas Regout as held for sale, the Company concluded that the carrying amount
of the net assets of such operations exceeded the estimated fair value less
costs to sell of such operations, and accordingly the Company recognized a
pre-tax impairment charge in the quarter of approximately $14.4 million to
write-down its investment in Thomas Regout to the estimated net realizable
value. On January 24, 2005, CompX completed the sale of its Thomas Regout
operations for approximately $22.6 million in net proceeds which included cash
(net of expenses) of approximately $18.4 million at closing and a subordinated
note for approximately $4.2 million payable over a period of four years. The net
proceeds from the sale of Thomas Regout approximated the net realizable value
previously estimated.
Mr. Bowers further commented, "The sale of our Thomas Regout operations in
Europe to local management is a significant step forward in bringing focus to
our precision slide business in North America and Asia. Under the CompX
Precision Slides banner, manufacturing facilities in Kitchener, Canada, Taipei,
Taiwan and Byron Center, Michigan, will coordinate activities of common product
lines to maximize collaboration with our customers on products that bring unique
solutions to their precision slide needs. Additionally, we expect to redeploy
personnel resources and the proceeds from the sale of Thomas Regout by investing
in areas that will provide new opportunities for growth and diversification."
He concluded, "2004 was a year of transition for CompX as management dealt with
the extraordinary escalation in raw material costs and the continued threat of
low priced foreign competition. We believe with the initiation of our Precision
Slides group, renewed emphasis on the development and introduction of new
products across all of our businesses, continued emphasis on opportunities to
improve our cost structure together with our strong balance sheet, has well
positioned the Company for profitable growth in 2005 and beyond.
Liquidity and Cash Flow
Cash provided by operating activities improved to $30.2 million for the year
compared to $24.4 million in the prior year. The improvement in cash provided by
operating activities was primarily due to the improvement in income from
continuing operations. Total cash was $21.0 million as of December 31, 2004
compared to $21.7 million as of December 31, 2003, while total debt declined $26
million over the same period. The Company currently has no debt outstanding
under its bank revolving line of credit.
About CompX International
CompX is a leading manufacturer of precision ball bearing slides, security
products and ergonomic computer support systems. It operates from seven
locations in the U.S., Canada and Taiwan and employs more than 1,400 people.
Statements in this release relating to matters that are not historical facts are
forward-looking statements based upon management's belief and assumptions using
currently available information. Although CompX believes the expectations
reflected in such forward-looking statements are reasonable, it cannot give any
assurances that these expectations will prove to be correct. Such statements, by
their nature, involve substantial risks and uncertainties that could
significantly impact expected results, and actual future results could differ
materially from those described in such forward-looking statements. While it is
not possible to identify all factors, CompX continues to face many risks and
uncertainties. Among the factors that could cause actual future results to
differ materially include, but are not limited to, general economic and
political conditions, demand for office furniture, service industry employment
levels, competitive products and prices, fluctuations in currency exchange
rates, the introduction of trade barriers, potential difficulties in integrating
completed acquisitions, negotiations with employee and government groups
relating to employee severance, the timing and amount of future cost savings
from restructuring actions, the ability to sustain or increase operating income
improvement resulting from cost control initiatives, uncertainties associated
with new product development and other risks and uncertainties detailed in
CompX's Securities and Exchange Commission filings. Should one or more of these
risks materialize (or the consequences of such a development worsen), or should
the underlying assumptions prove incorrect, actual results could differ
materially from those forecast or expected. CompX disclaims any intention or
obligation to publicly update or revise such statements whether as a result of
new information, future events or otherwise.
* * * * *
COMPX INTERNATIONAL INC.
SUMMARY OF CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per share
amounts) (Unaudited)
Three months ended Year ended
December 31, December 31,
2003 2004 2003 2004
------------------------ ------------------------
Net sales $ 45.7 $ 46.6 $ 174.0 $ 182.6
Cost of goods sold 38.1 36.4 142.9 142.8
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Gross profit 7.6 10.2 31.1 39.8
Selling, general and administrative 5.4 6.7 21.6 24.1
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Operating income (loss) 2.2 3.5 9.5 15.7
Interest expense (0.3) (0.1) (1.3) (0.5)
Other income (expense) 0.4 0.7 1.0 2.1
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Income from continuing operations
before income taxes 2.3 4.1 9.2 17.3
Income tax expense 0.9 2.7 3.4 7.8
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Income from continuing operations 1.4 1.4 5.8 9.5
Discontinued operations, net of tax (0.6) (13.1) (4.5) (12.5)
------------------------- ------------------------
Net income (loss) $ 0.8 $ (11.7) $ 1.3 $ (3.0)
========================= ========================
Net income (loss) per diluted common share
Continuing operations $ 0.09 $ 0.09 $ 0.38 $ 0.63
Discontinued operations (0.04) (0.86) (0.30) (0.83)
------------------------- ------------------------
$ 0.05 $ (0.77) $ 0.08 $ (0.20)
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Weighted average diluted common
shares outstanding 15.1 15.1 15.1 15.2
======================== =======================
COMPX INTERNATIONAL INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)
December 31, December 31,
2003 2004
----------------- --------------
Assets (Unaudited)
Current assets:
Cash and equivalents $ 19.6 $ 16.8
Accounts receivable, net 21.4 19.2
Inventories 21.0 20.8
Prepaid expenses and other 5.5 2.9
Assets held for sale 12.7 18.0
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Total current assets 80.2 77.7
Intangibles 30.7 30.7
Net property and equipment 73.5 66.1
Assets held for sale 25.9 11.0
Other assets 0.4 0.2
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Total assets $ 210.7 $ 185.7
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Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued liabilities $ 17.4 $ 17.7
Income taxes - 2.7
Liabilities related to assets held for sale 7.0 5.0
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Total current liabilities 24.4 25.4
Long-term debt 26.0 0.1
Other noncurrent liabilities 5.9 4.9
Stockholders' equity 154.4 155.3
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Total liabilities and stockholders' equity $ 210.7 $ 185.7
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