Zapata Corporation Announces 2003 Revenues Increase 55%
ROCHESTER, N.Y.--(BUSINESS WIRE)--March 26, 2004--Zapata Corporation (NYSE:ZAP) today announced its consolidated financial results for the fourth quarter and year ended December 31, 2003.
Zapata reported consolidated net income of $892,000 or $.37 per diluted share on revenues of $181.4 million for the year ended December 31, 2003 as compared to consolidated net income of $6.5 million or $2.70 per diluted share on revenues of $117.0 million in 2002. The increase in revenues was primarily the result of the Company's acquisition of 84% of the outstanding common stock of Safety Components International, Inc. (OTCBB:SAFY) As a result of this acquisition, the Company began consolidating amounts related to Safety's operations during the fourth quarter of 2003. On a consolidated basis, the decrease in net income is primarily the result of decreased net income at Omega Protein Corporation (NYSE:OME), partially offset by the consolidation of Safety Components' fourth quarter net income.
For the quarter ended December 31, 2003, Zapata reported net income of $95,000 or $.05 per diluted share as compared to net income of $1.6 million or $.68 per diluted share for the comparable quarter last year. The decrease in net income for the fourth quarter of 2003 as compared to 2002 primarily resulted from decreased net income at Omega Protein, offset by Zapata's consolidation of Safety's results for the quarter.
Omega Protein contributed approximately $117.9 million and $3.5 million to Zapata's consolidated revenues and net income, respectively, for the year ended December 31, 2003. For the quarter ended December 31, 2003, Omega contributed approximately $33.4 million and $19,000 to Zapata's consolidated revenues and net income, respectively. Omega Protein's 2003 results, as well as the results for the fourth quarter of 2003, reflected a lower than expected fish catch (approximately 11% below both 2003 expectations and 2002 fish catch level), combined with low oil yields. The reduced fish catch was primarily attributable to adverse weather conditions along the Atlantic Coast and the Gulf of Mexico and the low oil yields were due to reduced fat content of the fish. The reduced fish catch and low oil yields resulted in higher per unit cost inventories, as well as less product available for sale.
Safety Components contributed approximately $63.5 million and $538,000 to Zapata's consolidated revenues and net income, respectively, for the quarter and year ended December 31, 2003. Safety's fourth quarter contribution to Zapata's consolidated net income was impacted by purchase accounting adjustments, the largest of which related to inventory. As of the date of the acquisition, and consistent with the purchase method of accounting, Zapata recorded Safety's inventory at fair value. This fair value was approximately $2.8 million greater than the carrying value recorded by Safety. As all of the related inventory was sold by December 31, 2003, Zapata recorded the entire amount of the fair value mark-up as a charge to cost of goods sold during the fourth quarter of 2003. Net of tax effects, this charge reduced Zapata's consolidated net income by approximately $1.7 million, or $.69 per diluted share.
About Zapata:
Zapata is a holding company which currently has two operating companies, Safety Components International, Inc. and Omega Protein Corporation. As of December 31, 2003, the Company had an 83% ownership interest in Safety Components and a 59% ownership interest in Omega Protein. In addition, Zapata owns 98% of Zap.Com Corporation (OTCBB:ZPCM), which is a public shell company.
The Company makes certain reports available free of charge on its website at www.zapatacorp.com as soon as reasonably practicable after this information is electronically filed, or furnished to, the United States Securities and Exchange Commission.
"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this release which are not historical facts are "forward-looking" statements that involve risks and/or uncertainties as described in the "Significant Factors That Could Affect Future Performance and Forward-Looking Statements" in the Company's Annual Report on Form 10-K for the year ended December 31, 2003. You are cautioned not to place undue reliance on any forward-looking statements. The Company's actual actions or results may differ materially from those expected or anticipated in the forward-looking statements. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release.
ZAPATA CORPORATION
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share and Per Share Amounts)
Dec. 31, Dec. 31,
2003 2002
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ASSETS
Current assets:
Cash and cash equivalents $43,934 $80,643
Short-term investments 29,351 35,928
Accounts receivable, net 58,011 13,070
Inventories, net 63,957 41,939
Prepaid expenses and other current assets 6,045 4,015
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Total current assets 201,298 175,595
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Investments and other assets:
Long-term investments, available for sale -- 4,016
Intangible assets, net 8,121 --
Other assets 23,925 24,524
--------- ---------
Total investments and other assets 32,046 28,540
Property, plant and equipment, net 125,695 80,842
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Total assets $359,039 $284,977
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt $5,780 $1,270
Accounts payable 27,935 2,718
Accrued and other current liabilities 27,278 23,027
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Total current liabilities 60,993 27,015
--------- ---------
Long-term debt 29,422 14,239
Pension liabilities 7,687 11,835
Other liabilities and deferred taxes 9,698 1,608
Minority interest 68,702 55,018
--------- ---------
Total liabilities 176,502 109,715
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Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par; 200,000 shares
authorized; none issued or outstanding -- --
Preference stock, $.01 par; 1,800,000 shares
authorized; none issued or outstanding -- --
Common stock, $0.01 par, 16,500,000 shares
authorized; 3,070,325 and 3,069,859 shares
issued; 2,391,315 and 2,390,849 shares
outstanding, respectively 31 31
Capital in excess of par value 163,490 162,037
Retained earnings 51,108 50,216
Treasury stock, at cost, 679,010 shares (31,668) (31,668)
Accumulated other comprehensive loss (424) (5,354)
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Total stockholders' equity 182,537 175,262
--------- ---------
Total liabilities and stockholders' equity $359,039 $284,977
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ZAPATA CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
Three months Twelve months
ended ended
December 31, December 31,
----------------- -------------------
2003 2002 2003 2002
-------- -------- --------- ---------
Revenues $96,885 $31,300 $181,429 $117,008
Cost of revenues 86,207 24,791 154,553 89,305
-------- -------- --------- ---------
Gross profit 10,678 6,509 26,876 27,703
Operating expenses:
Selling, general and
administrative 10,160 3,253 20,086 11,906
-------- -------- --------- ---------
Total operating
expenses 10,160 3,253 20,086 11,906
-------- -------- --------- ---------
Operating income 518 3,256 6,790 15,797
-------- -------- --------- ---------
Other income (expense):
Interest (expense) income, net (522) 233 (329) 822
Other, net 1,053 (61) 1,011 (222)
-------- -------- --------- ---------
531 172 682 600
-------- -------- --------- ---------
Income before income taxes and
minority interest 1,049 3,428 7,472 16,397
-------- -------- --------- ---------
Provision for income taxes (400) (635) (3,733) (5,120)
Minority interest in net income
of consolidated subsidiaries (554) (1,154) (2,847) (4,804)
-------- -------- --------- ---------
Net income to common
stockholders $95 $1,639 $892 $6,473
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Earnings per share:
Basic $0.04 $0.69 $0.37 $2.71
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Diluted $0.04 $0.68 $0.37 $2.70
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Weighted average common shares
outstanding:
Basic 2,391 2,391 2,391 2,391
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Diluted 2,423 2,395 2,405 2,395
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CONTACT: Zapata Corp.
Leonard DiSalvo, 585-242-8703
http://www.zapatacorp.com
SOURCE: Zapata Corp.