D&K Healthcare Q3 Revenue Increases 42% And EPS Rise 40%; Posts All-time Quarterly Revenue, EBITDA, Net Income And EPS Records.Business Editors ST. LOUIS--(BUSINESS WIRE)--April 24, 2002 Raises FY 2002 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 Guidance to $2.4 Billion and 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. Guidance to $1.39 (Adjusted for 2-For-1 Stock Split) D&K Healthcare Resources, 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 : DKWD DKWD Disk Write Data ) today reported all-time all-time adj. Exceeding all others up to the present time: an all-time speed skating record. all-time Adjective Informal record quarterly net sales, earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for its fiscal third quarter ended March 31, 2002.
Summary Financial Results
(in millions, except per share data, and adjusted for the 2-for-1
stock split effective April 12, 2002)
----------------------------------------------------------------------
Q3`02 Q3`01 Change YTD `02 YTD `01 Change
----------------------------------------------------------------------
Net Sales $695.2 $490.5 + 42% $1,816.0 $1,196.6 + 52%
EBITDA $ 16.7 $ 9.7 + 73% $ 37.5 $ 22.2 + 69%
Net Income $ 7.3 $ 3.2 + 128% $ 15.5 $ 6.5 + 138%
Diluted EPS $ 0.49 $0.35 + 40% $ 1.05 $ 0.73 + 44%
Diluted Shares 14.8 9.2 + 61% 14.7 9.0 + 62%
J. Hord Armstrong, III, Chairman and Chief Executive Officer, commented, "D&K surpassed every performance goal we set for the quarter and year to date, establishing a number of all-time records. Given the benefits of our expanded capital base, our strong operating performance and the positive long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. trends in pharmaceutical demand, we are increasing our guidance for FY 2002 net sales to $2.4 billion and raising our FY 2002 EPS guidance to $1.39, reflecting the impact of the recently completed 2-for-1 stock split. Our previous FY 2002 guidance was $2.3 billion in net sales with EPS of $1.33, adjusted for the split." Martin D. Wilson Wilson, city (1990 pop. 36,930), seat of Wilson co., E N.C., in a rich agricultural region; inc. 1849. It is a commercial and industrial center with a large tobacco market. Manufactures include textile goods (especially clothing), metal products, and processed foods. , President and Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , added, "D&K generated sales of $277.3 million in the independent and regional pharmacy pharmacy, art of compounding and dispensing drugs and medication. The term is also applied to an establishment used for such purposes. Until modern times medication was prepared and dispensed by the physician himself. In the 18th cent. trade class in the third quarter, an increase of $87.9 million, or 46.4%, over the third quarter of last year, reflecting our high level of personalized per·son·al·ize tr.v. per·son·al·ized, per·son·al·iz·ing, per·son·al·iz·es 1. To take (a general remark or characterization) in a personal manner. 2. To attribute human or personal qualities to; personify. service. Revenue from the Diversified diversified (di·verˑ·s Healthcare acquisition in June June: see month. 2001 represented 51.2% of the increase, with the remaining 48.8% coming from same store sales Same Store Sales A statistic used in retail industry analysis. It compares sales of stores that have been open for a year or more. Notes: This statistic allows investors to determine what portion of new sales has come from sales growth and what portion from the opening of growth and new customer wins. "D&K's national pharmacy chain business achieved sales of $385.8 million in the third quarter, an increase of 41.0%, or $112.1 million. The improvement in this trade class over the same period last year is largely due to strong relationships with both suppliers and the chains, which we have been able to optimize optimize - optimisation with our improved capital structure. It is worth noting that our inventories at March 31, 2002 were $430 million, as we took advantage of attractive purchasing opportunities and positioned D&K to support its sales growth." Mr. Wilson continued, "Consolidated gross margin for the quarter totaled 4.36%, compared to 4.19% last year. Illustrating the significant operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. in our business model, our operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: for the quarter increased over 25% to 2.25%, up from 1.80% in the third quarter of fiscal 2001." Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs S. Hilton Hil·ton , Conrad Nicholson 1887-1979. American hotel-chain organizer who acquired hotels in many American cities and in 1946 founded the Hilton Hotel Corporation. , Senior Vice President and Chief Financial Officer, added, "The combination of enhanced capital resources, excellent execution, operational efficiencies and favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. interest rates contributed to this record setting quarter. Looking forward, we are expecting the gross margin for fiscal 2002 to be approximately 4.2%. Operating margin for fiscal 2002 should slightly exceed 1.8%. Total weighted average borrowings increased $62 million over third quarter last year to $248 million during the quarter, but were offset by a 320 basis point decline in weighted average interest rates compared to the same period last year, substantially accounting for the 14.4% decrease in net interest expense." About D&K Healthcare Resources With trailing twelve month revenues of $2.27 billion, St. Louis-based D&K Healthcare Resources, Inc., is a wholesale distributor of pharmaceutical and related healthcare and beauty aid products to independent and regional pharmacies This article is a list of major pharmacies (also known as chemists and drugstores) by country. Australia Pharmacies in Australia are mostly independently-owned by pharmacists, often operated as franchises of retail brands offered by the three major , national pharmacy chains and other healthcare providers. D&K currently services customers in 24 states primarily in the Midwest and South from distribution facilities in Cape Girardeau Cape Girardeau (jĭrär`dō, jērərdō`), city (1990 pop. 61,633), Cape Girardeau co., SE Mo., overlooking the Mississippi River; founded 1793, inc. as a city 1843. , MO; Weston, FL; Lexington, KY; Minneapolis, MN; Aberdeen, SD; and Owensboro, KY. D&K also offers a variety of additional services to its customers, including inventory management, services designed to contain costs, information technology systems and various marketing programs related to generic pharmaceuticals and other products. In addition, D&K owns a 70% equity interest in Pharmaceutical Buyers, Inc., a recognized alternate-site group purchasing organization A group purchasing organization is an entity that leverages the purchasing power of a group of businesses to obtain discounts from vendors based on the collective buying power of the GPO members. Many GPOs are funded by administrative fees that are actually paid by the vendors. . D&K invites you to visit its Web site at http://www.dkwd.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. Provisions This press release may contain 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 safe harbor 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 are inherently subject to risks and uncertainties. D&K's actual results could differ materially from those currently anticipated due to a number of factors, including without limitation, the competitive nature of the wholesale pharmaceutical distribution industry, with many competitors having substantially greater resources than D&K, and D&K's customers and suppliers generally having the right to terminate or reduce their purchases or shipments on relatively short notice, the changing business and regulatory environment of the healthcare industry in which D&K operates, changes in interest rates and other factors set forth in reports and other documents filed by D&K with the Securities and Exchange Commission from time to time. D&K undertakes no obligation to publicly update or revise any forward-looking statements.
D&K HEALTHCARE RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended
(Unaudited)
------------------------------------------------------
Mar. 31, % of Mar. 31, % of %
2002 Net Sales 2001 Net Sales Change
------------------------------------------------------
Net sales $ 695,241 100.00% $ 490,469 100.00% 41.8%
Cost of sales 664,894 95.64% 469,896 95.81% 41.5%
--------- ----------
Gross profit 30,347 4.36% 20,573 4.19% 47.5%
Operating
expenses 14,672 2.11% 11,740 2.39% 25.0%
--------- ----------
Income from
operations 15,675 2.25% 8,833 1.80% 77.5%
Other income
(expense):
Interest
expense, net (2,847) -0.41% (3,325) -0.68% -14.4%
Other, net (756) -0.11% (262) -0.05% 188.5%
--------- -----------
Pretax earnings 12,072 1.74% 5,246 1.07% 130.1%
Income tax
provision 4,770 0.69% 2,046 0.42% 133.1%
--------- ----------
Net income $ 7,302 1.05% $ 3,200 0.65% 128.2%
========= ==========
EBITDA $ 16,747 2.41% $ 9,670 1.97% 73.2%
Basic earnings
per share(a) $ 0.51 $ 0.38 34.2%
Diluted earnings
per share(a) $ 0.49 $ 0.35 40.0%
Basic common shares
outstanding(a) 14,366 8,477 69.5%
Diluted common shares
outstanding(a) 14,775 9,192 60.7%
(a) Shares and related EPS have been adjusted to reflect the 2 for 1
stock split effective April 12, 2002.
D&K HEALTHCARE RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Nine Months Ended
(Unaudited)
------------------------------------------------------
Mar. 31, % of Mar. 31, % of %
2002 Net Sales 2001 Net Sales Change
------------------------------------------------------
Net sales $1,816,030 100.00% $1,196,646 100.00% 51.8%
Cost of sales 1,739,330 95.78% 1,146,057 95.77% 51.8%
---------- ----------
Gross profit 76,700 4.22% 50,589 4.23% 51.6%
Operating
expenses 42,441 2.34% 30,895 2.58% 37.4%
---------- ----------
Income from
operations 34,259 1.89% 19,694 1.65% 74.0%
Other income
(expense):
Interest expense,
net (7,239) -0.40% (9,011) -0.75% -19.7%
Other, net (1,349) -0.07% 4 0.00% N/M
---------- ----------
Pretax earnings 25,671 1.41% 10,687 0.89% 140.2%
Income tax
provision 10,140 0.56% 4,168 0.35% 143.3%
---------- ----------
Net income $ 15,531 0.86% $ 6,519 0.54% 138.2%
========== ========== ======
EBITDA $ 37,504 2.07% $ 22,203 1.86% 68.9%
Basic earnings
per share(a) $ 1.09 $ 0.77 41.6%
Diluted earnings
per share(a) $ 1.05 $ 0.73 43.8%
Basic common shares
outstanding(a) 14,199 8,432 68.4%
Diluted common shares
outstanding(a) 14,655 9,032 62.3%
(a) Shares and related EPS have been adjusted to reflect the 2 for 1
stock split effective April 12, 2002.
D&K HEALTHCARE RESOURCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
Mar. 31, June 30,
2002 2001
---------------- -------------
(Unaudited)
Assets
Cash $ 9,490 $ 7,516
Accounts receivable 35,254 45,131
Inventories 430,046 214,739
Other current assets 2,694 2,664
----------- -------------
Total current assets 477,484 270,050
Property and equipment, net 10,897 9,703
Investment in PBI - 4,552
Other assets 59,000 45,899
----------- -------------
Total assets $ 547,381 $ 330,204
=========== =============
Liabilities and Stockholders' Equity
Accounts payable $ 239,849 $ 158,930
Current portion long-term debt 1,159 320
Other current liabilities 14,227 13,267
------------ ----------------
Total current liabilities 255,235 172,517
Long-term liabilities 2,622 2,300
Long-term debt 126,924 94,489
Deferred income taxes 2,925 3,388
Stockholders' equity 159,675 57,510
------------ --------------
Total liabilities and
stockholders' equity $ 547,381 $ 330,204
============ ==============
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