Steven S. Elbaum
Chairman and Chief Executive Officer
- THE ALPINE GROUP, INC. POSTS SECOND QUARTER 2009 RESULTS -
EAST RUTHERFORD, N.J., August 21, 2009, Market Wire/ -- The Alpine Group, Inc. ("Alpine") (APNI.PK) today posted its quarterly financial statements for the three month and six month periods ended June 30, 2009 to its Website (www.alpine-group.net).
Alpine had a loss from continuing operations of $1.6 million for the second quarter of 2009 compared to a loss of $4.1 million for the same quarter in 2008. For the six months ended June 30, 2009 Alpine had a loss from continuing operations of $2.0 million compared to a loss of $3.7 million (before non-cash charges of $1.1 million for LIFO inventory adjustment and hedge mark-to-market) for the same period in 2008. The comparative decrease in loss from continuing operations resulted primarily from the reduced losses recorded by Alpine related to the losses of its affiliates, Wolverine Tube Inc. (“Wolverine”) and Synergy Cables Ltd (“Synergy”). At Wolverine, Alpine’s share of the losses decreased by $3.1 million for both the three and six month periods ended June 30, 2009, as compared to the same periods in 2008. This comparative reduction in Alpine’s share of Wolverine’s losses is due to Alpine having previously written-down to zero its investment in Wolverine as of the end of 2008, as a result of such no additional losses related to Wolverine were recorded during the first six months of 2009. Alpine’s share of Synergy’s losses for the three and six month periods ended June 30, 2009 decreased by $0.2 and $0.4 million, respectively, compared to the same periods in 2008.
Revenues for the three and six month periods ended June 30, 2009 were $6.9 and $15.1 million, respectively, reflecting a decrease of $8.2 and $16.8 million as compared to respective revenues for the same periods in 2008. The decreases include revenue declines at Alpine’s Exeon Inc. and Posterloid Corporation subsidiaries. At Exeon, the decrease in revenues for both periods was due primarily to the sharp decline in copper prices from the comparative 2008 periods, with copper prices falling 44% and 49% lower during the first quarter and half year of 2009, respectively. The decline in copper prices did not have any significant impact on Exeon’s earnings. Posterloid’s 2009 three and six month period revenues declined 37% and 49% from the robust sales achieved by it in the comparative 2008 periods, the 2009 decline reflecting the current year’s slowdown in growth at Posterloid’s principal franchise customers which, in turn, reflects the overall decline in the U.S. economy.
Steven S. Elbaum, Alpine’s Chairman and Chief Executive Officer, stated that “excluding Alpine’s share of losses from investees accounted for under the equity method, Alpine’s loss for the three and six month periods ended June 30, 2009 was $0.4 and $0.7 million, respectively. These losses include non-cash charges of $0.2 and $0.4 million for the same three and six month periods, respectively, relating to amortization of stock grants and other compensation expense. The cash loss for the three and six month periods therefore was $0.2 and $0.3 million, respectively. Prior to the suspension of the Wolverine dividend the full cash costs of Alpine’s business and overhead would have been more than covered by the currently accruing $3 million annual cumulative preferred dividend.
“As mentioned previously, Alpine’s investments in Wolverine Tube and Synergy Cables are significantly and adversely affected by the economic downturn. Wolverine revenues in some key product lines are down 40-50% from prior year levels. Nonetheless, we believe that these comparative declines reflect similar declines and inventory destocking experienced by key customers and not market share losses. In the case of Wolverine, it successfully concluded an exchange offer that extended the maturity of all of its debt until 2012. While costly, this extension will hopefully take Wolverine through to a recovery in the economy and demand for its products. Wolverine has restructured, improved its competitiveness and is well positioned to strongly benefit from a recovery in the commercial markets and the development of new electronic cooling applications for new markets such as aerospace and power electronics. Synergy’s business will benefit greatly from, among other factors, the renewed availability of credit for infrastructure products in which power cable is used. We believe these businesses offer much potential for attractive value creation as part of a larger economic recovery.
“At the same time we are conscious of the need to align corporate and other costs to the changes in anticipated cash flows from operations and investee companies, while maintaining the resources and capability to support and strengthen our existing investments as well as to identify and exploit other opportunities for current income and long term value creation in this troubled environment.”
To facilitate a more timely release of Alpine’s quarterly financial information the Company is reporting its share of affiliate earnings and losses and other comprehensive income on a one-quarter lag beginning with the first quarter of 2009.
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.