Tremont Reports First Quarter Results

Apr 25, 2001, 01:00 ET from Tremont Corporation

    DENVER, April 25 /PRNewswire / -- Tremont Corporation (NYSE:   TRE) reported
 net income for the first quarter of 2001 of $4.5 million, or $.72 per diluted
 share, compared to a net loss of $1.8 million, or $.30 per share, for the same
 quarter in 2000.
     The Company's equity in earnings of 39%-owned TIMET was $.1 million in the
 first quarter of 2001 compared to a loss before extraordinary item of
 $4.0 million in the first quarter of 2000.  TIMET reported a loss before
 special items of $3.8 million in the first quarter of 2001 compared to a loss
 before special and extraordinary items of $8.3 million in the first quarter of
 2000.  TIMET sales of $124 million in the first quarter of 2001 were
 18% higher than the year-ago period.  This resulted principally from the net
 effects of an 18% increase in mill product sales volume, a 4% decrease in mill
 product selling prices (expressed in U.S. dollars using actual foreign
 currency exchange rates prevailing during the respective periods) and changes
 in product mix.  In billing currencies (which exclude the effects of foreign
 currency translation), mill product selling prices decreased 1%.  Melted
 product (ingot and slab) sales volume increases of 75% from year-ago levels
 were partially offset by selling price decreases of 3%.
     As compared to the fourth quarter of 2000, TIMET's sales were impacted by
 an 8% increase in mill product sales volume, a 3% increase in mill product
 selling prices (expressed in U.S. dollars) and changes in product mix.  In
 billing currencies, mill product selling prices increased 2%.  Melted product
 sales volume in the first quarter of 2001 was unchanged compared to the fourth
 quarter of 2000, while selling prices increased 7%.  TIMET's backlog at March
 31, 2001 was approximately $290 million, compared to $185 million at the end
 of March 2000 and $245 million at year-end 2000.
     In April 2001, TIMET announced that it had reached a settlement of the
 litigation between TIMET and The Boeing Company ("Boeing") relating to the
 parties' 1997 long-term titanium purchase and supply agreement.  TIMET will
 receive a cash payment pursuant to the settlement.  The parties have also
 entered into an amended long-term agreement that, among other things, provides
 Boeing with the right to purchase up to 7.5 million pounds of titanium
 products annually from TIMET through 2007.  TIMET expects to report pre-tax
 income of approximately $60 million to $65 million in the second quarter of
 2001 in connection with this settlement, including the cash settlement net of
 associated legal, profit sharing, and other costs.
     The Company's equity in earnings of 20%-owned NL Industries was
 $6.1 million in the first quarter of 2001 compared to $3.9 million in the
 first quarter of 2000.  NL reported net income of $34.6 million for the first
 quarter of 2001 compared to net income of $23.7 million in the first quarter
 of 2000.  Operating income of Kronos' titanium dioxide pigments ("TiO(2)")
 business in the first quarter of 2001 increased 12% to $51.9 million compared
 to $46.2 million in the first quarter of 2000.  The improved operating income
 is primarily due to higher average selling prices in billing currencies and
 higher production volume, partially offset by lower sales volume.
     Kronos' average selling price in billing currencies (which excludes the
 effects of foreign currency translation) during the first quarter of 2001 was
 5% higher than the first quarter of 2000 and 1% lower than the fourth quarter
 of 2000.  Compared to the fourth quarter of 2000, prices were lower in all
 major markets.  The average selling price in billing currencies in March was
 1% lower than the average selling price during the first quarter.  Kronos'
 first-quarter 2001 average selling price expressed in U.S. dollars computed
 using actual foreign currency exchange rates prevailing during the respective
 periods was 1% higher than the first quarter of 2000 and 2% higher than the
 fourth quarter of 2000.
     Kronos' first-quarter 2001 sales volume decreased 7% from the record first
 quarter of 2000 and increased 11% from the fourth quarter of 2000.  Sales
 volume in the first quarter of 2001 was 7% and 11% lower in Europe and North
 America, respectively, compared to the first quarter of 2000 while export
 volume increased by 7%.  Compared to the fourth quarter of 2000, sales volume
 increased by more than 10% in each of Kronos' major markets.  Finished goods
 inventory levels at the end of March increased slightly from December
 2000 levels and represent about two months of sales.
     First-quarter 2001 production volume was 2% higher than the comparable
 2000 period with operating rates near full capacity in both periods.
 Production at NL's Leverkusen facility was adversely affected late in the
 first quarter by the previously reported fire.  Production rates at NL's
 Leverkusen chloride-process plant returned to full capacity on April 8th, and
 NL's Leverkusen sulfate-process plant is expected to be over 50% operational
 in August 2001 and fully operational in October 2001.
     NL believes that the damages to property and the business interruption
 losses caused by the fire are covered by insurance.  No insurance proceeds
 have been recognized during the first quarter of 2001 for the business
 interruption portion of the loss because the amount of such proceeds is
 presently not determinable.  No provision for impairment of the damaged fixed
 assets has been recognized because NL believes the insurance proceeds will
 exceed their carrying value.
     An agreement was reached in January 2001 with the remaining members of
 NL's remaining principal former insurance carrier group to settle certain
 insurance coverage claims.  NL recognized a $10.3 million net pretax gain in
 the first quarter of 2001.  A majority of the proceeds from the settlement
 were transferred by the remaining members of the insurance carrier group in
 April to a special-purpose trust established to pay future remediation and
 other environmental expenditures of NL.
     The Company's equity in earnings of other joint ventures principally
 represents earnings from its real estate development partnership.  The
 Company's effective tax rate for the first quarter of 2001 is less than the
 statutory income tax rate because a portion of the Company's equity in
 earnings of NL are tax-free to the extent the Company receives dividends from
 NL.
 
     The statements contained in this release that are not historical facts are
 forward-looking statements that represent management's beliefs and assumptions
 based on currently available information.  Forward-looking statements can be
 identified by the use of words such as "believes," "intends," "may," "will,"
 "looks," "should," "could," "anticipates," "expects" or comparable terminology
 or by discussions of strategy or trends.  Although the Company believes that
 the expectations reflected in such forward-looking statements are reasonable,
 it cannot give any assurances that these expectations will prove to be
 correct.  Such statements by their nature involve substantial risks and
 uncertainties that could significantly affect expected results.  Actual future
 results could differ materially from those described in such forward-looking
 statements, and the Company disclaims any intention or obligation to update or
 revise any forward-looking statements, whether as a result of new information,
 future events or otherwise.  Among the factors that could cause actual results
 to differ materially are risks and uncertainties including, but not limited
 to, the cyclicality of TIMET's and NL's businesses, the sensitivity of TIMET's
 and NL's businesses to global industry capacity, the performance of The Boeing
 Company and other aerospace manufacturers under their long-term purchase
 agreements with the TIMET, the difficulty in forecasting demand for titanium
 products, global economic and political conditions, changes in product pricing
 and costs, the impact of long-term contracts with vendors or the ability to
 reduce or increase supply or achieve lower costs, operating interruptions,
 fluctuations in currency exchange rates, customer inventory levels,
 competitive technology positions, control by certain stockholders and possible
 conflicts of interest, uncertainties associated with new product development,
 the supply of raw materials and services, changes in raw material and other
 operating costs (including energy costs), recoveries from insurance claims and
 the timing thereof, the ultimate resolution of pending or possible future
 litigation and legislative developments and other risks and uncertainties
 included in the Company's filings with the Securities and Exchange Commission.
 Should one or more of these risks materialize (or the consequences of such a
 development worsen), or should the underlying assumptions prove incorrect,
 actual results could differ materially from those forecasted or expected.  The
 Company assumes no duty to update any forward-looking statements.
 
     Tremont, headquartered in Denver, Colorado, is principally a holding
 company with operations in the titanium metals business, conducted through
 TIMET, in the TiO(2) business, conducted through NL, and in real estate
 development, conducted through The Landwell Company.
 
 
                              TREMONT CORPORATION
 
                       SUMMARY OF CONSOLIDATED OPERATIONS
 
                      (In millions, except per share data)
                                  (Unaudited)
 
 
                                                           Quarters Ended
                                                              March 31,
                                                         2001           2000
 
     Equity in earnings (loss) of:
       TIMET                                              $.1         $ (4.0)
       NL Industries                                      6.1            3.9
       Other                                               .7             .3
                                                          6.9             .2
     Corporate expenses, net                               .6             .5
     Interest expense                                      .3             .3
 
       Income (loss) before taxes and minority interest   6.0            (.6)
 
     Income tax expense                                   1.5             .8
     Minority interest                                     --             .1
 
       Income (loss) before extraordinary item            4.5           (1.5)
 
     Equity in extraordinary loss of TIMET-
       early extinguishment of debt                        --            (.3)
 
       Net income (loss)                                 $4.5         $ (1.8)
 
     Earnings (loss) per share:
       Before extraordinary item:
         Basic                                           $.73         $ (.24)
         Diluted                                         $.72           (.24)
       Net income (loss):
         Basic                                           $.73         $ (.30)
         Diluted                                         $.72         $ (.30)
 
     Weighted average shares outstanding:
       Common shares                                      6.2            6.4
       Diluted shares                                     6.3            6.4
 
 
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SOURCE Tremont Corporation
    DENVER, April 25 /PRNewswire / -- Tremont Corporation (NYSE:   TRE) reported
 net income for the first quarter of 2001 of $4.5 million, or $.72 per diluted
 share, compared to a net loss of $1.8 million, or $.30 per share, for the same
 quarter in 2000.
     The Company's equity in earnings of 39%-owned TIMET was $.1 million in the
 first quarter of 2001 compared to a loss before extraordinary item of
 $4.0 million in the first quarter of 2000.  TIMET reported a loss before
 special items of $3.8 million in the first quarter of 2001 compared to a loss
 before special and extraordinary items of $8.3 million in the first quarter of
 2000.  TIMET sales of $124 million in the first quarter of 2001 were
 18% higher than the year-ago period.  This resulted principally from the net
 effects of an 18% increase in mill product sales volume, a 4% decrease in mill
 product selling prices (expressed in U.S. dollars using actual foreign
 currency exchange rates prevailing during the respective periods) and changes
 in product mix.  In billing currencies (which exclude the effects of foreign
 currency translation), mill product selling prices decreased 1%.  Melted
 product (ingot and slab) sales volume increases of 75% from year-ago levels
 were partially offset by selling price decreases of 3%.
     As compared to the fourth quarter of 2000, TIMET's sales were impacted by
 an 8% increase in mill product sales volume, a 3% increase in mill product
 selling prices (expressed in U.S. dollars) and changes in product mix.  In
 billing currencies, mill product selling prices increased 2%.  Melted product
 sales volume in the first quarter of 2001 was unchanged compared to the fourth
 quarter of 2000, while selling prices increased 7%.  TIMET's backlog at March
 31, 2001 was approximately $290 million, compared to $185 million at the end
 of March 2000 and $245 million at year-end 2000.
     In April 2001, TIMET announced that it had reached a settlement of the
 litigation between TIMET and The Boeing Company ("Boeing") relating to the
 parties' 1997 long-term titanium purchase and supply agreement.  TIMET will
 receive a cash payment pursuant to the settlement.  The parties have also
 entered into an amended long-term agreement that, among other things, provides
 Boeing with the right to purchase up to 7.5 million pounds of titanium
 products annually from TIMET through 2007.  TIMET expects to report pre-tax
 income of approximately $60 million to $65 million in the second quarter of
 2001 in connection with this settlement, including the cash settlement net of
 associated legal, profit sharing, and other costs.
     The Company's equity in earnings of 20%-owned NL Industries was
 $6.1 million in the first quarter of 2001 compared to $3.9 million in the
 first quarter of 2000.  NL reported net income of $34.6 million for the first
 quarter of 2001 compared to net income of $23.7 million in the first quarter
 of 2000.  Operating income of Kronos' titanium dioxide pigments ("TiO(2)")
 business in the first quarter of 2001 increased 12% to $51.9 million compared
 to $46.2 million in the first quarter of 2000.  The improved operating income
 is primarily due to higher average selling prices in billing currencies and
 higher production volume, partially offset by lower sales volume.
     Kronos' average selling price in billing currencies (which excludes the
 effects of foreign currency translation) during the first quarter of 2001 was
 5% higher than the first quarter of 2000 and 1% lower than the fourth quarter
 of 2000.  Compared to the fourth quarter of 2000, prices were lower in all
 major markets.  The average selling price in billing currencies in March was
 1% lower than the average selling price during the first quarter.  Kronos'
 first-quarter 2001 average selling price expressed in U.S. dollars computed
 using actual foreign currency exchange rates prevailing during the respective
 periods was 1% higher than the first quarter of 2000 and 2% higher than the
 fourth quarter of 2000.
     Kronos' first-quarter 2001 sales volume decreased 7% from the record first
 quarter of 2000 and increased 11% from the fourth quarter of 2000.  Sales
 volume in the first quarter of 2001 was 7% and 11% lower in Europe and North
 America, respectively, compared to the first quarter of 2000 while export
 volume increased by 7%.  Compared to the fourth quarter of 2000, sales volume
 increased by more than 10% in each of Kronos' major markets.  Finished goods
 inventory levels at the end of March increased slightly from December
 2000 levels and represent about two months of sales.
     First-quarter 2001 production volume was 2% higher than the comparable
 2000 period with operating rates near full capacity in both periods.
 Production at NL's Leverkusen facility was adversely affected late in the
 first quarter by the previously reported fire.  Production rates at NL's
 Leverkusen chloride-process plant returned to full capacity on April 8th, and
 NL's Leverkusen sulfate-process plant is expected to be over 50% operational
 in August 2001 and fully operational in October 2001.
     NL believes that the damages to property and the business interruption
 losses caused by the fire are covered by insurance.  No insurance proceeds
 have been recognized during the first quarter of 2001 for the business
 interruption portion of the loss because the amount of such proceeds is
 presently not determinable.  No provision for impairment of the damaged fixed
 assets has been recognized because NL believes the insurance proceeds will
 exceed their carrying value.
     An agreement was reached in January 2001 with the remaining members of
 NL's remaining principal former insurance carrier group to settle certain
 insurance coverage claims.  NL recognized a $10.3 million net pretax gain in
 the first quarter of 2001.  A majority of the proceeds from the settlement
 were transferred by the remaining members of the insurance carrier group in
 April to a special-purpose trust established to pay future remediation and
 other environmental expenditures of NL.
     The Company's equity in earnings of other joint ventures principally
 represents earnings from its real estate development partnership.  The
 Company's effective tax rate for the first quarter of 2001 is less than the
 statutory income tax rate because a portion of the Company's equity in
 earnings of NL are tax-free to the extent the Company receives dividends from
 NL.
 
     The statements contained in this release that are not historical facts are
 forward-looking statements that represent management's beliefs and assumptions
 based on currently available information.  Forward-looking statements can be
 identified by the use of words such as "believes," "intends," "may," "will,"
 "looks," "should," "could," "anticipates," "expects" or comparable terminology
 or by discussions of strategy or trends.  Although the Company believes that
 the expectations reflected in such forward-looking statements are reasonable,
 it cannot give any assurances that these expectations will prove to be
 correct.  Such statements by their nature involve substantial risks and
 uncertainties that could significantly affect expected results.  Actual future
 results could differ materially from those described in such forward-looking
 statements, and the Company disclaims any intention or obligation to update or
 revise any forward-looking statements, whether as a result of new information,
 future events or otherwise.  Among the factors that could cause actual results
 to differ materially are risks and uncertainties including, but not limited
 to, the cyclicality of TIMET's and NL's businesses, the sensitivity of TIMET's
 and NL's businesses to global industry capacity, the performance of The Boeing
 Company and other aerospace manufacturers under their long-term purchase
 agreements with the TIMET, the difficulty in forecasting demand for titanium
 products, global economic and political conditions, changes in product pricing
 and costs, the impact of long-term contracts with vendors or the ability to
 reduce or increase supply or achieve lower costs, operating interruptions,
 fluctuations in currency exchange rates, customer inventory levels,
 competitive technology positions, control by certain stockholders and possible
 conflicts of interest, uncertainties associated with new product development,
 the supply of raw materials and services, changes in raw material and other
 operating costs (including energy costs), recoveries from insurance claims and
 the timing thereof, the ultimate resolution of pending or possible future
 litigation and legislative developments and other risks and uncertainties
 included in the Company's filings with the Securities and Exchange Commission.
 Should one or more of these risks materialize (or the consequences of such a
 development worsen), or should the underlying assumptions prove incorrect,
 actual results could differ materially from those forecasted or expected.  The
 Company assumes no duty to update any forward-looking statements.
 
     Tremont, headquartered in Denver, Colorado, is principally a holding
 company with operations in the titanium metals business, conducted through
 TIMET, in the TiO(2) business, conducted through NL, and in real estate
 development, conducted through The Landwell Company.
 
 
                              TREMONT CORPORATION
 
                       SUMMARY OF CONSOLIDATED OPERATIONS
 
                      (In millions, except per share data)
                                  (Unaudited)
 
 
                                                           Quarters Ended
                                                              March 31,
                                                         2001           2000
 
     Equity in earnings (loss) of:
       TIMET                                              $.1         $ (4.0)
       NL Industries                                      6.1            3.9
       Other                                               .7             .3
                                                          6.9             .2
     Corporate expenses, net                               .6             .5
     Interest expense                                      .3             .3
 
       Income (loss) before taxes and minority interest   6.0            (.6)
 
     Income tax expense                                   1.5             .8
     Minority interest                                     --             .1
 
       Income (loss) before extraordinary item            4.5           (1.5)
 
     Equity in extraordinary loss of TIMET-
       early extinguishment of debt                        --            (.3)
 
       Net income (loss)                                 $4.5         $ (1.8)
 
     Earnings (loss) per share:
       Before extraordinary item:
         Basic                                           $.73         $ (.24)
         Diluted                                         $.72           (.24)
       Net income (loss):
         Basic                                           $.73         $ (.30)
         Diluted                                         $.72         $ (.30)
 
     Weighted average shares outstanding:
       Common shares                                      6.2            6.4
       Diluted shares                                     6.3            6.4
 
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X11527831
 
 SOURCE  Tremont Corporation