Rogers, Connecticut, February 4, 2004: Rogers Corporation (NYSE:ROG) announced today that diluted earnings per share for the fourth quarter of 2003 were $0.54, up 59% compared to the $0.34 earned in the fourth quarter of 2002. For the year, net income increased to $26.3 million, with earnings per diluted share rising to $1.61 in 2003 compared to $1.16 in 2002.
Net sales in the fourth quarter were $85.8 million, up 67% compared to the $51.5 million sold in the fourth quarter of 2002. The Durel acquisition at the beginning of the fourth quarter of 2003 added $20.7 million to sales in the quarter. Fourth quarter 2002 revenues of the Moldable Composites Division (MCD), divested in November of 2002, were $4.7 million. For the full year, 2003 net sales increased by 11% to $243.3 from $219.4 in 2002. Total sales included in 2002 for the divested MCD division were $30.3 million. Combined Sales, which include half of the sales of Rogers’ unconsolidated joint ventures, were up over 30% compared to the fourth quarter of 2002. Combined Sales for the year totaled $297.0 million, up almost 4% compared to the $286.7 million in 2002. (See reconciliation for Combined Sales to net sales under Non-GAAP information included at the end of this press release.)
Sales of Printed Circuit Materials for the quarter again set a new sales record totaling $38.1 million, up over 76% from the fourth quarter of 2002. The flexible circuit material portion of this segment’s sales rose 118% over the same quarter last year, as the cellular and handheld mobile device markets surged. While the high frequency laminate portions revenue continued to be driven by strong sales into the satellite television market, as well as sales into the expanding wireless 3G infrastructure market. For the full year, Printed Circuit Materials had revenues of $114.2 million, up 39%.
Fourth quarter sales of High Performance Foams were $17.8 million, up over 14% from the fourth quarter of last year. This quarter marked an all-time sales record for the PORON® cellular urethane foam product line. Increased revenues were generated primarily through new design wins in various industrial applications as well as dramatic growth in China. For the year, High Performance Foams had $69.5 million in sales, up 7% from $65.1 million in 2002. Urethane foams led the increase, which more than offset lower sales of polyolefin foams.
Sales of Polymer Materials and Components totaled $29.9 million for the quarter, compared to last year’s fourth quarter sales of $14.3 million. Last year’s quarterly revenues included the now divested Moldable Composites Division. This year, sales for the quarter include Durel Division sales, formerly a 50-50 joint venture with 3M. For the full-year, Polymer Materials and Components had revenues of $59.6 million, compared to 2002 full year sales of $71.9 million.
The Company’s three 50% owned joint ventures had a strong quarter with total sales of $16.6 million. Total fourth quarter 2002 sales of $40.9 million included the three continuing joint ventures and Durel. Rogers purchased 3M’s 50% share of Durel at the beginning of the fourth quarter of 2003. Accordingly, Durel’s fourth quarter 2003 revenues are included in Rogers net sales. Due to cell phone and LCD panel application sales Rogers Chang Chun Technologies (RCCT), a flexible circuit materials joint venture, saw sales increase by almost 150% over the fourth quarter 2002. Rogers Inoac Corporation (RIC), which produces polyurethane foams, also had strong sales growth in the fourth quarter, primarily driven by industrial applications in Asia.
Fourth quarter gross margin was 33.4%. For the year, Rogers’ gross margin was 32.3%, a significant improvement over the 2002 full-year margin of 31.6%. This is the result of our continuing efforts to improve yields, six sigma projects and increasing sales volumes.
Rogers’ balance sheet remains in excellent condition. Rogers’ cash and short-term investments balance increased to $34.5 million versus $28.9 million at the end of 2002 despite the cash used to acquire 3M’s 50% share of Durel. Net capital expenditures were $4.7 million for the fourth quarter, and $16.0 million for the year. Inventory levels remained in line, proportionally increasing slightly less than sales. The Company continues to be debt free.
Robert D. Wachob, President and COO commented, “Business remains robust; looking forward we will continue to focus our efforts on growing our business in the most profitable markets within our core technologies. This strategic agenda requires sometimes having to make some difficult decisions, such as the previously announced Windham plant closure and moving that business to our manufacturing facility in Suzhou, China. Some opportunities for the coming year include integrating the recently announced KF Inc. acquisition, completing the transfer of the polyolefin product lines into our Carol Stream, Illinois facility, and investing in a number of other ongoing capacity expansion projects. We are confident in our strategic direction and believe these actions will help us continue to deliver significant sales and earnings growth. In the first quarter of 2004 we expect revenues to be in the range of $85 to $90 million with earnings per diluted share of $0.60 to $0.65. This represents a 67% to 81% increase in earnings over the first quarter of 2003.”
Walter E. Boomer, Chairman and CEO stated, “I am very pleased with the results achieved in 2003. Our performance is testament to the hard work and professionalism of Rogers’ employees. It is true that our strategic markets of wireless communications, networking and computing improved considerably during 2003, but it is also true that we were prepared to take advantage of an improving economy when it arrived. As previously announced, I will retire on April 1, 2004. I have the utmost confidence in Bob Wachob, who will lead Rogers as President and CEO, and in our superb management team. Together, with our outstanding employees, this should ensure Rogers’ future success. I look forward to working with them as a continuing member of the Board of Directors.”
Safe Harbor Statement
Statements in this news release that are not strictly historical may be deemed to be “forward-looking” statements which should be considered as subject to the many uncertainties that exist in the Company’s operations and environment. These uncertainties, which include economic conditions, market demand and pricing, competitive and cost factors, rapid technological change, new product introductions, legal proceedings, and the like, are incorporated by reference in the Rogers Corporation 2002 Form 10-K filed with the Securities and Exchange Commission. Such factors could cause actual results to differ materially from those in the forward-looking statements.
Additional Information and February 5th Conference Call
For more information, please contact the Company directly, visit Rogers website on the Internet, or send a message by email.
Financial News Contact:
James M. Rutledge
Vice President Finance and Chief Financial Officer
Phone: 860-774-9605
FAX: 860-779-5585
Editorial Contact:
Edward J. Joyce
Manager of Investor and Public Relations
Phone: 860-774-5705
FAX: 860-779-5509
email: edward.joyce@rogerscorporation.com
A conference call to discuss fourth quarter and full year results will be held on Thursday, February 5th at 9:00AM (Eastern Time).
Rogers' participants in the conference call will be:
- Robert D. Wachob, President and COO
- James M. Rutledge, Vice President Finance and CFO
- Robert M. Soffer, Vice President and Secretary
- Paul B. Middleton, Corporate Controller
A Q&A session will immediately follow management’s comments.
To participate in the conference call, please call: 1-800-574-8929 toll-free in the United States and 1-706-634-1907 internationally. There is no passcode for the live teleconference. For playback access, please call: 1-800-642-1687 in the United States and 1-706-645-9291 internationally through 11:59PM, Thursday, February 12th. The passcode for the audio replay is 5004304.
The call will also be webcast live in a listen only mode. The webcast may be accessed through links available on the Rogers Corporation website at www.rogerscorporation.com. Replay of the archived webcast will be available on the Rogers website beginning two hours following the webcast.
Presentation of Information in this Press Release
In an effort to provide investors with additional information regarding the Company’s results, the Company may disclose certain Non-GAAP information which management believes provides useful information to investors. Management sometimes refers to “Combined Sales” which are defined as net sales (as reported under GAAP) plus 50% of the revenues from the Company’s unconsolidated joint ventures. These unconsolidated joint ventures are viewed by management as important to the Company’s business and make a significant contribution towards the Company’s profits.
Reconciliation of Non-GAAP Financial Information
|
(Dollars in Millions)
|
Fourth Quarter Full Year
|
|
|
2003 | 2002
|
2003 | 2002
|
|
Net Sales, as reported in this report and in accordance with generally accepted accounting principles
|
$85.8 |
$51.5 |
$243.3 |
$219.4 |
|
50% of Durel Joint Venture Sales
|
--- |
12.5 |
25.7
|
42.0 |
|
50% of Rogers' continuing Joint Venture Sales
|
8.3 |
7.9 |
28.0 |
25.3 |
|
Combined Sales
|
$94.1 |
$71.9 |
$297.0 |
$286.7 |
|
|
|
|
|
Consolidated Statements of Income*
(Dollars in Thousands, Except Per Share Amounts)
|
|
Quarters Ended
|
Years Ended |
| |
December 28, 2003 |
December 29, 2002 |
December 28, 2003 |
December 29, 2002 |
| |
| Net Sales |
$85,795 |
$ 51,516 |
$243,329 |
$ 219,438 |
| Costs and Expenses: |
|
Cost of Sales
|
57,175 |
33,663 |
164,789 |
150,183 |
|
Selling and Administrative
|
14,219 |
9,559 |
43,304 |
39,335 |
|
Acquisition/Restructuring Costs
|
-- |
1,600 |
-- |
2,150 |
|
Research and Development
|
4,533 |
3,074 |
13,665 |
13,596 |
| Total Costs and Expenses: |
(Including Depreciation and
Amortization of:
2003 - $11,488; 2002 - $13,571)** |
75,927 |
47,896 |
221,758 |
205,264 |
| Operating Income |
9,868 |
3,620 |
21,571 |
14,174 |
|
Other Income less Other Charges
|
1,985 |
3,096 |
13,143 |
10,861 |
|
Interest Income / (Expense) Net
|
141 |
31 |
320 |
(226) |
| Income Before Income Taxes |
11,994 |
6,747 |
35,034 |
24,809 |
|
Income Taxes
|
2,999 |
1,325 |
8,759 |
6,202 |
| Net Income |
$ 8,995 |
$ 5,422 |
$ 26,275 |
$ 18,607 |
| Net Income Per Share: |
|
Basic
|
$0.56 |
$0.35 |
$1.67 |
$1.20 |
|
Diluted
|
$0.54 |
$0.34 |
$1.61 |
$1.16 |
| Shares Used in Computing: |
|
Basic
|
15,964 |
15,530 |
15,775 |
15,471 |
|
Diluted
|
16,627 |
15,970 |
16,319 |
16,023 |
* Statements are subject to year-end audit.
**For the twelve month periods. |
| Consolidated Balance Sheets* |
| (In Thousands) |
December 28, 2003 |
December 29, 2002 |
| ASSETS |
| Current Assets: |
|
Cash and Cash Equivalents
|
$ 31,476 |
$22,300 |
|
Short-term Investments
|
3,005 |
6,628 |
|
Accounts Receivable, Net
|
52,981 |
32,959 |
|
Accounts Receivable - Joint Ventures
|
3,178 |
1,414 |
|
Note Receivable - Current
|
2,100 |
2,100 |
|
Inventories
|
27,501 |
18,069 |
|
Other Current Assets
|
6,856 |
6,305 |
| Total Current Assets |
127,097 |
89,775 |
|
Notes Receivable, Long Term
|
7,800 |
9,900 |
| Property, Plant and Equipment, Net |
131,157 |
99,883 |
| Investment in Unconsolidated Joint Ventures |
10,741 |
21,860 |
| Pension Asset |
6,886 |
8,951 |
| Goodwill and Other Intangible Assets, Net |
25,121 |
22,204 |
| Other Assets |
5,638 |
5,128 |
| Total Assets |
$314,440 |
$257,701 |
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
| Current Liabilities: |
|
Accounts Payable
|
$ 20,442 |
$ 10,125 |
|
Accrued Employee Benefits and Compensation
|
13,359 |
10,414 |
|
Other Current Liabilities
|
16,222 |
14,241 |
| Total Current Liabilities |
50,023 |
34,780 |
| Noncurrent Deferred Income Taxes |
14,058 |
8,308 |
| Noncurrent Pension Liability |
14,909 |
22,658 |
| Noncurrent Retiree Health Care and Life Insurance Benefits |
6,198 |
6,197 |
| Other Long-Term Liabilities |
2,383 |
2,720 |
| Shareholders’ Equity |
226,869 |
183,038 |
| Total Liabilities and Shareholders’ Equity |
$314,440 |
$257,701 |
|
* Statements are subject to year-end audit.
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|