ADVO discusses third quarter earnings.WINDSOR Windsor, British royal family Windsor (wĭn`zər), family name of the royal house of Great Britain. The name Wettin, family name of Albert of Saxe-Coburg-Gotha, consort of Queen Victoria, was changed to Windsor by George V in 1917. , Conn.--(BUSINESS WIRE)--June 24, 1996--ADVO Inc. (NYSE NYSE See: New York Stock Exchange :AD) today announced that its earnings for the third quarter of its 1996 fiscal year would be below the consensus range of analysts' estimates of $0.30-0.35. The company said that despite improved operating performance over that experienced in its first fiscal half, results are expected to be below prior years results due to interest expense incurred from the company's recent recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. and the continuing effects of higher paper prices. Robert "Kam" Kamerschen, ADVO's chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said, "While we are encouraged by some improvement in the tone of our business, we continue to feel the effects of higher year on year paper costs, and the significant internal distractions of the last nine months. These included our exploration of strategic alternatives, the reengineering of the Company and our new margin based sales compensation system. "Based on our current assessment, we believe that the year on year decline in revenues experienced in the second quarter and forecast for the third quarter will reverse itself in the fourth quarter, after adjusting for the extra week in FY95. This is based on our continued high readership read·er·ship n. 1. The readers of a publication considered as a group. 2. Chiefly British The office of a reader at a university. and response rates versus all of our competitors as well as the elimination of several factors that have hampered revenue growth this year. These include the elimination of our second in-home date in Chicago, the annualization of our exit from unprofitable client segments and the end of the internal diversions that took place this year. "We are further encouraged looking further into 1997 as we get the full effect of our reengineering initiative (which to date has yielded $20MM in lower SG&A on an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis and which is expected to produce significant productivity improvements) and postal reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. benefits, both of which are proceeding ahead of plan." The company stated that its current forecasts are based on the anticipated return of positive revenue growth, partially for the reasons given above, and that actual performance could vary depending on this assumption. ADVO is the nation's largest full-service direct mail marketing services company with annual revenues in excess of $1 billion. ADVO specializes in shared and solo direct mail services and provides customized Microtargeting(R) solutions for its clients' needs. The company's Mailbox A simulated mailbox in the computer that holds e-mail messages. Mailboxes are stored on disk as a file of messages, a database of messages or as an individual file for each message. The standard mailboxes are usually In, Out, Trash and Junk (Spam). Values(R) branded shared mail program is distributed nationally to over 61 million households weekly. ADVO also offers limited transportation services. It has 20 mail processing facilities and 70 sales offices nationwide. ADVO's corporate headquarters are located at One Univac Lane, Windsor, CT 06095. CONTACT: ADVO Inc, Windsor Donald McCombs, 860/285-6391 |
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