NN Inc. (Johnson City, Tennessee) reported lower earnings for third quarter 2001 on improved sales due to acquisitions. Results from continuing operations were down.

NN is a major world manufacturer of precision balls and rollers for bearings, in addition to retainers and other components.

Comparable sales from continuing operations dropped sharply to USD $20.5 million in 3Q2001 from $24.1 million in 3Q2000. These comparable sales factor out the effects of recently-acquired Delta Rubber Company and NN Euroball ApS.

Sales from all operations in the third quarter hit $42.6 million, up from $37.1 million in 2000. Operating income suffered, falling to only $5.9 million (14% of sales) during the quarter from $7.7 million (21% of sales) in 2000.

The company recently announced it would close its Walterboro, South Carolina ball plant in December 2001, resulting in after-tax charges of $1 million.

NN's inventory and collections both rose during the fiscal year, reflecting the impact of the slowing manufacturing economy. Since January 1, inventory has swelled to $42.2 million from $27.9 million; receivables have grown to $31.2 million from $29.5 million.

Chairman and CEO Roderick "Rock" Baty said, "Our bearing component business continues to be negatively impacted by the recessionary environment in the U.S. industrial markets. Our business experienced a 17% decrease in domestic core business revenues over the third quarter of 2000 and experienced a slowing of manufacturing activity in Europe."

Mr. Baty further predicted NN will, "experience continuing recessionary levels of activity," in the U.S. through the first half of 2002, with a moderate U.S. improvement in the second half expected to be offset by softening demand in Europe.