Columbus McKinnon has sold most of the assets of its subsidiary Automatic Systems, Inc. (ASI) to the division’s management, backed by venture capitalists, for $27.4m.
CM president and CEO Timothy Tevens said: “ASI did not prove to be a good fit for us mainly because of the highly volatile nature of its business, its significant dependence on the auto industry and its heavy use of working capital.” CM recorded a $121.5m loss on the sale of the ASI business. As a result CM breached certain covenants of its bank lending agreements as of 31 March 2002 and had to negotiate a new bank agreement and credit facility.
Including the loss on ASI and a $9.6m restructuring charge, CM recorded a net loss of $135m for the year to 31 March 2002. From continuing operations the loss was $6m, compared with a 2001 of $15m. Net sales were down 18% to $480m and operating profit was down 37% to $48.7m.
Despite the decline in sales, the company ‘maintained market share in every major product category’ said president and CEO Timothy Tevens.
