SOURCE: Continental Materials Corporation

November 13, 2006 17:00 ET

Continental Materials Corporation Reports Third Quarter Results

CHICAGO, IL -- (MARKET WIRE) -- November 13, 2006 -- Continental Materials Corporation (AMEX: CUO) today reported net income of $529,000, 33 cents per diluted share for its third quarter, on sales of $40,924,000. In the prior year's quarter, net income was $1,038,000, 66 cents per diluted share on sales of $36,415,000.

All segments except Door reported increased sales for the quarter lead by a 20% increase from the Concrete, Aggregates and Construction Supplies (CACS) segment. The increased CACS volume was primarily due to three large jobs in the Pueblo area. Pricing also improved although the increases were largely instituted to offset increased cement and fuel costs.

Operating income for the 2006 quarter declined to $915,000 from $1,552,000 in the 2005 quarter despite the increased volume. Narrower margins were reported primarily in the Heating and Cooling and Evaporative Cooling segments due to increased copper, aluminum and steel costs. Selling and administrative costs were significantly higher in the Heating and Cooling segment due to the addition of personnel in the sales and engineering departments and the opening of a sales and service center in Oklahoma City, Oklahoma.

For the first nine months of 2006, net income was $1,658,000, $1.03 per diluted share. In the prior year, the company reported net income of $1,695,000, $1.03 per diluted share.

Consolidated sales for the nine-month period increased $13,867,000 to $118,312,000. All segments reported higher sales, with the CACS segment responsible for $12,059,000 of the improved sales. The CACS volume increased for the reasons noted above as well as more favorable weather in Colorado during the first quarter of 2006 as compared to the 2005 period. The operating results for the nine-month period ended September 30, 2006 were $2,871,000 compared to $2,516,000 for the prior year period as a result of the stronger sales. In addition, the operating performance of the Heating and Cooling and the Evaporative Cooling segments were both better during the first six months of the year prior to the material cost increases which did not significantly affect our results until the third quarter.


                    CONTINENTAL MATERIALS CORPORATION
                      SUMMARY OF SALES AND EARNINGS
                                (Unaudited)



                      Three Months Ended           Nine Months Ended
                  September 30,  October 1,   September 30,    October 1,
                      2006          2005          2006           2005
                  ------------  ------------  -------------  -------------

Sales             $ 40,924,000  $ 36,415,000  $ 118,312,000  $ 104,445,000

Operating income       915,000     1,552,000      2,871,000      2,516,000

Interest expense,
 net                  (250,000)     (225,000)      (548,000)      (515,000)

Other income           137,000        37,000        189,000        107,000
                  ------------  ------------  -------------  -------------

Income before
 income taxes          802,000     1,364,000      2,512,000      2,108,000

Provision for
 income taxes          273,000       326,000        854,000        413,000
                  ------------  ------------  -------------  -------------

Net income        $    529,000  $  1,038,000  $   1,658,000  $   1,695,000
                  ============  ============  =============  =============

Basic earnings
 per share        $        .33  $        .66  $        1.03  $        1.06
                  ============  ============  =============  =============
Average shares
 outstanding         1,605,000     1,563,000      1,605,000      1,601,000
                  ============  ============  =============  =============

Diluted earnings
 per share        $        .33  $        .65  $        1.03  $        1.03
                  ============  ============  =============  =============
Average shares
 outstanding         1,605,000     1,596,000      1,605,000      1,643,000
                  ============  ============  =============  =============



Contact Information

  • CONTINENTAL MATERIALS CORPORATION
    200 SOUTH WACKER DRIVE, SUITE 4000
    CHICAGO, IL 60606-5821

    CONTACT:
    Mark S. Nichter
    (312) 541-7207