White Plains, NY -- /PRNewswire-FirstCall/ -- WHX Corporation reported financial results for the third quarter ended September 30, 2009.

 

WHX reported net income of $1.0 million on net sales of $145.2 million in the third quarter of 2009, compared with net income of $9.5 million on net sales of $195.3 million for the third quarter of 2008. Basic and diluted net income per common share was $0.08 on 12,179,000 shares outstanding for the third quarter of 2009, compared with net income per common share of $5.48 on 1,729,000 shares outstanding in the same period of 2008.

 

Revenue for the third quarter of 2009 was $145.2 million, a decrease of $50.2 million, or 25.7 percent from $195.3 million for 2008 amid the general slow-down in the U.S. and world economies, especially weakness in the U.S. housing, automotive, and general industrial markets.

 

For the nine months ended September 30, 2009, WHX reported a net loss of $14.5 million on net sales of $417.4 million, as compared to net income of $8.6 million on net sales of $564.6 million for the same period of 2008.

 

The net loss for the three months ended September 30, 2009 includes a net increase in non-cash pension expense of $5.7 million and a $1.1 million non-cash goodwill impairment charge, partially offset by a $3.0 million gain on proceeds from an insurance claim. The net loss for the nine months ended September 30, 2009 includes a net increase in non-cash pension expense of $17.0 million, non-cash asset and goodwill impairment charges of $3.2 million, and a $3.0 million gain on proceeds from an insurance claim.

 

The Company generated Adjusted EBITDA of $15.6 million for the third quarter of 2009, as compared to $18.2 million for the same period in 2008. The decline in third quarter 2009 Adjusted EBITDA was principally due to lower sales and income from continuing operations of our businesses.

 

"WHX's net sales and profitability were adversely effected by the world-wide economic recession for the three months and the nine months ended September 30, 2009," said Glen Kassan, Vice Chairman of the Board and Chief Executive Officer of WHX. "Sales were down by 26 percent for both the third quarter and nine months ended September 30, 2009, compared to the same periods of 2008. All but one of the Company's reportable segments experienced declines in operating income for the third quarter and nine months ended September 30, 2009, compared to the same periods in 2008.

 

"During the third quarter of 2009 we continued to apply significant cost containment actions across all of our business segments and the corporate headquarters. These actions include a reduction in compensation and benefits for salaried employees, layoffs in both the salaried and hourly workforce, the temporary idling of certain of our manufacturing facilities for various periods during 2009 to better match production with customer demand, and certain other restructuring activities. We believe these initiatives significantly contributed to the Company improving its adjusted gross margin (as adjusted for certain items as described below) in the second and third quarters of 2009 versus the prior quarter, and effectively managing its margin for the three and nine months ended September 30, 2009 as compared to the same periods in 2008 despite the significant decline in sales during 2009. Additionally, the Company has continued to closely focus on effectively managing cash flow, including working capital utilization, in 2009. Total debt, including the Company's term loans, was reduced by $23.1 million during the first nine months of 2009 while we maintained what we believe to be sufficient liquidity.”