TULSA, Okla., Feb. 9, 2009 (GLOBE NEWSWIRE) -- North American Galvanizing & Coatings, Inc. (Nasdaq:NGA) announced today unaudited fourth-quarter 2008 earnings from continuing operations of $3.0 million, or $.18 per share, a 39% increase over the prior year fourth quarter. For the year, income from continuing operations was $12.5 million, or $.74 per share, a 37% increase over the prior year. This year was the highest earnings year in the Company's fifty-three year history.
The Company previously announced a final settlement agreement with the Metropolitan Water District of Greater Chicago, related to the Company's former subsidiary, Lake River Corporation. The loss from discontinued operations of $.7 million, net of tax, was recorded in the fourth quarter of 2008. Net income per share for the fourth quarter was $.14 per share, a 7.7% increase from the prior year fourth quarter net income, including the ($.04) per share result from discontinued operations recorded in 2008.
All per share data are reported on a fully-diluted basis and have been adjusted to reflect the effect of the September 14, 2008 four-for-three stock split effected by a stock dividend.
Commenting on the results, Ronald J. Evans, president and chief executive officer, said, "North American Galvanizing achieved record financial results for the fourth quarter and year. The Company finished the year in a solid financial position, and began 2009 aggressively by announcing the addition of a new plant. With the final resolution of the matters relating to previously discontinued operations, we can now focus our attention on implementing our growth plans."
Results from Operations
Due to an overall increase in demand from existing customers and incremental project work, sales volumes for the year ended December 31, 2008 increased 7% over the prior year. The average selling price for 2008 was 9% lower than the average selling price for 2007 resulting in a 2.6% decrease in annual revenues. A combination of product mix and the lower cost of zinc contributed to the lower average selling price in 2008. Market prices have decreased related to decreases in zinc costs.
The decrease in cost of goods sold from 2007 to 2008 was mainly due to the decrease in zinc costs. Selling, general, and administrative expenses increased $.9 million, or 9.8%, in 2008 compared to the prior year due to increases in personnel costs, primarily non-cash share-based compensation.
Recent New Plant Announcement
On January 27, 2009 the Company announced that it would be constructing a new hot dip galvanizing plant located in Benwood, West Virginia. The new operation, which is expected to be online in late April, will utilize a 30 foot kettle and becomes the Company's eleventh hot dip galvanizing plant. The new plant located three miles south of Wheeling, West Virginia, centrally located in the vicinity of Interstates 77, 70 and 79, will allow the Company to more economically and efficiently service regional customers, others in the tri-state area, as well as in-transit work. This new location is a logical geographic extension, supporting the Company's internal growth plans. The plant will be constructed in an existing building that the Company has leased.
