Despite a drop in sales and profits last year, Bandag chairman and CEO Martin Carver says the company is in a better position than it's ever been to meet the challenges of an evolving industry.
Bandag posted 1999 net earnings of $52.3 million on sales of $1.0 billion versus 1998 earnings of $59.3 million on sales of $1.1 billion. Fourth quarter earnings were $8.1 million on sales of $263.2 million versus $18.5 million on sales of $275 million the year before.
The company said that tread volume globally was down 6% for both the quarter and the year. Bandag's profits were affected by restructuring costs, principally in the North American operations.
"While the North American restructuring program affected fourth quarter and full year results, it also sucessfully streamlined the organization, focusing our resources on key intiatives," said Carver. "An important measure of our strength in 1999 was evident in Bandag's national account business, through which we signed several new fleet customers."
Sales of Bandag's Tire Distribution Systems subsidiary were up 4% for the quarter, excluding sales of operations acquired in 1999. Sales for the year were down 2%, which the company attributed to the discontinuation of some off-road tires.
The company's Tire Management Solutions subsidiary, which provides tire management systems to Roadway Express, hasn't yet shown a profit but Carver said Roadway is "pleased with the fleet uptime and service provided by TMS."
The first two dealers have signed up for SystemBandag, the company's new tire management system. Carver said that in early February Bandag will unveil three new pieces of equipment, each designed to deliver significant improvements in productivity, finished product quality, manufcturing cost and dealer profitibility.
"We are confident that evolving opportunities in our rapidly changing instry will continue to verify the strength of Bandag's vision and its mission," he said.