NORTHVILLE, MI -- Hayes Lemmerz International reported that sales for the fiscal second quarter, which ended on July 31, rose 4 percent to $523.7 million compared with $502.8 million a year earlier. Sales for the six months, which ended on July 31 were $1,117.8 million compared to $1,018.1 million a year earlier, an increase of 10 percent.

The company reported a net loss of $10 million, or 26 cents a share, for the second fiscal quarter ended July 31, 2004. For the fiscal first half of 2004, the company reported a net loss of $12.7 million, or 34 cents a share. For the second fiscal quarter of 2004, earnings from operations excluding fresh start accounting adjustments and reorganization items was $9.5 million, compared with $20.4 million a year earlier. Increased volumes and favorable exchange rates abroad were offset by lower OEM production requirements in North America, lower unit pricing globally, and increased steel and iron prices. For the six months ended July 31, 2004, earnings from operations with those exclusions amounted to $35.7 million, compared with $34.8 million a year earlier.

The company reported a cash balance of $49.1 million as of July 31, 2004 and there were no borrowings under its $100 million revolving credit facility.

"I am encouraged by our continuing progress in making Hayes Lemmerz more cost-efficient and customer-focused in our operations," said Curtis Clawson, chairman, president and CEO. "Given the challenges faced by our industry, including sharply higher steel costs and soft new vehicle sales, we did well in the second quarter. For the first half of 2004, we slightly increased earnings from operations excluding fresh start accounting adjustments and reorganization items."

Mr. Clawson cautioned that Hayes Lemmerz will continue to face high materials costs, and also the impacts of new global competitors, especially in China. "Our industry remains under intense pricing pressure from competitors, and from our major customers. Fortunately, our intense focus on reduction in production costs, facility improvements, and increased productivity is allowing us to respond effectively to those pressures," Mr. Clawson said.

The 2004 fiscal second quarter results included $0.9 million of restructuring charges, primarily arising from severance and related closure costs of the Howell, Michigan, manufacturing plant as part of management's ongoing rationalization efforts.

Results for the first half of 2004 also include a $12.2 million loss on early extinguishment of debt. During the first quarter, Hayes Lemmerz sold 7.7 million shares of its common stock in a primary offering, and used a portion of the $117.0 million net proceeds to extinguish $87.5 million of its New Senior Notes and to prepay $16 million of its New Term Loan.

_______________________________________

Click here to view the rest of today's headlines.