Concepts Direct, Inc. Reports Second Quarter and Fiscal Year 1999 Sales and Financial Results.LONGMONT Longmont, city (1990 pop. 51,555), Boulder co., N Colo.; inc. 1885. It is a trade and processing center for a rich farm area irrigated by the Colorado–Big Thompson project. Vitamins, primary metal products, and manufacturing equipment are produced. , Colo.--(BUSINESS WIRE)--July 20, 1999-- Concepts Direct, Inc. (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 : CDIR CDIR Cumulative Damage Index Right Engine CDIR Chemical Demilitarization and Installation Restoration CDIR Channel Distribution Information at the Receiver ), announced today its results for the quarter and six months ended June June: see month. 30, 1999. Sales for the quarter ended June 30, 1999, were $11,068,000, a 30% decrease from sales of $15,855,000 for the same period in 1998. The Company posted a loss of $736,000 or $0.15 per share for the quarter ended June 30, 1999, as compared to a loss of $193,000 or $0.04 per share in the same period of 1998. For the six months ended June 30, 1999, sales were $23,613,000, a 25% decrease from sales of $31,336,000 for the same period in 1998. The Company reported a loss of $1,181,000 or $0.24 per share for the six-month period ended June 30, 1999, compared to a loss of $817,000 or $0.16 per share for the same period in 1998. Phillip Phillip is a variant of the name Philip. It may refer to: Given name:
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 site development and a significant increase in reserves for losses in inventory value combined to make second-quarter results negative. In the quarter we also had significant capital expenditures for the continued development of e-commerce e-commerce, commerce conducted over the Internet, most often via the World Wide Web. E-commerce can apply to purchases made through the Web or to business-to-business activities such as inventory transfers. infrastructure and sites and the purchase of certain assets of the Music Stand. Despite these difficulties, I remain optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that more positive results will return during the holiday shopping season."
Three Months Ended June 30, Six Months Ended June 30,
1999 1998 1999 1998
------ ------ ------ ------
Sales $11,068,000 $15,855,000 $23,613,000 $31,336,000
Gross Profit 3,632,000 6,921,000 8,177,000 13,671,000
Operating loss (1,037,000) (286,000) (1,641,000) (1,331,000)
Net loss (736,000) (193,000) (1,181,000) (817,000)
Loss Per Share $(0.15) $(0.04) $(0.24) $(0.16)
Average Shares
Outstanding 4,977,000 4,957,000 4,973,000 4,957,000
Decreased Sales Company sales decreased by 30% for the quarter ended June 30, 1999, as compared to the same period in 1998. This decrease primarily resulted from a 35% decrease in the total number of catalogs distributed in the second quarter of 1999 as compared to the same period in 1998. The decrease in catalog circulation was intended to reduce prospecting loss per mail cycle, but response to prospect mail was weak and, as a result, this objective was not met. Catalog Activity During the quarter, the Company launched a new catalog, Linda's Lawn and Garden. This catalog was a test to determine whether or not to pursue a market that may be counter-seasonal to the Company's other catalogs. Sales results from Linda's Lawn and Garden were reasonably good, but there will not be a second edition until Spring, 2000, at the earliest. The Company will probably test only one new niche niche: see ecology. niche Smallest unit of a habitat that is occupied by an organism. A habitat niche is the physical space occupied by the organism; an ecological niche is the role the organism plays in the community of organisms found in the catalog in the remainder of 1999. The Company intends to further reduce prospect circulation for Linda A set of parallel processing functions added to languages, such as C and C++, that allows data to be created and transferred between processes. It was developed by Yale professor David Gelernter, when he was a 23-year old graduate student. Anderson Anderson, river, Canada Anderson, river, c.465 mi (750 km) long, rising in several lakes in N central Northwest Territories, Canada. It meanders north and west before receiving the Carnwath River and flowing north to Liverpool Bay, an arm of the Arctic , Linda Anderson's Collectibles and Snoopy Snoopy world’s most famous beagle. [Comics: “Peanuts” in Horn, 542] See : Dogs Snoopy imaginative dog. [Comics: “Peanuts” in Horn, 542–543] See : Illusion (TM), etc. in an attempt to reduce prospecting loss per mail cycle and increase contribution to profit and general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. . Microniche Offers Several microniche offers were circulated in very small quantity. Results were encouraging but circulation quantities were so small that the microniche offers had little overall impact. The Music Stand Catalog Purchase On June 2, 1999, the Company completed the purchase of certain assets of The Music Stand, a catalog marketer of assorted music-related gifts, awards and collectibles. The Company is currently merging all operational aspects of the catalog into its existing infrastructure and plans to begin mailing The Music Stand late in the summer or early fall of 1999. The Company also is planning to develop a web site called MusicStand.com. E-commerce Initiative Progress During the quarter the Company made significant progress on its e-commerce initiatives. Phase one of the infrastructure development project was completed. A corporate e-site, CDIR.com. was launched. The Company's first Internet retailing site, LindaAnderson.com, was made available in beta test A test of new or revised hardware or software that is performed by users at their facilities under normal operating conditions. Beta testing follows alpha testing. Vendors of packaged software often offer their customers the opportunity of beta testing new releases or versions, and the to public shoppers on June 29th. The Company plans to continue e-commerce development and launch other e-sites during the remainder of 1999. Marketing for LindaAnderson.com began on a limited scale in July July: see month. . Quarterly Decline In Gross Profit Margin 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. Gross profit as a percentage of sales for the quarter period ended June 30, 1999, was 33% as compared to 44% for the same period in 1998. This decrease primarily related to increased provisions for losses on inventory values and lower sales over which to spread higher fixed costs fixed costs, n.pl the costs that do not change to meet fluctuations in enrollment or in use of services (e.g., salaries, rent, business license fees, and depreciation). . Decreased Selling, General and Administrative Costs As A Percent Of Sales Selling, general and administrative costs as a percentage of sales decreased to 42% for the second quarter of 1999 from 45% for the same quarter in 1998. This decrease occurred because mailings to customers performed better than last year, despite the fact that mailings to prospects performed worse. Balance Sheet Review During the first six months of 1999, cash decreased by $3,589,000. Primary factors in this decrease were expenditures for e-commerce infrastructure and site development and purchase of certain assets of The Music Stand catalog. Cautionary Statement This press release contains certain 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. as such term is defined in 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. Company statements that are not historical facts, including statements about management's expectations, beliefs, plans and objectives are forward-looking statements and involve various risks and uncertainties. Additional discussion of factors that could cause actual results to differ materially from management's expectations, beliefs, plans and objectives is contained in the Company's SEC filings.
Selected Key Statistics
(in thousands except percentages and
average order amounts)
Q299 Q199 1998 Q498
----------------------------------
Approximate Catalogs
Circulated (1)(8)
------------------------------
Colorful Images 6,361 6,708 51,603 8,283
Linda Anderson 1,520 3,107 17,299 5,417
Snoopy etc. 361 864 2,942 1,033
Linda Anderson's Collectibles 551 660 6,429 2,941
Linda's Lawn and Garden 299 0 0 0
Total 9,092 11,339 78,273 17,674
Customer Database Size (2)(9)
Colorful Images 8,507 8,293 8,188
Linda Anderson 595 513 470
Snoopy etc. 150 122 110
Linda Anderson's Collectibles 146 122 112
Linda's Lawn and Garden 10 0 0
Total 8,979 8,956 8,774
Active Customers (3)(9)
Colorful Images 1,331 1,429 1,561
Linda Anderson 287 308 301
Snoopy etc. 60 57 53
Linda Anderson's Collectibles 89 92 83
Linda's Lawn and Garden 3
Total 1,660 1,758 1,859
Average Order Amount
------------------------
Colorful Images $29 $29 $28 $29
Linda Anderson $59 $59 $58 $59
Snoopy etc. $62 $62 $65 $64
Linda Anderson's Collectibles $62 $63 $61 $63
Linda's Lawn and Garden $71 $0 $0 $0
Merchandise Mix (4)
------------------------
Personalized Paper Products 40% 38% 34% 29%
Other Merchandise 60% 62% 66% 71%
Gross Profit Margin (5) 32.8% 36.2% 44.0% 44.6%
------------------------
SG&A Costs As A Percent
of Sales 42.1% 41.0% 46.3% 42.3%
------------------------------
Customer Marketing (6)
------------------------
Sales 7,472 8,146 46,977 17,048
Related Advertising Expense 1,958 2,060 15,436 5,252
Advertising as % of Sales 26.2% 25.3% 32.9% 30.8%
Prospect Marketing (7)
------------------------
Sales 3,446 4,418 39,066 17,361
Related Advertising Expense 1,677 2,054 19,110 7,936
Advertising as % of Sales 48.7% 46.5% 48.9% 45.7%
Balance Sheet Information
------------------------
Cash 481 3,402 4,070
Deferred Advertising 2,726 3,088 4,455
Inventories 8,933 9,256 10,053
Property and Equipment 11,807 12,691 12,272
Long Term Liabilities 5,881 5,967 6,079
Total Liabilities 12,296 12,687 14,633
Stockholders' Equity 16,307 17,036 17,440
Effective Income tax rate -34% -34% -32% 43%
------------------------
Selected Key Statistics
(in thousands except percentages and
average order amounts)(Cont.)
Q398 Q298 Q198 1997
---------------------------------
Approximate Catalogs
Circulated (1)(8)
------------------------------
Colorful Images 20,895 10,130 12,295 64,462
Linda Anderson 5,636 2,531 3,715 9,178
Snoopy etc. 1,244 128 537 1,072
Linda Anderson's Collectibles 2,366 1,122 0 1,005
Linda's Lawn and Garden 0 0 0 0
Total 30,141 13,911 16,547 77,172
Customer Database Size (2)(9)
Colorful Images 7,891 7,670 7,512
Linda Anderson 314 247 198
Snoopy etc. 45 34 23
Linda Anderson's Collectibles 45 27 15
Linda's Lawn and Garden 0 0 0
Total 8,286 7,959 7,727
Active Customers (3)(9)
Colorful Images 1,827 1,865 1,999
Linda Anderson 215 168 132
Snoopy etc. 37 26 23
Linda Anderson's Collectibles 45 27 15
Linda's Lawn and Garden
Total 2,009 2,000 2,097
Average Order Amount
------------------------
Colorful Images $29 $28 $26 $28
Linda Anderson $59 $58 $58 $58
Snoopy etc. $66 $68 $62 $71
Linda Anderson's Collectibles $62 $61 $56 $57
Linda's Lawn and Garden $0 $0 $0 $0
Merchandise Mix (4)
------------------------
Personalized Paper Products 33% 35% 44% 48%
Other Merchandise 67% 65% 56% 52%
Gross Profit Margin (5) 43.5% 43.6% 43.6% 46.6%
------------------------
SG&A Costs As A Percent
of Sales 50.8% 45.4% 50.4% 44.0%
------------------------------
Customer Marketing (6)
------------------------
Sales 10,932 9,489 9,508 44,696
Related Advertising Expense 4,131 3,256 2,797 10,592
Advertising as % of Sales 37.8% 34.3% 29.4% 23.7%
Prospect Marketing (7)
------------------------
Sales 8,610 6,420 6,675 34,790
Related Advertising Expense 4,670 2,708 3,796 19,609
Advertising as % of Sales 54.2% 42.2% 56.9% 56.4%
Balance Sheet Information
------------------------
Cash 4,007 5,003 8,674
Deferred Advertising 11,187 8,333 6,493
Inventories 10,777 6,789 5,078
Property and Equipment 11,659 11,606 11,781
Long Term Liabilities 6,467 6,178 6,337
Total Liabilities 22,270 15,020 15,154
Stockholders' Equity 17,016 17,995 18,189
Effective Income tax rate -35% -35% -35% 35%
------------------------
Selected Key Statistics
(in thousands except percentages and
average order amounts)(Cont.)
Q497 Q397 Q297
-------------------------
Approximate Catalogs
Circulated (1)(8)
------------------------------
Colorful Images 12,025 21,921 14,149
Linda Anderson 2,475 2,748 1,793
Snoopy etc. 1,012 60 0
Linda Anderson's Collectibles 1,005 0 0
Linda's Lawn and Garden 0 0 0
Total 16,515 25,972 16,366
Customer Database Size (2)(9)
Colorful Images 7,230 6,535 6,381
Linda Anderson 161 110 79
Snoopy etc. 20 0 0
Linda Anderson's Collectibles 15 0 0
Linda's Lawn and Garden 0 0 0
Total 7,434 6,671 6,408
Active Customers (3)(9)
Colorful Images 2,112 1,909 1,822
Linda Anderson 115 85 62
Snoopy etc. 16 0 0
Linda Anderson's Collectibles 14 0 0
Linda's Lawn and Garden
Total 2,195 1,961 1,865
Average Order Amount
------------------------
Colorful Images $29 $27 $27
Linda Anderson $58 $56 $58
Snoopy etc. $71 $0 $0
Linda Anderson's Collectibles $57 $0 $0
Linda's Lawn and Garden $0 $0 $0
Merchandise Mix (4)
------------------------
Personalized Paper Products 45% 51% 48%
Other Merchandise 55% 49% 52%
Gross Profit Margin (5) 46.3% 43.0% 47.1%
------------------------
SG&A Costs As A Percent
of Sales 41.1% 50.2% 44.1%
------------------------------
Customer Marketing (6)
------------------------
Sales 18,432 8,438 9,369
Related Advertising Expense 4,180 2,325 2,292
Advertising as % of Sales 22.7% 27.6% 24.5%
Prospect Marketing (7)
------------------------
Sales 15,414 6,221 5,477
Related Advertising Expense 8,217 3,895 3,217
Advertising as % of Sales 53.3% 62.6% 58.7%
Balance Sheet Information
------------------------
Cash 13,902 8,375 500
Deferred Advertising 7,616 10,578 7,566
Inventories 5,168 3,401 3,475
Property and Equipment 11,861 10,954 6,278
Long Term Liabilities 6,486 0 0
Total Liabilities 21,565 16,898 10,923
Stockholders' Equity 18,813 17,647 8,022
Effective Income tax rate 35% -36% 35%
------------------------
(1) Includes approximate number of catalogs mailed and catalogs
distributed in product shipments. Specialty mailings are
attributed to the related catalog title.
(2) Approximate size of proprietary customer database, including
customers, catalog requesters, gift recipients and catalog
referrals, at period end.
(3) Approximate number of prior 12-month buyers at period end.
(4) Estimated percentage of Company catalog sales attributable to
major merchandise categories.
(5) Net Sales less product cost, order fulfillment cost and order
shipping cost.
(6) Gross catalog sales and the related advertising expense to
customers of the same catalog title, prior to refunds.
(7) Gross catalog sales and the related advertising expense to
individuals not previously classified as customers of the catalog
title, prior to refunds.
(8) Catalogs distributed in the last 2 days of June 1998 are included
in 3rd Qtr. counts: 4,085,000 Colorful Images, 1,419,000 Linda
Anderson, 463,000 Snoopy, etc. and 597,000 Linda Anderson's
Collectibles
(9) Counts for a period may vary from one report to another due to
factors such as elimination of duplicate customer records,
elimination of undeliverable address records, changes in
classification, etc.
|
|
Printer friendly
Cite/link
Email
Feedback
Reader Opinion