| Myers Industries 1999 Letter to Shareholders We are pleased to report a record
performance for 1999, our 66th year of operation and 28th year as a public company. For
the fourth year in a row, both our business segments, manufacturing and distribution,
achieved record sales and profits.
Net sales for the fourth quarter
were $166.6 million, up 51 percent from the same period last year. Net income of $9.8
million increased 7 percent, and net income per share of $.49 was up 9 percent.
For the year, net sales were
$580.8 million, up 48 percent over 1998 results. Net income of $31.2 million increased 9
percent, and net income per share of $1.55 increased 9 percent from the $1.42 earned in
1998.
In July, the Board of Directors
declared a 10 percent stock dividend, the 24th consecutive year that it has increased the
Company’s cash payout to shareholders.
1999 was a year of exciting change
for Myers Industries. We completed three acquisitions, accounting for nearly $200 million
in annualized sales. With those acquisitions we expanded manufacturing operations in
Europe and North America and strengthened our existing reusable plastic container and
plastic planter businesses.
As we noted last year, the
purchase of Allibert Équipement in February 1999 was the largest acquisition Myers had
ever made. Headquartered in Europe, Allibert Équipement is a leading manufacturer of
reusable plastic material handling products. The acquisition gave Myers a serious
manufacturing base in Europe, more than 1,000 additional products, and new customer
relationships. Included in the purchase was Allibert’s North American business, which
we merged with our existing Buckhorn and Kadon businesses to form a substantial material
handling resource for customers in the Western Hemisphere.
In August, we acquired Dillen
Products and Listo Products, leading manufacturers of plastic planters, trays, pots,
bowls, and hanging baskets, both indoor and outdoor. We have gained two respected names in
both the grower and mass retail segments of the horticultural market.
Excluding contributions from our
acquisitions, total net sales would have been slightly higher in the fourth quarter and
would have increased 3 percent for the year. Operating profits are higher compared to
1998, mainly due to our focus on fundamental components of sound business management.
In the Company’s
manufacturing segment, sales increased 81 percent over last year’s fourth quarter
results and 77 percent over the comparable 12 months. Excluding acquisitions, sales in the
manufacturing segment increased 2 percent for the quarter and 6 percent for the year.
Sales in the distribution segment
decreased 2 percent compared with 1998 fourth quarter results and were slightly higher for
the 12 months when compared to the prior year. Margins on sales improved for both the
quarter and the year due to more sales of higher margin consumable supplies versus lower
margin equipment.
The performance of Myers stock for
the year was disgruntling. We opened the year at $26.08 and finished in December at
$15.75. We attempt to build value over sustained periods to the long-term benefit of
ownership. That style did not seem to catch the interest of the market in 1999. Investors
seemed to be following more immediate opportunities.
We significantly changed the scope
of Myers Industries in 1999. We are now an international leader in reusable plastic
containers, with great ability to bring material handling product and service solutions to
customers around the world. Myers is also now one of North America’s largest
manufacturers of plastic planters. Myers Industries operates 23 manufacturing facilities
in six countries and 42 distribution locations in 31 states. We offer more than 20,000
products to a diverse spectrum of customers. We employ nearly 4,200 people.
Despite pressure from higher resin
prices, and the distractions and debt from making the acquisitions, we delivered solid
financial performance in 1999. We shall attempt to continue in that fashion in the coming
years.
We try to create consistent
earnings growth and protect what has been gained. The effects of our efforts in 1999 have
placed the Company as a major factor in the growing markets for plastic material handling
products and plastic planters. We believe that Myers is in good position for sustainable
long-term growth.
We thank our valued customers,
suppliers, and the Myers Industries employees, both old and new, worldwide, without whose
hard work, talent, and ideas we would not be able to report these record results. To our
shareholders, we express our appreciation for your continued confidence. I welcome your
thoughts and comments.
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