| NACCO Industries, Inc. Announces Third Quarter 2009 Results
CLEVELAND, Nov. 4 /PRNewswire-FirstCall/ -- NACCO Industries, Inc.
(NYSE: NC) today announced a consolidated net loss for the third quarter of
2009 of $3.9 million, or $0.47 per share, on revenues of $532.6 million
compared with a consolidated net loss for the third quarter of 2008 of
$17.3 million, or $2.09 per share, on revenues of $917.8 million.
NACCO's third quarter 2008 results were negatively affected by the
recognition of a non-cash tax charge of $14.5 million against the
accumulated deferred tax assets at NACCO Materials Handling Group's
("NMHG") Australian operations and for certain U.S. state taxing
jurisdictions.
NACCO's consolidated revenues for the third quarter of 2009 were lower
than the prior year primarily as a result of lower volumes at NMHG due to a
significant drop in global forklift truck market demand.
NACCO and Subsidiaries Consolidated Third Quarter Highlights
Key perspectives on NACCO's third quarter results are as follows:
-- NMHG's net loss was $22.4 million in 2009, compared with a net loss of
$20.1 million in 2008. In early October 2009, NMHG announced a
manufacturing restructuring program and additional reduction-in-force
programs that resulted in a restructuring charge of $6.9 million both
before and after tax. The third-quarter 2008 net loss included a
restructuring charge of $1.7 million, or $1.2 million net of taxes of
$0.5 million, and additional related costs of $0.9 million, or $0.6
million net of taxes of $0.3 million. Excluding the tax charge and the
restructuring charges noted above, third quarter 2009 operating results
declined significantly from the third quarter of 2008. The key drivers
for the decline in operating results at NMHG were a significant decline
in volume for units and parts and unfavorable product sales mix,
partially offset by lower material costs, favorable foreign currency
movements, favorable pricing, lower warranty costs and benefits from
cost containment actions.
-- In light of the current difficult economic conditions, NACCO
increased the capitalization of NMHG by making non-cash
contributions of $2.4 million during the third quarter of 2009.
-- Hamilton Beach's net income increased to $6.9 million in 2009 from $1.3
million in 2008. The increase resulted primarily from lower product
costs, sales of higher-margin and higher-priced products and reduced
freight costs, partially offset by a decline in volume.
-- Kitchen Collection's net income increased to $0.3 million in 2009 from a
net loss of $3.3 million in 2008 primarily due to improved gross margins
at comparable stores.
-- North American Coal's net income increased to $11.4 million in 2009
compared with $7.0 million in 2008 primarily due to lease bonus payments
for leasing certain oil and gas mineral rights to a third party,
partially offset by reduced operating results at Red River Mining
Company and higher income tax expense.
For the nine months ended September 30, 2009, NACCO reported a net loss
of $11.4 million, or $1.38 per share, on revenues of $1.6 billion. This
compared with a net loss of $9.4 million, or $1.14 per share, on revenues
of $2.7 billion for the first nine months of 2008.
Consolidated Outlook for 2009
Economic and market conditions continued to be weak in the third
quarter of 2009, although some positive signs of limited recovery began to
emerge. The forklift truck capital goods market in which NMHG participates
continues to be in a significant global downturn that has resulted in an
unprecedented decline in industry factory bookings in the Americas, Europe
and Asia-Pacific, although the decline, specifically in the Americas,
appears to have stabilized at very low levels. The consumer markets in
which Hamilton Beach and Kitchen Collection participate are likely to
continue to be weak during the fourth quarter of 2009 as consumers struggle
with high unemployment rates and lower income levels. Changes in product
positioning and product costs have been implemented at NMHG and Hamilton
Beach to achieve more acceptable margin positions in the fourth quarter of
2009 despite anticipated lower market levels. While North American Coal's
lignite coal operations continue to be strong, customer power plant outages
and temporarily challenging mining conditions are expected to result in
lower deliveries in the fourth quarter. North American Coal also expects
limerock production to be significantly lower due to an unfavorable legal
ruling that set aside customers' existing mining permits at most of the
limerock mining operations and continued low demand for limerock due to the
decline in the housing and construction markets in southern Florida.
Limerock customers are expected to return to production under new permits,
which are currently anticipated to be issued in early 2010.
The Company continues to operate on the assumption that the economic
environment will not improve significantly in the fourth quarter of 2009 or
the first part of 2010. Aggressive cost containment actions and other
programs put in place in late 2008 and during 2009 to help meet the
challenges of 2009 have moderated the effect of the economic downturn in
the first nine months of the year and are expected to affect results
favorably in the fourth quarter of 2009. The Company will continue to focus
on cost reductions during the fourth quarter of 2009.
At NMHG, these cost containment actions will not overcome the effect of
reduced volumes, and NMHG is expected to have a moderate loss in the fourth
quarter of 2009. While the consumer businesses anticipate continued weak
markets during the 2009 fourth-quarter holiday season, both Hamilton Beach
and Kitchen Collection currently expect significantly improved fourth
quarter results, compared with very weak 2008 results before charges for
goodwill and intangible impairments. Kitchen Collection is expected to
benefit significantly from the new Le Gourmet Chef® store format that is in
place, improved merchandising and sustained improvements in logistics.
North American Coal expects results in the fourth quarter of 2009,
excluding the pending Red River Mining Company sale transaction, to be
moderately lower than the fourth quarter of 2008.
Overall, NACCO expects its subsidiaries to generate substantial cash
flow before financing activities over the remainder of 2009 and for the
full year. Currently, NACCO has substantial cash availability, which
provides the Company with flexibility in capitalizing its subsidiaries.
Detailed Discussion of Results
NMHG - Third Quarter Results
Due to the immateriality of the remaining Retail operations after the
sale of the Australian Hyster® Retail dealerships, the Company has changed
its discussion of NMHG to eliminate the separate Retail discussion and to
discuss only consolidated NMHG information.
NMHG reported a net loss of $22.4 million on revenues of $328.4 million
for the third quarter of 2009 compared with a net loss of $20.1 million on
revenues of $696.4 million for the third quarter of 2008.
The third-quarter 2009 net loss includes a restructuring charge
totaling $6.9 million before and after tax for NMHG's Italian operations
announced in early October 2009 and additional reduction-in-force programs.
Included in the third-quarter 2008 net loss was $1.7 million, or $1.2
million net of taxes of $0.5 million, of restructuring charges, and
additional costs of $0.9 million, or $0.6 million net of taxes of $0.3
million, related to the Irvine, Scotland restructuring program. In
addition, the third-quarter 2008 net loss included a non-cash tax charge of
$14.5 million against the accumulated deferred tax assets for NMHG's
Australian operations and for certain U.S. state taxing jurisdictions.
Revenues decreased 53 percent in the third quarter of 2009 compared
with the third quarter of 2008 primarily as a result of a decrease in units
and parts volume in all geographic regions due to the economic downturn in
each of these markets. Worldwide shipments in the third quarter of 2009
declined 55 percent to approximately 9,400 units from shipments of
approximately 20,700 units in the third quarter of 2008. The effect of
unfavorable foreign currency movements as the U.S. dollar strengthened
against the British pound and Australian dollar and an unfavorable shift in
sales mix to lower-priced lift trucks in the Americas and Europe also
contributed to the decrease in revenues. The favorable effect of unit and
parts price increases implemented in prior years in the Americas and Europe
slightly offset those revenue decreases.
Unit shipments were down significantly from the prior year but were
down only moderately from unit shipments of approximately 9,900 in the
second quarter of 2009. Parts sales also declined in the third quarter of
2009 compared with the previous year's third quarter, but increased
moderately over the second quarter of 2009. NMHG's worldwide backlog
increased slightly to approximately 13,200 units at September 30, 2009 from
a low of approximately 12,300 units at June 30, 2009. Worldwide backlog was
approximately 26,000 units at September 30, 2008.
NMHG's net loss, excluding the effect of the prior year tax charge and
restructuring charges discussed previously, increased significantly in the
third quarter of 2009 compared with the third quarter of 2008 primarily as
a result of a decline in gross profit of $34.6 million, partially offset by
$20.5 million pre-tax of favorable foreign currency movements and lower
selling, general and administrative expenses. Gross profit declined mainly
as a result of significantly reduced unit and parts volume, a shift in mix
to sales of lower-margin units and an increase in manufacturing costs as
less fixed costs were absorbed due to lower production volumes. These
unfavorable items were partially offset by decreases in material costs
totaling $20.7 million pre-tax, price increases implemented in prior
periods, which resulted in benefits totaling $13.6 million pre-tax, and
reduced warranty costs resulting from better claims experience and lower
sales volumes. Selling, general and administrative expenses declined $5.2
million due to reduced workforce levels and other cost containment actions
implemented in late 2008 and 2009. These favorable expense reductions were
partially offset by an increase in product liability expense caused by the
absence of a favorable adjustment taken in the prior year third quarter, as
well as the absence of a favorable adjustment in the prior year to reduce
the accrual for the 2008 incentive compensation plans.
For the nine months ended September 30, 2009, NMHG reported a net loss
of $44.0 million on revenues of $1.1 billion compared with a net loss of
$10.2 million on revenues of $2.2 billion for the first nine months of
2008.
NMHG - Outlook
Global market levels for units appear to have stabilized in 2009 at
current low levels, especially in the Americas. Parts volumes also appear
to be stabilizing around current levels. NMHG is not anticipating a market
upturn of any significance in the last quarter of 2009. As a result, the
company expects continued significantly lower levels in all lift truck
markets, significantly lower unit shipment levels and a reduction in parts
sales in the fourth quarter of 2009 compared with the fourth quarter of
2008. However, unit bookings and parts sales are expected to increase
slightly in the fourth quarter of 2009 compared with the third quarter of
2009.
NMHG has taken a number of steps in late 2008 and during 2009 to
respond to the market outlook, and the company continues to resize the
organization as market conditions warrant through restructurings and
reductions-in-force. Early in October 2009, NMHG announced the closure of
one of the company's Italian facilities which is expected to be completed
in early 2010. Estimated benefits from this restructuring program are
approximately $3.1 million in 2010, approximately $3.5 million in 2011 and
approximately $3.1 million in 2012 and annually thereafter. This program
supplements the estimated benefits from the Irvine, Scotland restructuring
program of approximately $2.5 million in the fourth quarter of 2009,
approximately $15.6 million in 2010 and approximately $18 million annually
thereafter. In addition, estimated benefits at the current reduced
workforce levels from the reductions-in-force programs implemented over the
last two years are approximately $11.8 million in the fourth quarter of
2009 and approximately $50 million on a current annualized basis with
approximately 75 percent of the benefits related to manufacturing
operations. Additional actions taken include capital expenditure
restraints, additional planned plant downtime, restrictions on spending and
travel, suspension of incentive compensation and profit-sharing, wage
freezes and salary and benefit reductions, all of which are expected to
continue to reduce expenses in the fourth quarter of 2009 compared with
2008. NMHG is closely monitoring its operations and will make additional
adjustments if necessary.
NMHG is also actively monitoring commodity costs and other supply chain
drivers to ensure timely implementation of reductions in pricing because
material costs, specifically steel, fuel and freight, have moderated.
NMHG's warehouse truck and big truck product development programs, and
its new electric-rider lift truck program, are progressing as planned. The
new electric-rider lift truck program is expected to bring a full line of
newly designed products to market. During the second quarter of 2009, NMHG
introduced two series, the 1 to 2 ton three- and four-wheel electric trucks
in Europe and the 2 to 3 ton four-wheel electric trucks in the Americas,
which have been very well received. The company expects to introduce the 2
to 3 ton four-wheel electric trucks in Europe in the fourth quarter of 2009
and the remainder of the electric-rider lift truck series throughout 2010.
NMHG is expected to operate at a loss for the 2009 full year. However,
modest unit and parts volume improvements, benefits from new product
introductions, benefits from restructuring programs, reduced material and
product costs, as well as further general expense reductions, are
anticipated in the fourth quarter, which are expected to lead to a moderate
loss in the fourth quarter of 2009. Cash flow before financing activities
is expected to improve further in the fourth quarter of 2009 primarily as a
result of a reduction in working capital and low capital expenditures.
Longer-term, NMHG has been reviewing ways to strengthen its Hyster® and
Yale® dealer structure in North America. As a result of this review, NMHG
has adjusted its policy to permit common ownership of dealers for its two
brands, Hyster® and Yale®, in defined North American territories, under
controlled conditions.
Hamilton Beach - Third Quarter Results
Hamilton Beach reported net income of $6.9 million for the third
quarter of 2009 on revenues of $118.9 million, compared with net income of
$1.3 million for the third quarter of 2008 on revenues of $138.2 million.
Hamilton Beach's third-quarter 2009 revenues declined 14 percent
compared with 2008 primarily due to reduced sales volumes as a result of
lower consumer spending stemming from the weak global economy, coupled with
reduced distribution to certain retailers.
Despite a decrease in revenues, net income increased in the third
quarter of 2009 compared with 2008 primarily from an increase in gross
profit. Lower product costs resulting from the decline in commodity costs,
sales of higher-margin and higher-priced products, lower freight costs and
cost containment initiatives, partially offset by the decline in volume,
were the primary factors for the improvement in gross profit over the prior
year third quarter.
For the nine months ended September 30, 2009, Hamilton Beach reported
net income of $13.0 million on revenues of $320.3 million compared with net
income of $0.8 million on revenues of $342.2 million for the nine months
ended September 30, 2008.
Hamilton Beach - Outlook
The economy and other consumer financial concerns are among factors
creating an extremely uncertain and challenging retail environment, which
has resulted in low retail expectations for the normally strong
fourth-quarter holiday-selling season. Accordingly, Hamilton Beach
anticipates revenues for the fourth quarter of 2009 to be lower than the
fourth quarter of 2008.
As a result of anticipated lower full year 2009 volumes, Hamilton Beach
took aggressive cost containment actions in early 2009. These actions,
along with initiatives to improve pricing and product positioning and
initiatives to reduce product and transportation costs are expected to
continue to affect results favorably in the fourth quarter of 2009,
resulting in significantly improved fourth quarter 2009 net income compared
with a very weak 2008 fourth quarter.
Despite the challenging economic environment, Hamilton Beach is placing
continued focus on strengthening its market position through product
innovation, promotions and branding programs, together with appropriate
levels of advertising. In addition, Hamilton Beach's "Good Thinking®"
consumer advertising campaign will commence during the fourth quarter of
2009, and will include two of the company's most innovative products: the
BrewStation® Coffeemaker and the Stay or Go(® )Slow Cooker. These products,
as well as further new product introductions in the pipeline for 2010, are
expected to affect revenues favorably.
Overall, full-year 2009 net income and cash flow before financing
activities are currently expected to improve significantly compared with
very weak 2008 results before the goodwill impairment charge of $80.7
million pre-tax as a result of previously discussed actions, including
suspended or reduced employee compensation and benefits. However, if the
company's markets, which currently appear to have stabilized, begin to
deteriorate again, revenues and earnings could be adversely affected.
Kitchen Collection - Third Quarter Results
Kitchen Collection reported net income of $0.3 million on revenues of
$48.3 million for the third quarter of 2009 compared with a net loss of
$3.3 million on revenues of $45.6 million for the third quarter of 2008.
Kitchen Collection's third quarter 2009 revenues increased six percent
compared with the prior year primarily as a result of an increase in new
store and comparable store sales at both Kitchen Collection® and Le Gourmet
Chef®. Comparable store transactions and customer visits were up but the
average sales transaction value was lower at the Kitchen Collection® stores
as consumers continued to seek value brands and buy basic needs items in
the current economy. However, the Le Gourmet Chef® stores had an increase
in the average sales transaction value as a result of improvements in
merchandising and fewer markdowns despite a decrease in comparable store
transactions and customer visits.
At September 30, 2009, Kitchen Collection® operated 211 stores, which
included nine seasonal stores that were kept open after the 2008 holiday
season, compared with 199 stores at September 30, 2008 and 202 stores at
December 31, 2008. Le Gourmet Chef® operated 77 stores at September 30,
2009, down from 79 stores at September 30, 2008 and 83 stores at December
31, 2008.
Kitchen Collection reported slightly better than breakeven earnings in
the third quarter of 2009 compared with a large net loss in the third
quarter of 2008. The improvement in results was primarily driven by fewer
product markdowns and improvements in merchandise offered at both Kitchen
Collection® and Le Gourmet Chef® stores. In the prior year, the Le Gourmet
Chef® store format was substantially updated, including the products
offered. This update required significant markdowns on discontinued
products in 2008. Kitchen Collection's third quarter 2009 results also
benefited from lower product costs.
For the nine months ended September 30, 2009, Kitchen Collection
reported a net loss of $4.2 million on revenues of $128.6 million compared
with a net loss of $10.2 million on revenues of $124.5 million for the
first nine months of 2008.
Kitchen Collection - Outlook
Uncertainties in the U.S. economy and consumer financial concerns are
expected to continue to affect consumer traffic to outlet and traditional
malls and negatively affect retail spending decisions in the fourth quarter
of 2009. Nevertheless, Kitchen Collection expects an improved
fourth-quarter holiday-selling season compared with 2008 due to the
continued strength of Kitchen Collection® stores and the expectation of
significantly improved margins at the Le Gourmet Chef® stores resulting
from the conclusion of new product enhancement and store-merchandising
programs. In addition, the opening of seasonal store locations during the
holiday season, capital expenditure restraints and administrative cost
control measures implemented in late 2008 and throughout 2009 are also
expected to continue to improve results in the fourth quarter of 2009.
Overall, Kitchen Collection expects that its current sales and
merchandising programs and sustained improvements in logistics will lead to
significantly improved fourth-quarter and full-year results compared with
2008 results before charges of $3.9 million pre-tax for goodwill and
intangible impairment. Cash flow before financing activities is expected to
be about breakeven in 2009 and significantly improved compared with 2008.
Longer term, Kitchen Collection expects to deliver store growth in the
Kitchen Collection® and Le Gourmet Chef® formats. However, with the
exception of opening seasonal stores for the holiday season, the total
number of Kitchen Collection® and Le Gourmet Chef® stores is not expected
to increase in the fourth quarter of 2009.
North American Coal - Third Quarter Results
North American Coal's net income for the third quarter of 2009 was
$11.4 million on revenues of $37.7 million compared with net income of $7.0
million on revenues of $39.0 million for the third quarter of 2008.
North American Coal's lignite coal and limerock deliveries for the
third quarter of 2009 compared with the third quarter of 2008 are as
follows:
2009 2008
-------- --------
Lignite coal deliveries (tons) (in millions)
Consolidated mines 2.1 2.1
Unconsolidated mines 6.9 6.8
-------- --------
Total lignite coal deliveries 9.0 8.9
======== ========
Limerock deliveries (cubic yards) 0.8 4.6
======== ========
Revenues decreased in the third quarter of 2009 compared with the third
quarter of 2008 primarily due to reduced deliveries at the limerock
dragline mining operations resulting mainly from an unfavorable legal
ruling that set aside North American Coal's customers' mining permits at
most of the limerock mining operations and the continued decline in the
southern Florida housing and construction markets. The company's customers
are currently appealing this ruling. The decrease in revenues was partially
offset by contractual price escalation and increased coal deliveries at the
Mississippi Lignite Mining Company.
The increase in the 2009 third quarter net income compared with the
2008 third quarter was primarily attributable to the receipt of lease bonus
payments of $7.1 million pre-tax for leasing certain oil and gas mineral
rights controlled by North American Coal to a third party. Increased
earnings of unconsolidated mines mainly due to contractual price escalation
and improved results at the limerock dragline mining operations primarily
due to the new cost reimbursable management fee contracts also contributed
to the increase in net income. These increases were partially offset by
reduced operating results at the Red River Mining Company as a result of
difficult mining conditions and an increase in income tax expense resulting
from a shift in the mix of pre-tax income to entities with higher income
tax rates.
For the nine months ended September 30, 2009, North American Coal's net
income was $29.3 million on revenues of $110.4 million, compared with net
income of $17.2 million on revenues of $104.4 million for the first nine
months of 2008.
North American Coal - Outlook
Overall, North American Coal expects full year 2009 net income to
improve in comparison with 2008, although results in the fourth quarter of
2009, excluding the pending Red River Mining Company sale transaction, are
expected to be lower than the fourth quarter of 2008. In addition, full
year cash flow before financing activities and before the effect of the
pending Red River Mining Company transaction is expected to increase.
Tons delivered by the lignite coal mines are expected to decrease in
the fourth quarter of 2009 compared with 2008 as a result of inclement
October weather conditions and an increase in customer power plant outage
days. In addition, contractual price escalation is not expected to affect
fourth-quarter results as favorably in 2009 as it did in 2008 because of
recent declines in commodity costs. An increase in income tax expense
resulting from a shift in the mix of pre-tax income toward entities with
higher income tax rates is also expected to continue to unfavorably affect
fourth quarter results.
Limerock customer projections for the 2009 fourth-quarter deliveries
continue to be down compared with the prior year. For limerock mining
operations within the lake belt region of Florida, production will be
significantly reduced due to an unfavorable legal ruling that set aside
North American Coal's customers' mining permits at most of the limerock
mining operations. Customers are expected to return to production under new
permits that are currently anticipated to be issued in early 2010. The
company has mitigated its financial exposure to these limerock operations
by entering into new cost reimbursable management fee contracts with the
majority of its customers. Customer projections for deliveries from
limerock mining operations outside of the lake belt region reflect the
continued decline in the southern Florida housing and construction markets.
Early in the third quarter of 2009, North American Coal entered into a new
limerock mining services contract for a quarry outside of the region
covered by the legal ruling which calls for deliveries of approximately 1.0
million cubic yards annually once the market improves, which will then
allow the quarry to reach full capacity. North American Coal commenced
limerock mining at this quarry during the third quarter of 2009.
In April 2009, North American Coal entered into an agreement to sell
the assets of the Red River Mining Company in Louisiana to its customer for
approximately $42 million in cash, subject to closing adjustments. The sale
of the mine, which is subject to customary closing conditions, including
regulatory approval, is expected to generate a substantial gain and enhance
cash flow when the transaction is completed in late 2009.
The company has a number of new project opportunities for which it
expects to continue to incur additional expenses in the fourth quarter of
2009. In the second quarter of 2009, North American Coal entered into a new
contract mining services agreement to provide approximately 300,000 to
400,000 tons of lignite coal annually to a new customer, with initial
deliveries expected to commence in 2010. In addition, in the third quarter
of 2009, North American Coal entered into a new contract mining services
agreement to provide approximately 650,000 tons of lignite coal annually to
a customer that currently purchases lignite coal from The Sabine Mining
Company, with initial deliveries expected to commence in 2013. The company
is also continuing to pursue other contract mining opportunities. The
company continues to seek permitting at its Otter Creek Reserve in North
Dakota in preparation for the expected construction of a new mine. In
addition, the company is working on a project with Mississippi Power to
provide lignite coal to a new coal gasification Integrated Gasification
Combined Cycle power plant in Mississippi. North American Coal is also
pursuing a new mine in Texas and anticipates that it will sign an agreement
for this mine in the fourth quarter of 2009.
Over the longer term, North American Coal expects to continue its
efforts to develop new domestic coal projects and is hopeful that more new
project opportunities may become available, including opportunities for
coal-to-liquids, coal gasification and other clean coal technologies.
Further, the company continues to pursue additional non-coal mining
opportunities.
Conference Call
In conjunction with this news release, the management of NACCO
Industries, Inc. will host a conference call on Thursday, November 5, 2009
at 11:00 a.m. eastern time. The call may be accessed by dialing (888)
680-0879 (Toll Free) or (617) 213-4856 (International), Pass code:
64872045, or over the Internet through NACCO Industries' website at
http://www.nacco.com. Please allow 15 minutes to register, download and install
any necessary audio software required to listen to the broadcast. A replay
of the call will be available shortly after the end of the conference call
through November 12, 2009. The online archive of the broadcast will be
available on the NACCO Industries website.
Non-GAAP Measures
For certain pre-tax disclosures included in this earnings release, the
resulting after-tax amount and the related income tax amount have been
included. Certain after-tax amounts are considered non-GAAP measures in
accordance with Regulation G. Management believes that after-tax
information is useful in analyzing the Company's net income.
For purposes of this earnings release, discussions about net income
(loss) refer to net income (loss) attributable to stockholders.
Forward-looking Statements Disclaimer
The statements contained in the news release that are not historical
facts are "forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. These forward-looking statements are made subject to certain risks
and uncertainties, which could cause actual results to differ materially
from those presented. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date hereof.
The Company undertakes no obligation to publicly revise these
forward-looking statements to reflect events or circumstances that arise
after the date hereof. Such risks and uncertainties with respect to each
subsidiary's operations include, without limitation:
NMHG: (1) reduction in demand for lift trucks and related aftermarket
parts and service on a worldwide basis, including the ability of NMHG's
dealers and end-users to obtain financing at reasonable rates as a result
of current economic conditions, (2) changes in sales prices, (3) delays in
delivery or increases in costs, including transportation costs, of raw
materials or sourced products and labor, (4) exchange rate fluctuations,
changes in foreign import tariffs and monetary policies and other changes
in the regulatory climate in the foreign countries in which NMHG operates
and/or sells products, (5) delays in, increased costs from or reduced
benefits from restructuring programs, (6) customer acceptance of, changes
in the costs of, or delays in the development of new products, (7)
introduction of new products by, or more favorable product pricing offered
by, NMHG's competitors, (8) delays in manufacturing and delivery schedules,
(9) changes in or unavailability of suppliers, (10) bankruptcy of or loss
of major dealers, retail customers or suppliers, (11) product liability or
other litigation, warranty claims or returns of products, (12) the
effectiveness of the cost reduction programs implemented globally,
including the successful implementation of procurement and sourcing
initiatives, (13) acquisitions and/or dispositions of dealerships by NMHG,
(14) changes mandated by federal and state regulation, including health,
safety or environmental legislation, (15) the ability of NMHG and its
dealers and suppliers to access credit in the current economic environment
and (16) the ability of NMHG to obtain future financing on reasonable terms
or at all.
Hamilton Beach: (1) changes in the sales prices, product mix or levels
of consumer purchases of small electric appliances, (2) changes in consumer
retail and credit markets, (3) bankruptcy of or loss of major retail
customers or suppliers, (4) changes in costs, including transportation
costs, of sourced products, (5) delays in delivery of sourced products, (6)
changes in, or unavailability of quality or cost effective, suppliers, (7)
exchange rate fluctuations, changes in the foreign import tariffs and
monetary policies and other changes in the regulatory climate in the
foreign countries in which Hamilton Beach buys, operates and/or sells
products, (8) product liability, regulatory actions or other litigation,
warranty claims or returns of products, (9) customer acceptance of, changes
in costs of, or delays in the development of new products, (10) increased
competition, including consolidation within the industry, (11) the ability
of Hamilton Beach and its customers and suppliers to access credit in the
current economic environment and (12) the ability of Hamilton Beach to
obtain future financing on reasonable terms or at all.
Kitchen Collection: (1) changes in gasoline prices, weather conditions,
the level of consumer confidence and disposable income as a result of the
current financial crisis or other events or other conditions that may
adversely affect the number of customers visiting Kitchen Collection® and
Le Gourmet Chef® stores, (2) changes in the sales prices, product mix or
levels of consumer purchases of kitchenware, small electric appliances and
gourmet foods, (3) changes in costs, including transportation costs, of
inventory, (4) delays in delivery or the unavailability of inventory, (5)
customer acceptance of new products, (6) increased competition and (7) the
ability of Kitchen Collection to obtain future financing on reasonable
terms or at all.
North American Coal: (1) weather conditions, extended power plant
outages or other events that would change the level of customers' lignite
coal or limerock requirements, (2) weather or equipment problems that could
affect lignite coal or limerock deliveries to customers, (3) changes in
mining permit requirements that could affect deliveries to customers,
including the resumption of Florida limerock mining, (4) changes in costs
related to geological conditions, repairs and maintenance, new equipment
and replacement parts, fuel or other similar items, (5) costs to pursue and
develop new mining opportunities, including costs in connection with North
American Coal's joint ventures, (6) consummation of the sale of the Red
River Mining Company, (7) changes in U.S. regulatory requirements,
including changes in power plant emission regulations, (8) changes in the
power industry that would affect demand for North American Coal's reserves
and (9) the ability of North American Coal's utility customers to access
credit markets to maintain current liquidity.
About NACCO
NACCO Industries, Inc. is an operating holding company with
subsidiaries in the following principal industries: lift trucks, small
appliances, specialty retail and mining. NACCO Materials Handling Group,
Inc. designs, engineers, manufactures, sells, services and leases a
comprehensive line of lift trucks and aftermarket parts marketed globally
under the Hyster® and Yale® brand names. Hamilton Beach Brands, Inc. is a
leading designer, marketer and distributor of small electric household
appliances, as well as commercial products for restaurants, bars and
hotels. The Kitchen Collection, Inc. is a national specialty retailer of
kitchenware and gourmet foods operating under the Kitchen Collection® and
Le Gourmet Chef® store names in outlet and traditional malls throughout the
United States. The North American Coal Corporation mines and markets
lignite coal primarily as fuel for power generation and provides selected
value-added mining services for other natural resources companies. For more
information about NACCO Industries, visit the Company's website at
http://www.nacco.com.
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED FINANCIAL AND OPERATING HIGHLIGHTS
Three Months Ended Nine Months Ended
September 30 September 30
--------------------- ---------------------
2009 2008 2009 2008
---------- ---------- ---------- ----------
(In millions, except per share data)
Total revenues $532.6 $917.8 $1,636.4 $2,730.9
Cost of sales 438.3 813.8 1,363.2 2,372.7
---------- ---------- ---------- ----------
Gross profit 94.3 104.0 273.2 358.2
Earnings of unconsolidated
mines 10.5 9.7 30.8 27.6
Operating expenses
Selling, general and
administrative expenses 94.7 109.2 281.1 353.1
Restructuring charges 6.9 1.7 9.1 3.1
Gain on sale of assets (6.0) (0.3) (8.2) (0.5)
---------- ---------- ---------- ----------
95.6 110.6 282.0 355.7
Operating profit 9.2 3.1 22.0 30.1
Other income (expense) (7.7) (7.0) (22.8) (22.8)
---------- ---------- ---------- ----------
Income (loss) before
income taxes 1.5 (3.9) (0.8) 7.3
Income tax provision 5.5 13.2 10.9 16.4
---------- ---------- ---------- ----------
Net loss (4.0) (17.1) (11.7) (9.1)
Net (income) loss
attributable to
noncontrolling interest 0.1 (0.2) 0.3 (0.3)
---------- ---------- ---------- ----------
Net loss attributable
to stockholders $(3.9) $(17.3) $(11.4) $(9.4)
========== ========== ========== ==========
Basic and diluted loss
per share $(0.47) $(2.09) $(1.38) $(1.14)
========== ========== ========== ==========
Cash dividends per share $0.5175 $0.5150 $1.5500 $1.5300
Basic and diluted weighted
average shares outstanding 8.291 8.283 8.289 8.279
(All amounts are subject to annual audit by our independent registered public accounting firm.)
NACCO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED FINANCIAL AND OPERATING HIGHLIGHTS
Three Months Ended Nine Months Ended
September 30 September 30
--------------------- ---------------------
2009 2008 2009 2008
---------- ---------- ---------- ----------
(In millions)
Revenues
NACCO Materials
Handling Group $328.4 $696.4 $1,079.5 $2,162.8
Hamilton Beach 118.9 138.2 320.3 342.2
Kitchen Collection 48.3 45.6 128.6 124.5
North American Coal 37.7 39.0 110.4 104.4
NACCO and Other - - - -
Eliminations (0.7) (1.4) (2.4) (3.0)
---------- ---------- ---------- ----------
Total $532.6 $917.8 $1,636.4 $2,730.9
========== ========== ========== ==========
Operating profit (loss)
NACCO Materials
Handling Group $(20.4) $(5.6) $(34.7) $14.8
Hamilton Beach 13.5 4.0 27.7 8.0
Kitchen Collection 0.6 (4.8) (6.3) (15.6)
North American Coal 16.9 9.3 39.2 23.7
NACCO and Other (1.4) 0.2 (4.0) (0.8)
Eliminations - - 0.1 -
---------- ---------- ---------- ----------
Total $9.2 $3.1 $22.0 $30.1
========== ========== ========== ==========
Net income (loss)
attributable to
stockholders
NACCO Materials
Handling Group $(22.4) $(20.1) $(44.0) $(10.2)
Hamilton Beach 6.9 1.3 13.0 0.8
Kitchen Collection 0.3 (3.3) (4.2) (10.2)
North American Coal 11.4 7.0 29.3 17.2
NACCO and Other (1.5) 0.8 (4.4) 0.6
Eliminations 1.4 (3.0) (1.1) (7.6)
---------- ---------- ---------- ----------
Total $(3.9) $(17.3) $(11.4) $(9.4)
========== ========== ========== ==========
(All amounts are subject to annual audit by our independent registered public accounting firm.)
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