SEC Filing Html Data
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of
Report (Date of the earliest event reported)
February
25, 2009
CompX
International Inc.
(Exact
name of registrant as specified in its charter)
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Delaware
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1-13905
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57-0981653
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(State
or other jurisdiction of incorporation)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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5430
LBJ Freeway, Suite 1700, Dallas, Texas
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75240-2697
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code
(972)
448-1400
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(Former
name or former address, if changed since last report.)
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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):
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
2.02
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Results
of Operations and Financial
Condition.
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Item
7.01
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Regulation
FD Disclosure.
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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 February 25, 2009, 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.
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Item
9.01
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Financial
Statements and Exhibits.
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(c) Exhibits.
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Item
No.
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Exhibit
Index
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99.1
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Press
Release dated February 25, 2009 issued by the
registrant.
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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: February
25, 2009
INDEX
TO EXHIBITS
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Exhibit
No.
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Description
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99.1
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Press
Release dated February 25, 2009 issued by the
registrant.
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PRESS
RELEASE
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FOR
IMMEDIATE RELEASE:
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CONTACT:
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CompX
International Inc.
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David
A. Bowers
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5430
LBJ Freeway, Suite 1700
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President
& CEO
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Dallas,
Texas 75240
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Tel.
864-286-1122
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COMPX
REPORTS FOURTH QUARTER 2008 RESULTS
DALLAS,
TEXAS … February 25, 2009 … CompX International Inc. (NYSE: CIX) announced today
sales of $37.4 million for the fourth quarter of 2008 compared to $42.5 million
in the same period of 2007. Operating income was $3.1 million in the
fourth quarter of 2008 compared to $1.2 million in the same period in
2007. Operating income in the fourth quarter of 2007 was negatively
impacted by $1.9 million in expenses relating to the consolidation of three of
the company’s northern Illinois facilities into one new
facility. Fourth quarter 2008 operating income was positively
impacted by the favorable effect of changes in currency exchange rates of $1.4
million compared to the previous year. Net income for the fourth
quarter of 2008 was $700,000, or $0.06 per diluted share, compared to $500,000,
or $0.04 per diluted share, in 2007.
Net sales
for the year ended December 31, 2008 were $165.5 million compared to $177.7
million in the previous year. Excluding a third quarter non-cash
goodwill impairment charge of $9.9 million relating to the Marine Components
segment, operating income was $16.1 million for the year ended December 31, 2008
compared to operating income of $15.6 million for 2007, although 2007 operating
income was impacted by $2.7 million in facility consolidation
costs. Including the goodwill impairment charge, operating income for
the year ended December 31, 2008 was $6.2 million. The impairment
charge is not deductible for tax purposes, and therefore there is no income tax
benefit associated with the charge for financial reporting
purposes. As a result, the Company reported a net loss of $3.1
million, or $0.25 per diluted share, for year ended December 31, 2008 compared
to net income of $9.0 million, or $0.61 per diluted share, in
2007. The non-cash goodwill impairment charge did not affect the
Company’s liquidity, cash flows or debt covenant compliance and will not have
any impact on future operations. The goodwill impairment charge
impacted the 2008 net loss by $9.9 million or $0.80 per share.
Net sales
comparisons were unfavorably impacted by lower order rates from most customers
across all business segments due to general economic
conditions. Excluding the goodwill impairment charge, operating
income comparisons were primarily impacted by the net result of lower order
rates from many of our customers due to unfavorable economic conditions in North
America and increased raw material costs, offset by the favorable effects of
facility consolidation costs incurred in 2007, the continuation of cost
reductions throughout 2008 and changes in foreign currency exchange
rates.
“One of
our main strategies is to continuously improve operational and cost structure
efficiencies. This is serving us well in this economic downturn as we
are able to reduce the impact on cash flow of lower customer demand by having
processes, equipment and facilities that are somewhat flexible to changes in
order rates. Unfortunately, this does not totally offset the effect
of current economic conditions and results in the painful process of reducing
headcount, which we have addressed throughout the year,” commented David A.
Bowers, President and Chief Executive Officer. “We expect the effect
of the current economy to be even more of a challenge in 2009 and therefore our
goal is to manage the business based on customer demand without hampering
resources and infrastructure required for the long term.”
Mr.
Bowers continued, “In addition to working diligently to control costs, we are
also increasing our efforts to identify new markets and applications for our
products in order to mitigate the impact of the economy on sales as well as
develop a more diversified product and customer base that we can leverage when
the economy recovers.”
CompX is
a leading manufacturer of security products, furniture components and
performance marine components. It operates from six locations in the
U.S., Canada and Taiwan and employs approximately 1,000 people.
Forward-Looking
Statements
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, changes in
raw material and other operating costs, 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, the ability to sustain or
increase operating income improvement resulting from cost control initiatives,
uncertainties associated with the development of new product features and other
risks and uncertainties detailed in CompX’s Securities and Exchange Commission
filings. Should one or more of these risks materialize or if the
consequences worsen, or if the underlying assumptions prove incorrect, actual
results could differ materially from those currently forecasted 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.
Explanation
of CompX’s Use of Non-GAAP Financial Measures
In
addition to results presented in accordance with GAAP, this news release
includes non-GAAP financial measures relating to excluding the goodwill
impairment charge from GAAP operating income. CompX believes this
non-GAAP financial measure provides information useful to investors in
understanding the underlying operational performance of the company, its
business and performance trends. Specifically, the Company believes the
exclusion of goodwill impairment permits evaluation and a comparison of results
for on-going business operations, and it is on this basis that CompX’s
management internally assesses the company's performance. The goodwill
impairment is excluded from CompX’s segment measures used internally to evaluate
segment performance in accordance with GAAP because management does not consider
the impairment particularly relevant or useful in evaluating the operating
performance of our business segments. Although CompX believes the
above non-GAAP financial measure enhances investors' understanding of its
business and performance, this non-GAAP financial measure should not be
considered an alternative to GAAP basis financial measures.
Reconciliation
of GAAP to non-GAAP financial measures:
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Operating
income
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|||
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Including
the effect of the goodwill impairment charge
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Goodwill
impairment
charge
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Excluding
the effect of the goodwill impairment charge
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(GAAP)
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(Non-GAAP)
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(Dollars
in millions)
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Year
ended December 31, 2008:
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Operating
income
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$6.2
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$9.9
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$16.1
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* * * *
*
COMPX
INTERNATIONAL INC.
SUMMARY
OF CONSOLIDATED OPERATIONS
(In
millions, except per share amounts)
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Three
months ended
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Year
ended
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|||||||||||||||
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December
31,
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December
31,
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|||||||||||||||
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2007
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2008
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2007
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2008
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(Unaudited)
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Net
sales
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$ | 42.5 | $ | 37.4 | $ | 177.7 | $ | 165.5 | ||||||||
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Cost
of goods sold
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33.2 | 29.3 | 132.5 | 125.2 | ||||||||||||
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Gross
margin
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9.3 | 8.1 | 45.2 | 40.3 | ||||||||||||
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Selling,
general and administrative expense
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6.1 | 5.6 | 25.8 | 24.8 | ||||||||||||
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Goodwill
impairment
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- | - | - | 9.9 | ||||||||||||
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Facility
consolidation costs
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1.9 | - | 2.7 | - | ||||||||||||
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Other
operating income (loss), net
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(0.1 | ) | 0.6 | 1.1 | 0.6 | |||||||||||
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Operating
income
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1.2 | 3.1 | 15.6 | 6.2 | ||||||||||||
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Interest
expense
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(0.6 | ) | (0.5 | ) | (0.8 | ) | (2.4 | ) | ||||||||
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Other
non-operating income, net
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0.2 | - | 1.1 | 0.3 | ||||||||||||
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Income
before income taxes
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0.8 | 2.6 | 15.9 | 4.1 | ||||||||||||
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Provision
for income taxes
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0.3 | 1.9 | 6.9 | 7.2 | ||||||||||||
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Net
income (loss)
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$ | 0.5 | $ | 0.7 | $ | 9.0 | $ | (3.1 | ) | |||||||
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Net
income per diluted common share
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$ | 0.04 | $ | 0.06 | $ | 0.61 | $ | (0.25 | ) | |||||||
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Weighted
average diluted common shares
outstanding
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13.2 | 12.4 | 14.8 | 12.4 | ||||||||||||
COMPX
INTERNATIONAL INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(In
millions)
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December
31,
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December
31,
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|||||||
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2007
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2008
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Assets
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Current
assets:
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Cash
and equivalents
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$ | 18.4 | $ | 14.4 | ||||
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Accounts
receivable, net
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20.4 | 16.8 | ||||||
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Inventories,
net
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24.3 | 22.7 | ||||||
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Deferred
income taxes and other
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3.8 | 4.7 | ||||||
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Note
receivable
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1.3 | 0.9 | ||||||
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Total
current assets
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68.2 | 59.5 | ||||||
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Intangibles
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43.3 | 32.9 | ||||||
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Net
property and equipment
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72.2 | 67.4 | ||||||
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Assets
held for sale
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3.1 | 3.5 | ||||||
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Other
assets
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0.9 | 0.1 | ||||||
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Total
assets
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$ | 187.7 | $ | 163.4 | ||||
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Liabilities
and Stockholders’ Equity
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Current
liabilities:
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||||||||
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Current
maturities of note payable to affiliate
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$ | 0.3 | $ | 1.0 | ||||
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Accounts
payable and accrued liabilities
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17.7 | 14.3 | ||||||
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Interest
payable to affiliate
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0.5 | 0.5 | ||||||
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Income
taxes
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0.4 | 1.2 | ||||||
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Total
current liabilities
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18.9 | 17.0 | ||||||
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Note
payable to affiliate
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49.7 | 42.0 | ||||||
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Deferred
income taxes
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15.0 | 13.1 | ||||||
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Stockholders’
equity
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104.1 | 91.3 | ||||||
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Total
liabilities and stockholders’ equity
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$ | 187.7 | $ | 163.4 | ||||