Angelica Announces Fourth Quarter and Fiscal Year 2003 Earnings Within Guidance Despite Asset Impairment Charge.To download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. high-resolution, print-ready JPEG JPEG in full Joint Photographic Experts Group Standard computer file format for storing graphic images in a compressed form for general use. JPEG images are compressed using a mathematical algorithm. images, click on the thumbnail A miniature representation of a page or image that is used to identify a file by its contents. Clicking the thumbnail opens the file. Thumbnails are an option in file managers, such as Windows Explorer, and they are found in photo editing and graphics program to quickly browse multiple image above. WARNING: these images are very large (800K+) Click here for caption Business Editors MULTIMEDIA AVAILABLE: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=4596849 ST. LOUIS--(BUSINESS WIRE)--March 17, 2004 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 and textile rental services, announced fourth quarter and fiscal year 2003 financial results for the periods ended January 31, 2004. Despite an asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. pre-tax charge of $1.3 million, or approximately $0.11 per share after-tax, related to underperforming stores that are not expected to be part of the Life Uniform division sale, fiscal year 2003 earnings were $1.03 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 and within the previously provided guidance of $1.00 to $1.10 per share. Fourth quarter revenues in fiscal year 2003 were $99.5 million, up 11.8% from $89.0 million in fourth quarter fiscal year 2002. For reference, fourth quarter of fiscal year 2003 was 14 weeks versus fiscal year 2002 with 13 weeks. Angelica Textile Services (ATS) recorded fourth quarter fiscal year 2003 revenues of $78.6 million, up 15.6% from $68.0 million in fourth quarter fiscal year 2002. The extra week, the previously announced Safety Harbor and Tenney acquisitions and organic growth contributed to the ATS revenue increase. Life Uniform sales for fourth quarter fiscal year 2003 were $20.9 million, down 0.5% from $21.0 million in fourth quarter fiscal year 2002. Same store sales Same Store Sales A statistic used in retail industry analysis. It compares sales of stores that have been open for a year or more. Notes: This statistic allows investors to determine what portion of new sales has come from sales growth and what portion from the opening of for fourth quarter fiscal year 2003 were up 1.9% versus fiscal year 2002 fourth quarter. Excluding the impact from the extra week, fourth quarter same-store sales Same-store sales is a business term which refers to the revenue generated by one of a retail chain's specific outlets during a certain period of time (often a fiscal quarter or a particular shopping season), compared to an identical period in the past, usually in the previous year. from stores open at least one year were down 6.3% year to year. This same-store sales decline, combined with 21 fewer stores open at the end of fourth quarter fiscal year 2003 versus fourth quarter fiscal year 2002, was mostly offset by the extra week in fiscal year 2003. As previously announced, beginning first quarter of fiscal year 2004 Angelica will treat Life Uniform as a discontinued operation discontinued operation A segment of a business that has been abandoned or sold or for which plans for one or another of these actions have been approved. See also continuing operations. . Fourth quarter net income in fiscal year 2003, including the $1.3 million pre-tax asset impairment charge noted above, was $1.7 million, down 10.1% versus $1.9 million of earnings 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 in fourth quarter fiscal year 2002 but up 11.0% when compared to fourth quarter fiscal year 2002 net income of $1.5 million which includes discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. . Earnings per diluted 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. ) were $0.19 in fourth quarter fiscal year 2003, down 9.5% versus $0.21 from continuing operations in fourth quarter fiscal year 2002. On a pre-tax basis, ATS 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 year 2003 was $5.6 million, up 57.2% from fourth quarter fiscal year 2002 operating income of $3.6 million. The previously announced timing of 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, higher revenues and lowered health care costs were offset partially by increased energy expenses and start-up Start-up The earliest stage of a new business venture. costs for new plants in Phoenix, AZ and Columbia, SC. Life Uniform's operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for fourth quarter fiscal year 2003 was $1.9 million, including the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. asset impairment charge, versus $0.1 million of operating income in fourth quarter fiscal year 2002. Corporate expenses were $1.9 million, up 33.5% from $1.4 million in fourth quarter fiscal year 2002. Contractual expenses associated with the retirement of the former 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. and 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 provisions for positions expected to be eliminated through expense reduction initiatives accounted for the majority of the corporate expense increase. Fiscal year 2003 revenues were $374.3 million, up 3.0% from $363.4 million in fiscal year 2002. ATS fiscal year 2003 revenues were $291.5 million, up 7.5% from $271.3 million in fiscal year 2002. Organic growth, the extra week in fiscal year 2003 and the fourth quarter acquisitions accounted for this increase. Life Uniform fiscal year 2003 revenues were $82.8 million, down 10.2% from $92.2 million in fiscal year 2002. A 7.4% same-store sales decline and 21 fewer stores, offset partially by the extra week, accounted for the Life Uniform sales decline. Fiscal year 2003 net income was $9.2 million, up 39.5% from fiscal year 2002 income from continuing operations of $6.6 million and compared to a fiscal year 2002 net loss of $65,000 which includes discontinued operations. Fiscal year 2003 includes the previously announced second quarter insurance pre-tax gain of $1.9 million and the fourth quarter Life Uniform asset impairment pre-tax charge of $1.3 million. Fiscal 2002 income from continuing operations includes the previously announced $6.8 million pre-tax prepayment penalty Prepayment penalty A fee a borrower pays a lender when the borrower repays a loan before its scheduled time of maturity. on refinancing Refinancing An extension and/or increase in amount of existing debt. the Company's debt. ATS fiscal year 2003 operating income was $21.5 million, down 1.8% versus $21.9 million in fiscal year 2002. Higher revenues were offset by increased energy expenses, start-up costs for new plants in Phoenix, AZ and Columbia, SC, and higher workers' compensation expense. Life Uniform's operating income declined from $2.9 million in fiscal year 2002 to a loss of $2.7 million in fiscal year 2003. Corporate expenses in fiscal year 2003 were $7.7 million, up 7.1% from $7.2 million in fiscal year 2002, but the insurance gain and lower interest expense more than offset the increase. Angelica continues to have significant borrowing capacity with its revolving line of credit Revolving line of credit A bank line of credit on which the customer pays a commitment fee and can take and repay funds at will. Normally a revolving LOC involves a firm commitment from the bank for a period of several years. . Year-end debt was $17.3 million, net of cash, and shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. was $146.7 million. The Company recently increased its borrowing capacity on its revolving line of credit to $100 million. Commenting on the results, Steve O'Hara, President and CEO said, "We are pleased with Angelica Textile Services' strong fourth quarter and finish in fiscal year 2003. The Phoenix start up is now complete and our new Columbia, SC facility commenced operations last month, setting the stage for continued growth in the healthcare market in 2004. As we look to grow our healthcare linen management services and improve the efficiency of our operations, we will continue to pursue the sale of Life Uniform. We have received several indications of interest and anticipate finalizing the sale this year." Mr. O'Hara continued, "We continue to expect organic revenue growth of about 5% from ATS in fiscal year 2004. We hope to complement this with 5% to 10% of increased revenue from acquisitions. At this time, we are estimating fiscal year 2004 EPS between $1.15 to $1.30 from continuing operations. As we get deeper into the year and our acquisition efforts and energy costs crystallize crys·tal·lize also crys·tal·ize v. crys·tal·lized also crys·tal·ized, crys·tal·liz·ing also crys·tal·iz·ing, crys·tal·liz·es also crys·tal·iz·es v.tr. 1. , we look forward to providing more clarity to this guidance." 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 rental 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. The Company also operates a national chain of retail healthcare uniform and shoe stores with a fully-integrated catalogue and e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. operation as a discontinued operation pending sale of this division. 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, actual charges to the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). reserve significantly different from estimated charges, disruption disruption /dis·rup·tion/ (dis-rup´shun) a morphologic defect resulting from the extrinsic breakdown of, or interference with, a developmental process. to the Company's operation by union activities, the ability of the Company to sell the Life Uniform segment under financial terms and conditions currently anticipated, the ability of the Company to accomplish its strategy of re-directing 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 of certain expense reduction initiatives, the ability to obtain financing in required amounts and at appropriate rates, the ability to identify, negotiate, fund and integrate acquisitions, and other factors which may be identified in the Company's filings with the Securities and Exchange Commission.
Results for fourth quarter and fiscal year ended January 31, 2004
compared with same periods ended January 25, 2003
(dollars in thousands, except per share amounts):
Fourth Quarter
---------------------- Percent
Fiscal 2003 Fiscal 2002 Inc (Dec)
----------- ----------- ---------
Continuing Operations:
----------------------
Combined sales and revenues:
Textile Services $ 78,577 $ 67,966 15.6
Life Uniform 20,938 21,037 (0.5)
---------- ----------
Total $ 99,515 $ 89,003 11.8
Income from operations:
Textile Services $ 5,645 $ 3,591 57.2
Life Uniform (1,934) 57 n/m
Corporate expense (1,902) (1,425) 33.5
---------- ----------
Total $ 1,809 $ 2,223 (18.6)
Interest expense $ (228) $ (252) (9.5)
Non-operating income, net $ 306 $ 40 665.0
Loss on early extinguishment of
debt(a) -- --
Pretax income $ 1,887 $ 2,011 (6.2)
Income from continuing operations $ 1,699 $ 1,890 (10.1)
Earnings per share:
- Basic $ .19 $ .22 (13.6)
- Diluted $ .19 $ .21 (9.5)
Discontinued Operations:
------------------------
Loss from discontinued
operations, net of tax -- $ (360)
Combined Continuing and
Discontinued Operations
-----------------------
Net income (loss) $ 1,699 $ 1,530 11.0
Earnings (loss) per share:
- Basic $ .19 $ .18 5.6
- Diluted $ .19 $ .17 11.8
Percent
Fiscal 2003 Fiscal 2002 Inc (Dec)
----------- ----------- ---------
Continuing Operations:
----------------------
Combined sales and revenues:
Textile Services $ 291,499 $ 271,250 7.5
Life Uniform 82,777 92,169 (10.2)
---------- ----------
Total $ 374,276 $ 363,419 3.0
Income from operations:
Textile Services $ 21,487 $ 21,891 (1.8)
Life Uniform (2,659) 2,948 n/m
Corporate expense (7,727) (7,212) 7.1
---------- ----------
Total $ 11,101 $ 17,627 (37.0)
Interest expense $ (738) $ (2,843) (74.0)
Non-operating income, net $ 2,244 $ 502 347.0
Loss on early extinguishment of
debt(a) -- $ (6,783)
Pretax income $ 12,607 $ 8,503 48.3
Income from continuing operations $ 9,203 $ 6,597 39.5
Earnings per share:
- Basic $ 1.04 $ .76 36.8
- Diluted $ 1.03 $ .75 37.3
Discontinued Operations:
------------------------
Loss from discontinued
operations, net of tax -- $ (6,662)
Combined Continuing and
Discontinued Operations
-----------------------
Net income (loss) $ 9,203 $ (65) n/m
Earnings (loss) per share:
- Basic $ 1.04 $ (.01) n/m
- Diluted $ 1.03 $ (.01) n/m
(a) During the second quarter of fiscal 2002, a prepayment penalty was
paid to lenders in connection with the complete refinancing of the
Company's debt following the sale of the Manufacturing and
Marketing segment. In accordance with FASB Statement No. 4, that
prepayment penalty was treated as an extraordinary item. Under
FASB Statement No.145, adopted by the Company effective at the
beginning of fiscal 2003, the prepayment penalty is no longer
treated as an extraordinary item, and accordingly, these results
are restated to reflect this change in accounting treatment.
Condensed balance sheets as of January 31, 2004 and January 25, 2003
(dollars in thousands):
January 31, January 25,
2004 2003
---------- ----------
Current assets:
Cash and investments $ 2,712 $ 18,166
Receivables, net 37,664 35,316
Inventories 11,700 13,395
Linens in service 35,255 32,520
Other 10,988 11,333
Net current assets of discontinued segment -- 2,162
---------- ----------
Total current assets 98,319 112,892
Property and equipment, net 91,489 78,553
Other long-term assets 45,973 36,839
---------- ----------
Total assets $ 235,781 $ 228,284
========== ==========
Current liabilities:
Current maturities of long-term debt $ 192 $ 237
Accounts payable 22,761 19,905
Other 28,076 31,453
---------- ----------
Total current liabilities 51,029 51,595
Long-term debt 19,773 20,574
Other long-term liabilities 18,319 16,455
Shareholders' equity 146,660 139,660
---------- ----------
Total liabilities and shareholders' equity $ 235,781 $ 228,284
========== ==========
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