Brunswick Technologies Reports Increased First Quarter Sales
BRUNSWICK, ME - May 5, 2000 - Brunswick Technologies, Inc. (Nasdaq:BTIC) ("BTI"), a leading manufacturer and innovative developer of composite reinforcements, today reported first quarter 2000 net sales of $12.1 million, an increase of 5.9% over the same period last year and 16.1% over the fourth quarter of 1999. Gross profit was $2.4 million, down from $2.48 million during the same period last year. Net income was $268,000, or $0.05 per fully diluted share, compared with $365,000, or $0.07 per fully diluted share for the same period in 1999.
"We were pleased with a rebound in domestic sales, the continued strength of our international revenues and the increasing penetration of our unique next-generation carbon reinforcement product line, Black Steel(R), into the infrastructure and industrial industries." said Martin S. Grimnes, Chairman and CEO of BTI. Sales of Black Steel(R), our next-generation carbon reinforcement product line, grew to $688,000 in the first quarter, about 150% over the past two quarters combined. Because Black Steel(R) represents tremendous revenue growth potential for BTI, we committed significant production capacity to the development and delivery of the product line, which unfortunately negatively impacted sales of our conventional glass fabric products in this quarter. Margins were also negatively impacted by raw material price negotiations with the major glass suppliers that extended through the last few days of 1999. This was too late for us to effectively pass these increases on to the marketplace until late in the first quarter."
Commenting further on BTI's production commitment to the Black Steel(R) product line, Bill Dubay, President and COO of BTI said, "We are leveraging the success of BTI's development and rollout of our engineered glass reinforcements product line to build our expertise in the development and high-speed processing of carbon-based fabrics."
BTI also reported that operating expenses were 16.2% of net sales for the first quarter of 2000, down from 17.2% during the same period one-year ago. Research and development costs as well as selling expenses were also down in comparison to the same period last year. The company reported that orders in the domestic plant were received and filled for wind-blades for the first time since the first quarter of 1999. Volume is expected to continue growing in this market throughout 2000.
On May 3, 2000, the BTI Board of Directors recommended that BTI shareholders reject as inadequate an unsolicited $8.00 per share tender offer made on April 20, 2000 by Vetrotex CertainTeed Corporation, a wholly-owned subsidiary of France-based holding company Compagnie de Saint-Gobain.
Commenting on the Board's decision, Grimnes said, "After a careful review of the Saint-Gobain offer, with the assistance of our financial advisors, the Board determined that the offer is financially inadequate and does not recognize the inherent value of this company, especially given our strong emerging new technologies. The Board believes it is in the best interest of all shareholders at this time to aggressively explore strategic alternatives to enhance value for BTI shareholders, and has formed a committee of independent directors to oversee this process. We will promptly report any developments resulting from these efforts."
Examples of products manufactured with BTI engineered reinforcements include: ballistic armor, boats, snowboards, railcars, truck panels, wind blades, airframe structures, automotive parts, marine pilings, bridges, and offshore oil and gas production equipment. BTI has manufacturing facilities in the Maine, Texas and the UK.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
Matters discussed in this news release, including any discussion of or impact, expressed or implied, on the Company's anticipated revenue growth, operating results and future earnings per share contain forward-looking statements (identified by the words "expect", "estimate", "project", "plans", "believe", and similar expressions) that involve known and unknown risks and uncertainties. For these statements the company claims the protection of the safe harbor of the private Securities Litigation Reform Act of 1995. The company's results may differ significantly from the results indicated by such forward-looking statements.
The Company's future results are dependent upon general economic conditions, the availability of supplies of fiberglass, the ability to expand new and existing markets, competition from competing product lines from both fiberglass and non-fiberglass suppliers, the ability to manage growth in inventory, the stability of its customers' capital spending plans and the ability of the company to obtain necessary capital from time to time. These and other risks are detailed from time to time in the Company's SEC reports, including Form 10K for the year ended December 31, 1999.
CONTACT: Brunswick Technologies, Inc.
Phil Harmon, 207/729-7792
or
Citigate Sard Verbinnen
David Reno/Andrew Cole
212/687-8080