Hallwood Group Reports Results for the Third Quarter and Nine Months Ended September 30, 2007
November 15 2007 - 5:49PM
PR Newswire (US)
DALLAS, Nov. 15 /PRNewswire-FirstCall/ -- The Hallwood Group
Incorporated (AMEX:HWG) today reported results for the third
quarter and nine months ended September 30, 2007. For the quarter,
Hallwood reported a net loss of $367,000, or $0.24 per share,
compared to a net loss of $848,000, or $0.56 per share, in 2006.
For the nine months, Hallwood reported a net loss of $8.3 million,
or $5.44 per share, compared to a net loss of $883,000, or $0.58
per share, in 2006. The 2007 nine month loss included an equity
loss from the Company's Hallwood Energy, L.P. affiliate in the
amount of $13.6 million. Following is a comparison of results for
the 2007 and 2006 periods: Operating Income (Loss). For the 2007
and 2006 third quarters, operating income, primarily from textile
products operations, was $1.2 million and a loss of $584,000, on
revenue of $32.6 million and $25.1 million, respectively. For the
2007 and 2006 nine months, operating income was $2.0 million and
$790,000, on revenue of $92.9 million and $84.5 million,
respectively. The increases in revenue and operating income were
primarily due to military sales, which were $18,079,000 and
$46,625,000 for the three months and nine months ended September
30, 2007, compared to $11,541,000 and $40,455,000, respectively.
Other Income (Loss). Other income (loss) consists of equity from
the Company's 24% minority investment in its Hallwood Energy, L.P.
affiliate, interest expense and other income and expense. For the
2007 and 2006 third quarters, other income (loss) was a loss of
$1.5 million and $670,000, respectively, including an equity loss
from its energy investment of $1.3 million in 2007, compared to an
equity loss of $665,000 in 2006. For the nine months, other income
(loss) was a loss of $14.1 million and $1.7 million, respectively,
including equity losses of $13.6 million in 2007 and $1.7 million
in 2006. Income Taxes. For the 2007 third quarter, income tax
expense was $75,000, which included a noncash deferred federal tax
benefit of $168,000 and state tax expense of $243,000. For the 2006
third quarter, the income tax benefit of $406,000, included a
noncash deferred federal tax benefit of $227,000, current federal
tax benefit of $230,000 and state tax expense of $51,000. For the
2007 nine months, the income tax benefit of $3.8 million, included
a noncash deferred federal tax benefit of $4.3 million and state
tax expense of $469,000. For the 2006 nine months, the income tax
benefit of $48,000, included a noncash deferred federal tax benefit
of $246,000, a current federal tax benefit of $230,000 and state
tax expense of $428,000. Hallwood Energy Capital Requirements. The
Company's Hallwood Energy, L.P. affiliate anticipates that it will
require $30,000,000 of additional capital contributions in the
fourth quarter of 2007. In November 2007, Hallwood Energy received
$15,000,000 of this amount from a new equity partner. In addition,
Hallwood Investments Limited, another existing investor and the
lender to Hallwood Energy entered into a letter agreement providing
up to $15,000,000 of additional equity to Hallwood Energy. Hallwood
Energy also anticipates that it will likely require in excess of
$80,000,000 to finance its tentative 2008 operating budget and is
in the process of seeking this additional capital from external
sources. Chairman and Majority Shareholder Withdraws Proposal. Mr.
Gumbiner, the Company's chairman and majority shareholder, has
advised the Company that, because his previously announced proposal
to purchase the Company's interest in Hallwood Energy could
conflict with Hallwood Energy's efforts to obtain additional
capital, among other things, he has withdrawn his proposal that the
board of directors consider a liquidation of the Company. The board
of directors determined that the special committee would continue
to consider the Company's strategic alternatives with respect to
Brookwood, however. There can be no assurance that the special
committee will recommend that the Company take any action with
respect to Brookwood, or that any transaction will be completed.
The following table sets forth selected financial information for
the three months and nine months ended September 30, 2007 and 2006.
THE HALLWOOD GROUP INCORPORATED (In thousands, except per share
amounts) Three Months Ended Nine Months Ended September 30,
September 30, 2007 2006 2007 2006 Revenue $32,576 $25,055 $92,949
$84,528 Operating income (loss) $1,248 $(584) $2,043 $790 Other
income (loss) (1,540) (670) (14,097) (1,721) Loss before income
taxes (292) (1,254) (12,054) (931) Income tax expense (benefit) 75
(406) (3,790) (48) Net loss $(367) $(848) $(8,264) $(883) PER
COMMON SHARE: BASIC Net loss $(0.24) $(0.56) $(5.44) $(0.58)
Weighted average shares outstanding 1,521 1,515 1,518 1,513
ASSUMING DILUTION Net loss $(0.24) $(0.56) $(5.44) $(0.58) Weighted
average shares outstanding 1,521 1,515 1,518 1,513 Certain
statements in this press release may constitute "forward-looking
statements" which are subject to known and unknown risks and
uncertainties including, among other things, certain economic
conditions, competition, development factors and operating costs
that may cause the actual results to differ materially from results
implied by such forward-looking statements. These risks and
uncertainties are described in greater detail in the Company's
periodic filings with the SEC. DATASOURCE: The Hallwood Group
Incorporated CONTACT: Melvin Melle, Chief Financial Officer of The
Hallwood Group Incorporated, 1-800-225-0135, or +1-214-528-5588 Web
site: http://www.hallwood.com/
Copyright
Hallwood (AMEX:HWG)
Historical Stock Chart
From Jun 2024 to Jul 2024
Hallwood (AMEX:HWG)
Historical Stock Chart
From Jul 2023 to Jul 2024