Action Performance Reports Fiscal Fourth Quarter and Fiscal Year 2004 Financial Results.PHOENIX -- Action Performance Companies, Inc. (NYSE NYSE See: New York Stock Exchange : ATN ATN Acute tubular necrosis, see there ), the leader in the design, marketing, promotion and distribution of licensed motorsports merchandise MERCHANDISE. By this term is understood all those things which merchants sell either wholesale or retail, as dry goods, hardware, groceries, drugs, &c. It is usually applied to personal chattels only, and to those which are not required for food or immediate support, but such as remain , today reported financial results for the fourth quarter and fiscal year ended September September: see month. 30, 2004. Action also announced the company's board elected e·lect v. e·lect·ed, e·lect·ing, e·lects v.tr. 1. To select by vote for an office or for membership. 2. To pick out; select: elect an art course. one of its independent members, Herbert M. Baum, to serve as lead director. The company reported revenues of $97.4 million for the fourth quarter, a decline of $8.5 million, or 8.0%, from revenues of $105.8 million for the same period last year. Revenues for the fourth quarter included $12.0 million from Funline, which was acquired in September of 2003 and contributed $0.5 million in the prior year quarter. Excluding the impact of the Funline acquisition, revenues were down $20.0 million, or 19.0% from the same period last year. For the quarter, the company had a net loss of $2.9 million, or $0.16 per share (fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. ), which was down from income of $2.7 million, or $0.15 per share (fully diluted) for the fourth quarter of 2003. Included in the results for the fourth quarter of 2004 was a $4.0 million (pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta ) expense for a reserve for distributor accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying , a $2.2 million (pre-tax) expense to write inventory and accounts receivable for the Jeff Hamilton Jeff Hamilton may refer to the following:
When a person begins a civil lawsuit, the person enters into a process called litigation. with New Hampshire International Speedway New Hampshire International Speedway is a 1.058 mile (1703 m) oval track which has hosted NASCAR racing since the 1990s. It is commonly referred to by its location, Loudon. . Action looks forward to continuing its relationship with the New Hampshire New Hampshire, one of the New England states of the NE United States. It is bordered by Massachusetts (S), Vermont, with the Connecticut R. forming the boundary (W), the Canadian province of Quebec (NW), and Maine and a short strip of the Atlantic Ocean (E). track during the 2005 race season. For the full 2004 fiscal year, revenues were $344.3 million, a decline of $25.1 million, or 6.8%, from the 2003 fiscal year. Revenues for the year included $42.1 million from Funline, which was acquired in 2003 and contributed $0.5 million in that year. Excluding the impact of the Funline acquisition, revenues were down $66.8 million, or 18.1% from last year. For 2004, the company had net income of $0.5 million, or $0.03 per share (fully diluted), which was down from $24.2 million, or $1.33 per share (fully diluted), for 2003. "This ends what has been a challenging and disappointing year for Action Performance," Chief Executive Officer Fred (Friendly Rollabout Engineered for Doctors) A mobile medical conferencing unit. See videoconferencing. 1. FRED - Robert Carr. Language used by Framework, Ashton-Tate. 2. Wagenhals said. "At the same time, I believe that we recognize the problems we face, have the right team to address them, and have begun to make the changes necessary to bring Action back to the level of performance our shareholders deserve." Specifically, Wagenhals explained that the company needs to provide a more focused product line, and that product line needs to be delivered to the market in a manner that meets our consumers' expectations. In addition, the company needs to further penetrate more traditional retail outlets retail outlet n → punto de venta retail outlet n → point m de vente retail outlet retail n → . Action intends to provide more detailed turnaround Turnaround A situation where a company that has had poor performance for an extended period of time experiences a positive reversal. Notes: A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. plans later in the first half of fiscal 2005. Wagenhals concluded, "Most importantly Adv. 1. most importantly - above and beyond all other consideration; "above all, you must be independent" above all, most especially of all, in 2005 Action will be a profit focused company, determined to create value for our shareholders." Another measure to further strengthen the company and position it for turnaround was the board's naming of a lead director, reflecting a growing corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. trend among U.S. public companies. Baum, who first became an Action director in 2000, was elected lead director by the company's board during its regular November November: see month. meeting. Baum is president and chief executive officer of The Dial Corporation, and is one of seven independent directors on Action's 10-member board. About Action Performance Action Performance Companies Inc. (NYSE: ATN) is the leader in the design, promotion, marketing and distribution of licensed motorsports merchandise. The Company's products include a broad range of motorsports-related die-cast Adj. 1. die-cast - formed by forcing molten metal into a die; "a die-cast seal" formed - having or given a form or shape replica Earlier document exchange software from Farallon Communications, Inc. that converted a Windows or Mac document into a proprietary viewing format. The viewer could be distributed separately or embedded within the document itself, turning it into a single-document viewer. collectibles, apparel, souvenirs and other memorabilia mem·o·ra·bil·i·a pl.n. 1. Objects valued for their connection with historical events, culture, or entertainment: posters, publicity photographs, and other movie memorabilia. 2. . Action Performance markets and distributes products through a variety of channels including the Action Racing Collectables network of wholesale distributors, the Racing Collectables Club of America America [for Amerigo Vespucci], the lands of the Western Hemisphere—North America, Central (or Middle) America, and South America. The world map published in 1507 by Martin Waldseemüller is the first known cartographic use of the name. , QVC QVC Quality Value Convenience QVC Question Valid Command , goracing.com, trackside track·side n. The area near a track, especially a racetrack. at racing events, direct corporate promotions, mass retail, department stores This is a list of department stores. In the case of department store groups the location of the flagship store is given. This list does not include large specialist stores, which sometimes resemble department stores. , and specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. dealers. Additional information about Action Performance can be found at www.action-performance.com. This press release may contain 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. regarding the company's expectations performance and prospects. The Company's actual results could differ materially from those set forth in these forward-looking statements. Factors that might cause such differences include, among others, the ability of the Company to successfully execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution its business plan, competitive pressures, acceptance of the Company's products and services in the marketplace, the success of new marketing programs, the Company's ability to successfully execute its agreements with other parties, general economic conditions, and other risks discussed in the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , dated September 30, 2003, on file with the U.S. Securities and Exchange Commission.
ACTION PERFORMANCE COMPANIES, INC.
Unaudited Condensed Consolidated Balance Sheets
September 30, 2004 and 2003
(in thousands)
2004 2003
-------- --------
ASSETS
Current Assets:
Cash and cash equivalents $ 12,580 $ 49,462
Accounts receivable, net 51,769 69,890
Inventories 56,947 43,232
Prepaid royalties 2,834 4,470
Taxes receivable 2,126 -
Deferred income taxes 8,766 5,291
Prepaid expenses and other 5,920 3,161
-------- --------
Total Current Assets 140,942 175,506
-------- --------
Long-Term Assets:
Property and equipment, net 64,878 62,951
Goodwill 88,653 87,448
Licenses and other intangibles, net 56,614 44,426
Other 3,196 2,357
-------- --------
Total Long-Term Assets 213,341 197,182
-------- --------
$354,283 $372,688
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 28,778 $ 36,734
Accrued royalties 10,702 9,692
Accrued expenses 8,757 11,764
Taxes payable 1,742 3,156
Current portion of long-term debt 4,009 567
-------- --------
Total Current Liabilities 53,988 61,913
-------- --------
Long-Term Liabilities:
Long-term debt 11,882 34,425
Deferred income taxes and other 25,277 11,816
-------- --------
Total Long-Term Liabilities 37,159 46,241
-------- --------
Commitments and Contingencies
Minority Interests 2,509 2,941
Shareholders' Equity 260,627 261,593
-------- --------
$354,283 $372,688
======== ========
Certain prior period amounts have been reclassified to conform to the
current year presentation.
ACTION PERFORMANCE COMPANIES, INC.
Unaudited Condensed Consolidated Statements of
Operations and Comprehensive Income (Loss)
Three and Twelve Months Ended September 30, 2004 and 2003
(in thousands, except per share data)
Three Months Ended Twelve Months Ended
------------------ -------------------
2004 2003 2004 2003
-------- -------- -------- --------
Net sales $ 97,377 $105,843 $344,330 $369,458
Cost of sales 71,695 75,039 247,959 245,879
-------- -------- -------- --------
Gross profit 25,682 30,804 96,371 123,579
-------- -------- -------- --------
Operating expenses:
Selling, general and
administrative 28,747 25,892 90,713 82,598
Amortization of licenses and
other intangibles 928 841 3,802 3,416
-------- -------- -------- --------
Total operating expenses 29,675 26,733 94,515 86,014
-------- -------- -------- --------
Income (loss) from operations (3,993) 4,071 1,856 37,565
Interest expense (462) (357) (1,832) (2,085)
Gain (loss) on extinguishment
of debt (322) - (322) 34
Foreign currency gains 588 467 1,545 3,574
Earnings from joint venture 404 62 1,370 62
Other income 89 111 204 485
Other expense (261) (1,023) (1,215) (1,909)
-------- -------- -------- --------
Income (loss) before income
taxes (3,957) 3,331 1,606 37,726
Income taxes (1,081) 635 1,066 13,499
-------- -------- -------- --------
Net income (loss) (2,876) 2,696 540 24,227
Other comprehensive income 414 97 1,032 2,118
-------- -------- -------- --------
Comprehensive income (loss) $ (2,462) $ 2,793 $ 1,572 $ 26,345
======== ======== ======== ========
Earnings (Loss) Per Common
Share:
Basic $ (0.16) $ 0.15 $ 0.03 $ 1.36
Diluted $ (0.16) $ 0.15 $ 0.03 $ 1.33
Weighted Average Shares
Outstanding:
Basic 18,366 17,916 18,328 17,856
Diluted 18,366 18,368 18,600 18,259
Certain prior period amounts have been reclassified to conform to the
current year presentation.
ACTION PERFORMANCE COMPANIES, INC.
Unaudited Condensed Consolidated Statements of Cash Flows
Twelve Months Ended September 30, 2004 and 2003
(in thousands)
2004 2003
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 540 $ 24,227
Adjustments to reconcile net income to cash
provided by operations-
Deferred income taxes (885) 3,354
Depreciation and amortization 30,184 26,153
Stock option tax benefits 142 623
Gain (loss) on extinguishment of debt 322 (34)
Undistributed earnings from joint venture (1,370) (62)
Other 1,149 982
Changes in assets and liabilities, net of
businesses acquired and disposed-
Accounts receivable, net 18,456 (1,865)
Accounts payable and accrued expenses (9,469) (6,117)
Income taxes receivable and payable (3,660) (1,851)
Inventories (13,077) (363)
Prepaid royalties and accrued royalties 2,539 (4,226)
Other (5,058) (1,395)
-------- --------
Net cash provided by operating activities 19,813 39,426
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures, net (24,856) (33,121)
Acquisition of businesses (8,142) (15,733)
Other 615 -
-------- --------
Net cash used in investing activities (32,383) (48,854)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Long-term debt borrowings 11,700 3,001
Long-term debt repayments (31,303) (9,429)
Common stock purchases for treasury - (2,024)
Dividends paid - common shareholders (3,663) (2,497)
Dividends paid - minority interest shareholders (1,609) (1,256)
Stock option and other exercise proceeds 330 871
-------- --------
Net cash used in financing activities (24,545) (11,334)
-------- --------
Effect of exchange rates on cash and cash
equivalents 233 639
-------- --------
Net change in cash and cash equivalents (36,882) (20,123)
Cash and cash equivalents, beginning of period 49,462 69,585
-------- --------
Cash and cash equivalents, end of period $ 12,580 $ 49,462
======== ========
ACTION PERFORMANCE COMPANIES, INC.
Unaudited Schedule of Net Sales by Channel
Three and Twelve Months Ended September 30, 2004 and 2003
(in thousands)
Three Months Ended Twelve Months Ended
------------------ -------------------
2004 2003 2004 2003
-------- -------- -------- --------
Domestic Die-cast:
Wholesale distribution and
promotion $ 14,059 $ 25,494 $ 63,695 $102,003
Wholesale to mass-merchant
retailers 18,262 2,350 59,146 22,140
Retail through collector's
catalog club 5,735 5,545 19,485 24,406
Foreign die-cast - wholesale
distribution and promotion 9,768 9,122 36,903 34,631
-------- -------- -------- --------
Total die-cast 47,824 42,511 179,229 183,180
-------- -------- -------- --------
Domestic Apparel and
Memorabilia:
Wholesale distribution and
promotion 15,670 23,910 68,818 82,254
Wholesale to mass-merchant
retailers 17,057 21,082 43,519 48,587
-------- -------- -------- --------
Total apparel and
memorabilia 32,727 44,992 112,337 130,841
-------- -------- -------- --------
Retail at Trackside 16,311 17,473 49,928 52,456
Royalties and Other 515 867 2,836 2,981
-------- -------- -------- --------
Net Sales $ 97,377 $105,843 $344,330 $369,458
======== ======== ======== ========
Net Sales from Businesses
Acquired in Fiscal 2003 $ 12,000 $ 480 $ 42,140 $ 480
======== ======== ======== ========
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