CAS Simplify China A Shares Plus Income ETF

FRANKLIN PARK, Ill., May 1 /PRNewswire-FirstCall/ -- A. M. Castle & Co. (AMEX:CAS), a global distributor of specialty metal and plastic products, value-added services and supply chain solutions, today reported record sales and continued strong financial results for the first quarter ended March 31, 2007. For the first quarter, consolidated net sales were a record $375.4 million, an increase of $96.2 million or 34.4% from the first quarter of 2006. Net income for the quarter was $15.6 million, or $0.81 per diluted share, as compared to $15.8 million or $0.86 per diluted share in the prior year. First quarter 2007 net income included a $0.9 million after-tax charge ($0.04 per diluted share) for the write-off of the Company's prior investment in information technology systems. During the quarter, the Company signed an agreement to purchase Oracle's ERP system in support of its strategic growth initiative. "As we embark on our bold new direction to become the foremost provider of specialty products, services and specialized supply-chain solutions for targeted industries, we have carefully considered the infrastructure required to successfully execute the strategy," commented Michael Goldberg, President and CEO of A. M. Castle. "The existing systems in our metals business lack the flexibility and functionality needed to support our customers growing requirements on a global scale. The acquisition of Transtar also increased our need for a technology upgrade. Our selection of Oracle, which is at the forefront of global technology solutions, exemplifies our commitment to the strategy," Goldberg added. The Company expects to invest $10 to $12 million for the system implementation across its metals segment, which is expected to be completed in late 2008. Metal segment sales were $346.6 million in the first quarter, an increase of $95.9 million, or 38.3%, versus the first quarter of 2006. Of the 38.3% increase, the acquisition of Transtar Metals (which was completed on September 5, 2006), contributed 29.0% of the increase in sales and 14.4% was attributable to increased material pricing, offset by a 5.1% decline in volume for the balance of the business. "Excluding Transtar, volumes were off from the corresponding quarter last year, but we should remember from an overall tons sold perspective, the first half of 2006 represented the strongest period of the cycle so far," stated Goldberg. "In the first quarter of this year, our average daily tons sold, excluding Transtar, were up slightly versus each of the prior three quarters. In addition, our mix continues to change with an increasing proportion of non-ferrous metal product sales driven by strong specialty metal markets. We continued to experience strong demand for specialty metal grade products in the aerospace and oil and gas markets. The balance of the business remains healthy, but is just softer than the exceptional first quarter we experienced last year," indicated Goldberg. The Company reported record high pricing for nickel during the first quarter of 2007, and experienced price increases in nearly all other metal products compared to the first quarter of 2006. Plastic segment sales were $28.8 million in the quarter, an increase of $0.2 million versus the first quarter of last year. Pricing and volume were essentially flat versus the same period last year. The Company reported stronger operating cash flows in the first quarter of 2007 as compared to the prior year's quarter. "From a historical perspective, our first quarter has the highest cash funding requirements of the year," stated Larry Boik, Vice President and CFO of A.M. Castle. "Given the historical cash trends, we were pleased to bring our debt-to-capital ratio down to 49.4%, which is an improvement versus 51.2% at year-end 2006." "Overall business conditions remain good," stated Goldberg. "In particular, the aerospace and oil and gas markets remain very strong and the Transtar acquisition has proven to be a sound investment and a solid strategic long-term fit for the Company. Pricing has been firm with surcharges for nickel and scrap being at all time highs." Also on April 26, 2007, the Company announced a cash dividend of $0.06 per share to be paid on May 28, 2007 to shareholders of record at close of business on May 14, 2007. Webcast Information Management will hold a conference call at 11:00 a.m. ET today to review the Company's results for the three month period ended March 31, 2007. The call can be accessed via the Internet live or as a replay. Those who would like to listen to the call may access the webcast through http://www.amcastle.com/. An archived version of the conference call webcast will be accessible for replay on the above website until the next earnings conference call. A replay of the conference call will also be available for seven days by calling 303-590-3000 (international) or 800-405-2236 and citing code 11088867. About A. M. Castle & Co. Founded in 1890, A. M. Castle & Co. is a global distributor of specialty metal and plastic products and supply chain services, principally serving the producer durable equipment sector of the economy. Its customer base includes many Fortune 500 companies as well as thousands of medium and smaller-sized firms spread across a variety of industries. Within its core metals business, it specializes in the distribution of alloy and stainless steels; nickel alloys; aluminum and carbon. Through its subsidiary, Total Plastics, Inc., the Company also distributes a broad range of value-added industrial plastics. Together, Castle operates over 65 locations throughout North America and Europe. Its common stock is traded on the American and Chicago Stock Exchange under the ticker symbol "CAS". Safe Harbor Statement / Regulation G Disclosure This release may contain forward-looking statements relating to future financial results. Actual results may differ materially as a result of factors over which the Company has no control. These risk factors and additional information are included in the Company's reports on file with the Securities Exchange Commission. The financial statements included in this release contain a non-GAAP disclosure, EBITDA, which consists of income before provision for income taxes plus depreciation and amortization, and interest expense, less interest income. EBITDA is presented as a supplemental disclosure because this measure is widely used by the investment community for evaluation purposes and provides the reader with additional information in analyzing the Company's operating results. EBITDA should not be considered as an alternative to net income or any other item calculated in accordance with U.S. GAAP, or as an indicator of operating performance. Our definition of EBITDA used here may differ from that used by other companies. A reconciliation of EBITDA to net income is provided per U.S. Securities and Exchange Commission requirements. CONSOLIDATED STATEMENTS OF INCOME For the Three (Dollars in thousands, except per Months Ended share data) March 31, Unaudited 2007 2006 Net sales $375,351 $279,193 Costs and expenses: Cost of materials (exclusive of depreciation) 269,450 196,100 Warehouse, processing and delivery expense 35,570 29,625 Sales, general, and administrative expense 36,394 24,885 Depreciation and amortization expense 4,896 2,444 Operating income 29,041 26,139 Interest expense, net (4,261) (1,087) Income before income taxes and equity earnings of joint venture 24,780 25,052 Income taxes (9,877) (10,242) Net income before equity in earnings of joint venture 14,903 14,810 Equity in earnings of joint venture 932 1,239 Net income 15,835 16,049 Preferred stock dividends (243) (242) Net income applicable to common stock $15,592 $15,807 Diluted earnings per share $0.81 $0.86 EBITDA* $34,869 $29,822 *Earnings before interest, taxes, and depreciation and amortization Reconciliation of EBITDA to net income: For the Three Months Ended March 31, 2007 2006 Net income $15,835 $16,049 Depreciation and amortization expense 4,896 2,444 Interest expense, net 4,261 1,087 Income taxes 9,877 10,242 EBITDA $34,869 $29,822 CONSOLIDATED BALANCE SHEETS (Dollars in thousands) As of Unaudited March 31, Dec 31, 2007 2006 ASSETS Current assets Cash and cash equivalents $11,453 $9,526 Accounts receivable, less allowances of $3,268 at March 31, 2007 and $3,112 at December 31, 2006 189,934 160,999 Inventories (principally on last-in, first-out basis) (latest cost higher by $142,984 at March 31, 2007 and $128,404 at December 31, 2006) 237,525 202,394 Other current assets 10,360 18,743 Total current assets 449,272 391,662 Investment in joint venture 14,152 13,577 Goodwill 101,790 101,783 Intangible assets 64,490 66,169 Prepaid pension cost 5,657 5,681 Other assets 5,955 5,850 Property, plant and equipment, at cost Land 5,222 5,221 Building 48,927 49,017 Machinery and equipment 144,348 141,090 198,497 195,328 Less -- accumulated depreciation (127,494) (124,930) 71,003 70,398 Total assets $712,319 $655,120 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $152,822 $117,561 Accrued liabilities 30,825 30,152 Income taxes payable 2,748 931 Deferred income taxes -- current 15,746 16,339 Short-term debt 125,749 123,261 Current portion of long-term debt 12,844 12,834 Total current liabilities 340,734 301,078 Long-term debt, less current portion 88,338 90,051 Deferred income taxes 34,341 31,782 Deferred gain on sale of assets 5,419 5,666 Pension and postretirement benefit obligations 10,948 10,636 Commitments and contingencies Stockholders' equity Preferred stock, $0.01 par value -- 10,000,000 shares authorized; 12,000 shares issued and outstanding 11,239 11,239 Common stock, $0.01 par value -- authorized 30,000,000 shares; issued and outstanding 17,085,091 at March 31, 2007 and 17,085,091 at December 31, 2006 170 170 Additional paid-in capital 70,994 69,775 Retained earnings 175,194 160,625 Accumulated other comprehensive loss (17,895) (18,504) Deferred unearned compensation (1,157) (1,392) Treasury stock, at cost -- 362,114 shares at March 31, 2007 and 362,114 shares at December 31, 2006 (6,006) (6,006) Total stockholders' equity 232,539 215,907 Total liabilities and stockholders' equity $712,319 $655,120 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) For the Three Months Unaudited Ended Mar 31, 2007 2006 Cash flows from operating activities: Net income $15,835 $16,049 Adjustments to reconcile net income to net cash from operating activities: Depreciation and amortization 4,896 2,444 Other non-cash items 3,288 (1,763) Increase (decrease) from changes, net of acquisitions, in: Working capital (20,581) (17,390) Other assets and liabilities 1,048 1,278 Net cash from operating activities 4,486 618 Cash flows from investing activities: Capital expenditures (2,179) (4,999) Other 367 354 Net cash used in investing activities (1,812) (4,645) Cash flows from financing activities: Increased (decreased) borrowings 797 (129) Dividends paid on common shares (1,023) (1,004) Preferred stock dividends (243) (242) Exercise of stock options and other (21) 647 Net cash used in financing activities (490) (728) Effect of exchange rate changes on cash and cash equivalents (257) 67 Net (decrease) increase in cash and cash equivalents 1,927 (4,688) Cash and cash equivalents -- beginning of year $9,526 $37,392 Cash and cash equivalents -- end of year $11,453 $32,704 DATASOURCE: A. M. Castle & Co. CONTACT: Larry A. Boik, Vice President-Finance & CFO, +1-847-349-2576, ; or Analysts, Katie Pyra, +1-312-553-6717, , for A. M. Castle & Co. Web site: http://www.amcastle.com/

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