CUNO reports record third quarter results

Aug. 26, 2004
Among highlights:
* Record 3Q sales of $89.9 million (up 20%)
* Record 3Q diluted EPS of $0.50 (up 14%)
* Record 3Q orders of $90.1 million (up 19%)

MERIDEN, CT, Aug. 25, 2004 (PRNewswire-FirstCall) -- CUNO Inc. reported record third quarter results for the period ended July 31. Sales were $89.9 million, up 20% vs. the same period in 2003 and up 17% in local currency. Net income for the quarter increased by 15% to $8.6 million from $7.5 million reported a year earlier. Diluted earnings per share for the period were a third quarter record $0.50, up 14% compared to $0.44 in the prior year quarter and up about 9% on a currency-adjusted basis.

Commenting on the company's third quarter results, Mark G. Kachur, CUNO chairman and CEO, said "Our record third quarter results reflect the strength and effectiveness of our business model. We achieved double-digit sales growth in each of our primary markets, including Potable Water, Healthcare and Fluid Processing. Our geographic diversity also contributed to our strong overall results, as international sales increased by 26% (up 20% in local currency), led by strong growth in Japan, Europe and the Asia/Pacific region."

For the first nine months of fiscal 2004, sales were a record $248.1 million, up 18% (or 12% in local currency), and net income was $24.1 million vs. $19.2 million in the prior year period. Strong performance both in our international operations and in North America drove sales growth. Diluted earnings per share were a record $1.41, up 25% from $1.13 in the first nine months of 2003 and up about 15% on a currency-adjusted basis.

Commenting on business conditions and the outlook for CUNO, Kachur added, "Our incoming orders were a third quarter record $90.1 million and our backlog remains strong. As a result, we expect to achieve continued strong financial results during the fourth quarter, and we are comfortable with the current $1.86 consensus of analysts' EPS estimates for the full year."

As previously announced, on August 2, 2004, CUNO completed the acquisition of WTC Industries, Inc. The aggregate consideration for the outstanding WTC shares (including payment for the settlement of outstanding stock options and warrants) was about $115 million (including the assumption of WTC's outstanding bank debt and all acquisition-related expenses). CUNO funded the acquisition with a combination of existing cash and bank borrowings under a new variable-rate, 5-year, $120 million unsecured revolving credit facility.

CUNO is a world leader in the design, manufacture and marketing of a comprehensive line of filtration products for the separation, clarification and purification of liquids and gases. CUNO's products, which include proprietary depth filters and semi-permeable membrane filters, are used in the potable water, healthcare, and fluid processing markets.


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