Bright Horizons Family Solutions Reports 21% Revenue Increase for Third Quarter; Nine New Center Openings, Including First School Program.NASHVILLE Nashville, city (1990 pop. 487,969), state capital, coextensive with Davidson co., central Tenn., on the Cumberland River, in a fertile farm area; inc. as a city 1806, merged with Davidson co. 1963. , Tenn.--(BUSINESS WIRE)--Oct. 21, 1998--Bright Horizons Family Solutions, Inc. (Nasdaq: BFAM BFAM Brother from Another Mother BFAM Bioinformatics for the Analysis of Mammalian Genomes BFAM Budget Formulation & Appropriation Model ) today announced financial results for the quarter and nine months ended Sept. 30, 1998. Bright Horizons (formerly Nasdaq: BRHZ) and CorporateFamily Solutions (formerly Nasdaq: CFAM CFAM Cerebral Function Analysis Monitor CFAM Cash Flow After Marketing (costs; finance, accounting) CFAM Contingency Force Analysis Model (military simulation model) ) completed their previously announced merger on July July: see month. 24, 1998, creating a new company, Bright Horizons Family Solutions Bright Horizons Family Solutions is a US-based child-care provider and one of the largest publicly held child-care corporations in the world. The result of a merger in 1998 between Massachusetts-based Bright Horizons , Inc. (BFAM). The merger is being accounted for as a pooling of interests Pooling of Interests An accounting method, used in mergers and acquisitions, where the balance sheet items of the two companies are simply added together. Notes: The opposite of pooling of interests is the purchase acquisition method. and BFAM reports financial results on a calendar year basis. Revenues for the third quarter increased 21% to $53.2 million from $43.9 million for the quarter ended Sept. 30, 1997. Net income for the third quarter of 1998 increased 109% to $1.3 million, or $0.11 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, from $642,000, or $0.07 per diluted share, for the same prior year period, excluding merger costs recorded in the current quarter ($5.4 million, net of tax, or $0.48 per diluted share) and non-recurring costs recorded in the quarter ended Sept. 30, 1997 ($297,000, or $0.03 per diluted share). Including the effects of these non-recurring items, the net loss was $4.0 million, or ($0.36) per diluted share, for the quarter ended Sept. 30, 1998 compared to net income of $345,000, or $0.04, for the same quarter in 1997. Revenues for the nine months ended Sept. 30, 1998 rose 23% to $154.3 million from $125.4 million for the same prior year period. Net income for the current nine-month period increased 88% to $4.2 million, or $0.34 per diluted share from $2.2 million, or $0.26 per diluted share for the nine months ended September September: see month. 30, 1997, excluding the effects of non-recurring charges (merger costs in 1998 and transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). and the removal of restrictions on certain common stock in 1997). Including the effects of these non-recurring items, the net loss was $1.2 million for the nine months ended Sept. 30, 1998, or ($0.10) per diluted share, compared to net income of $1.6 million, or $0.19 per diluted share, for the nine months ended Sept. 30, 1997. "We are very proud of the fact that 44 of Working Mother magazine's '100 Best Companies for Working Mothers' - and all of the Top Ten - are our client partners," Chief Executive Officer Marguerite Marguerite, for French women thus named, use Margaret Marguerite. For French women thus named, use Margaret. marguerite, in botany marguerite: see daisy. Sallee sallee Austral 1. a SE Australian eucalyptus with a pale grey bark 2. an acacia tree said. Bright Horizons Family Solutions has opened 35 new family centers since Sept. 30, 1997. Among these were new centers for Johnson & Johnson, IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) (through the American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Business Collaborative col·lab·o·rate intr.v. col·lab·o·rat·ed, col·lab·o·rat·ing, col·lab·o·rates 1. To work together, especially in a joint intellectual effort. 2. ) and Citibank CITIBANK First National City Bank , three of the Top Ten companies cited. "Revenue growth, from new family centers as well as from our existing base of centers, continues to be strong," Sallee said. "We opened nine new centers this quarter, including Chestnut Hill Chestnut Hill may refer to: In geography:
Boston, town (1991 pop. 26,495), E central England, on the Witham River. Boston's fame as a port dates from the 13th cent., when it was a Hanseatic port trading wool and wine. Having recovered from a decline in the 18th and 19th cent. ," Sallee noted. Two family centers were closed this quarter. "Our income growth over last year has been driven by the solid performance of new family centers, as well as by effective cost control in our existing base of centers," Sallee said. "Reduced interest expense resulting from the repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of debt with proceeds from our predecessor predecessor - parent companies' public offerings in 1997 also contributed to net income growth." Sallee added, "We are excited about leveraging our market leadership position in employer-sponsored child care. With our nationwide presence, we are confident that we can continue to strengthen current operations while expanding our scope through additional family centers and workplace services." Bright Horizons Family Solutions is the nation's leading provider of employer-sponsored child care, early education and work/life consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" . The company manages 269 family centers for more than 200 clients in 35 states and the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). . Among Bright Horizons Family Solutions' clients are many of the nation's leading companies, including 68 Fortune 500 and 44 of the "100 Best Companies for Working Mothers", as recognized by Working Mother magazine. This press release contains 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. , which involve a number of risks and uncertainties. Bright Horizons Family Solutions' actual results may vary significantly from the results anticipated in these forward-looking statements as a result of certain factors that are discussed in detail in the Company's filings with the Securities and Exchange Commission, including the "Risk Factors" section in the Registration Statement on Form S-4 dated June June: see month. 17, 1998. -0-
Bright Horizons Family Solutions
Selected Financial Information
(Unaudited)
(in thousands except per share data)
Three Months Ended
9/30/98 9/30/97
------- -------
Revenues $53,161 100.0% $43,923 100.0%
Cost of services 46,272 87.0% 38,376 87.4%
------------- -------------
Gross profit 6,889 13.0% 5,547 12.6%
Selling, general and
administrative expenses 4,742 8.9% 4,196 9.6%
Amortization 172 0.3% 215 0.5%
Merger costs(3) 7,500 14.1% - -
Other non-recurring costs(4) - - 297 0.7%
------------- -------------
Income (loss) from operations (5,525) -10.4% 839 1.9%
Net interest income (expense) 317 0.6% (29) -0.1%
------------- -------------
Income before income taxes (5,208) -9.8% 810 1.8%
Income tax (provision) benefit 1,159 2.2% (465) -1.1%
------------- -------------
Net income (loss) before
preferred stock dividends
and accretion on
redeemable common stock(1) ($4,049) -7.6% $345 0.8%
============= =============
Net income (loss) available to
common shareholders(1) ($4,049) ($9)
======= =======
Per share data:
Net income (loss) per share
-diluted- before preferred
dividends and redeemable
common stock accretion ($0.36) $0.04
======= =======
Weighted average number
of common and common
equivalent shares, assuming
conversion of preferred
stock(1) 11,207 9,088
======= =======
Net income (loss) per share
-diluted(2) ($0.36) ($0.00)
======= =======
Weighted average number of
common and common
equivalent shares 11,207 4,310
======= =======
Pro forma net income excluding
non-recurring charges(3)(4) $1,345 $642
======= =======
Pro forma net income
per share -diluted $0.11 $0.07
======= =======
Weighted average number of
common and common
equivalent shares 12,328 9,088
======= =======
Nine months ended
9/30/98 9/30/97
-------- -------
Revenues $154,336 100.0% $125,395 100.0%
Cost of services 133,275 86.3% 108,425 86.5%
-------------- --------------
Gross profit 21,061 13.7% 16,970 13.5%
Selling, general and
administrative expenses 14,094 9.1% 11,914 9.5%
Amortization 706 0.5% 821 0.7%
Merger costs(3) 7,500 4.9% - -
Other non-recurring costs(4) - - 840 0.7%
-------------- --------------
Income (loss) from operations (1,239) -0.8% 3,395 2.7%
Net interest income (expense) 935 0.6% (285) -0.2%
-------------- --------------
Income before income taxes (304) -0.2% 3,110 2.5%
Income tax (provision) benefit (853) -0.6% (1,478) -1.2%
-------------- --------------
Net income (loss) before
preferred stock dividends
and accretion on
redeemable common stock(1) ($1,157) -0.7% $1,632 1.3%
============= ==============
Net income (loss) available to
common shareholders(1) ($1,157) $715
======== ========
Per share data:
Net income (loss) per share
-diluted- before preferred
dividends and redeemable
common stock accretion ($0.10) $0.19
======== ========
Weighted average number
of common and common
equivalent shares, assuming
conversion of preferred
stock(1) 11,099 8,546
======== ========
Net income (loss) per share
-diluted(2) ($0.10) $0.15
======== ========
Weighted average number of
common and common
equivalent shares 11,099 4,973
======== ========
Pro forma net income excluding
non-recurring charges(3)(4) $4,237 $2,249
======== ========
Pro forma net income
per share -diluted $0.34 $0.26
======== ========
Weighted average number of
common and common
equivalent shares 12,391 8,546
======== ========
(1) In connection with BRHZ and CFAM initial public offerings
completed in November 1997 and August 1997, respectively,
preferred stock and related accumulated dividends, as well as
redeemable common stock and related accretion, were converted to
common stock.
(2) In accordance with Statement of Financial Accounting Standards No.
128 and Staff Accounting Bulletin No. 98, the conversion of
preferred stock has not been assumed in the diluted earnings per
share calculations for periods prior to the BRHZ and CFAM
respective initial public offerings because it was anti-dilutive.
(3) In July 1998, the Company completed its previously announced
merger CFAM and BRHZ. Costs associated with the merger have been
included as a charge in the operating results of the third quarter
of 1998.
(4) In the third quarter of 1997, restrictions on common stock held by
an officer of the Company were removed, resulting in a non-cash
compensation charge. In the second quarter of 1997, BRHZ incurred
costs of $543,000 associated with a proposed public offering of
securities. Because the offering was delayed, the amounts incurred
were treated as a period cost.
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