Cavalier Announces Second Quarter Results.Business Editors ADDISON Addison, village (1990 pop. 32,058), Du Page co., NE Ill.; inc. 1884. An industrial suburb of Chicago, it manufactures machinery and plastic items. , Ala ALA aminolevulinic acid. Ala alanine. ala (a´lah) pl. a´lae [L.] a winglike process. .--(BUSINESS WIRE)--July 25, 2001 Cavalier cavalier (kăv'əlĭr`), in general, an armed horseman. In the English civil war the supporters of Charles I were called Cavaliers in contradistinction to the Roundheads, the followers of Parliament. Homes, Inc. (NYSE NYSE See: New York Stock Exchange :CAV (1) (Component Analog Video) See YPbPr. (2) (Constant Angular Velocity) Rotating an optical disc or hard disk at a constant speed. Contrast with "constant linear velocity" (CLV), in which the platter rotates at varying speeds. ) today announced results for the second quarter and six months ended June June: see month. 30, 2001. Although adverse industry conditions continue, the Company's floor shipments increased during the second quarter versus the year-earlier period -- the first interim period since the first quarter of 1999 that quarterly floor shipments have improved on a year-over-year basis. Cavalier believes these higher shipments for the quarter provides a further sign that its revenue continues to stabilize stabilize See peg. . Also, even though the Company incurred continuing losses in the second quarter, its pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta loss narrowed for the second consecutive quarter versus comparable amounts last year. Revenue for the second quarter declined 8% to $94,337,000 from $102,695,000 in the year-earlier period. Home manufacturing sales, the largest component of revenue, declined 1% to $90,332,000 for the quarter versus $91,492,000 for the second quarter of 2000 as floor shipments increased 2% to 5,557 floors versus 5,470 floors in the same period last year. Other revenue, including retail sales and financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. revenue, also declined. The Company's pre-tax loss for the second quarter was $4,613,000, a 77% improvement over the pre-tax loss of $19,988,000 posted in the year-earlier period. However, the prior-year pre-tax loss included impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. and other related charges totaling $4,397,000, charges for anticipated dealer failures of $5,022,000, and inventory valuation charges of $783,000. In the second quarter of 2001, Cavalier recorded charges of $398,000 for anticipated dealer failures. Thus, from an operating standpoint The Standpoint is a newspaper published in the British Virgin Islands. It was originally published under the name Pennysaver, largely as a shopping-coupon promotional newspaper, but since emerged as one of the most influential sources of journalism in the , the Company's pre-tax loss for the second quarter improved 57% to $4,215,000 versus $9,786,000 in the year-earlier quarter, which follows a 19% reduction in comparable pre-tax loss reported for the first quarter of 2001. The Company did not record any income tax benefit for net operating losses Net operating losses Losses that a firm can take advantage of to reduce taxes. in the second quarter because management believes it is no longer appropriate to record income tax benefits on current losses in excess of anticipated refunds. In the second quarter last year, the Company recorded an income tax benefit of $6,979,000. The net loss for the second quarter of 2001 was $4,613,000 or $0.26 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 with a net loss of $13,009,000 or $0.73 per diluted share in the prior-year period. Commenting on the results, David Roberson Roberson is a surname, and may refer to
To provide additional context to the Company's results for the first half of 2001, Roberson noted that the most recent industry figures for wholesale shipments reported by the Manufactured Housing Manufactured housing (also known as prefab housing) is a type of housing unit that is largely assembled in factories and then transported to sites of use. In the United States, the term "manufactured home" specifically refers to a house built entirely in a protected Institute through May show that year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. shipments for the period declined 36.3% on a unit basis and 33.5% as measured by floors (which compensates for changing patterns of product mix) compared with the same period last year. In the Company's core 11-state marketing region, which includes key manufactured housing states such as Texas, Alabama Alabama, indigenous people of North America Alabama (ăləbăm`ə), indigenous people of North America whose language belongs to the Muskogean branch of the Hokan-Siouan linguistic stock (see Native American languages). , North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. , South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. , Georgia Georgia, country, Asia Georgia (jôr`jə), Georgian Sakartvelo, Rus. Gruziya, officially Republic of Georgia, republic (2005 est. pop. 4,677,000), c.26,900 sq mi (69,700 sq km), in W Transcaucasia. , and Mississippi Mississippi, state, United States Mississippi (mĭs'əsĭp`ē), one of the Deep South states of the United States. It is bordered by Alabama (E), the Gulf of Mexico (S), Arkansas and Louisiana, with most of the border formed by , the decline in industry sales continued to be disproportionately dis·pro·por·tion·ate adj. Out of proportion, as in size, shape, or amount. dis  pro·por larger versus the
Company's results, with floor shipments dropping 40.0% for the
first five months of 2001. Although complete second quarter industry
figures are not yet available, Cavalier's 2% increase in floor
shipments currently contrasts with industry floor shipments that have
declined 26.9% thus far for April and May.Cavalier's revenue for the first half of 2001 declined 22% to $153,515,000 from $196,882,000 in the first six months of 2000. Home manufacturing sales declined 19% to $145,895,000 for the period versus $179,767,000 last year as shipments fell 15% to 9,126 floors compared with 10,760 floors in the first six months of 2000. The Company's pre-tax loss for the first half of 2001 was $15,471,000, reflecting a 54% improvement over the pre-tax loss of $33,763,000 posted in the year-earlier period. However, the prior-year pre-tax loss included impairment and other related charges, charges for anticipated dealer failures and inventory valuation charges totaling $12,485,000. Cavalier recorded charges of $770,000 for anticipated dealer failures in the first six months of 2001. Therefore, from an operating standpoint, the Company's pre-tax loss for the first half of 2001 improved 31% to $14,701,000 versus $21,278,000 in the year-earlier period. The Company's net loss for the first half of 2001 was $14,871,000 or $0.85 per diluted share compared with a net loss of $21,646,000 or $1.22 per diluted share in the prior-year period. "We believe the improvements we have seen in our operating results during the first half of 2001, in terms of slowing the rate of decline in revenue and reversing the trend in shipments, reflect our efforts to reduce our manufacturing and cost structure as well as the positive impact of product changes," Roberson continued. "In this last phase, which has been our focus for several months, we have committed ourselves to creating a new level of value for homebuyers through both product and manufacturing advances. However, in keeping with our heritage, we have not attempted to achieve these product enhancements by reducing quality or asking our customers to choose between features and price. As a result, I believe we are now building some of the most attractive homes on the market, and we are gratified grat·i·fy tr.v. grat·i·fied, grat·i·fy·ing, grat·i·fies 1. To please or satisfy: His achievement gratified his father. See Synonyms at please. 2. by the response from dealers and customers. "At the same time, we know that one quarter's increase in floor shipments does not mark the end of a difficult market," he continued, "and ongoing weakness in the general economy and industry remains a concern. Therefore, we continue to watch our costs and our manufacturing processes to maintain flexibility in the way we respond to uncertain and evolving market conditions. We believe our focus on these fundamentals has played an important role in the improved performance we posted for the second quarter, and we are hopeful that we can build on this momentum in the third quarter, assuming that overall market conditions, including the availability of consumer credit and other industry factors, do not deteriorate de·te·ri·o·rate v. 1. To grow worse in function or condition. 2. To weaken or disintegrate. from the current level." Barry Barry, Welsh Barri, town (1991 pop. 45,053) and port, Vale of Glamorgan, S Wales, on the Bristol Channel. Once a major coal-exporting port, its more diversified export products include cement, flour, and steel products. Donnell, Chairman, noted that Cavalier continued its focus on asset management during the second quarter. "We have worked diligently dil·i·gent adj. Marked by persevering, painstaking effort. See Synonyms at busy. [Middle English, from Old French, from Latin d over the past two years to maintain a sound balance sheet in light of weaker market conditions, and inventory control has been one of our highest priorities." According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Donnell, inventories declined 45% to $18,741,000 at June 30, 2001, from $33,936,000 at the end of the second quarter 2000. Dealer inventory at June 30, 2001, including inventory at company-owned retail sales centers, declined 33% to approximately $164,000,000 from $245,000,000 at June 30, 2000. Cash and cash equivalents totaled $24,889,000 as of June 30, 2001, versus $36,713,000 at June 30, 2000. Donnell noted that Cavalier's $35,000,000 revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility, which matures in April 2003, provided the Company with total lending capacity of $18,643,000 as of June 30, 2001, based on the Company's current tangible net worth Tangible Net Worth Total assets less intangible assets and total liabilities. Notes: In terms of a consumer, tangible net worth is the sum of all your tangible assets (cash, home, cars, etc). plus current year treasury stock purchases and reduced by any outstanding letters of credit. Of this available amount, $15,000,000 was outstanding at quarter's end. Cavalier's total 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. at June 30, 2001, including the $15,000,000 advanced against the lending capacity of the Company's credit facility, totaled $24,345,000 compared with total long-term debt of $24,363,000 at June 30, 2000. Cavalier Homes, Inc. and its subsidiaries produce, sell, and finance manufactured housing. The Company markets its homes primarily through independent dealers, including exclusive dealers that carry only Cavalier products, and provides financial services to retail purchasers of manufactured homes sold through its dealer network. A public, listen-only simulcast of Cavalier Homes' second quarter conference call will begin at 9:30 a.m. Eastern Daylight Time tomorrow (July 26, 2001) and may be accessed via the Company's web site, www.cavhomesinc.com. A replay of this call will be available shortly after the call using this same link and will continue until August 26, 2001. With the exception of historical information, the statements made in this press release, including those containing the words "intends," "anticipates," "expects," "plans," "hopes," "believes," and words of similar import, and those relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc industry trends and conditions, Cavalier's expectations for its results of operations in future periods, acceptance of Cavalier's new product initiatives and the effect on the Company's future sales and earnings, and Cavalier's plans and expectations for addressing current and future industry and business conditions, constitute 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. , are based upon current expectations, 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. Such forward-looking statements involve certain known and unknown assumptions, risks and uncertainties that could cause actual results to differ materially from those included in or contemplated by the statements. These assumptions, risks and uncertainties include, but are not limited to, those discussed or indicated in Cavalier'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 period ended December 31, 2000, under the heading "Item 1. Business-Risk Factors," and its Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the period ended March 31, 2001, under the heading "Safe Harbor Statement under the Private 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. Reform Act of 1995," as filed with the Securities and Exchange Commission, and in the other documents filed by Cavalier with the Securities and Exchange Commission. Cavalier disclaims any obligation to update any forward-looking statements as a result of developments occurring after the issuance of this press release.
Cavalier Homes, Inc.
Unaudited Financial Highlights
(In thousands, except per share amounts)
Second Quarter Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
2001 2000 2001 2000
--------- --------- --------- ---------
Revenue $ 94,337 $ 102,695 $ 153,515 $ 196,882
Net loss before
income tax
benefit(a) $ (4,613) $ (19,988) $ (15,471) $ (33,763)
Net loss(a) $ (4,613) $ (13,009) $ (14,871) $ (21,646)
Net loss per share
- diluted(a) $ (0.26) $ (0.73) $ (0.85) $ (1.22)
Weighted average
shares - diluted 17,488 17,768 17,511 17,770
Note: Revenue amounts for previous periods reflect certain
reclassifications in order to conform to the 2001 presentation.
(a) The Company recorded impairment and other related charges of
$4,397 ($3,465 net of taxes or $0.19 per diluted share) and $4,745
($3,778 net of taxes or $0.21 per diluted share) in the second
quarter and six-month period ended June 30, 2000, respectively,
related to the idling of home manufacturing plants, the closure or
planned sale of retail sales centers, and the expected sale of a
portion of its insurance and premium finance business.
Cavalier Homes, Inc. Data Sheet - Unaudited
($ in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
--------------------- ----------------------
2001 2000 2001 2000
STATEMENT OF INCOME -------- --------- --------- ---------
SUMMARY
Home manufacturing
net sales $ 90,332 $ 91,492 $ 145,895 $ 179,767
Financial services 785 1,590 1,480 3,037
Retail 1,751 7,865 3,393 10,806
Other 1,469 1,748 2,747 3,272
-------- -------- --------- ---------
Total revenue $ 94,337 $102,695 $ 153,515 $ 196,882
======== ======== ========= =========
Cost of sales 82,293 91,006 136,448 173,794
-------- -------- --------- ---------
Gross profit $ 12,044 $ 11,689 $ 17,067 $ 23,088
======== ======== ========= =========
Selling, general
and administrative 16,269 27,085 31,947 51,544
Impairment and other
related charges -- 4,397 -- 4,745
-------- -------- --------- ---------
Operating loss (4,225) (19,793) (14,880) (33,201)
-------- -------- --------- ---------
Other income (expense):
Interest expense (574) (631) (1,095) (1,239)
Other, net 186 436 504 677
-------- -------- --------- ---------
(388) (195) (591) (562)
-------- -------- --------- ---------
Loss before income
tax benefit (4,613) (19,988) (15,471) (33,763)
Income tax benefit -- (6,979) (600) (12,117)
-------- -------- --------- ---------
Net loss $ (4,613) $(13,009) $ (14,871) $ (21,646)
======== ======== ========= =========
Net loss per basic
and diluted share $ (0.26) $ (0.73) $ (0.85) $ (1.22)
======== ======== ========= =========
Weighted average shares
outstanding 17,487,843 17,768,472 17,511,405 17,769,640
======== ======== ========= =========
Weighted average
shares outstanding
assuming dilution 17,487,843 17,768,472 17,511,405 17,769,640
======== ======== ========= =========
OPERATING DATA SUMMARY
Manufacturing sales:
Floor shipments 5,557 5,470 9,126 10,760
Home shipments:
Single section 1,214 1,358 1,722 2,913
Multi-section 2,172 2,048 3,703 3,909
-------- -------- --------- ---------
Total shipments 3,386 3,406 5,425 6,822
Shipments to company-owned
retail locations (36) (56) (58) (118)
-------- -------- --------- ---------
Wholesale shipments to
independent retailers 3,350 3,350 5,367 6,704
======== ======== ========= =========
Retail sales:
Single section 18 166 30 223
Multi-section 32 153 63 193
-------- -------- --------- ---------
Total sales 50 319 93 416
======== ======== ========= =========
Cavalier produced
homes sold 39 267 79 341
======== ======== ========= =========
Used homes sold 10 45 13 66
======== ======== ========= =========
Independent exclusive
dealer locations 208 241 208 241
Company-owned stores 5 6 5 6
Home manufacturing
facilities --
operating 15 15 15 15
Installment loan
purchases $ 9,676 $ 18,635 $ 18,590 $ 32,124
EBITDA $ (1,967) $(16,827) $ (10,193) $ (27,364)
BALANCE SHEET SUMMARY
Cash, cash equivalents
and certificates of
deposit $ 24,889 $ 36,713 $ 24,889 $ 36,713
Working capital $ 15,329 $ 35,863 $ 15,329 $ 35,863
Current ratio 1.2 to 1 1.6 to 1 1.2 to 1 1.6 to 1
Long-term debt $ 24,345 $ 24,363 $ 24,345 $ 24,363
Stockholders' equity $ 79,201 $106,278 $ 79,201 $ 106,278
Number of shares
outstanding 17,487,843 17,769,396 17,487,843 17,769,396
Stockholders' equity
per share $ 4.53 $ 5.98 $ 4.53 $ 5.98
CIS installment
loan portfolio $ 11,097 $ 7,079 $ 11,097 $ 7,079
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