EVANSVILLE, IN — United Components, Inc. (UCI) has announced results for the fourth quarter ended Dec. 31, 2006. Revenue of $222.7 million increased $31.8 million compared to the year-ago quarter. The quarter included $20.5 million in sales by water pump manufacturer ASC Industries, which was acquired by UCI during the second quarter. On a comparable basis (excluding ASC sales), the company reported revenue increases in the retail and heavy duty channels, a decline in the OEM channel, with sales flat in the traditional and original equipment service channels.
On Nov. 30, 2006, the company completed the sale of its Flexible Lamps lighting systems operations for about $39 million in cash. Flexible Lamps, as well as the company’s former Neapco and Pioneer operations that were sold in the second quarter, are accounted for as discontinued operations for all periods presented.
Net income from continuing operations for the quarter was $2.1 million, including $7.2 million ($4.5 million net of tax) in special charges, primarily costs related to the acquisition of ASC. Excluding these charges, adjusted net income from continuing operations would have been $6.6 million for the quarter. Adjusted net income from continuing operations for the fourth quarter of 2005 was $1.8 million, excluding $20.2 million in special charges net of tax.
Earnings before interest, taxes, depreciation and amortization, or EBITDA, for UCI’s continuing operations, as adjusted consistent with the company’s historical presentations, was $30.7 million for the fourth quarter, compared with $24.8 million for the year-ago quarter. The reconciliation of net income to adjusted EBITDA, a non-GAAP measure of financial performance, is set forth in Schedule A.
"United Components finished 2006 on a strong note, both operationally and strategically," said Bruce Zorich, chief executive officer of UCI. "In a very competitive market, our initiatives in facilities consolidation, procurement and targeted revenue growth allowed us to achieve an improvement in performance over last year. Strategically, with the divestiture of our last non-core business, Flexible Lamps, and the continued success of our integration of ASC, we believe the new UCI is well positioned for growth in 2007 and beyond."
"As we head into 2007, we are focused on expanding UCI into an efficient global manufacturer," continued Zorich. "Building on our ongoing targeted new business efforts in North America, we have identified a number of international opportunities for sales growth. In addition, continuing to leverage ASC’s China operations, we are working on global sourcing and manufacturing initiatives across all of our businesses."
As of Dec. 31, 2006, the company’s debt stood at $500.6 million, after a debt repayment of $30 million of its senior credit facility borrowings in October. The company ended the quarter with $31.5 million in cash. In addition, during the first quarter of 2007, the company has repaid an additional $40 million of its senior credit facility borrowings, primarily with cash flow from operations.
For the full year 2006, revenue was $906.1 million. Net income from continuing operations was $6.1 million for 2006, including $18.8 million in special charges net of tax, primarily costs relating to the acquisition of ASC and facilities consolidation costs, compared to a net loss from continuing operations of $7.6 million for 2005, including $22.9 million in special charges net of tax, primarily related to impairment write-downs of a trademark, software assets and property and equipment. EBITDA, as adjusted consistent with the company’s historical presentations, was $122.1 million for 2006 and $103.2 million for 2005.
For more information about United Components, go to: http://www.ucinc.com.
