SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) : July 21, 2004
LAWSON PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-10546 36-2229304
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification
incorporation) No.)
1666 East Touhy Avenue, Des Plaines, Illinois 60018
(Address of principal executive offices) (Zip code)
(Registrant's telephone number, including area code) (847) 827-9666
(Former name or former address, if changed since last report) Not Applicable
Lawson Products, Inc.
Current Report of Form 8-K
Item 12. Results of Operations and Financial Condition.
On July 21, 2004, Lawson Products, Inc. issued a press release announcing
its operating results for the quarter ended June 30, 2004. A copy of the
press release is attached as Exhibit 99.1 to this Form 8-K.
The information in this Form 8-K is being furnished and shall not be deemed
"filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 or
otherwise subject to the liabilities of that Section. The information in this
Form 8-K may only be incorporated by reference in another filing under the
Securities Exchange Act of 1934 or Securities Act of 1933 if such subsequent
filing specifically references this Form 8-K.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LAWSON PRODUCTS, INC.
/s/ Joseph L. Pawlick
-----------------------------------------
Joseph L. Pawlick
Date: July 21, 2004 Senior Vice President, Accounting
(principal accounting officer)
EXHIBIT INDEX
NUMBER DESCRIPTION
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99.1 Press release issued by Lawson Products, Inc. on July 21, 2004.
Exhibit 99.1
PRESS RELEASE Source: Lawson Products, Inc.
LAWSON PRODUCTS, INC. REPORTS INCREASE IN SECOND QUARTER, 2004 SALES AND NET
INCOME
CHICAGO, July 21 /PRNewswire-FirstCall/ -- Lawson Products, Inc. (Nasdaq: LAWS)
reported second quarter net income of $5.3 million, or $.56 per share up 28.4%
from $4.1 million, or $.44 per share a year earlier. The increase in earnings
was driven primarily by a 7.6% increase in net sales for the second quarter to a
quarterly record $104.4 million.
Robert J. Washlow, Chairman of the Board and CEO commented, "Record sales for
the second quarter of 2004 indicate that initiatives implemented in previous
periods continue to deliver positive results. Our business is strong and
growing, with increases in second quarter sales and operating income realized
across our MRO and OEM segments."
Net sales by segment for the second quarter of 2004 and 2003 and for the six
months ended June 30, 2004 and 2003 follow:
(Dollars in millions)
Second Quarter Six Months Ended 6/30
2003 2004 % change 2003 2004 % change
MRO $80.2 $83.5 +4.1 $159.7 $165.0 +3.3
OEM 16.9 20.9 +23.9 33.5 40.1 +19.7
Total $97.1 $104.4 +7.6 $193.2 $205.1 + 6.2
The second quarter's consolidated gross margins declined slightly from the prior
year, primarily due to a higher sales mix from the lower-margin OEM segment. As
presented in the table above, OEM sales grew at a 23.9% rate over the prior year
quarter compared to a 4.1% sales increase for MRO. Gross margins in the MRO
segment improved slightly in the second quarter 2004 compared to the prior year.
Second quarter 2004 earnings comparisons to the prior year were impacted by a
pre-tax charge of $1.2 million in the second quarter 2003 for retirements and
terminations. Such charges were not incurred during the second quarter of 2004.
Mr. Washlow added, "In light of the difficulties presented by the steel and
commodity markets this year, I am pleased with our improved performance." For
the first six months of 2004, earnings per share were up 50.6% to $1.25, from
$.83 per share in the same period last year on a 6.2% increase in sales to
$205.1 million from $193.2 million.
Lawson Products is an international seller and distributor of products, services
and systems to the industrial, commercial and institutional maintenance, repair
and replacement marketplace. The Company also manufactures, sells and
distributes production and specialized component parts to the original equipment
marketplace, including the automotive, appliance, aerospace, construction and
transportation industries.
This press release, including Mr. Washlow's statements, may contain certain
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 that involve risks and uncertainties. These
statements are not guarantees of future performance and involve risks,
uncertainties and assumptions that are difficult to predict. These statements
are based on management's current expectations, intentions or beliefs and are
subject to a number of factors, assumptions and uncertainties that could cause
actual results to differ materially from those described in the forward- looking
statements. Factors that could cause or contribute to such differences include,
but are not limited to, those related to general economic conditions and market
conditions in the original equipment manufacturers and maintenance, repair and
replacement distribution industries in North America and to a lesser extent, the
United Kingdom, the Company's ability to obtain new customers and manage growth,
material or labor cost increases, competition in the Company's business,
operating margin risk due to competitive pricing and operating efficiencies,
seasonality, effectiveness of our sales and marketing programs, and the length
of economic downturns in the Company's markets. The Company undertakes no
obligation to update any such factor or to publicly announce the results of any
revisions to any forward-looking statements contained herein whether as a result
of new information, future events or otherwise.
LAWSON PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED SUMMARY OF OPERATIONS
(UNAUDITED)
Three Months Ended June 30, Six Months Ended June 30,
2004 2003 % Change 2004 2003 % Change
Net Sales $104,443,078 $97,108,559 7.6% $205,100,836 $193,183,669 6.2%
Income
Before
Taxes (a) 8,725,964 6,705,002 30.1% 19,253,226 13,326,173 44.5%
Provision
for Income
Taxes 3,409,000 2,564,000 7,410,000 5,427,000
Net Income
(a) $5,316,964 $4,141,002 28.4% $11,843,226 $7,899,173 49.9%
Net Income
per share
of Common Stock:
Basic $0.56 $0.44 27.3% $1.25 $0.83 50.6%
Diluted $0.56 $0.44 27.3% $1.25 $0.83 50.6%
Weighted
Average Shares
Outstanding:
Basic 9,445,574 9,490,111 9,465,769 9,491,325
Diluted 9,475,151 9,505,609 9,493,451 9,509,183
(a) In the second quarter of 2003, the Company recorded a pre-tax charge
of $1,246,000, having an after-tax effect of $751,000,
for the severance and retirement of certain management personnel.
SOURCE Lawson Products, Inc.
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/CONTACT: Joseph Pawlick, Senior Vice President, Accounting, of Lawson Products,
Inc., +1-847-827-9666/
/First Call Analyst: /
/FCMN Contact: /
(LAWS)