Steven S. Elbaum
Chairman and Chief Executive Officer
- THE ALPINE GROUP, INC. POSTS THIRD QUARTER 2008 RESULTS -
EAST RUTHERFORD, N.J., January 9, 2009, Market Wire/ -- The Alpine Group, Inc. ("Alpine") (APNI.PK) today posted its quarterly financial statements for the three and nine month periods ended September 30, 2008 to its Website (www.alpine-group.net).
Alpine had a net loss of $7.2 million for the third quarter 2008 compared to net income of $0.6 million for the third quarter of 2007. The net loss primarily reflects Alpine’s 23% share of unusual items recorded during the quarter at Wolverine Tube, Inc. (“Wolverine”), Alpine’s 23% owned equity investee. These items include a non-cash $44 million goodwill impairment charge taken by Wolverine during the quarter and $22 million of gains on divestitures. The Wolverine items result from the restructuring and downsizing of its business that began with Alpine’s investment in 2007. Alpine’s non-cash share of the Wolverine items amounted to $5 million in the third quarter. Alpine also recorded a loss of $2.6 million for its 52% share of Synergy Cables Ltd. loss for the third quarter of 2008. Synergy’s loss was largely attributable to the write down of unhedged copper inventory. Partially offsetting these losses was a $1.5 million after-tax gain recorded by Exeon Inc. during the quarter on account of changes in LIFO valuation and mark-to-market hedge adjustments.
Alpine’s net loss for the nine month period ended September 30, 2008 was $8.2 million compared to $0.5 million in net income for the comparable period in 2007. The comparative decrease was due primarily to the aforementioned Wolverine items. The 2008 nine month results also include an after-tax gain of $3.7 million resulting from the proceeds (net of expenses) received by Alpine related to a litigation settlement recorded as income from discontinued operations during the second quarter of 2008. This gain was offset by Alpine‘s share ($4.3 million) of Synergy Cables Ltd. losses for the nine month period ended September 30, 2008.
Revenues were $15.1 million for the quarter ended September 30, 2008, which was the same as the comparable quarter in 2007. Revenues for the nine month period ended September 30, 2008 were $45.5 million, an increase of $6.8 million, which was due primarily to Posterloid Corporation, which was acquired in early 2007.
As a result of finalizing the recording of the sale of its wholly owned subsidiary, Wolverine Tube (Canada), Inc., in the third quarter of 2008 Wolverine determined that assets held for sale as reported in its June 29, 2008 unaudited condensed consolidated balance sheet should have been reduced by approximately $8.7 million to a fair value of $55.9 million. Wolverine thereafter restated its financial results for the second quarter of 2008 to reflect the foregoing revision. Since Alpine adopted the equity method of accounting for its ownership interest in Wolverine during the second quarter of 2008, it has revised its financial results for such period to reflect its $1.9 million share in the foregoing negative adjustment recorded by Wolverine. Accordingly, Alpine’s second quarter 2008 unaudited financial statements have been restated as of January 7, 2009 to reflect this adjustment and have been posted to the Company’s website. These restated unaudited financial statements replace the previously posted Alpine unaudited financial statements for such quarter, which should not be relied upon.
Mr. Steven S. Elbaum, Chairman and Chief Executive Officer, commented that “third quarter results at Wolverine reflect necessary and anticipated restructuring and disposal activities as its business model is redefined around higher performance copper tubing sold directly to leading OEM’s. The result will be a smaller, less leveraged and more profitable Wolverine over the long term. Synergy’s losses during the quarter included losses incurred on unhedged copper inventories exposed to sudden and unprecedented declines in LME copper prices during the quarter and particularly in October. Controls have been implemented at Synergy to increasing hedge positions to mitigate future exposure to extreme volatility in the copper market, as well as a more uncertain demand environment.
“The effects of the deepening recession, frozen credit and disrupted capital markets along with historic volatility in commodity markets, are well documented and omnipresent. Nonetheless, I am reasonably confident that the business restructuring actions at Wolverine, which we initiated in 2007, will result in a solid long term investment for Alpine. Our priorities are to complete the operational restructuring and refinance the upcoming debt maturity into a longer term capital structure. At this point, I am optimistic about achieving these priorities.
“The continued focus on infrastructure development and energy efficiency, including through anticipated stimulus programs, should benefit both Wolverine and Synergy Cables’ power cable business.”All statements in this press release other than statements of historical fact are forward-looking statements within the meaning of the “safe harbor” provision of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in this press release. The forward-looking statements speak only as of the date of this press release, and the Company expressly disclaims any obligations to release publicly any update or revision to any forward-looking statement contained herein if there are any changes in conditions or circumstances on which any such forward-looking statement is based.
The Alpine Group, Inc. (APNI.PK) has substantial experience in operating and actively managing companies in which it invests capital. Alpine has focused on industrial and other businesses that are underperforming, experiencing financial constraints and will benefit from operational improvements, consolidation and an improved capital structure. Alpine has actively invested in and operated leading domestic and global manufacturers of specialty materials, coatings, wire and cable products and electronic components.