AM International Inc. said Thursday its fiscal first-quarter net income rose 19 percent, boosted by higher sales, weakness of the dollar abroad and lower income taxes.
The Chicago-based graphics equipment and supplies firm also told shareholders that its Varityper typesetting equipment division, which has been up for sale since last June, will probably fetch less than the $100 million-plus in proceeds previously predicted.
At the company`s annual meeting here, AM also provided more details of its somewhat tense discussions this fall with a Japanese printing company that has acquired a 6.9 percent stake in AM.
In the quarter ended Oct. 31, AM`s net income advanced to $6.6 million, or 9 cents a share, from $5.5 million, or 7 cents a share, in the year-earlier period. Revenues rose 10 percent, to $304.8 million from $277.5 million.
Merle H. Banta, AM chairman and chief executive, said all of the company`s divisions posted higher revenues in the latest quarter, with some of the strongest gains registered abroad.
Banta said the company is optimistic about prospects for the remainder of fiscal 1988, primarily because of the beneficial impact of the lower dollar on foreign sales and because of the strong order backlog at its Harris Graphics web press division.
However, Banta lowered his sights on the probable sales price for Varityper. He said that, because of the current turmoil in the financial markets, AM probably will receive less than $100 million in proceeds from the sale, and that a deal with a buyer probably won`t be concluded until sometime in 1988.
Banta said the company is looking to add sheet-fed printing presses to its product line and that Komori Printing Machinery Co. of Japan is among some possible suppliers of those presses.
Komori has been accumulating AM shares since last December and now has a 6.9 percent of AM shares outstanding. Although Komori has said those shares were an ”investment,” AM previously has suggested Komori might be trying to ”coerce” AM into selling its press division or into some other business arrangement.
Two weeks ago, Komori signed a ”stand-still” agreement under which it agreed to restrict its holdings of AM stock over the next four years. AM, in turn, agreed to discuss some business arrangement with Komori.
In a letter distributed Thursday to AM shareholders, Banta revealed that, earlier this fall, Komori suggested, unsuccessfully, ”that a young Japanese
`financial consultant,` three years out of Harvard Business School, serve on (AM`s) board of directors.”
Banta said Komori also previously refused to sign an stand-still agreement similar to the one reached two weeks ago.
