Gibraltar announced net income of $15.4 million on sales of $257 million for the second quarter, and net income of $24.8 million on sales of $469 million for the first six months of 2004.

Second Quarter Results—Net income of $15.4 million represents an 87% increase over the $8.3 million net income in the second quarter of 2003. Earnings per share were $.78, compared to $.51 in the second quarter of 2003, an increase of 53%, on approximately 22% more weighted average shares outstanding as a result of Gibraltar's successful completion of its 3.2-million share secondary stock offering last December. Sales of $257 million represent a 27% increase over $203 million in the second quarter of 2003.

Six Month Results—Net income of $24.8 million represents an 88% increase compared to $13.2 million in the first six months of 2003. Earnings per share were $1.26, compared to $.82 in the first half of 2003, an increase of 54%, on approximately 22% more weighted average shares outstanding. Sales of $469 million represent a 29% increase compared to $365 million in the first half of 2003.

Comments—"Our performance in the second quarter was helped by the national manufacturing and distribution footprint established last year and the continued ramp up of available capacity utilization. Gross margins exceeded 20% and operating margins were 10.7%, indicative of our year-over-year continuous improvement programs and a generally improving economic climate," said Brian J. Lipke, Gibraltar's Chairman and CEO.

"All segments generated double-digit sales increases in the second quarter, and even stronger improvements in operating income. We had continued strong performances in our targeted growth segments including building products and heat treating. We estimate that the majority of our second-quarter sales improvement came from higher unit volumes, with the balance coming from acquisition timing and higher selling prices (which were largely the result of the unprecedented increase in steel prices)," said Mr. Lipke.

On June 1, Gibraltar completed the acquisition of the assets of the powdered metals division of SCM Metal Products. SCM manufactures nonferrous metal powder products that are used in brazing pastes, roofing shingles, oil-less bearings, and friction products, among others. SCM has more than one hundred customers, in a number of different industries, including automotive, aerospace, electronics, and consumer products. Nearly one-third of its sales (which were $45 million in 2003) go to customers in Europe, Asia, and Central and South America.

During the second quarter, Gibraltar also took steps to strengthen its balance sheet. It entered into a $75-million private placement of debt, with a term of seven years and a rate of 5.75 percent. An initial draw of $25 million was used to lower the balance on Gibraltar's revolving credit facility. The balance, which will be drawn down at specific future intervals, will be used for general corporate purposes, including internal growth initiatives and potential acquisitions.

"We were able to term out a significant portion of our credit line at favorable rates and terms. These and other steps that we are taking to strengthen our balance sheet, together with our strong and consistent financial performance, will continue to give us access to the funds necessary to reach our strategic growth goals," said Mr. Lipke.

Outlook—"We expect to continue our positive sales and earnings momentum in the third quarter; however, the volatility in the steel supply markets has not abated. At this point, we are confidently managing the situation and therefore we expect our third-quarter earnings per share will be in the range of $.61 to $.65, compared to $.49 in the third quarter of 2003, on approximately 22% more weighted average shares outstanding," said Mr. Lipke. The second quarter is historically the strongest period for Gibraltar, with growth slowing in the third quarter as a result of model year changeovers in the auto industry and seasonal slowing in the building industry.

Gibraltar is a manufacturer and distributor of more than 5,000 residential and commercial building products, a leading North American metal processor, and North America's second-largest commercial heat treater. The company serves approximately 10,000 customers in a variety of industries in all 50 states, Canada, Mexico, Europe, Asia, and Central and South America. It has approximately 4,000 employees and operates 72 facilities in 26 states, Canada, and Mexico.