C2, Inc. Announces Revised Earnings Report.Business Editors MILWAUKEE--(BUSINESS WIRE)--Aug. 8, 2002 C2, Inc. (Nasdaq:CTOO) today announced it is revising its recently released earnings report for the second quarter and six months ended June 30, 2002, to defer the gain it realized on the sale of a refrigerated re·frig·er·ate tr.v. re·frig·er·at·ed, re·frig·er·at·ing, re·frig·er·ates 1. To cool or chill (a substance). 2. To preserve (food) by chilling. warehouse facility to Sara Lee
Sara Lee Corporation (NYSE: SLE) is a global consumer-goods company based in Downers Grove, Illinois, USA. Corporation. This revision excludes the previously reported and realized gain Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. on the sale of assets and reduces net income for the quarter and six months ended June 30, 2002 by $463,000, or $0.09 per fully 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. Revised net earnings for the quarter (as previously noted in the original earnings release excluding the gain) are $861,000, or $0.16 per fully diluted share which reflects an increase of 180% over last year's second quarter net earnings of $307,000, or $0.06 per fully diluted share. Revised net earnings for the six months ended June 30, 2002 are $1,614,000, or $0.31 per fully diluted share which is an increase of 174% over the $589,000, or $0.11 per fully diluted share reported for the comparable period last year. This revision results from further analysis and consultation with the Company's independent auditor Independent Auditor An external auditor with a certified public accounting designation that qualifies him or her to provide an auditor's report. Notes: These auditors aren't affiliated with the company being audited. on the accounting treatment for the sale by Total Logistic lo·gis·tic also lo·gis·ti·cal adj. 1. Of or relating to symbolic logic. 2. Of or relating to logistics. [Medieval Latin logisticus, of calculation Control (TLC TLC total lung capacity; thin-layer chromatography. TLC abbr. 1. thin-layer chromatography 2. ) of a facility to Sara Lee Corporation. The sale of this facility was completed on May 31, 2002 for cash, paid in full, in the amount of $9.8 million which resulted in a realized pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern gain of $772,000 ($463,000 after tax, or $0.09 per fully diluted share). TLC will provide dedicated facility warehousing and distribution services to Sara Lee under a six-year operating agreement An operating agreement is an agreement among limited liability company ("LLC") members governing the LLC's business, and Member's financial and management rights and duties. No state requires an LLC to have an Operating agreement. . In light of the ongoing contractual relationship with Sara Lee, this transaction will be accounted for as a "sale-leaseback" with deferral deferral - Waiting for quiet on the Ethernet. of the gain over the life of the contract. In the Company's previous earnings release on July 18, 2002, specific note of earnings for both the second quarter and first six months of fiscal 2002 excluding the gain on sale of the warehouse was made. C2, Inc. is a Milwaukee-based public company with two operating businesses, Total Logistic Control and Zero Zone. Total Logistic Control TLC, based in Zeeland, Michigan Zeeland is a city in Ottawa County in the U.S. state of Michigan. The population was 5,805 at the 2000 census. The city is located at the western edge of Zeeland Charter Township which is politically independent. Its name is derived from the Dutch province of Zeeland. , is a national provider of integrated logistic services which include refrigerated and dry warehousing, transportation operations, supply chain management, dedicated third-party facility and operations management Operations management is an area of business that is concerned with the production of goods and services, and involves the responsibility of ensuring that business operations are efficient and effective. , food distribution, and fulfillment services for e-commerce applications. Operations are conducted through a network of 35 logistic centers with 36.3 million cubic feet of refrigerated capacity and over 3 million square feet of dry warehouse space making it the tenth largest provider of refrigerated warehousing services in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . TLC operates a fleet of over 350 tractors with 560 refrigerated and dry trailers. TLC recently was cited by Inbound in·bound 1 adj. Bound inward; incoming: inbound commuter traffic. Adj. 1. inbound Logistics as a Top 10 Provider of Third Party Logistics Excellence for the fourth year in a row. TLC is a 100 percent owned subsidiary of C2, Inc. Zero Zone Zero Zone, headquartered in North Prairie, Wisconsin North Prairie is a village in Waukesha County, Wisconsin. It is located in the Town of Genesee, near the town's southwestern corner. As of the 2000 census, the village had a total population of 1,571. Government North Prairie is a village, with a village board. is a manufacturer of refrigerated and freezer display cases used in grocery, convenience and drug store chains for retail merchandising of food, beverage and floral products. Zero Zone recently announced the acquisition of Zero Zone Refrigeration refrigeration, process for drawing heat from substances to lower their temperature, often for purposes of preservation. Refrigeration in its modern, portable form also depends on insulating materials that are thin yet effective. which manufactures refrigeration houses and racks to power and control the refrigeration systems, electrical panels, air conditioning air conditioning, mechanical process for controlling the humidity, temperature, cleanliness, and circulation of air in buildings and rooms. Indoor air is conditioned and regulated to maintain the temperature-humidity ratio that is most comfortable and healthful. and stand-by power for supermarkets, convenience stores The following is a list of convenience stores organized by geographical location. Stores are grouped by the lowest heading that contains all locales in which the brands have significant presence. and industrial applications. Zero Zone is a 70.6 percent owned subsidiary of C2, Inc. The statements contained in this release that are not historical facts 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. . Actual results may differ materially from management's expectations. The forward-looking statements involve risks and uncertainties, including but not limited to: -- Demand for warehousing, transportation logistic services, refrigerated display and refrigeration control systems cases may be adversely affected by increases in interest rates, adverse economic conditions, increased energy costs, loss of a material customer, weather or other factors. -- Growth in volume of services or products may be adversely affected by reduced ability to identify and hire qualified employees. -- The Company's profitability may be adversely affected by increases in interest rates because a significant portion of the Company's capital structure is debt, a portion which bears interest at variable interest rates. -- The Company's profitability may be adversely affected by performance which does not meet standards established in contractual agreements relating to transportation operations, logistics management and dedicated facility operations. -- Consolidations within the food industry or food retailers could negatively impact the Company's customers. -- The Company's market share may be adversely affected as a result of new or increased competitive conditions in warehousing, transportation or display case and refrigeration control systems manufacturing. Additional information about risks and uncertainties discussed above as well as additional material risks in the Company's business may be found in the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year 2001 and other filings the Company made from time to time with the Securities and Exchange Commission. This and other C2, Inc. news releases and additional corporate data can be accessed on the Internet at www.c2-inc.com.
C2, INC.
Consolidated Statement of Earnings
(In Thousands, Except Per Share Data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------------------------------
2002 2001 2002 2001
---------------------------------------------
Revenues:
Logistics Services $ 53,291 $ 36,447 $ 98,732 $ 68,742
Product Sales 20,033 18,481 39,232 35,116
--------- --------- --------- ---------
73,324 54,928 137,964 103,858
--------- --------- --------- ---------
Costs and Expenses:
Logistics Expense 47,601 32,161 87,987 59,631
Cost of Product Sales 15,730 14,218 31,312 27,455
Depreciation and
Amortization 2,030 2,144 4,110 4,285
Selling, General &
Administrative
Expenses 5,002 4,095 9,096 8,002
--------- --------- --------- ---------
70,363 52,618 132,505 99,373
--------- --------- --------- ---------
Earnings from Operations 2,961 2,310 5,459 4,485
Other Income (Expense):
Interest Expense, net (1,105) (1,288) (2,172) (2,736)
Other Income (Expense) (163) (20) (139) (19)
--------- --------- --------- ---------
(1,268) (1,308) (2,311) (2,755)
Earnings before Income
Taxes, and Minority
Interest 1,693 1,002 3,148 1,730
Income Tax Provision 672 439 1,250 764
--------- --------- --------- ---------
Net Earnings before
Minority Interest 1,021 563 1,898 966
Minority Interest 160 256 284 377
--------- --------- --------- ---------
Net Earnings $ 861 $ 307 $ 1,614 $ 589
========= ========= ========= =========
Basic Net Earnings Per
Share $ 0.17 $ 0.06 $ 0.32 $ 0.12
========= ========= ========= =========
Diluted Net Earnings Per
Share $ 0.16 $ 0.06 $ 0.31 $ 0.11
========= ========= ========= =========
Average Number of Shares
Outstanding 5,081,864 5,081,864 5,081,864 5,081,864
Diluted Number of Shares
Outstanding 5,277,286 5,223,411 5,261,774 5,227,245
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