Atrium Companies, Inc. Announces Financial Results for the First Quarter Ended March 31, 2004.Business Editors DALLAS--(BUSINESS WIRE)--May 7, 2004 Atrium Companies, Inc. ("Atrium" or the "Company"), one of the largest manufacturers and suppliers of residential windows 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. , today announced its unaudited financial results for the first quarter ended March 31, 2004. Selected financial results are set forth in the table at the end of this press release and the Company's definitive results will be included in its Quarterly Report on Form 10-Q Form 10-Q See 10-Q. to be filed with the Securities and Exchange Commission (the "SEC") no later than Monday Monday: see week. , May 17, 2004. The following is a summary of Atrium's financial highlights for the first quarters ended March 31, 2004 and 2003 (reported results include the results of MD Casting, Inc., Danvid Window Company, Aluminum Screen Manufacturers, Inc. and Superior Engineered Products Corporation since their dates of acquisition, which were January 31, 2003, April 1, 2003, October 1, 2003 and December 31, 2003, respectively, while pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma results give effect to the 2003 transactions, including the acquisitions, the sale of the Company and the debt refinancing Refinancing An extension and/or increase in amount of existing debt. as if they had occurred as of January 1, 2003): Reported: -- 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 increased $36.9 million, or 32.5%, to $150.5 million during the first quarter of 2004 from $113.6 million during the first quarter of 2003. -- Gross profit totaled $43.9 million (29.2% of net sales) during the first quarter of 2004 compared to $35.0 million (30.8% of net sales) during the first quarter of 2003. -- Net loss totaled $5.7 million during the first quarter of 2004 compared to a net loss of $2.6 million during the first quarter of 2003. -- EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become totaled $12.1 million (8.0% of net sales) during the first quarter of 2004 compared to $10.1 million (8.9% of net sales) during the first quarter of 2003, representing an increase of 20.4%. -- As of March 31, 2004, the Company had total liquidity of $48.8 million, including cash of $2.7 million, availability under its $50.0 million revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility of $41.3 million (net of letters of credit totaling $8.7 million) and availability under its $50.0 million 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 securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. facility of $4.8 million (net of borrowings of $35.6 million and $9.6 million currently unavailable due to borrowing base limitations). Pro Forma: -- Net sales increased $9.6 million, or 6.8%, to $150.5 million during the first quarter of 2004 from $140.9 million during the first quarter of 2003. -- Gross profit totaled $43.9 million (29.2% of net sales) during the first quarter of 2004 compared to $41.7 million (29.6% of net sales) during the first quarter of 2003. -- Net loss totaled $5.7 million during the first quarter of 2004 compared to a net loss of $2.3 million during the first quarter of 2003. -- EBITDA totaled $12.1 million (8.0% of net sales) during the first quarter of 2004 compared to $11.9 million (8.4% of net sales) during the first quarter of 2003, representing an increase of 1.7%. "While we were pleased with the quarter over quarter sales growth of nearly 7% and while EBITDA was in line with the previous estimates provided during the fourth quarter earnings call, EBITDA was negatively impacted during the first quarter by higher than expected 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. and health insurance costs. Excluding these amounts, EBITDA growth would have exceeded sales growth for the quarter," stated Chairman, President and Chief Executive Officer, Jeff L. Hull. "Short of higher insurance costs, which are being addressed through cost reduction programs, the business performed very well in the first quarter and the trends that we are seeing right now bode bode 1 v. bod·ed, bod·ing, bodes v.tr. 1. To be an omen of: heavy seas that boded trouble for small craft. 2. well for the remainder of the year," added Mr. Hull. The results for the first quarter ended March 31, 2004 discussed herein are preliminary and subject to completion of the annual audit by Atrium's independent public auditors AUDITORS, practice. Persons lawfully appointed to examine and digest accounts referred to them, take down the evidence in writing, which may be lawfully offered in relation to such accounts, and prepare materials on which a decree or judgment may be made; and to report the whole, together . We can provide no assurance that these results will not be subject to adjustment or 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. upon completion of the audit. Atrium will hold a conference call at 10:00 a.m. (central) on Tuesday, May 11, 2004 to discuss its first quarter results. The call-in number is (888) 428-4478 (reference "Atrium First Quarter Earnings"). A replay will be available at 1:30 p.m. (central) on May 11, 2004 and will run until 11:59 p.m. (central) on May 25, 2004. The replay call-in number is (800) 475-6701, access code 730003. Atrium, based in Dallas, is one of the largest manufacturers and suppliers of residential windows in North America, with annual pro forma net sales of approximately $700 million, over 6,000 employees and 56 manufacturing facilities and distribution centers in 22 states and Mexico.
Atrium Companies, Inc.
Unaudited selected historical and pro forma financial results
(dollars in millions)
Reported:
First Quarter Ended March 31,
------------------------------
2004 2003
-------------- ---------------
Net sales $150.5 $113.6
Gross profit 43.9 35.0
Net income (loss) (5.7) (2.6)
EBITDA 12.1 10.1
Pro Forma:
First Quarter Ended March 31,
------------------------------
2004 2003
-------------- ---------------
Net sales $150.5 $140.9
Gross profit 43.9 41.7
Net income (loss) (5.7) (2.3)
EBITDA 12.1 11.9
The reconciliation of net income (loss) (in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ) to EBITDA (as defined in this press release) is summarized as follows (dollars in millions):
Reported:
First Quarter Ended March 31,
------------------------------
2004 2003
-------------- ---------------
Net income (loss) $(5.7) $(2.6)
Interest expense 8.7 8.3
Securitization expense 0.3 0.3
Income taxes - -
Depreciation and amortization 6.2 4.0
Stock compensation expense - 0.1
Special charges 2.6 -
-------------- ---------------
EBITDA $12.1 $10.1
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Pro Forma:
First Quarter Ended March 31,
------------------------------
2004 2003
-------------- ---------------
Net income (loss) $(5.7) $(2.3)
Interest expense 8.7 8.5
Securitization expense 0.3 0.3
Income taxes - 0.2
Depreciation and amortization 6.2 5.2
Stock compensation expense - -
Special charges 2.6 -
-------------- ---------------
EBITDA $12.1 $11.9
============== ===============
EBITDA, for purposes of this press release, is defined as earnings before interest, securitization expense, income taxes, depreciation and amortization, stock compensation expense and special charges. The special charges included in the definition of EBITDA were incurred as a result of the December 2003 sale of the Company. While we do not intend for EBITDA to represent 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 as defined by GAAP and we do not suggest that you consider it as an indicator of operating performance or an alternative to cash flow or 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. (as measured by GAAP) or as a measure of liquidity, we include it herein to provide additional information with respect to our ability to meet our future debt service, capital expenditures and working capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. . We believe EBITDA provides investors and analysts in the building materials Building materials used in the construction industry to create . These categories of materials and products are used by and construction project managers to specify the materials and methods used for . industry the necessary information to analyze and compare our historical results on a comparable basis with other companies on the basis of operating performance, leverage and liquidity. However, as EBITDA is not defined by GAAP, it may not be calculated on the same basis as other similarly titled measures of other companies within the building materials industry. Statements in this press release, other than statements of historical information, are 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 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. Investors are cautioned that forward-looking statements are inherently uncertain. Actual performance and results may differ materially from those projected or suggested herein due to certain risks and uncertainties including, without limitation, operating risks Operating risk The inherent or fundamental risk of a firm, without regard to financial risk. The risk that is created by operating leverage. Also called business risk. . Those and other risks are described in Atrium's filings with the SEC made over the last 12 months, copies of which are available from the SEC or may be obtained upon request from the Company's Chief Financial Officer. |
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