codewithdark/sec-edgar-rpt · Datasets at Hugging Face

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Income before taxes and minority interest decreased $12,922,000 in 2000 (or
$3,286,000, exclusive of the 1999 gain on sale of the Graphite and Lubricants
division of $9,636,000). The Company recorded pre-tax provisions of $1,641,000
and $1,917,000 in 2000 and 1999, respectively, for restructuring and related
costs for a company-wide cost reduction program and plant consolidation.
Restructuring costs in 2000 include $1,173,000 for employee severance and
related costs and $468,000 for the sale or abandonment of Mexico properties. In
fiscal 2000, approximately $367,000 was charged to the 2000 severance cost
accrual and $156,000 against the accrual for property abandonment. In addition,
$1,704,000 was charged against the remaining 1999 accrual. (See Note 12 to
Consolidated Financial Statements.) U.S. Consumer operating profits decreased
primarily due to lower revenue and higher manufacturing inefficiencies due to
strict inventory reduction efforts and consolidation activities. Foreign
Consumer operating profits reflected a decrease in Mexico due to start-up
inefficiencies relating to the transfer of certain U.S. production and lower
margins due to competitive pricing pressures. Industrial operating profits
decreased principally due to lower Refractories division sales and operating
profits. Interest expense decreased $500,000 primarily due to lower foreign
borrowings and interest rates. Income taxes decreased due to the decrease in
pre-tax income.


1999 vs. 1998:
- --------------

Income before income taxes and minority interest increased $6,274,000 in
1999. Gain from the sale of the Graphite and Lubricants division in 1999 was
$9,636,000. In 1999, the Company recorded a $1,917,000 pre-tax provision for
restructuring and related costs associated with plant consolidation and a
company-wide cost reduction program designed to improve overall financial
performance in the future. Restructuring costs principally include anticipated
losses from the sale or abandonment of property and equipment (approximating
$1,330,000) and severance costs for affected employees (approximating $587,000).
In 1999, approximately $213,000 was charged against the severance cost accrual,
substantially related to costs associated with planned personnel reductions.
(See Note 12 to Consolidated Financial Statements.) There was a $2,163,000
decrease in the Industrial operating profits primarily due to the sale of the
Graphite and Lubricants division and weakness in the industries served by the
Refractories division. Decreased U.S. interest expense, primarily due to
proceeds from the division sale were offset by higher interest expense in
Mexico, reflecting increased borrowings since it acquisition of Vinci (see Note
10 to Consolidated Financial Statements) and higher inventory levels. Income
taxes increased principally due to significantly higher pre-tax income.




<PAGE>


REVENUES
- --------

Overall 2000 revenues decreased $11,811,000 from the prior year. The
changes by segment are as follows:

Increase(Decrease) % Increase (Decrease)
(in thousands) Total Volume Price / Mix
-------------- ----- ------ -----------
Consumer U.S. $(8,725) (13) (12) (1)
Consumer Foreign 3,043 10 12 (2)
Industrial (6,129) (35) (33) (2)


U.S. Consumer revenue decreased principally in the mass retail and
wholesale club markets reflecting the effects of reduced customer inventory
levels and increased competition from imports. Foreign Consumer revenue
increased primarily in the Mexico and Canada mass markets reflecting additional
product distribution in these channels. Industrial revenue decreased $4.6
million due to the disposition of the Graphite and Lubricants business with the
balance of the decrease due to weakness in the industries served by the
Refractories division.
While the Company has operations in Canada, Mexico and the U.K.,
historically only the operating results in Mexico have been materially impacted
by currency fluctuations. There has been a significant devaluation of the
Mexican peso at least once in each of the last three decades, the last one being
in August of 1998. In the short term after such devaluations, consumer
confidence has been shaken, leading to an immediate reduction in revenues in the
months following the devaluation. Then, after the immediate shock, and as the
peso stabilizes, revenues tend to grow. Selling prices tend to rise over the
long term to offset any inflationary increases in costs. The peso, as well as
any currency value, depends on many factors including international trade,
investor confidence and government policy, to name a few. These factors are
impossible for the Company to predict, and thus, an estimate of potential effect
on results of operations for the future cannot be made. This currency risk in
Mexico is presently managed through occassional foreign currency hedges, local
currency financing and by export sales to the U.S. denominated in U.S. dollars.
Overall 1999 revenues decreased $10,033,000 from the prior year. The
changes by segment are as follows:

Increase(Decrease) % Increase (Decrease)
(in thousands) Total Volume Price / Mix
-------------- ----- ------ -----------
Consumer U.S. $(3,875) (6) (5) (1)
Consumer Foreign 1,373 5 2 3
Industrial (7,531) (30) (29) (1)

The U.S. Consumer revenue decrease was strictly in the mass retail
(principally mega-store) market where customer consolidation and inventory
reductions affected sales during the back-to-school buying season. Foreign

Income before taxes and minority interest decreased $12,922,000 in 2000 (or

$3,286,000, exclusive of the 1999 gain on sale of the Graphite and Lubricants

division of $9,636,000). The Company recorded pre-tax provisions of $1,641,000

and $1,917,000 in 2000 and 1999, respectively, for restructuring and related

costs for a company-wide cost reduction program and plant consolidation.

Restructuring costs in 2000 include $1,173,000 for employee severance and

related costs and $468,000 for the sale or abandonment of Mexico properties. In

fiscal 2000, approximately $367,000 was charged to the 2000 severance cost

accrual and $156,000 against the accrual for property abandonment. In addition,

$1,704,000 was charged against the remaining 1999 accrual. (See Note 12 to

Consolidated Financial Statements.) U.S. Consumer operating profits decreased

primarily due to lower revenue and higher manufacturing inefficiencies due to

strict inventory reduction efforts and consolidation activities. Foreign

Consumer operating profits reflected a decrease in Mexico due to start-up

inefficiencies relating to the transfer of certain U.S. production and lower

margins due to competitive pricing pressures. Industrial operating profits

decreased principally due to lower Refractories division sales and operating

profits. Interest expense decreased $500,000 primarily due to lower foreign

borrowings and interest rates. Income taxes decreased due to the decrease in

pre-tax income.

1999 vs. 1998:

- --------------

Income before income taxes and minority interest increased $6,274,000 in

1999. Gain from the sale of the Graphite and Lubricants division in 1999 was

$9,636,000. In 1999, the Company recorded a $1,917,000 pre-tax provision for

restructuring and related costs associated with plant consolidation and a

company-wide cost reduction program designed to improve overall financial

performance in the future. Restructuring costs principally include anticipated

losses from the sale or abandonment of property and equipment (approximating

$1,330,000) and severance costs for affected employees (approximating $587,000).

In 1999, approximately $213,000 was charged against the severance cost accrual,

substantially related to costs associated with planned personnel reductions.

(See Note 12 to Consolidated Financial Statements.) There was a $2,163,000

decrease in the Industrial operating profits primarily due to the sale of the

Graphite and Lubricants division and weakness in the industries served by the

Refractories division. Decreased U.S. interest expense, primarily due to

proceeds from the division sale were offset by higher interest expense in

Mexico, reflecting increased borrowings since it acquisition of Vinci (see Note

10 to Consolidated Financial Statements) and higher inventory levels. Income

taxes increased principally due to significantly higher pre-tax income.

<PAGE>

REVENUES

- --------

Overall 2000 revenues decreased $11,811,000 from the prior year. The

changes by segment are as follows:

Increase(Decrease) % Increase (Decrease)

(in thousands) Total Volume Price / Mix

-------------- ----- ------ -----------

Consumer U.S. $(8,725) (13) (12) (1)

Consumer Foreign 3,043 10 12 (2)

Industrial (6,129) (35) (33) (2)

U.S. Consumer revenue decreased principally in the mass retail and

wholesale club markets reflecting the effects of reduced customer inventory

levels and increased competition from imports. Foreign Consumer revenue

increased primarily in the Mexico and Canada mass markets reflecting additional

product distribution in these channels. Industrial revenue decreased $4.6

million due to the disposition of the Graphite and Lubricants business with the

balance of the decrease due to weakness in the industries served by the

Refractories division.

While the Company has operations in Canada, Mexico and the U.K.,

historically only the operating results in Mexico have been materially impacted

by currency fluctuations. There has been a significant devaluation of the

Mexican peso at least once in each of the last three decades, the last one being

in August of 1998. In the short term after such devaluations, consumer

confidence has been shaken, leading to an immediate reduction in revenues in the

months following the devaluation. Then, after the immediate shock, and as the

peso stabilizes, revenues tend to grow. Selling prices tend to rise over the

long term to offset any inflationary increases in costs. The peso, as well as

any currency value, depends on many factors including international trade,

investor confidence and government policy, to name a few. These factors are

impossible for the Company to predict, and thus, an estimate of potential effect

on results of operations for the future cannot be made. This currency risk in

Mexico is presently managed through occassional foreign currency hedges, local

currency financing and by export sales to the U.S. denominated in U.S. dollars.

Overall 1999 revenues decreased $10,033,000 from the prior year. The

changes by segment are as follows:

Increase(Decrease) % Increase (Decrease)

(in thousands) Total Volume Price / Mix

-------------- ----- ------ -----------

Consumer U.S. $(3,875) (6) (5) (1)

Consumer Foreign 1,373 5 2 3

Industrial (7,531) (30) (29) (1)

The U.S. Consumer revenue decrease was strictly in the mass retail

(principally mega-store) market where customer consolidation and inventory

reductions affected sales during the back-to-school buying season. Foreign