CUNO Cuno (MM)

Cuno Reports Record Second Quarter Results * Record second quarter Sales of $82.7 million (up 19%) * Record second quarter diluted EPS of $0.49 (up 32%) * Record second quarter Operating Margin of 15.1% * Record second quarter Orders of $89.9 million MERIDEN, Conn., May 19 /PRNewswire-FirstCall/ -- CUNO Incorporated today reported record second quarter results for the period ended April 30, 2004. Sales were $82.7 million, up 19% versus the same period in 2003 and up 13% in local currency. Net income for the second quarter increased by 34% to $8.4 million from $6.3 million reported in the same period in 2003. Diluted earnings per share for the period were a second quarter record $0.49, up 32% compared to $0.37 in the prior year period and up approximately 22% on a currency-adjusted basis. Commenting on the Company's second quarter results, Mark G. Kachur, Chairman and Chief Executive Officer, said "Our record second quarter results reflect the strength and effectiveness of our business model. We achieved double-digit sales growth in each of our primary markets, including Potable Water, Healthcare and Fluid Processing. In addition, our geographic diversity contributed to our strong results, as international sales increased by 26% (up 12% in local currency), reflecting double-digit Sales growth in each of our major geographic segments." For the first six months of 2004, sales were a record $158.2 million, up 17% (up 9% in local currency), and net income was $15.4 million versus $11.7 million in the prior year first half. Particularly strong sales growth in our international operations supplemented solid growth in North America. Diluted earnings per share were a record $0.90, up 30% from $0.69 in the first six months of 2003 and up approximately 19% on a currency-adjusted basis. Commenting on business conditions and the outlook for CUNO, Mr. Kachur added, "Our incoming orders were a second quarter record $89.9 million and our backlog remains strong. As a result, we expect to achieve strong financial results in fiscal 2004, and are increasing our previous EPS guidance for the year to the $1.76-1.84 range (from $1.72-$1.80)." A conference call will be held Thursday, May 20 at 10:00 a.m. (EDT) to review the Company's second quarter financial results and business outlook. The call-in number is 1-888-273-9885 for interested analysts and investors. Alternatively, visit us at http://www.cuno.com/investors to access the webcast of our conference call. Also, visit us at http://www.cuno.com/ for additional information about the Company. CUNO is a world leader in the design, manufacture and marketing of a comprehensive line of filtration products for the separation, clarification and purification of liquids and gases. CUNO's products, which include proprietary depth filters and semi-permeable membrane filters, are used in the potable water, healthcare, and fluid processing markets. CUNO wants to provide shareowners and prospective investors with more meaningful and useful information and, therefore, this press release includes various comments regarding business conditions and the outlook for CUNO, which reflect currently available information. These forward-looking statements are subject to risks and uncertainties which could cause performance or actual results to differ materially from those expressed herein. Such risks and uncertainties include, among other things: volumes of shipments of CUNO's products; changes in product mix and product pricing; costs of raw materials; the rate of economic and industry growth in the U.S. and the other countries in which CUNO conducts business; economic and political conditions in the foreign countries in which CUNO conducts a substantial part of its operations and other risks associated with international operations including exchange rate fluctuations; CUNO's ability to protect its technology; continuing beneficial relationships with customers; proprietary products and manufacturing techniques; changes in technology; changes in legislative, regulatory or industrial requirements and risks generally associated with new product introductions and applications; and domestic and international competition in CUNO's global markets. CUNO assumes no obligation to update the information contained in this press release. Investor contact: Frederick C. Flynn, Jr. 203/238-8847 CUNO Incorporated Consolidated Statements of Income (unaudited) (dollars in thousands, except share and per-share amounts) Three Months Ended Six Months Ended April 30, April 30, 2004 2003 2004 2003 Net sales $82,745 $69,305 $158,154 $135,742 Less costs and expenses: Cost of products sold 43,676 38,027 84,229 74,710 Selling, general and administrative 22,510 18,238 42,748 36,027 Research, development and engineering 4,036 3,372 8,225 7,042 70,222 59,637 135,202 117,779 Operating income 12,523 9,668 22,952 17,963 Nonoperating income (expense): Interest expense (87) (134) (170) (281) Interest and other income, net 216 90 366 181 129 (44) 196 (100) Income before income taxes 12,652 9,624 23,148 17,863 Income taxes 4,208 3,320 7,699 6,171 Net income $8,444 $6,304 $15,449 $11,692 Basic earnings per common share $0.51 $0.38 $0.93 $0.70 Diluted earnings per common share $0.49 $0.37 $0.90 $0.69 Basic shares outstanding 16,694,466 16,638,881 16,690,853 16,601,152 Diluted shares outstanding 17,214,286 17,014,779 17,211,187 16,956,848 CUNO Incorporated Consolidated Condensed Balance Sheets (dollars in thousands) (unaudited) April 30, October 31, 2004 2003 Assets Current assets Cash and cash equivalents $59,737 $57,603 Accounts receivable, net 69,082 59,658 Inventories, net 36,696 31,058 Deferred income taxes 9,156 9,020 Prepaid expenses and other current assets 4,812 4,306 Total current assets 179,483 161,645 Noncurrent assets Deferred income taxes 1,333 1,340 Goodwill, net 29,379 28,489 Prepaid pension costs 7,943 7,923 Other noncurrent assets 5,232 3,551 Property, plant and equipment, net 88,557 85,060 Total assets $311,927 $288,008 Liabilities and Stockholders' Equity Current liabilities Current portion of long-term debt $213 $849 Short-term bank loans 11,242 11,804 Accounts payable 26,822 20,850 Accrued payroll and related taxes 15,722 17,456 Other accrued expenses 9,430 10,443 Accrued income taxes 5,196 2,558 Total current liabilities 68,625 63,960 Noncurrent liabilities Long-term debt, less current portion 539 401 Deferred income taxes 10,003 9,862 Accrued pension liability 5,631 5,457 Other long term liabilities 391 - Total noncurrent liabilities 16,564 15,720 Stockholders' equity Preferred Stock - - Common Stock 17 17 Treasury Stock, at cost (57) (57) Additional paid-in-capital 56,771 53,787 Unearned compensation (1,876) (784) Accumulated other comprehensive income (loss) -- Foreign currency translation adjustments 4,340 3,282 Minimum pension liability, net (2,049) (2,049) Fair value of derivative financial instruments, net 24 13 2,315 1,246 Retained earnings 169,568 154,119 Total stockholders' equity 226,738 208,328 Total liabilities and stockholders' equity $311,927 $288,008 DATASOURCE: CUNO Incorporated CONTACT: Frederick C. Flynn, Jr. of CUNO Incorporated, +1-203-238-8847, Company News On-Call: http://www.prnewswire.com/comp/126696.html

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