Tokheim Faces Uncertain Future
FORT WAYNE, Ind. -- With its two chief competitors sold in the last 18 months, speculation is emerging that Tokheim Corp. could either be forced to shut down operations or be the next on the market, following the company's recent federal filing indicating that cash is running out.
Almost exactly two years after it filed for bankruptcy protection, the maker of gasoline dispensers and point-of-sale systems said it expected to lose money for the rest of the year and that it had violated some loan agreements stipulated as part of its bankruptcy reorganization.
The company's auditor, Ernst & Young, said the company's net losses and lack of cash flow cast "substantial doubt about the company's ability to continue as a going concern," according to media reports.
In its first-quarter filing with the Securities and Exchange Commission, the company said, "management believes the company has sufficient resources to maintain its operations until at least Nov. 30, 2002."
During the first quarter ended Feb. 28, Tokheim lost $8.83 million, compared with an $11.4-million loss in the same quarter a year ago. Sales fell to $119.6 million from $121.2 million, largely because of a 24.3-percent decline in sales in North America.
Sales in Europe and Africa rose by 11.8 percent, accounting for roughly 70 percent of total sales. Still, total sales have declined in each of the past three years and no turnaround is anticipated soon.
The company's struggles mirror much of the petroleum equipment market, which has been stifled by a sluggish economy in the United States - by far the world's largest market -- that has forced gasoline retailers to cut back on capital upgrades.
Most recently, Tokheim said it planned to terminate 70 positions in the United States. The company employs some 3,400 people worldwide, including 500 at its Fort Wayne office.
In the past 18 months, Tokheim's two main rivals -- Marconi Commerce Systems and Dresser Wayne -- have been sold. Earlier this year, Danaher Corp., the owner of Veeder-Root fuel inventory systems, purchased Marconi and its famed Gilbarco gasoline dispenser line for $325 million, while in January 2001, Halliburton Co. sold the Dresser Wayne dispenser division to an investment group.
Almost exactly two years after it filed for bankruptcy protection, the maker of gasoline dispensers and point-of-sale systems said it expected to lose money for the rest of the year and that it had violated some loan agreements stipulated as part of its bankruptcy reorganization.
The company's auditor, Ernst & Young, said the company's net losses and lack of cash flow cast "substantial doubt about the company's ability to continue as a going concern," according to media reports.
In its first-quarter filing with the Securities and Exchange Commission, the company said, "management believes the company has sufficient resources to maintain its operations until at least Nov. 30, 2002."
During the first quarter ended Feb. 28, Tokheim lost $8.83 million, compared with an $11.4-million loss in the same quarter a year ago. Sales fell to $119.6 million from $121.2 million, largely because of a 24.3-percent decline in sales in North America.
Sales in Europe and Africa rose by 11.8 percent, accounting for roughly 70 percent of total sales. Still, total sales have declined in each of the past three years and no turnaround is anticipated soon.
The company's struggles mirror much of the petroleum equipment market, which has been stifled by a sluggish economy in the United States - by far the world's largest market -- that has forced gasoline retailers to cut back on capital upgrades.
Most recently, Tokheim said it planned to terminate 70 positions in the United States. The company employs some 3,400 people worldwide, including 500 at its Fort Wayne office.
In the past 18 months, Tokheim's two main rivals -- Marconi Commerce Systems and Dresser Wayne -- have been sold. Earlier this year, Danaher Corp., the owner of Veeder-Root fuel inventory systems, purchased Marconi and its famed Gilbarco gasoline dispenser line for $325 million, while in January 2001, Halliburton Co. sold the Dresser Wayne dispenser division to an investment group.