Corporate and Financial
Brunswick Second Quarter EPS in Line With Expectations; Reducing Second Half Estimates Due to Marine Markets
Conference Call ScheduledLAKE FOREST, Ill., July 12, 2006 /PRNewswire-FirstCall via COMTEX News Network/ -- Brunswick Corporation
(NYSE: BC) announced today that it expects to report earnings from continuing
operations in the range of $0.93 to $0.94 per diluted share for the second
quarter of 2006, in the middle of the company's previously announced estimate
of $0.90 to $0.97. This estimate excludes tax-related benefits expected to be
reported in the quarter.
Brunswick will release its second quarter 2006 financial results before
the markets open on Thursday, July 27. The company said it expects to report
sales up 1 percent to approximately $1.55 billion. Excluding acquisitions,
however, sales are estimated to have declined about 4 percent.
The company said that during the second quarter, it acquired approximately
1.5 million shares of its common stock for approximately $56 million. Over
the past year, approximately 5.1 million shares have been repurchased for
approximately $193 million.
"Our second quarter results are in line with our expectations," said
Brunswick Chairman and Chief Executive Officer Dustan E. McCoy. "Throughout
the key second quarter selling season for 2006-model-year marine products,
however, we have experienced significant declines in retail demand, which has
resulted in an increase in pipeline inventories. As we now enter the off-
season, we can't rely solely on retail demand to rebalance the pipeline. So,
we will be reducing further our production levels, leading to a lowering of
our earnings estimate for the second half of the year. This is primarily due
to reduced sales and the impact of fixed cost absorption from production cuts
needed to adjust pipeline inventories. Although this will result in reduced
margins, we believe that managing pipeline inventories is critical in a
cyclical, as well as a seasonal, industry."
The company said that 2006 earnings from continuing operations are
expected to be in the range of $2.40 to $2.55 per diluted share, compared with
its previous estimate of $3.00 and $3.15 per diluted share, in both cases
excluding tax-related items. In 2005, the company reported earnings from
continuing operations of $3.13 per diluted share, excluding stock sale gains
and tax-related items.
"While changing market conditions impact our financial results in the
short-term, we have not lost sight of our long-term value creation objectives,
and we continue to execute relentlessly against our five key strategies: get
the product right; get the distribution right; be best cost in our industries;
be global and attract and retain talent," McCoy continued. "Focusing intently
on such fundamentals is better positioning us to benefit when industry
conditions improve."
Conference Call Scheduled
The company said a conference call with investors has been scheduled for
10 a.m. CDT today, hosted by McCoy, Peter G. Leemputte, senior vice president
and chief financial officer, and Kathryn J. Chieger, vice president -
corporate and investor relations. The call will be broadcast over the
Internet at http://www.brunswick.com . To listen to the call, go to the Web
site at least 15 minutes before the call to register, download and install any
needed audio software.
Security analysts and investors wishing to participate via telephone
should call 800-857-4546 (passcode: Brunswick). Callers outside of North
America should call 1-210-234-0035 to be connected. These numbers can be
accessed 15 minutes before the call begins, as well as during the call. A
replay of the conference call will be available through midnight CDT
Wednesday, July 19, 2006, by calling 866-367-6718 or 1-203-369-0236. The
replay will also be available at http://www.brunswick.com .
Forward-Looking Statements
Certain statements in this press release are forward-looking as defined in
the Private Securities Litigation Reform Act of 1995. These statements
involve certain risks and uncertainties that may cause actual results to
differ materially from expectations as of the date of this filing. These
risks include, but are not limited to: the effect of a weak economy and stock
market on consumer confidence and thus the demand for marine, fitness,
billiards and bowling equipment and products; competitive pricing pressures;
the success of new product introductions; the ability to maintain market share
in high-margin products; competition from new technologies; competition in the
consumer electronics markets; imports from Asia and increased competition from
Asian competitors; the ability to obtain component parts from suppliers; the
ability to maintain effective distribution; the financial strength of dealers,
distributors and independent boat builders; the ability to transition and ramp
up certain manufacturing operations within time and budgets allowed; the
ability to maintain product quality and service standards expected by our
customers; the ability to successfully manage pipeline inventories; the
success of global sourcing and supply chain initiatives; the ability to
successfully integrate acquisitions; the ability to successfully complete
announced divestitures; the success of marketing and cost management programs;
the ability to develop product technologies that comply with regulatory
requirements; the ability to complete environmental remediation efforts and
resolve claims and litigation at the cost estimated; the impact of weather
conditions on demand for marine products and retail bowling center revenues;
shifts in currency exchange rates; adverse foreign economic conditions; and
the impact of interest rates and fuel prices on demand for marine products.
Additional factors are included in the company's Annual Report on Form 10-K
for 2005 and Quarterly Report on Form 10-Q for the quarter ended March 31,
2006.
About Brunswick
Headquartered in Lake Forest, Ill., Brunswick Corporation endeavors to
instill "Genuine Ingenuity"(TM) in all its leading consumer brands, including
Mercury and Mariner outboard engines; Mercury MerCruiser sterndrives and
inboard engines; MotorGuide trolling motors; Teignbridge propellers; MotoTron
electronic controls; Albemarle, Arvor, Baja, Bayliner, Bermuda, Boston Whaler,
Cabo Yachts, Crestliner, HarrisKayot, Hatteras, Laguna, Lowe, Lund, Maxum,
Meridian, Ornvik, Palmetto, Princecraft, Quicksilver, Savage, Sea Boss, Sea
Pro, Sea Ray, Sealine, Triton, Trophy, Uttern and Valiant boats; Attwood
marine parts and accessories; Land 'N' Sea, Kellogg Marine, Diversified Marine
and Benrock parts and accessories distributors; IDS dealer management systems;
Life Fitness, Hammer Strength and ParaBody fitness equipment; Brunswick
bowling centers, equipment and consumer products; Brunswick billiards tables;
and Valley-Dynamo pool, Air Hockey and foosball tables. For more information,
visit http://www.brunswick.com .
SOURCE: Brunswick Corporation
Kathryn Chieger, Vice President - Corporate and Investor Relations, Brunswick
Corporation, +1-847-735-4612
