Lilly Industries Inc., one of the largest US manufacturers of industrial coatings and speciality chemical products, reported in a company press release that sales for the nine months ended 31 August 1…
Lilly Industries Inc., one of the largest US manufacturers of industrial coatings and speciality chemical products, reported in a company press release that sales for the nine months ended 31 August 1999, were up 5% at US$ 487 million compared with US$ 461.9 million a year ago. Net income was US$ 23.9 million, or US 1.02 per diluted share, up 6% compared with US$ 22.5 million, or US$ 0.96 per diluted share, for the same period last year. Sales for the third quarter increased 6% over last year“s same quarter to US$ 169.5 million. Net income and diluted earnings per share for the quarter were even with prior year results at US$ 8.7 million and US$ 0.37 per share, respectively. Sales growth in the third quarter was driven by wood and powder coatings. The statement also said that operating profit margins declined in the third quarter from a year ago. The effect of product sales mix changes and increased operating expense levels to support business expansion initiatives have both contributed to lower operating profit margins. Net income and diluted earnings per share were even with last year, as lower operating income was offset by favourable interest expense and a lower tax rate. “We are pleased with our sales momentum over the past two quarters,” said Lilly“s chairman and CEO, Douglas W. Huemme. “Our investments in quality people and infrastructure to support our customers globally are paying off”. “However, lower operating margins are not an acceptable permanent result,” Huemme added. “We have implemented programmes to restore operating margins, including reductions in employment, plant rationalization, supply chain initiatives, and price increases. Operating efficiency is a key and permanent component of our business strategy going forward”. “We expect fourth quarter earnings per share to show improvement from last year, and we expect another record year for sales and earnings. We will continue to invest in future growth opportunities and I remain optimistic about Lilly“s future”. Lilly“s board of directors declared a regular quarterly cash dividend of 8 cents per common share, the 243rd consecutive quarterly cash dividend. The dividend is payable 3 January, 2000 to share to shareholders of record on 10 December 1999.