CSS Industries, Inc. Reports Sales and Earnings for the Quarter Ended June 30, 2003.Business Editors PHILADELPHIA--(BUSINESS WIRE)--July 24, 2003 CSS (1) See Cascading Style Sheets. (2) (Content Scrambling System) The copy protection system applied to DVDs, which uses a 40-bit key to encrypt the movie. Industries, Inc. (NYSE NYSE See: New York Stock Exchange :CSS) announced today the results of operations for the first quarter ended June June: see month. 30, 2003. Sales increased by 15% to $58,290,000 from $50,557,000 in 2002. The loss before cumulative effect of change in accounting principle decreased to $4,039,000, or $.35 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, compared to a prior year result of $4,340,000, or $.35 per diluted share. The prior year results have been restated to reflect a three for two stock split and also include the adoption of SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System No. 142, "Goodwill and Other Intangible Assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. " ("SFAS No.142"). Upon adoption of SFAS No. 142 and effective with the beginning of its prior fiscal year, April 1, 2002, the Company recorded a non-cash write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of goodwill and negative goodwill in the amount of $8,813,000, net of taxes, or $.70 per share. The Company's highly seasonal orientation results in operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. in the first and fourth quarters of the fiscal year and operating profits Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. in the second and third quarters. The increase in sales was primarily the result of the inclusion of Crystal Creative Products, Inc. ("Crystal"), acquired on October October: see month. 18, 2002. Excluding Crystal, sales increased $446,000, or 1%, due to increased sales of educational and other everyday products, partially offset by the shift of Christmas Christmas [Christ's Mass], in the Christian calendar, feast of the nativity of Jesus, celebrated in Roman Catholic and Protestant Churches on Dec. 25. In liturgical importance it ranks after Easter, Pentecost, and Epiphany (Jan. 6). shipments from the first quarter into the second quarter of fiscal 2004. Despite Crystal's seasonal net loss for the quarter of $840,000, which approximated budget, higher margins and lower selling, general and administrative expenses of the other businesses resulted in a decreased loss before the cumulative effect of the change in accounting principle versus the same quarter in the prior year. "We are pleased with the first quarter results of the Company. Although it is early in the year, these results support our previous guidance of EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. growth for fiscal year 2004 of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 10%," noted David Erskine Erskine (Arasgain in Scottish Gaelic) is a commuter town in Renfrewshire, Scotland, located on the southern bank of the River Clyde at the western extent of the Greater Glasgow conurbation. , President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . All statements other than statements of historical fact included 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. " within the meaning 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. Forward-looking statements are based on the beliefs of the Company's management as well as assumptions made by and information currently available to the Company's management. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including without limitation, general market conditions, increased competition, and other factors described 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 March 31, 2003. CSS' consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: results of operations for the quarters ended June 30, 2003 and 2002 and consolidated 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. balance sheets as of June 30, 2003, March 31, 2003 and June 30, 2002 follow:
CSS INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED RESULTS OF OPERATIONS
(Unaudited)
(In thousands, except
per share amounts)
Three Months Ended
June 30,
--------------------
2003 2002
--------- ----------
SALES $58,290 $50,557
--------- ----------
COSTS AND EXPENSES
Cost of sales 42,686 36,205
Selling, general and administrative expenses 21,553 20,998
Interest expense, net 705 275
Rental and other income, net (304) (141)
--------- ----------
64,640 57,337
--------- ----------
LOSS BEFORE INCOME TAXES (6,350) (6,780)
INCOME TAX BENEFIT (2,311) (2,440)
--------- ----------
LOSS BEFORE CUMULATIVE EFFECT
OF CHANGE IN ACCOUNTING PRINCIPLE (4,039) (4,340)
--------- ----------
CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE (NET OF TAX) - (8,813)
--------- ----------
NET LOSS $(4,039) $(13,153)
========= ==========
BASIC AND DILUTED LOSS PER COMMON SHARE
Before cumulative effect of accounting change $ (.35) $ (.35)
Cumulative effect of accounting change - (.70)
--------- ----------
Basic and diluted loss per common share $ (.35) $ (1.05)
========= ==========
WEIGHTED AVERAGE BASIC AND DILUTED
SHARES OUTSTANDING 11,632 12,522
========= ==========
CSS INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30, March 31, June 30,
2003 2003 2002
--------- --------- ----------
(Unaudited) (Audited) (Unaudited)
ASSETS
CURRENT ASSETS
Cash and temporary investments $ 5,426 $ 51,981 $ 1,769
Accounts receivable, net 45,739 47,583 37,816
Inventories 163,033 106,648 151,675
Income tax receivable 5,112 2,398 2,715
Deferred income taxes 6,194 6,226 6,408
Other current assets 14,475 13,771 10,256
--------- --------- ----------
Total current assets 239,779 228,607 210,639
--------- --------- ----------
PROPERTY, PLANT AND EQUIPMENT, NET 81,618 82,731 78,172
--------- --------- ----------
OTHER ASSETS
Intangible assets, net 36,017 36,045 25,983
Other 4,247 4,578 3,965
--------- --------- ----------
Total other assets 40,264 40,623 29,948
--------- --------- ----------
Total assets $361,861 $351,961 $318,759
========= ========= ==========
LIABILITIES AND SHAREHOLDERS'
EQUITY
CURRENT LIABILITIES
Notes payable $ - $ - $ 50,520
Accrued customer programs 12,963 13,334 9,413
Other current liabilities 69,230 56,311 63,902
--------- --------- ----------
Total current
liabilities 82,193 69,645 123,835
--------- --------- ----------
LONG-TERM DEBT, NET OF CURRENT
PORTION 50,000 50,063 141
--------- --------- ----------
LONG-TERM OBLIGATIONS 3,785 3,684 2,217
--------- --------- ----------
DEFERRED INCOME TAXES 7,939 7,706 5,660
--------- --------- ----------
SHAREHOLDERS' EQUITY 217,944 220,863 186,906
--------- --------- ----------
Total liabilities and
shareholders' equity $361,861 $351,961 $318,759
========= ========= ==========
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