Central Garden & Pet Reports Third Quarter Results; Income from Operations Increases 24% from Prior Year.Business Editors LAFAYETTE Lafayette (lä'fēĕt`, lăf'ēĕt`). 1 City (1990 pop. 23,501), Contra Costa co., NW Calif., a residential suburb in the San Francisco–Oakland area; settled 1848, inc. 1968. , Calif.--(BUSINESS WIRE)--Aug. 5, 2003 Narrows Fiscal 2003 Earnings Guidance to $1.70-$1.75 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 Central Garden & Pet 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 :CENT) today announced its financial results for the fiscal third quarter of 2003, ended June June: see month. 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 for the third quarter increased 3% to $345.1 million from $335.6 million in the comparable fiscal 2002 period. Income from operations for the third fiscal quarter of 2003 increased 24% to $32.6 million from $26.3 million in the year-ago period. The Company recorded net income for the quarter of $17.2 million, or $0.86 per diluted share, compared with net income of $18.4 million, or $0.84 per diluted share, in the comparable year-ago period. The 2002 quarter included $6.0 million of non-taxable non-taxable adj → nicht steuerpflichtig non-taxable adj non-taxable income → reddito non imponibile life insurance proceeds, partially offset by a $2.8 million write down of an equity investment. Excluding these items, net income for the third quarter of fiscal 2002 would have been $14.0 million, or $0.65 per diluted share. Average shares outstanding on a diluted basis decreased from 23.2 million shares in the 2002 quarter to 20.1 million shares in the 2003 quarter primarily due to the redemption of our convertible subordinated notes in January January: see month. 2003. The improved results for the third fiscal quarter of 2003 were driven by continued sales growth of our brands as well as lower administrative and 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. expenses. Partially offsetting these improvements were higher than normal grain prices and higher interest costs, due primarily to the Company's issuance of $150 million of 9 1/8% senior subordinated notes due 2013 and the refinancing Refinancing An extension and/or increase in amount of existing debt. of its senior credit facility. In connection with its senior credit facility refinancing, the Company incurred a charge to interest expense in the 2003 third quarter of $0.4 million for fees and expenses associated with the early retirement of the replaced credit facility. Depreciation and amortization expense for the most recent quarter totaled $4.5 million compared to $4.3 million in the prior year. Unusual expenses, consisting primarily of litigation expenses, were $1.2 million and $3.7 million in the third fiscal quarters of 2003 and 2002, respectively. Net sales for the first nine months of fiscal 2003 were $887.6 million, a 6% increase from $837.0 million in the comparable 2002 period. Net income for the first nine months of 2003 was $30.0 million, or $1.49 per diluted share, compared with $27.8 million, or $1.36 per diluted share, in the comparable year ago period, before the effect of adopting 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 on September September: see month. 30, 2001. In the first nine months of fiscal 2002, including the effect of the non-cash SFAS No. 142 accounting charge of $146.7 million, or $112.2 million after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. , the Company reported a net loss of $84.4 million, or $3.55 per diluted share. Average shares outstanding on a diluted basis decreased from 22.8 million shares in the fiscal 2002 period to 21.8 million shares in the fiscal 2003 period due primarily to the redemption of our convertible subordinated notes in January 2003. Central continues to anticipate substantial earnings growth for fiscal 2003 with net income expected to be in the range of $1.70-$1.75 per diluted share. The Company will discuss its fiscal third quarter 2003 results on an earnings conference call today at 4:30 p.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . The earnings conference call will be simultaneously broadcast 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 through Central's website, http://www.centralgardenandpet.com/. To listen to the webcast, please log on to the website prior to the scheduled call time to register and 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. any necessary audio software. Central Garden & Pet Company is a leading innovator, marketer and producer of quality branded products for the pet and lawn and garden supplies markets. Our pet products include pet bird and small animal food, aquarium aquarium, name for any supervised exhibit of aquatic animals and plants. Aquariums are known to have been constructed in ancient Rome, Egypt, and Asia. Goldfish have been bred in China for several hundred years and are still the most commonly kept fish in home products, flea, tick tick: see mite. tick Any of some 825 parasitic arachnid species (suborder Ixodida, order Parasitiformes), found worldwide. Adults may be slightly more than an inch (30 mm) long, but most species are much smaller. , mosquito mosquito (məskē`tō), small, long-legged insect of the order Diptera, the true flies. The females of most species have piercing and sucking mouth parts and apparently they must feed at least once upon mammalian blood before their eggs can and other pest control pest control n → control m de plagas pest control n → lutte f contre les nuisibles pest control pest n products, edible bones, cages, carriers, pet books, and other dog, cat, reptile and small animal products. These products are sold under a number of brand names, including Kaytee, All-Glass Aquarium, Zodiac, Pre-Strike, Altosid, Nylabone, TFH TFH Technische Fachhochschule (German: Engeneering College/University) TFH 24 Hours (Movie) TFH Thread from Hell (newsgroups) TFH Tinfoil Hat TFH Thanks For Helping and Four Paws. Our lawn and garden products include grass seed, wild bird food, weed weed, common term for any wild plant, particularly an undesired plant, growing in cultivated ground, where it competes with crop plants for soil nutrients and water. and insect control products, decorative outdoor patio patio In Spanish and Latin American architecture, a courtyard open to the sky within a building. A Spanish development of the Roman atrium, it is comparable to the Italian cortile but provides more seclusion, possibly due to Moorish custom. The patio of the contemporary U.S. products and ant control products. These products are sold under a number of brand names, including Pennington The name Pennington can refer to a number of different persons, places, and things. Place names In the United States
It usually falls into three main classes—porous-bodied pottery, stoneware, and porcelain. , Lilly Miller, Matthews Four Seasons, AMDRO and Grant's. For additional information on Central Garden & Pet, including access to the Company's SEC filings, please visit the Company's website at http://www.centralgardenandpet.com/. "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. " Statement under 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: The statements contained in this release which are not historical facts, including future earnings guidance, 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. that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by forward-looking statements. These risks are described in the Company's Securities and Exchange Commission filings, including, without limitation, the resolution of the litigation between the Company and The Scotts Company; the success of and the costs associated with the realignment re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. of the Company's lawn and garden distribution operations; any liabilities to which the Company may become subject as a result of the August 2, 2000 fire at its Phoenix distribution center; and the impact of any other outstanding or potential litigation.
Central Garden & Pet Company
Consolidated Statements of Income
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
June 28, June 29, June 28, June 29,
2003 2002 2003 2002
--------- --------- --------- ---------
Net Sales $345,115 $335,609 $887,560 $836,961
Cost of Goods Sold and
Occupancy 242,908 234,631 625,045 583,581
--------- --------- --------- ---------
Gross Profit 102,207 100,978 262,515 253,380
Selling, General and
Administrative Expenses 69,628 74,714 199,798 203,924
--------- --------- --------- ---------
Income from Operations 32,579 26,264 62,717 49,456
Interest Expense (5,495) (3,743) (14,679) (11,363)
Interest Income 69 33 139 74
Other Income 1,563 4,407 1,893 4,771
--------- --------- --------- ---------
Income Before Income Taxes 28,716 26,961 50,070 42,938
Income Taxes 11,486 8,594 20,028 15,144
--------- --------- --------- ---------
Income Before Cumulative Effect
of Accounting Change 17,230 18,367 30,042 27,794
Cumulative Effect of Change in
Accounting for Goodwill,
net of tax --- --- --- (112,237)
--------- --------- --------- ---------
Net Income (Loss) $17,230 $18,367 $30,042 $(84,443)
========= ========= ========= =========
Basic Earnings (Loss) Per
Common Share:
Before Cumulative Effect of
Accounting Change $0.89 $0.99 $1.56 $1.50
Accounting Change --- --- --- (6.06)
--------- --------- --------- ---------
Basic Earnings (Loss)
Per Common Share $0.89 $0.99 $1.56 $(4.56)
========= ========= ========= =========
Diluted Earnings (Loss) Per
Common Share:
Before Cumulative Effect of
Accounting Change $0.86 $0.84 $1.49 $1.36
Accounting Change --- --- --- (4.91)
--------- --------- --------- ---------
Diluted Earnings (Loss)
Per Common Share $0.86 $0.84 $1.49 $(3.55)
========= ========= ========= =========
Weighted Average Shares
Outstanding
Basic 19,357 18,579 19,217 18,498
Diluted 20,137 23,200 21,794 22,847
Central Garden & Pet Company
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
June 28, June 29, Sept. 28,
2003 2002 2002
--------- --------- ---------
Assets
Current Assets:
Cash & Cash Equivalents $75,594 $9,278 $10,884
Accounts Receivable 169,263 159,283 130,984
Inventories 212,233 186,434 193,159
Other Current Assets 11,602 17,816 26,096
--------- --------- ---------
Total Current Assets 468,692 372,811 361,123
Property & Equipment - Net 99,841 102,304 100,864
Other Assets 276,444 276,079 269,970
--------- --------- ---------
Total $844,977 $751,194 $731,957
========= ========= =========
Liabilities & Shareholders' Equity
Current Liabilities:
Notes Payable $--- $80,233 $59,975
Accounts Payable 105,901 99,954 96,796
Accrued Expenses 60,244 41,563 42,742
Current Portion of Long-Term Debt 12,821 7,375 7,593
--------- --------- ---------
Total Current Liabilities 178,966 229,125 207,106
Long-Term Debt 249,225 146,235 145,331
Other Long-Term Obligations 2,293 1,253 2,012
Shareholders' Equity 414,493 374,581 377,508
--------- --------- ---------
Total $844,977 $751,194 $731,957
========= ========= =========
Central Garden & Pet Company
Reconciliation of Non-GAAP Disclosure Items(1)
(Unaudited)
(In thousands except per share amounts)
Three Months Three Months
Ended Ended
June 29, 2002 June 28, 2003
Income before income taxes $26,961 $28,716
Less: Insurance proceeds (non-taxable) (6,000) --
Plus: Equity investment writeoff (taxable) 2,750 --
-------- --------
Adjusted income before income taxes 23,711 28,716
Adjusted income taxes 9,722 11,486
-------- --------
Adjusted net income $13,989 $17,230
======== ========
Adjusted net income per diluted common share $0.65 $0.86
======== ========
Weighted average shares outstanding - diluted 23,200 20,137
(1) Three-month period ended June 29, 2002, adjusted for non-taxable
insurance proceeds and write down of an equity investment.
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