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AFG Posts Record Revenues for Sixth Consecutive Year

January 15, 1987|MARY ANN GALANTE | Times Staff Writer

AFG Industries, the Irvine-based glass maker, reported its sixth consecutive year of record revenues and earnings Wednesday, with earnings for its fiscal 1987 up 153% to $53 million from $21.1 million a year earlier.

The results include after-tax profits of $19 million from the sale of the company's stock in Arizona-based Merabank and from stock transactions in its two bids last quarter to acquire Lear Siegler Inc.

Sales of Merabank securities contributed about $10 million after taxes to AFG's net earnings for the year ended Dec. 31, and sale of Lear Seigler shares acquired during the unsuccessful takeover bid netted the company about $9 million for the fourth quarter.

Revenues for the fiscal year jumped 39% to $452 million--including $37 million from pretax gains on the securities sales--from $324 million a year earlier.

AFG is the nation's fourth-largest manufacturer of flat glass, which is used mainly in residential and commercial construction. It also is a major manufacturer of specialized glass products for mirrors, oven doors, aquariums and other uses.

In October, AFG joined with Wagner & Brown, a Midland, Tex., oil concern, to form AFG Partners, which offered to buy Santa Monica-based Lear Siegler's outstanding stock for $85 a share. The partnership dropped its bid to acquire Lear Siegler after agreeing to sell its 10% stake in the aerospace and manufacturing conglomerate to Wickes Cos. for $93 a share.

$46.4-Million Profit

An attempt in December by AFG Partners to acquire Lear Siegler also failed when the partnership withdrew its bid for tax reasons. The two thwarted takeovers reaped a gross profit of $46.4 million for the partnership--half of which went to AFG Industries.

Even without the sizable gains on securities, AFG had an 8.5% return on sales for the year, the company said.

Net sales from operations totaled $406 million for 1986, 27% higher than the $320 million recorded for 1985.

R. D. Hubbard, AFG's chairman and chief executive, said AFG's 8.5% return on sales, excluding gains on securities, "exceeded the company's long-term goal of 7% and (was) well above the industry average."

Hubbard attributed the increased earnings to improved pricing, greater market penetration, lower energy costs and strong demand for AFG products. He said he expects those conditions to prevail this year as well.

He added that construction of AFG's fifth plant, scheduled to be completed in Victorville within 14 months, will expand the company's West Coast marketplace and give AFG "a national presence."

The company's treasurer, Gary Miller, said he believes that "AFG will continue to meet its goal of a 10% to 15% yearly increase in revenue and earnings."

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