Oglebay Norton Reports a 13% Increase in Third Quarter Earnings
Oglebay Norton Company yesterday announced results for the third quarter and
nine months ended September 30, 1999. Third quarter highlights include the
Net income increased 13.2% to $6.4 million from $5.7 million in the
year earlier period and earnings per share, assuming dilution, were
$1.32, a 10.9% improvement compared to $1.19 in the third quarter of
Proceeds from the sales of the Global Stone Detroit Lime Company and
Global Stone Ingersoll Ltd. and cash generated from operations resulted
in a $70 million reduction in total debt from $350 million, at the end of
the second quarter of 1999, to $280 million. This lowered the company's
leverage ratio (total debt to last twelve-months reported EBITDA) to 3.9
times from 4.9.
Successful completion and ratification of a new five-year labor agreement
with the United Steelworkers of America covering unlicensed vessel personnel
in the Marine Services segment.
Oglebay Norton Chairman, President and Chief Executive Officer John Lauer
said, "We are pleased with our strategic accomplishments in the third
quarter, however, we are far from satisfied with our third quarter income
"Our Marine Services segment is performing better than the rest of the
industry. We operated the entire fleet throughout the quarter at 100% of
capacity. However, we did not compare favorably to our record third quarter
of 1998. Revenues were down 4% primarily due to low water levels. Income
from operations was down 19% ($.22 per share) compared to last year
resulting from low water levels combined with higher fuel costs. While
Marine Services is behind last year's record level, if weather conditions
cooperate, the operating trend of the third quarter should continue through
the fourth quarter, producing the second best year of the segments long
"Industrial Sands operations had a strong quarter with revenue up 7% and
income from operations up 26% compared to last year, primarily as a result
of improvement in the oilfield markets and continuing strong momentum from
our Orange County operation. Our Brady, Texas operation just registered its
first quarterly increase in tonnage in the last five quarters. It appears
this trend is continuing in the fourth quarter. With continuing strength in
Orange County, we are confident of a strong fourth quarter and solid
increases for all of 1999."
"Despite softness in some of the traditional markets for lime and
limestone, non-recurring events at two of our facilities, and delays in
closing the sales of Global Stone Ingersoll and Global Stone Detroit Lime,
Lime and Limestone segment income from operations increased 6% on flat
revenue compared to last year. Demand is strong in most of our key markets,
particularly in the industrial fillers markets. We do not anticipate any of
the issues we experienced during the third quarter in this segment to
continue into the fourth quarter and are projecting solid gains in total
segment sales and operating profit for the year as a whole."
In the third quarter, the Lime and Limestone segment sold a dock located in
Detroit, Michigan. Non-recurring gains from the disposition of assets
increased earnings by $900,000 or $0.19 per share. The purchase price
received for Global Stone Ingersoll and Global Stone Detroit Lime was
treated as an adjustment to the 1998 purchase price of Global Stone
Corporation, and therefore, no gain was recognized.
Mr. Lauer concluded: "Our emphasis in the fourth quarter will be to offset
the unavoidable impact of low water levels on Marine Services with robust
performance in our minerals segments."
Oglebay Norton Company, a Cleveland, Ohio-based company, provides essential
minerals to a broad range of markets, from building materials and home
improvement to the environmental, energy and metallurgical industries.
Building on a 145-year heritage, our vision is to become the premier growth
company in the industrial minerals industry.
To access the live or taped web-cast of the conference call, visit the
Oglebay Norton Company website at www.oglebaynorton.com.
To access the replay via telephone, dial 1-800-475-6701, from within the
United States and 1-320-365-3844, from outside the United States. The Access
Code is 471870.