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| WASHINGTON--(BUSINESS
WIRE)--Jan. 30, 2002--Harman International (NYSE:HAR) today reported financial results for
the second quarter and first six months ended December 31, 2001. Net sales for the second quarter totaled $467.4 million, a 7 percent increase compared to net sales of $438.2 million in the same period last year. The Company reported pretax income of $24.8 million before recording an $8.3 million legal reserve. Net income for the quarter before the reserve was $17.6 million, equal to $0.53 per diluted share. The reserve represents $0.18 per diluted share. For the six months ended December 31, 2001, net sales were $866.4 million versus $833.2 million in the prior year period, an increase of 4 percent. Earnings per diluted share before recording the legal reserve were $0.68 for the first half. The legal reserve was recorded after the United States Court of Appeals affirmed a judgment in the lawsuit entitled Bose Corporation v. JBL Incorporated on December 17, 2001. The Company has filed a petition with the Court of Appeals and has been notified that the United States Patent and Trademark Office will reexamine the patent that was the subject of the lawsuit. The Company believes that it should prevail as a result of the petition and the reexamination. The charge is without future effect because the simple port design, which was the subject of the suit, was discontinued over two years ago. The Consumer Systems Group reported sales of $657.4 million for the six months ended December 31, 2001, an increase of 7 percent over the prior year. Sales to the automakers increased 11 percent during the period as aggressive dealer incentive programs drove higher vehicle sales. In North America and Asia, Mark Levinson digital audio system shipments to Lexus and JBL system sales to Toyota were above the prior year, offsetting lower sales to Chrysler. In Europe, Harman/Becker reported increased sales to BMW for systems supporting the 3-series and higher than planned volumes for the new 7-series Infotainment system. Multimedia sales to Dell and the aftermarket were above last year's levels partially offset by lower sales to Apple and Compaq. Consumer audio product sales approximated the same prior year period. Professional Group sales for the six months ended December 31, 2001 were $209.0 million, a 3 percent decrease from last year after adjusting for the sale of a unit in the prior year. JBL Professional reported sales above last year's levels while the remainder of the group experienced modest sales declines. Dr. Sidney Harman, Executive Chairman, and Bernard Girod, Vice Chairman and Chief Executive Officer, commented: ``The Company performed well during the second quarter and first half of fiscal 2002 despite continued economic uncertainty both domestically and abroad. Audio system sales to an expanding list of automotive customers and platforms remain strong even though sales to Chrysler continue to reflect their restructuring. The cost reduction programs initiated in the past are proving beneficial, as the consumer audio market remains soft. Multimedia continues to perform better than that industry as a whole. The Professional Group continues to do well in a market that has been affected by the languishing economy. ``The second half will present both challenge and opportunity. A major new automotive award will be formally announced in February. We have already taken the necessary steps to enlarge our engineering resources to process it.'' At 4:30 p.m. EDT today, Harman International will host a conference call to discuss the results for its second quarter and first half ended December 31, 2001, and to offer management's outlook for future periods. To participate in the conference call, please call (US) 888/273-9890 or for international calls dial 612/332-0418 prior to 4:30 p.m. EDT. Please let the operator know that you would like to join the Harman International call. A replay of the conference call will be available beginning at 8:00 p.m. EDT on January 30, 2002. The replay will be available through February 7, 2002. To access the replay, please call (US) 800/475-6701 or for international calls 320/365-3844. Access code 624216. Harman International Industries, Incorporated (www.harman.com) is a leading manufacturer of high-quality audio products and electronic systems for the consumer and professional markets. The Company's stock is traded on the New York Stock Exchange under the symbol: HAR. Note: Except for historical information contained herein, the
matters discussed are forward-looking statements within the meaning of Section 21E of the
Securities Exchange Act. You should not place undue reliance on these statements. We base
these statements on particular assumptions that we have made in light of our industry
experience, as well as our perception of historical trends, current market conditions,
expected future developments and other factors that we believe are appropriate under the
circumstances. These statements involve risks and uncertainties that could cause actual
results to differ materially from those suggested in the forward-looking statements,
including but not limited to the effect of changes in consumer confidence and spending,
automobile industry sales and production rates; model-year changeovers in the automotive
industry, our ability to satisfy contract performance criteria, availability of key
components to the products we manufacture, competitive products, currency exchange rates,
the outcome of pending or future litigation and other claims, labor disputes at our
facilities or those of our significant customers, general economic conditions and other
risks detailed in the Company's filings with the Securities and Exchange Commission.
HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED
SECOND QUARTER RESULTS - FISCAL 2002
FOR THE THREE AND SIX MONTHS ENDED
December 31, 2001 and 2000
(000s omitted except per share amounts)
Three Months Ended Six Months Ended
December 31, December 31,
2001 2000 2001 2000
-------- -------- -------- --------
Net sales 467,432 438,176 866,441 833,152
Cost of sales 339,994 316,583 635,282 601,849
-------- -------- -------- --------
Gross profit 127,438 121,593 231,159 231,303
Selling, general
and
administrative
expenses 104,897 81,910 195,274 175,477
-------- -------- -------- --------
Operating income 22,541 39,683 35,885 55,826
Other expense:
Interest
expense 5,508 5,615 11,600 11,345
Miscellaneous,
net 512 48 677 251
-------- -------- -------- --------
Income before
income taxes 16,521 34,020 23,608 44,230
Income tax
expense 4,791 9,866 6,847 12,831
-------- -------- -------- --------
Net income $ 11,730 $ 24,154 16,761 $ 31,399
======== ======== ======== ========
Basic EPS $ 0.37 $ 0.75 $ 0.52 $ 0.96
Diluted EPS $ 0.35 $ 0.72 $ 0.50 $ 0.92
Shares
outstanding -
basic 32,116 32,130 32,096 32,573
Shares
outstanding -
diluted 33,525 33,764 33,595 34,118
HARMAN INTERNATIONAL INDUSTRIES, INCORPORATED
CONSOLIDATED BALANCE SHEETS
(000s omitted)
Dec. 31, Dec. 31,
2001 2000
---------- ----------
ASSETS
Current assets
Cash and cash equivalents $ 5,301 $ 7,414
Accounts receivable 310,717 322,938
Inventories 335,061 368,636
Other current assets 68,593 66,319
---------- ----------
Total current assets 719,672 765,307
---------- ----------
Property, plant and equipment 274,623 265,798
Excess of cost over fair value
of assets acquired 144,468 160,420
Other assets 58,696 39,079
---------- ----------
Total assets $1,197,459 $1,230,604
========== ==========
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities
Short-term borrowings $ 14,921 $ 17,486
Current portion of
long-term debt 223,800 4,392
Accounts payable and
accrued liabilities 302,305 309,600
---------- ----------
Total current liabilities 541,026 331,478
---------- ----------
Long-term debt 162,166 416,499
Other non-current liabilities 47,035 34,975
Minority interest 945 1,062
Total shareholders' equity 446,287 446,590
---------- ----------
Total liabilities and
shareholders' equity $1,197,459 $1,230,604
========== ==========
Contact: Harman International Industries, Inc., Washington
Frank Meredith, 818/893-8411
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