Despite an 86 percent drop in third-quarter profits, Pennzoil-Quaker State officials contended that the companys performance is improving after a restructuring earlier this year.
Net earnings for the period ending Sept. 30 were $836,000, or 1 cent per share, down from $6.1 million, or 8 cents per share, for the third quarter of 2000. The company noted, however, that results for this years third quarter included $12.1 million in non-recurring after-tax charges and $3.8 million in losses from discontinued items. Excluding those items, recurring income rose 5 percent to $16.7 million.
Our third-quarter results reflect improving performance trends and the restructuring actions we announced in late June, President and Chief Executive Officer Jim Postl announced. Although the tragic events of Sept. 11 add a new level of uncertainty to the economic environment, our operational redesign should give us the flexibility we need to continue to grow and prosper.
In June the Houston-based marketer of automotive consumer parts slashed its quarterly dividend from 18.75 cents per share and announced plans to restructure in order to reduce manufacturing, selling and overhead expenses.
With last weeks earnings announcement, the company indicated that the plan has been completed. Restructuring in the Lubricants and Consumer Products segments accounted for most of the $12.1 million in third-quarter non-recurring charges.
Recurring operating income for the Lubricants segment fell 10 percent to $38 million, due to higher costs of goods sold and soft market conditions. Recurring operating income for Consumer Products rose 15.2 percent to $6.6 million thanks to lower costs from consolidation of four business units into one.
Recurring operating income from the International segment was up 121 percent to $5.1 million, despite a 4.2 percent drop in revenue. Jiffy Lube International had a 19 percent drop in recurring operating income, mostly because of increased motor oil costs.