ARC International Reports Fourth Quarter and Year-end Results.TORONTO, Ontario--(BUSINESS WIRE)--March 2, 1999-- - IcePro International Revenues Increase 38% From Year-Ago Quarter - - ARC's Ballantyne of Omaha and Cabletel Communications Holdings Presently Valued At Approximately $2.40 Per Share - ARC International This article is about the publicly traded processor company. For the privately held French housewares company of the same name, see ARC International (household). Corporation (AMEX AMEX See: American Stock Exchange : ATV (1) (Advanced TV) An early name for the digital TV standard proposed by the Advisory Committee on Advanced Television Service (ACATS). See ACATS. See also ATV Forum. (2) (Analog TV) Refers to the NTSC, PAL and SECAM analog TV standads. ) today reported results for the fourth quarter and year-ended December 31, 1998. ARC noted that full year-over-year results are not comparable because the Company no longer consolidates financial results with Ballantyne of Omaha (NYSE NYSE See: New York Stock Exchange : BTN BTN In currencies, this is the abbreviation for the Bhutan Ngultrum. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) due to a June 1997 share offering which lowered ARC's stake in Ballantyne from 51% to approximately 26%. As a result, ARC's investment in Ballantyne is accounted for in the Company's income statements as an equity interest in an affiliate. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight (all figures are reported in U.S. Dollars) for the fourth quarter ended December 31, 1998 were $14,231,550. Fourth quarter sales benefited from a 38% revenue increase at ARC's IcePro International, the Company's ice rink supply and services division, and a full year's revenue contribution of $2,048,548 from ARC's first U.S. skating skating: see ice skating; ice dancing; roller skating. skating Sport in which bladelike runners or sets of wheels attached to shoes are used for gliding on ice or on surfaces other than ice. complex in Rockville, Maryland Rockville is the county seat of Montgomery County, Maryland, United States. According to the 2006 census update, the city had a total population of 59,114, making it the second largest city in Maryland. . Giving effect to a non-cash holding loss and a non-recurring restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. primarily related to the write-down of goodwill at ARC's Cabletel Communications (AMEX: TTV TTV Transfusion Transmitted Virus TTV Total Thickness Variation (semiconductor wafer planarity) TTV TechTV TTV Total Transaction Value TTV Tapping the Vein (band) TTV Target Test Vehicle ) subsidiary, the Company reported a net loss for the 1998 fourth quarter of $9,818,392, or $0.69 per share. Excluding the non-cash holding loss and restructuring charges, the Company would have reported a net loss of $1,965,421, or $0.14 per share. The weighted average number of diluted shares outstanding for the fourth quarter of 1998 was 14,279,373. Commenting on the results, Arnold S. Tenney, Chairman, President and Chief Executive Officer of ARC, stated, "Fourth quarter results demonstrate operating momentum at IcePro, where a robust sales increase and cost controls generated profits of $191,000, compared to a loss of $174,000 from the year-ago quarter. The quarter also reflects vigorous demand for ice time at our Rockville skating complex, which opened the 1998-99 season with approximately 75% of available ice-time pre-sold to groups, helping drive strong cash flow for the quarter. "1998 saw our Sports division Sports Division was one of the biggest sports retailers in the United Kingdom during the 1990s. In 1998 it was sold to its main competitor, JJB Sports for approximately £295 Million. It was set up by Sir Tom Hunter in 1984, to sell trainers, see article about him for more information. develop into a major presence in the ice-based entertainment industry. IcePro continues to build an impressive track record, having installed equipment at the recently opened Air Canada Center in Toronto and MCI (1) (Media Control Interface) A high-level programming interface from Microsoft and IBM for controlling multimedia devices. It provides commands and functions to open, play and close the device. (2) (Microwave Communications Inc. Center in Washington, D.C., and its financial performance is improving. IceSports and Entertainment opened two new facilities in Chesapeake, Virginia Chesapeake is an independent city located in the South Hampton Roads region of eastern Virginia in the United States. One of the Seven Cities of Hampton Roads, Chesapeake was formed in 1963 by a political consolidation of the City of South Norfolk with the former Norfolk County, and East Lansing, Michigan East Lansing is a city in the U.S. state of Michigan. The city is located directly east of Lansing, Michigan, the state's capital. Most of the city is within Ingham County, though a small portion lies in Clinton County. and neared completion of a third facility in Danbury, Connecticut “Danbury” redirects here. For other uses, see Danbury (disambiguation). Danbury is a city in Fairfield County, Connecticut, United States. It has an estimated population as of July 1, 2005 of 78,736. , giving us a total of seven locations in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. featuring 18 ice surfaces." For the twelve-month period ended December 31, 1998, net sales were $57,297,379. Reflecting the non-cash holding loss, restructuring charges and expenses related to the Company's ice rink development activities, the Company reported a net loss of $12,073,530, or $0.85 per share. Excluding the non-cash holding loss and restructuring charges, the Company would have reported a net loss of $2,696,247, or $0.19 per share. The diluted weighted average number of shares outstanding in 1998 was 14,247,535. Mr. Tenney concluded, "We are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that 1999 will show significant operating improvement for ARC International, as we enjoy a growing contribution from our skating locations and continuing momentum at IcePro. We're excited about our recently opened Chesapeake and East Lansing East Lansing, city (1990 pop. 50,677), Ingham co., S central Mich., a suburb of Lansing, on the Red Cedar River; inc. 1907. The city was first known as College Park, but was renamed when it was incorporated. locations, and expect both facilities to perform well this year. We're also looking forward to the launch of our retail hockey equipment web site, a natural extension of our six-location retail hockey equipment business, which will mirror IcePro's business-to-business internet site (http://www.icerinks.com). In addition, we continue to seek financing for our 1999 expansion, and are closely reviewing several potential acquisition candidates. "Our Ballantyne and Cabletel holdings remain important components to the value of ARC, and recent developments at these companies reinforce our optimism. Late last year Ballantyne received the largest purchase commitment in its 68-year history valued between $35 to $45 million over a two-year period and recently struck an alliance with Digital Projection International to jointly create digital motion picture projectors. Cabletel finished 1998 with strong cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses and a rising backlog that presages a significant sales rebound. At current share prices, ARC's 26% stake in Ballantyne and 51% stake in Cabletel represent a combined value to ARC shareholders of approximately $2.40 per share." ARC International Corp. is a leading developer and operator of, and full-service equipment supplier to, ice skating ice skating, gliding along an ice surface on keellike runners known as ice skates. Skating as a Sport Skating, besides being an important form of winter recreation and the essential skill in the game of ice hockey (see hockey, ice) has developed facilities in North America. ARC also has significant equity holdings in Cabletel Communications Corp., Canada's leading supplier of broadband equipment, and Ballantyne of Omaha, America's leading manufacturer of motion picture projection and specialty entertainment lighting equipment. Additional corporate information is available at the Company's web site - http://www.arc-atv.com. Except for the historical information in this press release, it includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve risks and uncertainties, including, but not limited to, the commercial viability of its U.S. ice skating facilities, quarterly fluctuations in its subsidiary's operating results and other risks detailed from time to time in the Company's Securities and Exchange Commission filings. Actual results may differ materially from management expectations. -0-
ARC International Corporation
Consolidated Statements of Operations
(in U.S. Dollars)
Three Months Ended Year-Ended
December 31, December 31,
------------ ------------
1998 1997 1998 1997
---- ---- ---- ----
Net sales $14,231,550 $15,331,855 $57,297,379 $93,932,317
Cost of sales 11,590,940 12,715,665 47,149,650 73,847,762
---------- ---------- ---------- ----------
Gross profit 2,640,610 2,616,190 10,147,729 20,084,555
Selling, general &
administrative
expenses 3,683,622 4,189,885 13,315,033 18,052,127
--------- --------- ---------- ----------
Income (loss) from
operations (1,043,012) (1,573,695) (3,167,304) 2,032,428
Other income
(deductions):
Gain (loss) on
issuance of
subsidiary's shares 0 11,145 (9,837) 133,474
Gain on sale of
subsidiary's shares 0 0 0 27,717,036
Share of income of
Ballantyne 669,471 511,621 2,417,567 979,725
Loss on
extinguishment
of debt 0 0 0 (1,074,196)
Interest expense (1,318,561) (502,309) (2,859,206) (2,190,163)
Interest income 75,311 253,297 417,759 731,337
Depreciation and
amortization (414,583) (187,276) (1,696,498) (1,870,612)
--------- --------- ----------- -----------
(988,362) 86,478 (1,730,215) 24,426,601
--------- ---------- ----------- ----------
Income (loss) from
operations before
special items (2,031,374) (1,487,217) (4,897,519) 26,459,029
Provision for
unrealized loss (4,435,010) 0 (4,435,010) 0
Restructuring
(charge)
recovery (5,613,368) 610,302 (5,613,368) (1,023,777)
----------- ----------- ----------- -----------
Income (loss) from
operations before
income taxes and
minority interest (12,079,752) (876,915) (14,945,897) 25,435,252
Income taxes
(recovery) 40,365 640,384 (312,181) 12,988,292
----------- ----------- --------- ----------
Income (loss) from
operations before
minority interest (12,120,117) (1,517,299) (14,633,716) 12,446,960
Minority interest (2,301,725) 62,734 (2,560,186) 1,332,482
----------- ------------ ----------- ---------
Net income (loss) $(9,818,392)$(1,580,033)$(12,073,530)$11,114,478
=========== =========== ============ ===========
Net income (loss)
per share
Basic $(0.69) $(0.11) $(0.85) $0.80
Diluted $(0.69) $(0.11) $(0.85) $0.75
======= ======= ======= =====
Weighted average
shares outstanding
Basic 14,279,373 14,134,528 14,247,535 13,809,429
========== ========== ========== ==========
Diluted 14,272,373 14,134,528 14,247,535 14,780,945
========== ========== ========== ==========
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