Bell Sports Corp. Announces Significantly Improved Fiscal 1998 Third Quarter Net Income.SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif.--(BUSINESS WIRE)--April 27, 1998--Bell Sports Corp. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : BSPT BSPT Bachelor of Science in Physical Therapy BSPT British Standard Taper Pipe Thread BSPT Bachelor of Science in Physics for Teachers and BSPTG) Monday announced results for the fiscal 1998 third quarter ended March 28, 1998. Net income increased 52% to $3.2 million or $0.23 per share for the three months ended March 28, 1998 compared to net income of $2.1 million or $0.15 per share for the three months ended March 29, 1997 when excluding the results of businesses sold and restructuring charges 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. . 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. increased approximately $1.1 million, to 12.1% of 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 for the fiscal 1998 third quarter from 9.5% of net sales in the comparable fiscal 1997 third quarter - adjusted for the results of the businesses sold. The increase in operating income marks the ninth consecutive quarter of improvement. Net sales for the three month period ended March 28, 1998 decreased 6% to $52.3 million from $55.4 million for the three month period ended March 29, 1997 -- excluding the results of businesses sold. The decline in net sales is attributed to the company's planned elimination of selected low margin products from its sales mix sales mix See product mix. and softer sales in the mass merchant segment. This product pruning pruning, the horticultural practice of cutting away an unwanted, unnecessary, or undesirable plant part, used most often on trees, shrubs, hedges, and woody vines. strategy had a favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impact on gross margins. For the fiscal 1998 third quarter, gross margins increased to 34.8% of net sales from 31.9% of net sales in the fiscal 1997 third quarter when excluding the results of businesses sold from the fiscal 1997 three month period. Selling, general and administrative expenses increased slightly to 22.7% of net sales in the quarter ended March 28, 1998 from 22.4% of net sales in the comparable prior year period -- when excluding the results of businesses sold from the fiscal 1997 third quarter. The company also reported a 64% improvement in year-to-date net income. For the nine month period ended March 28, 1998, net income increased to $4.1 million or $0.30 per share from $2.5 million or $0.18 per share in the comparable fiscal 1997 period -- excluding the results of businesses sold and restructuring charges. Operating income improved to 8% of net sales for the fiscal 1998 nine month period up from 5% of net sales in the comparable fiscal 1997 period -- excluding the results of businesses sold. Net sales were $138.6 million for the nine month period ended March 28, 1998 compared to $140.8 million for the fiscal 1997 period -- excluding the results of businesses sold. The reduction in sales is attributable to the company's elimination of low margin products from its offerings and softer sales in the mass merchant trade channel. For the nine month period ended March 28, 1998, gross margins increased to 32.5% of net sales up from 31.4% of net sales in the fiscal 1997 nine month period -- adjusted for the results of the businesses sold. Selling, general and administrative expenses decreased to 24.9% of net sales during the nine month period ended March 28, 1998 from 26.0% of net sales during the comparable prior year period -- excluding the results of the businesses sold. Management continues to pursue alternatives designed to improve margins and reduce the company's overall overhead structure. Certain matters in this press release 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 involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. These include but are not limited to: possible increases in income, growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. and gross margins, uncertain seasonality, adverse weather conditions, market acceptance of new products, competitive actions, relationships with major retail customers, retail environment, economic conditions, currency fluctuations, results of pending litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. and other risks indicated in filings from time-to-time with the Securities and Exchange Commission. Headquartered in San Jose, Bell Sports is a leading manufacturer and marketer of bicycle helmets A bicycle helmet is a helmet intended to be worn while riding a bicycle. They are designed to attenuate impacts to the head of a cyclist in falls while minimizing side effects such as interference with peripheral vision. , bicycle accessories and auto racing helmets and offers snowboard snow·board n. A board resembling a small surfboard and equipped with bindings, used for descending snow-covered slopes on one's feet but without ski poles. intr.v. and ski helmets The ski helmet is an essential protection measure in skiing that is built and designed for multiple impacts. Similar to snowboard helmets, ski helmets are also insulated for cold weather. . Bell Sports markets its products under the brand names: Bell, Giro giro Noun pl -ros 1. (in some countries) a system of transferring money within a bank or post office, directly from one account into another 2. , Rhode Gear, VistaLite, Blackburn, Bike Star, Copper Canyon The Copper Canyon (Spanish: Barranca del Cobre) is a canyon system in the Sierra Tarahumara in the southwestern part of the state of Chihuahua in Mexico. This canyon system is larger and deeper than the Grand Canyon in the neighboring United States, although the Grand and Cycle Products. -0-
Bell Sports Corp.
Financial Highlights
(unaudited, in thousands, except per share data)
Nine Months Ended Three Months Ended
March 28, March 29, March 28, March 29,
1998 1997 1998 1997
RESULTS OF OPERATIONS:
Net sales $ 138,554 $ 189,267 $ 52,332 $ 70,575
Cost of sales 93,591 135,037 34,132 49,862
Gross profit 44,963 54,230 18,200 20,713
32.5% 28.7% 34.8% 29.3%
Selling, general and
administrative
expenses 34,499 45,342 11,858 15,417
Net operating income 10,464 8,888 6,342 5,296
Loss on disposal of
product line 25,360 25,360
Restructuring charges 1,228 4,142 2,675
Disposal of product
line adjustment (1,300)
Amortization of
intangibles 1,735 2,592 533 864
Investment income (1,381) (2,610) (476) (323)
Interest expense 3,539 5,467 1,189 1,943
Income (loss) before
income taxes 6,643 (26,063) 5,096 (25,223)
Provision (benefit) for
income taxes 2,524 (3,649) 1,936 (3,280)
Net income (loss) $ 4,119 $ (22,414) $ 3,160 $ (21,943)
Net income (loss)
per share - basic $ 0.30 $ (1.63) $ 0.23 $ (1.60)
Net income (loss)
per share - fully
diluted $ 0.29 $ (1.63) $ 0.22 $ (1.59)
Weighted average
common shares and
equivalents
outstanding - basic 13,827 13,713 13,861 13,736
March 28, June 28,
Condensed Balance Sheet: 1998 1997
Cash and cash equivalents $ 25,265 $ 29,008
Accounts receivable, net 65,318 75,915
Inventories 52,601 46,549
Property, plant and equipment, net 20,225 23,738
Goodwill 54,760 56,471
Other assets 29,161 37,073
Total assets $247,330 $268,754
Accounts payable $ 10,289 $ 11,299
Accrued expenses 19,779 24,207
Debt and capital leases 89,482 109,023
Other liabilities 4,187 5,260
Stockholders' equity 123,593 118,965
Total liabilities and
stockholders' equity $247,330 $268,754
CONTACT: Bell Sports Corp., San Jose Sondra L. Lehman, 888/534-9500 Linda K. Bounds, 408/574-3436 |
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