Crown Vantage Reports Second Quarter Results.OAKLAND Oakland, city (1990 pop. 372,242), seat of Alameda co., W Calif., on the eastern side of San Francisco Bay; inc. 1852. Together with San Francisco and San Jose, the city comprises the fourth largest metropolitan area in the United States. , Calif.--(BUSINESS WIRE)--July 30, 1996--Reflecting softness in world paper markets, Crown Vantage 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 :CVAN CVAN Attack Aircraft Carrier (Nuclear Propulsion) CVAN CINCPAC Voice Alert/Automated Net ) reported a net loss for the second quarter of 1996 of $3.0 million, or $.35 per share, compared to net income of $590,000, or $.07 per share, on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis in the second quarter of 1995. 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 were $230.6 million in the second quarter of 1996 on volume of 237,100 tons (Transparent Optical Networking Services) A marketing term for providing dark fiber to a customer. The customer is responsible for generating the transmission signal and interpreting it at the other end. See dark fiber. , compared to $272.0 million on 245,500 tons sold in the year-ago quarter. The company, which manufactures printing, publishing and specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. papers, said that operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for the 1996 second quarter totaled $10.2 million, down from $16.8 million on a pro forma basis in the second quarter a year ago. Earnings before interest, taxes and depreciation EBITD is an initialism or acronym for Earnings Before Interest, Taxes and Depreciation. See EBITDA. Some people find it useful to know this value for a business. and amortization (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ) for the second quarter of 1996 were $29.4 million, compared to $37.4 million on a pro forma basis in the second quarter of 1995. Net income for the first half of 1996 of $100,000, or $.01 per share, compared to net income of $2.4 million, or $.28 per share, on a pro forma basis for the first half of 1995. For the first six months of 1996, EBITDA was $70.1 million, compared to $76.3 million on a pro forma basis for the first six months of 1995. The company said its sales volume increased by 12,000 tons from the first quarter of 1996, but average sales price per ton declined, reflecting ongoing weakness in some markets. Crown Vantage continued its strategy of debt reduction during the quarter by permanently repaying another $44 million, of which $40 million was sourced from the successful completion of the securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. of 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 . Since its incorporation in August 1995, the company has prepaid pre·pay tr.v. pre·paid, pre·pay·ing, pre·pays To pay or pay for beforehand. pre·pay  ment n. more than $50 million, or 25 percent of its
prepayable term debt, in addition to $46 million of revolving credit Revolving CreditA 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. reductions. The results are an improving capital structure, lower cash interest costs and more than $100 million of available credit under its bank credit lines. Also during the quarter, Standard and Poor's Noun 1. Standard and Poor's - a broadly based stock market index Standard and Poor's Index raised the rating on the company's bank loan from BB- to BB. Crown Vantage operates in four business sectors: Coated Printing and Publishing Papers, Uncoated Printing and Publishing Papers, Food and Retail Packaging Papers, and Specialty Converting Papers. The Coated Printing and Publishing Papers segment, which makes coated groundwood papers for magazines and catalogs, reported net sales of $54 million for the 1996 second quarter, compared to $61 million in the second quarter of the prior year. Pricing in this segment continued to decline, reflecting soft markets and high inventory levels for coated groundwood manufacturers. Volume improved in the latter part of the quarter, facilitating some inventory reduction. Uncoated Printing and Publishing Papers, including book, text and cover, and commercial printing papers, reported net sales of $59 million for the second quarter of 1996, compared to net sales of $68 million in the second quarter of 1995. While this market appeared to be stabilizing stabilizing, v to hold a limb motionless in order to ground its energy; a standard isometric resistance technique, it releases tension and lengthens muscle fibers. early in the second quarter, demand weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak en·er n. and pricing
pressures resumed in May and June June: see month. .Food and Retail Packaging Papers had net sales of $75 million in the quarter, down from $92 million in second quarter 1995. Despite lower net sales, operating profits improved as these products benefited from lower pulp and manufacturing costs. Specialty Converting Papers had quarterly net sales of $39 million compared to $42 million in the second quarter 1995. Sales volumes improved for cast-coated and converting papers, although average sales price dropped. Ernest S Er´nest n. 1. See Earnest. . Leopold Leopold was the name of many rulers in Europe. (See List of rulers named Leopold) Leopold may also refer to: People:
In metallurgy, any substance introduced in the smelting of ores to promote fluidity and to remove objectionable impurities in the form of slag. Limestone is commonly used for this purpose in smelting iron ores. . Inventory levels that had built over the previous quarters continued to be worked down. While pricing for Crown Vantage's value-added val·ue-add·ed adj. Of or relating to the estimated value that is added to a product or material at each stage of its manufacture or distribution: mix of papers remained stable through the first quarter, in the second quarter our average sales price was down, reflecting mix and competitive market conditions," Leopold said. "Productivity improvement programs at our packaging papers mills resulted in a $2 million cost reduction this quarter. A similar program is being introduced at our largest mill as we continue to emphasize cost-reduction and productivity initiatives to improve overall profitability. "During the quarter we restructured our sales and marketing organizations to bring greater focus to our three major markets and to improve outreach Outreach is an effort by an organization or group to connect its ideas or practices to the efforts of other organizations, groups, specific audiences or the general public. to our customers. This is particularly important in the marketing of our specialty papers, where Crown Vantage has the strategic advantage of expertise and diverse manufacturing capabilities to produce papers NOTICE, TO PRODUCE PAPERS, practice, evidence. When it is intended to give secondary evidence of a written instrument or paper, which is in: the possession of the opposite party, it is, in general, requisite to give him notice to produce the same on the trial of the cause, before such tailored to the unique needs of individual customers." Commenting on the market outlook, Leopold said, "After the expected slow start to the second quarter, our business began to see volume improvement during June. The strength in the economy and improving markets in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). are positive indicators. As the
industrywide in·dus·try·wide adv. & adj. Throughout an entire industry: sales that have decreased industrywide; industrywide cooperation. inventory imbalance imbalance /im·bal·ance/ (im-bal´ans) 1. lack of balance, such as between two opposing muscles or between electrolytes in the body. 2. dysequilibrium (2). completes its correction CORRECTION,punishment. Chastisement by one having authority of a person who has committed some offence, for the purpose of bringing him to legal subjection. 2. It is chiefly exercised in a parental manner, by parents, or those who are placed in loco parentis. , we expect prices to stabilize stabilize See peg. and volume to improve in the second half." Crown Vantage, which includes nine paper mills 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. and two in Scotland Scotland, political division of Great Britain (1991 pop. 4,957,000), 30,414 sq mi (78,772 sq km), comprising the northern portion of the island of Great Britain and many surrounding islands. , had net sales in 1995 of $1.1 billion. The company is headquartered in Oakland. -0-
CROWN VANTAGE INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Six Months
Ended June 30, 1996 and June 25, 1995
(in thousands of dollars, except per share)
Six Months
1995
1996 1995 Pro Forma (a)
-------- -------- -------------
Net sales $483,417 $533,930 $533,430 Less: Cost of goods sold 428,455 468,191 469,120
Gross Margin 54,962 65,739 64,310
Selling & adm expenses 24,340 28,098 28,098 Operating Profit 30,622 37,641 36,212 Interest expense (31,830) (985) (31,940) Other income 1,373 251 251 Income before Income Taxes 165 36,907 4,523 Provision (benefit) for income taxes 65 14,763 2,166
NET INCOME $ 100 $ 22,144 $ 2,357
Earnings per share (b) $ .01 $ .28 a) The 1995 Pro forma amounts reflect pro forma adjustments, principally for interest expense at current rates as if the Subordinated Notes, Senior Pay-in-Kind Notes and amounts due under the Bank Credit Facility outstanding in 1996 had been outstanding during the quarter and six months ended June 25, 1995. b) Earnings per share is based upon 8,562,097 weighted average (and assumed weighted average) shares outstanding for the quarters ended June 1996 and June 1995, and 8,543,021 weighted average (and assumed weighted average) shares outstanding for the six months ended June 1996 and June 1995. (The number of shares considered outstanding does not include 308,289 shares held by the Employee Stock Ownership Plan Trust at June 30, 1996. In accordance with generally accepted accounting principles, shares held by the Trust are not considered outstanding for earnings per share calculations until the shares are committed for release from the Trust.)
CROWN VANTAGE INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Second Quarter
Ended June 30, 1996 and June 25, 1995
(in thousands of dollars, except per share)
Second Quarter First
1995 Quarter
1996 1995 Pro Forma (a) 1996
Net sales $230,564 $272,253 $272,003 $252,853 Less: Cost of goods sold 208,019 239,536 240,023 220,436
Gross Margin 22,545 32,717 31,980 32,417
Selling & adm expenses 12,392 15,139 15,139 11,948 Operating Profit 10,153 17,578 16,841 20,469 Interest expense (15,718) (496) (15,811) (16,112) Other income 647 300 300 726 Income (loss) before Income Taxes (4,918) 17,382 1,330 5,083 Provision (benefit) for income taxes (1,956) 6,984 740 2,021
NET INCOME (LOSS) $ (2,962) $ 10,398 $ 590 $ 3,062
Earnings (loss) per share (b) $ (.35) $ .07 $ .36
CROWN VANTAGE INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Six Months
Ended June 30, 1996 and June 25, 1995
(in thousands of dollars)
Six Months Ended
1996 1995
Cash provided by (used for)
operating activities:
Net income $ 100 $ 22,144 Items not affecting cash: Depreciation expense and cost of timber harvested 37,583 39,276 Amortization of goodwill and other intangibles 562 563 Change in Working Capital and other, net 16,470 (4,702)
Cash provided by operating activities 54,715 57,281
Cash provided by (used for) investing activities: Expenditures for property, plant and equipment (37,652) (22,321) Other, net 353 694
Cash used for investing activities (37,299) (21,627)
Cash provided by (used for) financing activities: Proceeds from securitization of receivables 40,000 Payments on revolving credit, net (3,000) Payments of long-term debt (47,047) (644) James River's capital withdrawal, net -- (45,150)
Cash provided by (used for)
financing activities (10,047) (45,794)
Increase (decrease) in cash and cash equivalents 7,369 (10,140) Cash and cash equivalents, beginning of period 5,335 12,435 Cash and cash equivalents, end of period $ 12,704 $ 2,295
CROWN VANTAGE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions of dollars)
June 30, 1996 Dec. 31, 1995
ASSETS
Cash and cash equivalents $ 12.7 $ 5.3
Accounts receivable 53.2 106.7
Inventories 99.4 100.4
Other current assets 21.1 23.8
Total Current Assets 186.4 236.2
Property, plant and equipment, net 668.1 668.3
Other assets 88.6 87.6
------ ------
$943.1 $992.1
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued expenses $126.2 $137.5
Current portion of long-term debt 7.6 11.9
Total Current Liabilities 133.8 149.4
Long-term debt 516.2 555.4
Other long-term liabilities & deferred
income taxes 245.0 242.1
------ ------
895.0 946.9
Shareholders' equity 48.1 45.2
------ ------
$943.1 $992.1
OPERATING RESULTS BY SECTOR
Net Sales and Tonnage by Sector For the Quarter Ended
June 30, June 25, March 31,
1996 1995 1996
Sales Tons Sales Tons Sales Tons
(millions) (000)
Printing &
publishing papers:
Coated groundwood $ 54 60 $ 61 69 $ 64 64
Uncoated 59 61 68 58 66 61
Food & retail packaging 75 59 92 65 85 60 Converting papers 39 43 42 41 36 37 Pulp & Miscellaneous 4 14 9 12 2 3
Total Company $231 237 $272 245 $253 225
Operating Profit By Sector (in millions)
For the Quarter Ended For the Half Ended
June 30, June 25, March 31, June 30, June 25,
1996 1995 1996 1996 1995
Printing & Publishing Papers $ 8 $ 13 $ 14 $ 22 $ 26 Food & Retail Packaging Papers 4 (2) 1 5 (3) Converting Papers 4 4 6 10 9 Pulp & Miscellaneous (6) 3 (1) (6) 6 Total Operating Income $ 10 $ 18 $ 20 $ 31 $ 38 CONTACT: Crown Vantage Inc., Oakland Katie Katie may refer to: In sports:
Neil Stuart, 510/874-3423 |
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