Harvard Industries, Inc. Files For
Bankruptcy Protection, Reports Second-Quarter Results
TAMPA, Fla., May 8, 1997 - Harvard Industries, Inc., a major
producer of OEM automotive parts and accessories, today announced
that it had filed for protection under Chapter 11 of the U.S.
Bankruptcy Code in the U.S. Bankruptcy Court for the District of
Delaware. The action was precipitated by continued operating
losses at Harvard's Doehler-Jarvis subsidiary, and the need to
reorganize the Company's capital structure, according to
Harvard's chairman, John W. Adams.
"While Doehler-Jarvis, a pioneer in the castings
industry, may be profitable in the long run, Harvard Industries
cannot support this subsidiary's current capital requirements and
still adequately finance its profitable subsidiaries," Adams
explained.
"We believe this filing to be a prudent action, which
will ultimately ease Harvard's debt burden, increase the
Company's liquidity, and permit us to focus on our highly
successful core businesses," Adams said.
"It is our intention to move forward under court
protection with submission of a reorganization plan as quickly as
possible. We intend to propose full payment to our suppliers as
part of our plan, and expect to emerge from the process with
substantially reduced debt. Harvard Industries is open for
business today and will be in the future. We intend to meet our
obligations to our customers, our vendors, our employees and our
shareholders as a leading supplier to the automotive and related
industries," said Adams.
Harvard has secured a commitment for $175 million in
Debtor-In-Possession financing, which includes the pre-petition
facility, enabling it to support continuing operations at its
subsidiaries, pay its suppliers on an ongoing basis and continue
prompt delivery of automotive components to customers.
The Company's core business consists of Harvard's
Kingston-Warren, Hayes- Albion and Trim Trends subsidiaries,
employing approximately 4300 people. These subsidiaries - which
account for over $400 million in annual sales - manufacture
automotive glass- run channels and body sealing systems, cast
metal products and fabricated metal components for automobiles
and light trucks manufactured in North America and abroad.
The Company is seeking buyers for its Doehler-Jarvis
subsidiary - which manufactures die-cast metal automotive
components; Harman Automotive - a manufacturer of outside
rearview mirror systems and exterior door handles; and Harvard
Interiors - a manufacturer and assembler of office furniture and
defense components. The Company has engaged Houlihan Lokey Howard
& Zukin to assist with the sale of Doehler-Jarvis, and to
provide financial advisory services.
Harvard Reports Results For Second Quarter Ended March 31,
1997 Consolidated net sales for the quarter ended March 31, 1997
amounted to $209,226,000, compared with $200,821,000 for the
quarter ended March 31, 1996.
After deducting accrued dividends and accretions related to
the Company's 14 1/4% PIK Preferred Stock of $4,224,000 and
$3,712,000 for the quarters ended March 31, 1997 and 1996,
respectively, the net loss for the quarter ended March 31, 1997
attributable to common shareholders was $172,378,000, or a net
loss of $24.57 per common share, compared with $24,674,000 or a
net loss of $3.53 per common share, for the quarter ended March
31, 1996.
Consolidated net sales for the six months ended Match 31, 1997
amounted to $396,487,000, compared with $411,357,000 for the six
months ended March 31, 1996.
After deducting accrued dividends and accretions related to
the Company's 14 1/4% PIK Preferred Stock of $8,448,000 and
$7,422,000 for the six months ended March 31, 1997 and 1996,
respectively, the net loss for the six months ended March 31,
1997 attributable to common shareholders was $206,770,000, or a
net loss of $29.47 per common share, compared with $30,108,000 or
a net loss of $4.30, for the six months ended March 31, 1996.
The Company attributes the net loss primarily to the continued
operational inefficiencies at the Company's Doehler-Jarvis and
Harman Automotive subsidiaries, impairment of long-lived assets,
as well as continued high interest expense and other expenses.
This release contains forward-looking statements. Additional
written or oral forward-looking statements may be made by the
Company from time to time, in filings with the Securities and
Exchange Commission or otherwise. Such forward-looking statements
are within the meaning of that term in Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Such statements may include, but not be limited to,
projections of revenues, income or losses, capital expenditures,
plans for future operations, including the possible sale of
underperforming operations, financing needs or plans, plans
relating to products or services of the Company, as well as
assumptions relating to the foregoing.
Forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted or quantified.
Consequently, future events and actual results could differ
materially from those set forth in, contemplated by, or
underlying the forward-looking statements. Other factors that
could contribute to or cause such differences include the effects
of the bankruptcy filing upon suppliers, vendors and customers,
unanticipated increases in launch and other operating costs, and
a reduction and inconsistent demand for passenger cars and light
trucks.
Harvard Industries, Inc., through its subsidiaries, designs,
develops and manufactures a broad range of components for
original equipment manufacturers, producing cars and light trucks
in North America and abroad.
HARVARD
INDUSTRIES, INC.
CONSOLIDATED BALANCE
SHEETS
MARCH 31, 1997 AND
SEPTEMBER 30, 1996
(In thousands of
dollars)
March 31,
September
30,
1997
1996
ASSETS (Unaudited)
(Audited)
Current assets:
Cash and cash equivalents $2,448
$ 1,107 Accounts receivable,
net 100,762 99,581
Inventories 57,896
53,901 Prepaid expenses and
other
current assets 2,224
1,637
Total current assets 163,330
156,226
Property, plant and equipment,
net 275,623
300,673
Intangible assets, net 5,209
127,250 Other assets, net
34,401 33,556
$478,563
$617,705
LIABILITIES AND SHAREHOLDERS' DEFICIENCY
Current liabilities:
Debt in default $398,147
$--- Current portion of
long
term debt ---
1,487
Accounts payable 102,614
89,073 Accrued expenses
68,959 66,949
Income taxes payable 3,582
5,875
Total current liabilities 573,302
163,384
Long-term debt ---
359,116 Postretirement
benefits
other than pensions 103,385
100,464
Other 31,375
25,970
Total liabilities 708,062
648,934
14 1/4% Pay-In-Kind
Exchangeable Preferred Stock,
($123,464 liquidation value at
March 31, 1997 -- includes
$8,214 of undeclared dividends
payable September 30, 1997) 122,943
114,495
Shareholders' deficiency:
Common Stock, $.01 par value;
30,000,000 shares authorized;
shares issued and outstanding:
7,017,767 at March 31,
1997 and 7,014,357 at
September 30, 1996 70
70
Additional paid-in capital 33,820
42,245 Additional minimum
pension
liability (1,767)
(1,767)
Foreign currency translation
adjustment (1,935)
(1,964)
Accumulated deficit (382,630)
(184,308)
Total shareholders'
deficiency (352,442)
(145,724)
Commitments and contingent
liabilities
$478,563
$617,7O5
HARVARD
INDUSTRIES, INC.
CONSOLIDATED STATEMENTS
OF OPERATIONS
THREE AND SIX MONTHS ENDED
MARCH 31,1997 AND 1996
(Unaudited)
(In thousands of dollars, except
share and per share data)
Three months ended
Six months
ended
March 31, March
31, March 31,
March 31,
1997 1996
1997
1996
Sales $209,226
$200,821 $396,487
$411,357
Costs and expenses:
Cost of sales 209,972
196,426 400,434
384,776
Selling, general and
administrative 14,385
11,945 24,590
22,199
Interest expense 12,144
10,311 24,332
20,361
Amortization of goodwill3,828
2,582 7,656
5,164
Other (income)
expense, net 1,539
(30) 1,797
94
Impairment of long-lived
assets 134,987
--- 134,987
---
Total costs and
expenses 376,855
221,234 593,796
432,594
Loss before income
taxes (167,629)
(20,413) (197,309)
(21,237)
Provision for income
taxes 525
549 1,013
1,449
Net loss $(168,154)
$(20,962) $(198,322)
$(22,686)
PIK preferred dividends
and accretion $4,224
$3,712 $8,448
$7,422
Net loss attributable
to common
shareholders $(172,378)
$(24,674) $(206,770)
$(30,108)
Primary per common and
common equivalent share:
Loss per common and
common equivalent
share $(24.57)
$(3.53) $(29.47)
$(4.30)
Weighted average number of
common and common
equivalent shares,
outstanding 7,017,160
6,997,157 7,016,126
6,996,032
HARVARD
INDUSTRIES, INC.
CONSOLIDATED STATEMENTS
OF CASH FLOWS
SIX MONTHS ENDED MARCH
31,1997 AND 1996
(UNAUDITED)
(In thousands of
dollars)
Six
mont
hs
ende
d
March 31,
March 31,
1997
1996
Cash flows related to
operating activities:
Loss from continuing
operations $(198,322)
$(22,686)
Add back (deduct) items not
affecting cash and cash
equivalents:
Depreciation and amortization34,718
25,901 Impairment of
long-lived
assets 134,987
---
Loss on disposition of
property, plant and equipment
and property held for sale 1,208
982
Postretirement benefits 3,499
3,848
Changes in operating assets and
liabilities of continuing
operations, net of effects
from acquisitions and
reorganization items:
Accounts receivable (1,181)
1,871 Inventories
(3,995)
1,853 Other current assets
(587) 167
Accounts payable 13,541
(6,870) Accrued expenses
and
income taxes payable 2,166
(16,064)
Other noncurrent liabilities4,977
474
Net cash used in continuing
operations (8,989)
(10,524)
Cash flows related to investing
activities:
Acquisition of property, plant
and equipment (20,313)
(20,787)
Cash flows related to
discontinued operations 204
2,673
Proceeds from disposition
of property, plant and equipment395
663
Net change in other
noncurrent accounts (2,889)
(1,070)
Net cash used in investing
activities (22,603)
(18,521)
Cash flows related to
financing activities:
Net borrowings under
financing/credit agreement 38,274
18,000
Proceeds from sale of stock/
exercise of stock options 23
29
Repayments of long-term debt (730)
(1,366) Pension fund
payments pursuant
to PBGC settlement agreement(3,000)
(3,000)
Payment of EPA settlements (1,634)
(810)
Net cash provided by
financing activities 32,933
12,853
Net increase (decrease) in
cash and cash equivalents 1,341
(16,192) Beginning of period
1,107 19,925
End of period $2,448
$3,733
SOURCE Harvard Industries, Inc. /CONTACT: Richard T. Dawson,
Harvard Industries, 888-234-7920, or 813-288-5000; or Stephen J.
Kasser, Public Communications Inc., 813-226-2772/
PacifiCorp Offers $75 Million
Enhanced Value to Big Rivers
HENDERSON, Ky., May 8, 1997 - PacifiCorp Kentucky Energy
Company (PKEC), an indirect subsidiary of PacifiCorp (NYSE: PPW),
today submitted a new proposal to Big Rivers Electric
Corporation, valued at $75 million more than a bid submitted by
LG&E in March.
"In keeping with the charge of the U.S. Bankruptcy Court
to maximize value, this proposal adds $75 million to the value of
Big Rivers, when compared to the transaction apparently still
under negotiation between Big Rivers and LG&E," said Don
Furman, president of PacifiCorp Power Marketing, Inc.
In addition, PKEC would waive its claim against Big Rivers,
which it believes exceeds $25 million, bringing the total
enhancement over the LG&E proposal to $100 million.
PacifiCorp and Big Rivers signed an omnibus agreement last
August under which PacifiCorp Kentucky Energy will lease and
operate Big Rivers generation facilities for an annual lease
payment of $30.1 million per year for 25 years. Under the
agreement, Big Rivers buys power from PKEC for its four
distribution cooperative members serving 91,000 retail customers
in western Kentucky. PKEC retains the surplus power and will sell
it into the eastern power markets.
Furman said the new proposal adds $125 million in value over
the previous PacifiCorp offer, including $72 million for a
reduction of the price Big Rivers will pay for power purchased
from PKEC, along with having Big Rivers retain four wholesale
power sales contracts, and $53 million by contracting with
SIGCORP, Inc., Evansville, Ind., the parent company of Southern
Indiana Gas and Electric Company (SIGECO), to handle dispatching,
transmission supervision and maintenance and billing.
Under the proposal, SIGCORP would give preference to Big
Rivers employees in hiring to perform additional workload. In
addition, SIGCORP and PacifiCorp would offer to any displaced Big
Rivers' employees the opportunity to apply for other positions
for which they are qualified.
"In preparing our new proposal, we identified additional
benefits based on the experience PKEC gained during the year of
its interim marketing agreement with Big Rivers, as well as
nearly a year and a half of working jointly with Big Rivers on
reducing workforce requirements and obtaining other
efficiencies," Furman said.
"The interim marketing agreement alone added $4.4 million
in value to Big Rivers during the year it has been in
operation," Furman said.
As to timing, Furman said, "We've submitted basically the
same transaction documents to which the two companies agreed last
year - with the changes made to reflect the enhanced value of our
offer - and are prepared to sign the agreements." They have
been approved by the PacifiCorp Board of Directors.
Big Rivers selected PacifiCorp late in 1995 in a competitive
bidding process to lease and operate its generating facilities as
part of the cooperative's plan to work through its financial
challenges.
Judge Roberts ordered a new auction process earlier this year
in which only LG&E submitted a bid.
"PKEC, and others, did not submit a bid in the Bankruptcy
Court process because we were unwilling and should not have been
required to waive our legal rights, which Judge Roberts imposed
as a condition of participating in the auction," Furman
said.
"Our proposal today is timely because it appears from the
new plan of reorganization and disclosure statement submitted by
Big Rivers that no agreement has been reached between Big Rivers
and LG&E on the terms of the transaction," Furman said.
"Very few details of the transaction are available."
A hearing is scheduled May 12 in U.S. Bankruptcy Court on the
adequacy of the disclosure statement.
Big Rivers is a generation and transmission cooperative
serving Green River Electric Corporation, Henderson Union
Electric Cooperative, Jackson Purchase Electric Cooperative and
Meade County Rural Electric Cooperative Corporation.
PacifiCorp, based in Portland, Oregon, serves 1.4 million
retail customers in the western United States and has more than
100 wholesale power customers nationwide. In addition, PacifiCorp
has 550,000 retail customers in Australia.
SOURCE PacifiCorp/CONTACT: media, Dave Kvamme, 503-464-6272,
or investors, Angela Hult, 503-731-2192, both of PacifiCorp/
/PacifiCorp press releases available through Company News On-
Call by fax, 800-758-5804, ext. 687526, or at
http://www.prnewswire.com/