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2012 Annual Summary
Simserv-Pitka Enterprises
January 2013
Corporate Overview
The consumer products industry has seen dramatic change in the last decade, due to increasing costs in manufacturing, need for innovative products, and decrease in brand loyalty. These changes have created the need to modify previous tactics to continue operating in this competitive industry.
Acquisition of Pitka Industries
In November, Simserv completed the process for acquiring Pitka Industries to form Simserv-Pitka Enterprises. The combined resources provide a stronger, more versatile organization to create innovative products and compete during the next decade. Here is a breakdown of the combined organization’s divisions, their locations, and number of employees: Simserv Headquarters Cleveland 1,355 Pitka Division Seattle 1,235 Product Development Cincinnati 350 West Coast Distribution Fresno 123
2011 Operating Results
Despite the Pitka acquisition, significant progress in restructuring the Company, and reducing debt in 2011, our progress was not reflected in our 2011 earnings performance. In fact, while our actions are expected to provide substantial future returns through lower operating and debt service costs, the up-front costs to implement our plan reduced our 2011 earnings.
For 2012, Simserv-Pitka recorded earnings from continuing operations of $9.3 million as compared to $15.5 million in 2011. Income from continuing operations available to common stock was a loss of $2.25 million, or 3 cents per common share, as compared to income of $7.5 million, or 7.5 cents per common share in 2011.
2012 Capital Expenditures
Simserv-Pitka’s capital expenditures for 2012 totaled $173.7 million, compared to $148.6 million from continuing operations in 2011. Expenditures by our Research and Development group increased by approximately $30 million due to projects aimed at increasing our competitiveness and efficiency in production. The expansion into Texas
Simserv-Pitka Enterprises
January 2013
Corporate Overview
The consumer products industry has seen dramatic change in the last decade, due to increasing costs in manufacturing, need for innovative products, and decrease in brand loyalty. These changes have created the need to modify previous tactics to continue operating in this competitive industry.
Acquisition of Pitka Industries
In November, Simserv completed the process for acquiring Pitka Industries to form Simserv-Pitka Enterprises. The combined resources provide a stronger, more versatile organization to create innovative products and compete during the next decade. Here is a breakdown of the combined organization’s divisions, their locations, and number of employees: Simserv Headquarters Cleveland 1,355 Pitka Division Seattle 1,235 Product Development Cincinnati 350 West Coast Distribution Fresno 123
2011 Operating Results
Despite the Pitka acquisition, significant progress in restructuring the Company, and reducing debt in 2011, our progress was not reflected in our 2011 earnings performance. In fact, while our actions are expected to provide substantial future returns through lower operating and debt service costs, the up-front costs to implement our plan reduced our 2011 earnings.
For 2012, Simserv-Pitka recorded earnings from continuing operations of $9.3 million as compared to $15.5 million in 2011. Income from continuing operations available to common stock was a loss of $2.25 million, or 3 cents per common share, as compared to income of $7.5 million, or 7.5 cents per common share in 2011.
2012 Capital Expenditures
Simserv-Pitka’s capital expenditures for 2012 totaled $173.7 million, compared to $148.6 million from continuing operations in 2011. Expenditures by our Research and Development group increased by approximately $30 million due to projects aimed at increasing our competitiveness and efficiency in production. The expansion into Texas