Form 8-K EASTERN CO For: Oct 28
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E-mailUNITED STATES
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: October 28, 2015
(Date of earliest event reported)
The Eastern Company
(Exact name of Registrant as specified in its charter)
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Connecticut
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0-599
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06-0330020
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(State or other jurisdiction
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(Commission File Number)
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(IRS Employer
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of incorporation)
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identification No.)
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112 Bridge Street, Naugatuck, Connecticut
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06770
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(Address of principal executive offices)
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(Zip Code)
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(203) 729-2255
(Registrant’s telephone number, including area code)
________________________________________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2)
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4( c) under the Exchange Act (17 CFR 240.13e-4( c))
Section 2 – Financial Information
ITEM 2.02 - Results of Operations and Financial Condition
Press Release dated October 28, 2015 announcing the third quarter earnings for 2015 is attached hereto.
Section 7 – Regulation FD
ITEM 7.01 - Regulation FD Disclosure
On October 28, 2015, The Eastern Company released the third quarter earnings of 2015. A copy of the Press Release dated October 28, 2015 announcing the third quarter earnings for 2015 is attached hereto.
Section 9 – Financial Statements and Exhibits
ITEM 9.01 - (d) Exhibits
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(99)
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Press Release dated October 28, 2015 announcing the third quarter earnings for 2015.
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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.
The Eastern Company
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Date: October 28, 2015
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/s/John L. Sullivan III
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John L. Sullivan III
Vice President and Chief Financial Officer
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Exhibit 99
FOR IMMEDIATE RELEASE
October 28, 2015
THE EASTERN COMPANY REPORTS RESULTS
FOR THE THIRD QUARTER AND NINE MONTHS OF 2015
Naugatuck, CT–The Eastern Company (NASDAQ-EML) today announced the results of its operations for the third quarter and nine months of 2015. Sales for the quarter were $36.2 million, compared to $35.8 million for the same period in 2014. Net income for the third quarter was $2.5 million or $0.41 per diluted share, compared to the $2.4 million or $0.39 per diluted share, reported in the third quarter of 2014.
Net sales for the nine months of 2015 were $110.2 million compared to $106.4 million for the first nine months of 2014, a 4% increase. For the nine month period ended October 3, 2015 net income was $4.0 million or $0.64 per diluted share, compared to $5.6 million or $0.90 per diluted share for the same period in 2014.
Leonard F. Leganza, Chairman, President and CEO, stated, “The Industrial Hardware Segment experienced sales growth of 9% and 5%, respectively, in the third quarter and nine months of 2015 compared to the same periods in 2014. The sales growth in the third quarter and nine months reflect a combination of increased sales from our new composite panel production facility located in North Carolina where the company manufactures sleeper cabs for Western Star’s new Class 8 truck 6900 series, also a surge in military aftermarket orders to equip “up armored” Humvees which are being retrofitted for lighter duty operations. In addition, the Company experienced an increase in sales of our paddle rotary latches and hinges for the Class 5 and 6 light service body vehicles and increased sales of latching hardware for new model vehicles for the recreational sports market. We anticipate that this broad trend of markets growth will continue through the fourth quarter.”
Mr. Leganza, continued, “Sales in the Security Products Segment for the third quarter and nine months were up 9% and 15% respectively. Sales of our electronic payment solution products are increasing as demand in both domestic and foreign markets are beginning to gain more momentum. Sales and earnings of the segment were also impacted favorably as a result of including the operating results from the acquisition of Argo Transdata in December 2014. That acquisition has been fully integrated and is accretive to our earnings. Sales were adversely affected by the sharp decline in our Metal Product Segment of 25% and 16%, respectively, for the third quarter and nine months of 2015 compared to the same periods in 2014. Softness in the coal mining industry continued to dampen our operating results of our Metal Product Segment in this year's third quarter and the nine months. In addition, lower oil and gas prices coupled with excessive coal inventories, have also sharply reduced demand for coal and our mining products in the U.S. We expect this market to remain soft throughout 2016. To counteract the decline in the U.S. mining industry we are working on new mining products which are currently being tested in Europe and Latin America to further expand our international mining presence. In addition to mining products we are very enthusiastic about the large number of active projects we are currently working on for the contract casting portion of our business. Our expertise in pouring both ductile and malleable iron, together with our many improved operating efficiencies, has increased our opportunities to expand our business in this $6 billion dollar casting market”.
Mr. Leganza added, “Net income in the third quarter of 2015 was also affected favorably as the result of lower commodity prices as world metal prices continued to fall. However, earnings for the first nine months of 2015 were significantly lower due to the one-time expenses incurred during a proxy contest in the first half of the year. The proxy contest expenses had a significant negative impact on the year to date earnings of approximately ($0.21) per diluted share. No further expenses relating to the proxy contest were incurred during the third quarter of 2015 and no further expenses are anticipated.”
Mr. Leganza concluded, “As previously noted in an earlier news release, we were pleased that the Company recently paid its 300th consecutive quarterly dividend on September 15, 2015 marking the 75th year of uninterrupted quarterly dividends to our shareholders. In addition, the Board of Directors in its goal to improve our governance policies, previously announced the termination of our 2008 Shareholder Rights Agreement which was a positive step towards modifying those governance policies. The Board is also carefully reviewing other governance practices including board classes and majority voting in an effort toward continuing to enhance the Company’s governance policies.”
About the Company
The Eastern Company is a 157-year-old manufacturer of industrial hardware, security products and metal castings. It operates from 13 locations in the U.S., Canada, Mexico, Taiwan and China. The diversity of the Company’s products helps it to respond to the changing requirements of a broad array of markets. More information on the Company can be found at www.easterncompany.com
Safe Harbor for Forward-Looking Statements
Statements in this document about the Company’s future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” “estimates” and similar expressions) should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including those set forth in the Company’s reports and filings with the U.S. Securities and Exchange Commission. The Company is not obligated to update or revise any forward-looking statements as a result of developments occurring after the date of this document.
The Eastern Company
Leonard F. Leganza or John L. Sullivan III, 203-729-2255
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Statement of Consolidated Income (unaudited)
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THE EASTERN COMPANY (NASDAQ - EML)
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THREE Months Ended
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NINE Months Ended
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13 wks
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13 wks
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39 wks
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39 wks
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||||||
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Oct. 3, 2015
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Sept. 27, 2014
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Oct. 3, 2015
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Sept. 27, 2014
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Net Sales
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$36,239,500
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$ 35,803,405
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$110,154,039
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$106,432,304
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Net Income After Tax
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$ 2,527,722
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$ 2,431,817
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$ 3,986,267
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$ 5,628,205
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Net Income Per Share:
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Basic
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$ 0.41
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$ 0.39
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$ 0.64
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$ 0.90
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Diluted
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$ 0.41
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$ 0.39
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$ 0.64
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$ 0.90
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Weighted average
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|||||||||
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shares outstandings:
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|||||||||
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Basic
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6,245,099
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6,223,140
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6,244,534
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6,222,678
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Diluted
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6,245,099
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6,240,396
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6,244,534
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6,239,805
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