Angelica Announces Fourth Quarter and Fiscal 2005 Financial Results; Fiscal Year Continuing Operations Revenues Increase 35.8% to $418.4 Million with EPS for Year of $0.25.ST. LOUIS -- Angelica angelica (ănjĕl`ĭkə), any species of the genus Angelica, plants of the family Umbelliferae (parsley family), native to the Northern Hemisphere and New Zealand, valued for their potency as a medicament and protection against Corporation (NYSE NYSE See: New York Stock Exchange : AGL (programming) AGL - (Atelier de Genie Logiciel) French for IPSE. ), a leading provider of healthcare linen linen, fabric or yarn made from the fiber of flax, probably the first vegetable fiber known to people. Linens more than 3,500 years old have been recovered from Egyptian tombs. Phoenician traders marketed linen in Mediterranean ports. management services, announced today fourth quarter and fiscal year 2005 financial results for the periods ended on January January: see month. 28, 2006. For the year, revenues from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the were $418.4 million, up 35.8% from fiscal year 2004. Earnings per share (EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ) from continuing operations were $0.25, slightly over prior guidance due to a higher than anticipated tax benefit. Fourth Quarter Ended January 28, 2006 Revenues from continuing operations for the fourth quarter of fiscal 2005 were $105.1 million, a 31.8% increase from $79.7 million recorded in the fourth quarter of fiscal 2004. Acquisitions, net of divestitures, added $22.7 million of the $25.4 million increase in fiscal fourth quarter 2005 revenue, or 28.4%. Organic growth year-over-year was $2.7 million, a 3.4% increase in revenues. Gross profit from continuing operations for the fourth quarter of fiscal 2005 was $11.1 million, a 0.6% decrease from $11.2 million in the fourth quarter of fiscal 2004. Higher revenues were offset by natural gas costs increasing as a percent of revenue to 7.5% from 5.0% in fourth quarter fiscal 2004. Our fourth quarter fiscal 2005 reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. , in which 56 employees were terminated ter·mi·nate v. ter·mi·nat·ed, ter·mi·nat·ing, ter·mi·nates v.tr. 1. To bring to an end or halt: , added $0.3 million in field operations severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when costs. Savings in linen procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. costs partially offset other cost increases. As a result, gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. was 10.6% in fourth quarter fiscal 2005, a decrease from 14.0% in the fourth quarter of fiscal 2004. Selling, general and administrative (SG&A) expenses from continuing operations in fourth quarter fiscal 2005 were $14.0 million compared to $8.2 million in fourth quarter fiscal 2004. SG&A as a percent of revenue was 13.3% in fourth quarter fiscal 2005 versus 10.2% in fourth quarter fiscal 2004. Fourth quarter fiscal 2005 includes $0.8 million in reorganization costs, including severance, $0.6 million for our operations process improvement project, $0.7 million in higher bad debt expense, $0.3 million related to a state tax audit, and $0.4 million for legal costs related to union initial contract negotiations and the Board of Directors' Special Committee. Amortization expense in fourth quarter fiscal 2005 was $1.1 million, substantially related to acquisitions, compared to $0.2 million in fourth quarter fiscal 2004. Other operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for fourth quarter fiscal 2005 was $5.5 million compared to $0.1 million in fourth quarter fiscal 2004. Fourth quarter fiscal 2005 includes $5.4 million reflecting the gain on the sale of non-healthcare assets in Long Beach and Stockton, California Stockton is a city in California and the seat of San Joaquin County (the 5th largest agricultural county in the United States). According to 2007 estimates by the California Department of Finance, Stockton has a population of 289,789 (689,689 MSA) and is the 13th largest city in . Higher interest rates and borrowings to finance acquisitions account for interest expense increasing to $2.2 million in fourth quarter fiscal 2005 from $0.5 million in fourth quarter fiscal 2004. Income from continuing operations for fourth quarter fiscal 2005 was $1.1 million, or $0.12 per 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. share, compared to income from continuing operations of $2.5 million, or $0.27 per diluted share in the fourth quarter of fiscal 2004. Fourth quarter fiscal 2005 loss from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. net of tax was $0.5 million, reflecting final operating and disposal costs associated with our third quarter fiscal 2005 exit from the St. Louis market, as well as the tax impact related to our second quarter fiscal 2004 sale of the Life Uniform retail business segment and other discontinued operations. Fourth quarter fiscal 2004 income from discontinued operations was $0.6 million, which includes $0.7 million of income attributed to the discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: retail business segment. Including the discontinued operations, we recorded net income in the fourth quarter fiscal 2005 of $0.5 million, or $0.06 per diluted share, compared to net income of $3.1 million, or $0.34 per diluted share in the fourth quarter of fiscal 2004. Fiscal Year 2005 Ended January 28, 2006 For the twelve months ended January 28, 2006, revenues from continuing operations were $418.4 million, a 35.8% increase from $308.0 million in fiscal 2004. Acquisitions, net of divestitures, added $100.6 million to fiscal 2005 revenue, a 32.6% increase. Organic growth year-over-year was $9.8 million, a 3.2% increase in revenues. Gross profit from continuing operations for fiscal 2005 was $54.1 million, a 10.8% increase from $48.8 million in fiscal 2004. The $5.3 million increase in gross profit reflects higher revenues offset primarily by production payroll payroll a list of employees, their salary rates, tax deductions, amounts paid, payroll tax, long service leave entitlements. costs increasing as a percent of revenue to 34.7% from 33.3% in fiscal 2004 and natural gas and delivery fuel costs increasing as a percent of revenue to 7.6% in fiscal 2005 versus 5.9% in fiscal 2004. The production payroll cost increase includes higher workers' compensation workers' compensation, payment by employers for some part of the cost of injuries, or in some cases of occupational diseases, received by employees in the course of their work. expense and increased payroll related to labor strike contingency contingency n. an event that might not occur. planning during the first half of this fiscal year, as well as costs associated with the closure of our Vallejo Vallejo (vălā`hō, –lā`ō, və–), city (1990 pop. 109,199), Solano co., W Calif., on San Pablo Bay at the mouth of the Napa River; inc. 1866. facility, consolidation of our two Dallas Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. facilities into one, and severance expense associated with our fourth quarter field reorganization. Savings in linen procurement costs partially offset other cost increases. Gross profit margin was 12.9% in fiscal 2005, down from 15.8% in fiscal 2004. Selling, general and administrative (SG&A) expenses from continuing operations in fiscal 2005 were $50.1 million, up 32.8% from $37.7 million in fiscal 2004. Fiscal 2005 SG&A included $1.3 million of management transition expense related to the senior management change and fourth quarter reorganization, $1.2 million of legal expenses associated with union campaign and organizational expenses and the Board of Directors' Special Committee, $0.7 million of consulting fees for our operations process improvement implementation, and $0.4 million of expenses associated with the financing alternative during the year that the Company chose not to complete. Fiscal 2005 SG&A also includes a $1.0 million increase in bad debt expense. Nevertheless, SG&A decreased as a percent of revenue to 12.0% in fiscal 2005, compared to 12.2% in fiscal 2004. Amortization expense for fiscal 2005 increased to $4.0 million from $0.9 million, reflecting the impact of our acquisitions completed in fiscal 2005 and late fiscal 2004. Other operating income for fiscal 2005 was $6.4 million compared to other operating income of $1.7 million in fiscal 2004. Fiscal 2005 other income includes gains from the sale of non-healthcare business in Long Beach, San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. and Stockton, California whereas fiscal 2004 other income includes the gain from our sale of non-healthcare business in Daytona Beach, Florida “Daytona” redirects here. For other uses, see Daytona (disambiguation). Daytona Beach is a city in Volusia County, Florida, USA. According to 2006 U.S. Census Bureau estimates, the city has a population of 64,421. . Interest expense for fiscal 2005 was $7.2 million compared to $1.4 million in fiscal 2004 due to increased borrowings for acquisitions and higher interest rates. Non-operating income declined to $1.6 million in fiscal 2005 from $2.7 million in fiscal 2004, due primarily to a real estate gain included in the prior year. Income tax benefit for fiscal 2005 was $1.6 million, compared to a $2.4 million expense in fiscal 2004. Lower income tax expense in fiscal 2005 was primarily due to lower pretax income pretax income Reported income before the deduction of income taxes. Pretax income is sometimes considered a better measure of a firm's performance than aftertax income because taxes in one period may be influenced by activities in earlier periods. . Income from continuing operations for fiscal 2005 was $2.3 million, or $0.25 per diluted share, compared to $10.7 million, or $1.18 per diluted share in fiscal 2004. The loss from discontinued operations net of tax for fiscal 2005 was $2.1 million, including a $1.3 million loss from operations of our Columbia, Illinois Columbia is a city located primarily in Monroe County, Illinois and partially in St. Clair County, Illinois. The population was 7,922 at the 2000 census. History The first white settlers who came to the area of Columbia, Illinois, in the mid-1600s were French. facility and a $0.3 million loss on disposal, plus the tax impact of $0.4 million related to our second quarter fiscal 2004 sale of our retail business segment and other discontinued operations. Fiscal 2004 loss from discontinued operations was $4.4 million, $4.0 million of which was attributed to the discontinued retail business segment. Net income for fiscal 2005 was $0.2 million, or $0.03 per diluted share compared to net income of $6.4 million, or $0.70 per diluted share, in fiscal 2004. Steve v. t. 1. To pack or stow, as cargo in a ship's hold. See Steeve. O'Hara O’Hara Scarlett hot-tempered heroine-coquette who wooed Southern Gentlemen. [Am. Lit.: Gone With The Wind] See : Flirtatiousness O’Hara Scarlett marriages to three other men fail to dim her love for Ashley Wilkes. , 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. , commenting on the results, said, "The results reported today are basically consistent with the guidance provided since last fall except we had a slightly higher tax benefit than expected. The real story of fiscal year 2005 was our transition to a larger organization more focused on serving our healthcare customers better. Fiscal year 2005 was a difficult transition year with union organizational activity, soaring soaring: see flight; glider. soaring or gliding Sport of flying a glider or sailplane. The craft is towed behind a powered airplane to an altitude of about 2,000 ft (600 m) and then released. energy costs and the expense associated with reorganizing to a customer centric business model. While further implementation of operations process improvements and customer service programs continue into fiscal 2006, as well as higher year over year energy costs, we expect to build quickly upon our fourth quarter results." Mr. O'Hara continued, "Specifically, we remain committed to achieving a 20.0% gross margin by fiscal 2008 and reducing SG&A as a percentage of revenues to 11.0% by fiscal 2008 through the customer service and operational programs discussed throughout the past year. In 2006, we expect to see sequential One after the other in some consecutive order such as by name or number. quarter to quarter improvements in our gross margin from fourth quarter fiscal 2005 beginning with the current quarter, with a second half fiscal 2006 gross margin of over 15.0%." Angelica Corporation, traded on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the symbol AGL, is a leading provider of textile textile Any filament, fibre, or yarn that can be made into fabric or cloth, and the resulting material itself. The word originally referred only to woven fabrics but now includes knitted, bonded, felted, and tufted fabrics as well. rental RENTAL. A roll or list of the rents of an estate containing the description of the lands let, the names of the tenants, and other particulars connected with such estate. This is the same as rent roll, from which it is said to be corrupted. and linen management services to the U.S. healthcare U.S. Healthcare is a now-defunct healthcare company. The logo had an apple. The merger with Aetna In 1996, the company merged with Aetna, calling it Aetna U.S. Healthcare. The U.S. Healthcare apple logo was next to the Aetna name, and U.S. Healthcare under it. U.S. market. More information about Angelica is available on its website, www.angelica.com. 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. Any forward-looking statements made in this document reflect the Company's current views with respect to future events and financial performance and are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such statements are subject to certain risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. These potential risks and uncertainties include, but are not limited to, competitive and general economic conditions, the ability to retain current customers and to add new customers in competitive market environments, competitive pricing in the marketplace, delays in the shipment of orders, availability of labor at appropriate rates, availability and cost of energy and water supplies, the cost of workers' compensation and healthcare benefits, the ability to attract and retain key personnel, the ability of the Company to recover its seller note and avoid future lease obligations as part of its sale of Life Uniform, the ability of the Company to accomplish its strategy of redirecting its resources to its healthcare linen management business in a timely and financially advantageous manner, unusual or unexpected cash needs for operations or capital transactions, the effectiveness the Company's recently announced initiatives to reduce key operating costs operating costs npl → gastos mpl operacionales as a percentage of revenues, the ability to obtain financing in required amounts and at appropriate rates and terms, the ability to identify, negotiate, fund, consummate To carry into completion; to fulfill; to accomplish. A Common-Law Marriage is consummated when the parties live in a manner intended to bring about public recognition of their relationship as Husband and Wife. and integrate acquisitions, and other factors which may be identified in the Company's filings with the Securities and Exchange Commission.
Unaudited condensed balance sheets as of January 28, 2006 and
January 29, 2005 (dollars in thousands):
January 28, January 29,
2006 2005
------------ ------------
ASSETS
------
Current Assets:
Cash $ 4,377 $ 926
Receivables, less reserves of $994 and
$510 58,151 44,454
Linens in service 43,785 37,660
Prepaid expenses and other current assets 3,602 3,817
Deferred income taxes - 5,386
Assets of discontinued operations held for
sale - 3,617
------------ ------------
Total Current Assets 109,915 95,860
Property and Equipment, net 106,293 99,366
Goodwill 49,259 31,272
Other Acquired Assets 42,470 24,728
Other Long-Term Assets 23,491 37,727
------------ ------------
Total Assets $ 331,428 $ 288,953
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Current Liabilities:
Current maturities of long-term debt $ 319 $ 419
Accounts payable 37,229 19,349
Accrued wages and other compensation 7,037 5,145
Other accrued liabilities 36,833 30,805
------------ ------------
Total Current Liabilities 81,418 55,718
Long-Term Debt, less current maturities 85,096 67,811
Other Long-Term Obligations 15,366 14,068
Shareholders' Equity 149,548 151,356
------------ ------------
Total Liabilities and Shareholders' Equity $ 331,428 $ 288,953
============ ============
Unaudited results for fourth quarter and fiscal year ended
January 28, 2006 compared with same periods ended January 29, 2005
(dollars in thousands, except per share amounts):
Fourth Quarter Ended
-----------------------------------
January 28, January 29, Percent
2006 2005 Change
------------ ------------ ---------
Continuing Operations:
Textile service revenues $ 105,076 $ 79,742 31.8%
Cost of textile services (93,965) (68,569) 37.0%
------------ ------------ ---------
Gross profit 11,111 11,173 -0.6%
Selling, general and
administrative expenses (13,987) (8,158) 71.5%
Amortization of other acquired nm
assets (1,084) (244)
Other operating income, net 5,544 101 nm
------------ ------------ ---------
Income from operations 1,584 2,872 -44.8%
Interest expense (2,247) (531) nm
Non-operating income, net 434 193 nm
------------ ------------ ---------
(Loss) income from continuing
operations pretax (229) 2,534 -109.0%
Benefit (provision) for income nm
taxes 1,321 (75)
------------ ------------ ---------
Income from continuing operations 1,092 2,459 -55.6%
------------ ------------ ---------
Discontinued Operations:
(Loss) income from discontinued
operations, net of tax (118) 94 nm
(Loss) gain on disposal of
discontinued operations, net of
tax (431) 551 nm
------------ ------------ ---------
(Loss) income from discontinued nm
operations (549) 645
------------ ------------ ---------
Net income $ 543 $ 3,104 -82.5%
============ ============ =========
Basic earnings (loss) per share:
Income from continuing
operations $ 0.12 $ 0.28 -57.1%
(Loss) income from discontinued nm
operations (0.06) 0.07
------------ ------------ ---------
Net income $ 0.06 $ 0.35 -82.9%
============ ============ =========
Diluted earnings (loss) per share:
Income from continuing
operations $ 0.12 $ 0.27 -55.6%
(Loss) income from discontinued nm
operations (0.06) 0.07
------------ ------------ ---------
Net income $ 0.06 $ 0.34 -82.4%
============ ============ =========
Fiscal Year Ended
-----------------------------------
January 28, January 29, Percent
2006 2005 Change
------------ ------------ ---------
Continuing Operations:
Textile service revenues $ 418,357 $ 308,034 35.8%
Cost of textile services (364,300) (259,265) 40.5%
------------ ------------ ---------
Gross profit 54,057 48,769 10.8%
Selling, general and
administrative expenses (50,092) (37,721) 32.8%
Amortization of other acquired nm
assets (4,036) (906)
Other operating income, net 6,384 1,743 nm
------------ ------------ ---------
Income from operations 6,313 11,885 -46.9%
Interest expense (7,198) (1,356) nm
Non-operating income, net 1,613 2,659 -39.3%
------------ ------------ ---------
(Loss) income from continuing
operations pretax 728 13,188 -94.5%
Benefit (provision) for income nm
taxes 1,591 (2,440)
------------ ------------ ---------
Income from continuing operations 2,319 10,748 -78.4%
------------ ------------ ---------
Discontinued Operations:
(Loss) income from discontinued
operations, net of tax (1,286) (1,369) -6.1%
(Loss) gain on disposal of
discontinued operations, net of
tax (785) (3,018) -74.0%
------------ ------------ ---------
(Loss) income from discontinued
operations (2,071) (4,387) -52.8%
------------ ------------ ---------
Net income $ 248 $ 6,361 -96.1%
============ ============ =========
Basic earnings (loss) per share:
Income from continuing
operations $ 0.26 $ 1.20 -78.3%
(Loss) income from discontinued
operations (0.23) (0.49) -53.1%
------------ ------------ ---------
Net income $ 0.03 $ 0.71 -95.8%
============ ============ =========
Diluted earnings (loss) per share:
Income from continuing
operations $ 0.25 $ 1.18 -78.8%
(Loss) income from discontinued
operations (0.22) (0.48) -54.2%
------------ ------------ ---------
Net income $ 0.03 $ 0.70 -95.7%
============ ============ =========
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