Wolverine's losses up sharply in 2006
By Eric Fleischauer
firstname.lastname@example.org · 340-2435
Wolverine Tube Inc. lost more than twice as much money in 2006 as it did in 2005, according to its annual report released Wednesday, but restructuring costs caused much of the shortfall.
The copper tubing company, based in Huntsville, employs about 500 in Decatur. It employs 3,000 worldwide.
The company reported a loss of $79.2 million in 2006, compared to $38.6 million in 2005. In the fourth quarter of 2006, it lost $34 million. It lost $19.2 million in the fourth quarter of 2005.
Restructuring costs plagued the company's balance sheet. It paid $75.3 million in 2006 and $17.2 million in 2005. It spent another $44 million in charges to close its Montreal; Ontario, Canada; and Jackson, Tenn., facilities.
The company expects the restructuring to bring in $135 million in equity.
Absent the restructuring costs, the picture was not so bleak. Profits for 2006 increased to $54.5 million, compared to $21.6 million in 2005. Sales in 2006 rose to $1.4 billion from $873.5 million in 2005, although that was largely due to increasing copper prices passed on to customers.
In February, Wolverine sold $50 million in preferred stock to The Alpine Group Inc. and a fund managed by Plainfield Asset Management LLC. The sale should generate between $75 million and $135 million in equity proceeds to the company.
In its annual report, Wolverine said it was hurt by a massive drop in demand related to a slowing of residential construction.
High copper prices also have caused many manufacturers to substitute plastic tubing for copper.
Wolverine's shares, delisted from the New York Stock Exchange earlier this year, closed on the Pink Sheets on Wednesday up 2.5 percent, at $2.05.
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