CORRECTING AND REPLACING Concord Camera Corp. Announces Results and Record Sales for the Fourth Quarter and Fiscal Year Ended June 28, 2003.Business Editors CORRECTION...by Business Wire HOLLYWOOD Hollywood. 1 Community within the city of Los Angeles, S Calif., on the slopes of the Santa Monica Mts.; inc. 1903, consolidated with Los Angeles 1910. , Fla.--(BUSINESS WIRE)--Aug. 14, 2003 In BW5202 (FL-CONCORD-CAMERA) Concord Concord, cities, United States Concord (kŏng`kərd, kŏn`kôrd'). 1 city (1990 pop. 111,348), Contra Costa co., W central Calif.; settled c.1852, inc. 1906. Camera Corp. Announces Results and Record Sales for the Fourth Quarter and Fiscal Year Ended June June: see month. 28, 2003 in the Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. Consolidated Statements of Operations, please read the columns for the quarter ended as June 28, 2003 and June 29, 2002 and for the year ended as June 28, 2003 and June 29, 2002. The corrected release reads: CONCORD CAMERA CORP. ANNOUNCES RESULTS AND RECORD SALES FOR THE FOURTH QUARTER AND FISCAL YEAR ENDED JUNE 28, 2003 Concord Camera Corp. ("Concord" or "Company") (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 National Market: LENS) today reported financial results for the fourth quarter and fiscal year ended June 28, 2003 (see attached tables). Fourth Quarter Comparison For the fourth quarter ended June 28, 2003, 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 ("sales") were $61.5 million, a 100% increase over the same quarter last year. Net income was $1.7 million, or $0.06 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. This compared to sales of $30.7 million, and net income of $0.9 million, or $0.03 per diluted share for the fourth quarter of the prior fiscal year. Excluding non-cash variable stock option expense of $0.9 million ($0.8 million after taxes) in this year's fourth quarter, net income was $2.5 million, or $0.08 per diluted share. Last year's fourth quarter included $2.8 million ($2.2 million after taxes) of non-cash variable stock option income. Excluding this item, the Company lost $(1.3) million, or $(0.05) per share in last year's fourth quarter. Commenting on the financial results, Ira B. Lampert, Concord's Chairman, Chief Executive Officer and President, said, "Concord's sales for the fourth quarter of fiscal 2003 of $61.5 million exceeded the high end of the range ($50 to $55 million) of the guidance we announced in May. Fourth quarter sales also set a Company record by exceeding sales in any prior fourth quarter. Excluding non-cash variable stock option expense, net income was $2.5 million, or $0.08 per diluted share versus guidance of $0.9 to $1.8 million, or $0.03 to $0.06 per diluted share." Mr. Lampert also said, "Sales from our Retail Sales and Distribution ("RSD RSD Reflex sympathetic dystrophy, see there ") business for the fourth quarter of fiscal 2003 were $47.9 million, an increase of $21.3 million, or 80%, and accounted for 78% of total sales. This growth was in large part due to new digital camera sales, Polaroid Polaroid: see Land, Edwin H. branded single use and traditional cameras, new accounts and organic growth from existing accounts due to sell through and new product introductions. Sales from our Design and Manufacturing Services ("DMS (1) (Document Management System) See document management. (2) (Defense Messaging System) An X.500-compliant messaging system developed by the U.S. Dept. of Defense. ") business were $13.6 million, an increase of $9.5 million, or 231%, and accounted for 22% of total sales. This increase was primarily due to a new single use camera being manufactured for Eastman Kodak Company ("Kodak") under a new supply agreement entered into in September 2002." Mr. Lampert continued, "We are very pleased with the increased market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" we experienced with all of our products in both of our RSD and DMS businesses. This increased penetration was primarily a result of opening new accounts, growth in existing accounts, increased digital camera product offerings and growth in our single use camera products and sales. "Gross profit for the fourth quarter of fiscal 2003 was $10.7 million, or 17.3% of sales, versus $4.1 million, or 13.3% of sales in the same quarter last year. Margins and costs were positively impacted by significantly increased sales and the resultant This article is about the resultant of polynomials. For the result of adding two or more vectors, see Parallelogram rule. For the technique in organ building, see Resultant (organ). In mathematics, the resultant of two monic polynomials efficiency gains in our manufacturing processes at our vertically integrated world class manufacturing facility located in the People's Republic People's Republic n. A political organization founded and controlled by a national Communist party. of China ("PRC"). We continue to invest in new product engineering, design and development, primarily focusing on digital technologies and products. We incurred $2.4 million, or 3.8% of sales, in product development costs in this year's fiscal fourth quarter as compared to $1.8 million, or 5.8% of sales last year. "Selling expenses for the fourth quarter of fiscal 2003 were $3.0 million, or 4.9% of sales. This compared to $1.8 million, or 5.7% of sales, for the fourth quarter last year. The increase in absolute dollars was primarily due to additional sales and marketing personnel, higher variable costs including freight and handling costs, and royalties related to the Polaroid brand licenses, all of which are attributable to the Company's sales growth. "General and administrative ("G&A") expenses for the fourth quarter of fiscal 2003 were $5.7 million, or 9.3% of sales. This compared to $4.7 million, or 15.3% of sales, for the fourth quarter last year. The increase in G&A expenses was primarily due to additional staffing, insurance costs and additional costs associated with the Company's growth. Last year's G&A expenses included a $0.3 million reduction in expense from a 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). reversal," said Mr. Lampert. Non-cash variable stock option expense for the fourth quarter of this fiscal year was $0.9 million in comparison to $2.8 million of income for the same quarter last year. Financial expense for the fourth quarter of fiscal 2003 was $0.2 million compared to $0.6 million in the same quarter last year. The decrease of $0.4 million was attributable to the repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. in August 2002 of our $15 million, 11% Senior Notes. Investment income was $0.5 million in this year's fiscal fourth quarter versus $0.4 million last year. Other (income), net was $(0.4) million for the fourth quarter of fiscal 2003, versus zero last year. The increase is primarily related to foreign exchange gains. Fiscal Year Comparison For the fiscal year ended June 28, 2003 ("Fiscal 2003"), sales set a Company record and were $189.8 million, a 46.8% increase over the same period last year, and net income was $6.4 million, or $0.22 per diluted share. Excluding non-cash variable stock option expense, net income was $7.2 million, or $0.25 per diluted share. For the fiscal year ended June 29, 2002 ("Fiscal 2002"), sales were $129.3 million and the net loss was $(5.2) million, or $(0.19) per share. RSD sales for Fiscal 2003 were $145.8 million, an increase of $50.1 million, or 52.3%, and accounted for 77% of total sales. This growth was in large part due to new digital camera sales, Polaroid branded single use and traditional cameras, new accounts and organic growth from existing accounts due to sell through and new product introductions. DMS sales were $44.0 million, an increase of $10.4 million, or 30.9%, and accounted for 23% of total sales. The increase was due primarily to digital camera sales to a Fuji Photo Film Co., Ltd. subsidiary, Legend Group Limited in the PRC and Visioneer, Inc., sales of a new single use camera being manufactured for Kodak under a new supply agreement entered into in September 2002 and other sales to existing customers, partially offset by the previously disclosed expiration EXPIRATION. Cessation; end. As, the expiration of, a lease, of a contract, or statute. 2. In general, the expiration of a contract puts an end to all the engagements of the parties, except to those which arise from the non- fulfillment of obligations created of certain DMS contracts. Gross profit for Fiscal 2003 was $36.3 million, or 19.1% of sales, versus $19.0 million, or 14.7% of sales in Fiscal 2002. This year included a $2.2 million pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern benefit related to a favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. dispute resolution partially offset by $0.8 million of additional air freight air freight n → flete m por avión air freight n → fret aérien air freight air n → Luftfracht f costs due to the West Coast dock worker's labor dispute, while last year included $3.1 million of net inventory provisions. Fiscal 2003 gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. were positively impacted by significantly increased sales accompanied by the related efficiency gains in manufacturing. Product development expenses were $8.5 million, or 4.5% of sales for Fiscal 2003 versus $7.6 million, or 5.9% of sales last year. Selling expenses for Fiscal 2003 were $8.9 million, or 4.7% of sales. Last year, selling expenses were $6.3 million, or 4.9% of sales. The increase was primarily due to additional sales and marketing personnel, higher freight and handling costs, and royalties related to the Polaroid brand licenses, all of which are attributable to the Company's year over year sales growth. General and administrative expenses for Fiscal 2003 were $20.6 million, or 10.9% of sales. This compared to $21.0 million, or 16.2% of sales last year. Fiscal 2002 G&A expenses included a $1.6 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 provision due to the Polaroid bankruptcy bankruptcy, in law, settlement of the liabilities of a person or organization wholly or partially unable to meet financial obligations. The purposes are to distribute, through a court-appointed receiver, the bankrupt's assets equitably among creditors and, in most , a $1.1 million charitable contribution charitable contribution n. in taxation, a contribution to an organization which is officially created for charitable, religious, educational, scientific, artistic, literary, or other good works. for victims of the September 11, 2001 terrorist attack, and a net $0.7 million provision due to the Kmart bankruptcy. Fiscal 2003 G&A expenses included a $0.5 million reduction in expense due to a payment from Polaroid in settlement of Concord's outstanding Polaroid claims related to the Polaroid bankruptcy filing. The remaining elements of G&A expenses increased year over year by approximately $3.5 million primarily due to additional staffing, professional and insurance costs, and other costs associated with the Company's growth. Financial expense for Fiscal 2003 was $1.2 million versus $2.5 million last year, a decrease of $1.3 million. The decrease relates to the repurchase of the Senior Notes described herein. Investment income for Fiscal 2003 was $1.5 million versus $2.3 million last year. Last year included higher investment income mostly attributable to higher interest rates. Other (income), net was $(0.8) million for Fiscal 2003 as compared to $(0.7) million in Fiscal 2002. Last year included $1.2 million of income from an arbitration award An arbitration award (or arbitral award) is a determination on the merits by an arbitration tribunal in an arbitration, and is analogous to a judgment in a court of law. . Excluding this award, last year would have been $0.5 million of expense. The increase in income this year was primarily due to foreign exchange gains. Working Capital Working capital was $121.1 million at June 28, 2003, $115.4 million at March 29, 2003 and $128.4 million at June 29, 2002. During the fourth quarter working capital increased by $5.7 million with cash and short term investments increasing by $4.5 million ending the quarter at $88.3 million. Accounts receivable increased by $13.1 million, while inventory levels declined by $2.0 million, both due to very strong sales in the fourth quarter. For Fiscal 2003, working capital declined by $7.3 million from $128.4 million to $121.1 million. Cash and investments decreased by $15.6 million from $103.9 million at June 29, 2002 to $88.3 million at June 28, 2003 partially as a result of the repurchase of the $15 million Senior Notes, pre-paying $4 million in conjunction with the Polaroid brand license agreements and incurring in·cur tr.v. in·curred, in·cur·ring, in·curs 1. To acquire or come into (something usually undesirable); sustain: incurred substantial losses during the stock market crash. 2. $5.8 million of fixed asset expenditures. These three cash uses, totaling $24.8 million, were offset by $9.2 million from positive cash flows from operations and other balance sheet items. Accounts receivable and inventory increased by $9.5 and $9.8 million, respectively, during Fiscal 2003 as a result of our significant sales growth. Concord's Balance Sheet Remains Strong Mr. Lampert continued, "Concord ended the fourth quarter with working capital of $121.1 million, no long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. , and cash and investments on hand of $88.3 million or approximately $3.16 per share. We also had total stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. of $156.8 million, or approximately $5.62 per share, as of June 28, 2003. We remain convinced that if we adhere to adhere to verb 1. follow, keep, maintain, respect, observe, be true, fulfil, obey, heed, keep to, abide by, be loyal, mind, be constant, be faithful 2. our fundamental strategies of engineering, developing, designing and manufacturing high quality products at low cost and introducing new products to our RSD and DMS customers, our business will grow. We continue to invest in human resources The fancy word for "people." The human resources department within an organization, years ago known as the "personnel department," manages the administrative aspects of the employees. , technologies, manufacturing facilities, capital equipment and product development to support growth and our transition to a leading image capture technology-based DMS and RSD business." First Quarter 2004 Guidance Commenting on the short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. outlook for the Company, Mr. Lampert continued, "Providing long- term future guidance continues to be challenging. The economy remains difficult to forecast. Currently, for the first quarter of fiscal 2004, we anticipate revenues in the approximate range Noun 1. approximate range - near to the scope or range of something; "his answer wasn't even in the right ballpark" ballpark ambit, range, scope, reach, compass, orbit - an area in which something acts or operates or has power or control: "the range of a of $55 to $60 million and net income in the approximate range of $2.1 to $2.7 million, or $0.07 to $0.09 per diluted share, before any non-cash variable stock option expense." Potential New Products and Relationships If the Company's development efforts are successfully concluded, the Company anticipates introducing several new digital, single use and traditional cameras to potential new and existing DMS and RSD customers during Fiscal 2004. Corporate Governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. and Enhanced Reporting Concord has endorsed and will fully comply with the requirements of NASDAQ, the Sarbanes-Oxley Act See SOX. and the new SEC rules related to corporate governance, accounting and reporting. Investor Conference Call Ira B. Lampert, Chairman, Chief Executive Officer and President, will host a conference call today, Thursday, August 14, 2003 at 11:00 A.M. Eastern Daylight Time, to discuss the fourth quarter and Fiscal 2003 results. To participate in the live conference call with management, please call (973) 582-2866 at least five minutes prior to the start time. The conference call will also be broadcast live over the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the via the WEBCAST section on the home page of Concord's web site - www.concord-camera.com. To listen to the live call, go to the web site at least 15 minutes early to register, 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. and install any necessary audio software. If you are unable to listen to the call live, the conference call will be archived and can be accessed for approximately five business days. About Concord Camera Corp. Concord Camera Corp. is a global developer, designer, manufacturer and marketer of high quality, popularly priced, digital, instant, Advanced Photo System (APS), and 35mm format cameras and 35mm, APS, and instant format single use cameras. Concord markets its cameras under the trademarks POLAROID(R), CONCORD(R), KEYSTONE key·stone n. 1. Architecture The central wedge-shaped stone of an arch that locks its parts together. Also called headstone. 2. The central supporting element of a whole. (R), CONCORD EYE Q(R), LE CLIC CLIC Centre Local d'Information et de Coordination (French) CLiC Climate and Cryosphere (World Climate Research Programme project, Norway) CLIC Compact Linear Collider CLIC Connecticut Licensing Information Center (R), GOLDLINE(R), APEX apex (a´peks) pl. apexes, a´pices [L.] tip; the pointed end of a conical part; the top of a body, organ, or part.ap´ical apex of lung the rounded upper extremity of either lung. (R), and ARGUS Argus (är`gəs) or Argos (är`gŏs, –gəs), in Greek mythology. 1 Many-eyed monster, also called Panoptes. He guarded Io after she had been changed into a heifer. (R). Concord sells and markets its camera products worldwide through direct sales offices 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. , Canada, Germany, Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. , the United Kingdom and France and through independent sales agents. Concord manufactures its products in its vertically integrated manufacturing facilities in the People's Republic of China. The Polaroid trademark is owned by Polaroid Corporation and is used by Concord under license from Polaroid. Except for the historical matters contained herein, statements in this press release are forward-looking 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. Investors are cautioned that 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. , including the statements regarding anticipated or expected results and the future introduction of new products, involve risks and uncertainties which may affect the Company's business and prospects, including the risks discussed under "Risk Factors" 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 fiscal year ended June 29, 2002 and subsequently filed reports. Any forward-looking statements contained in this press release represent our estimates only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" , or as of such earlier dates as are indicated, and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim dis·claim v. dis·claimed, dis·claim·ing, dis·claims v.tr. 1. To deny or renounce any claim to or connection with; disown. 2. To deny the validity of; repudiate. 3. any obligation to do so, even if our estimates change.
Concord Camera Corp. and Subsidiaries
Condensed Consolidated Balance Sheets
(In Thousands)
June 28, March 29, June 29,
2003 2003 2002
----------- --------- ---------
Assets (Unaudited)
Current Assets:
Cash and cash equivalents $38,221 $33,816 $103,868
Short-term investments 50,035 49,906 -
Accounts receivable, net 32,494 19,352 22,984
Inventories 32,317 34,355 22,485
Prepaid expenses and other current
assets 5,122 3,948 4,194
----------- --------- ---------
Total current assets 158,189 141,377 153,531
Property, plant and equipment, net 21,328 20,779 20,985
Goodwill, net 3,721 3,721 3,721
Other assets 22,576 25,313 19,839
----------- --------- ---------
Total assets $ 205,814 $191,190 $198,076
=========== ========= =========
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $22,105 $15,398 $12,502
Accrued expenses 13,023 8,885 12,013
Other current liabilities 1,984 1,664 634
----------- --------- ---------
Total current liabilities 37,112 25,947 25,149
Senior notes - - 14,934
Other long-term liabilities 11,874 10,679 8,837
----------- --------- ---------
Total liabilities 49,986 36,626 48,920
Commitments and contingencies
Stockholders' Equity:
Blank check preferred stock, no
par value,
1,000 shares authorized, none
issued - - -
Common stock, no par value,
100,000 shares authorized,
29,464, 29,458 and 29,029
shares issued as of June 28,
2003, March 29, 2003 and June
29, 2002, respectively 141,109 141,092 140,547
Paid-in capital 5,407 4,507 4,412
Deferred stock-based compensation (190) (232) (332)
Retained earnings 15,070 13,400 8,667
Notes receivable arising from common
stock purchase agreements - - (1)
Accumulated other comprehensive loss (431) (66) -
----------- --------- ---------
160,965 158,701 153,293
Less: treasury stock, at cost, 1,543
shares (4,137) (4,137) (4,137)
----------- --------- ---------
Total stockholders' equity 156,828 154,564 149,156
----------- --------- ---------
Total liabilities and stockholders'
equity $205,814 $191,190 $198,076
=========== ========= =========
Concord Camera Corp. and Subsidiaries
Condensed Consolidated Statements of Operations
(In Thousands except per share data)
(Unaudited)
-----------
For the quarter ended For the year ended
--------------------- ------------------
June 28, June 29, June 28, June 29,
2003 2002 2003 2002
--------- -------- ---------- ----------
Net sales $61,515 $30,742 $189,783 $129,317
Cost of products sold 50,845 26,648 153,532 110,345
--------- -------- ---------- ----------
Gross profit 10,670 4,094 36,251 18,972
Selling expenses 3,009 1,757 8,905 6,343
General and
administrative expenses 5,702 4,715 20,616 20,967
(Recovery) of operating
expenses, net - - - (1,150)
Variable stock-based
compensation expense
(income) 900 (2,825) 900 -
Financing (income)
expense, net (335) 237 (297) 172
Other (income) expense,
net (406) 44 (845) (709)
--------- -------- ---------- ----------
Income (loss) before
income taxes 1,800 166 6,972 (6,651)
Provision (benefit) for
income taxes 131 (758) 569 (1,403)
--------- -------- ---------- ----------
Net income (loss) $1,669 $924 $6,403 $(5,248)
========= ======== ========== ==========
Basic earnings (loss) per
common share $0.06 $0.03 $0.23 $(0.19)
========= ======== ========== ==========
Diluted earnings (loss)
per common share $0.06 $0.03 $0.22 $(0.19)
========= ======== ========== ==========
Weighted average common
shares outstanding-basic 27,919 27,475 27,874 27,438
Dilutive effect of common
stock options 1,683 2,280 1,571 -
--------- -------- ---------- ----------
Weighted average common
shares outstanding-
diluted 29,602 29,755 29,445 27,438
========= ======== ========== ==========
Note: Certain amounts for the quarter and year ended June 29, 2002
have been restated to conform to the current year presentation.
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