Dan River Inc. Reports Sales and Net Income for Fiscal 1999.Business Editors DANVILLE Danville. 1 City (1990 pop. 33,828), seat of Vermilion co., E Ill., on the Vermilion River at the Ind. line; inc. 1839. It is a commercial and industrial center in a dairy, farm, and coal area. , Va.--(BUSINESS WIRE) Feb. 9, 2000. Dan River Inc. (NYSE NYSE See: New York Stock Exchange :DRF DRF Daily Racing Form (horse racing) DRF Dansk Ride Forbund (Danish) DRF Deafness Research Foundation DRF Disaster Relief Fund DRF Data Recovery Field DRF Demat Request Form DRF Dose Reduction Factor ) today reported results for the fourth quarter and year ended January January: see month. 1, 2000. 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 13 weeks of the fourth quarter of fiscal 1999 were $149.5 million, down 6.2% from $159.3 million for the 13 weeks of the fourth quarter of fiscal 1998. For the fourth quarter of fiscal 1999, the Company reported net earnings of $2.0 million or $0.09 per basic share. This compares to a net loss of $1.0 million or $0.04 loss per basic share for the fourth quarter of fiscal 1998. The fiscal 1998 fourth quarter results included a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge of $5.7 million ($3.5 million after tax; $0.16 per share) for the closure of the Company's Spindale, North Carolina Spindale is a town in Rutherford County, North Carolina, United States. The population was 4,022 at the 2000 census. Geography Spindale is located at (35.358348, -81.925271)GR1. Apparel Fabrics weaving weaving, the art of forming a fabric by interlacing at right angles two or more sets of yarn or other material. It is one of the most ancient fundamental arts, as indicated by archaeological evidence. plant and a $0.4 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. loss ($0.02 per share) related to the refinancing Refinancing An extension and/or increase in amount of existing debt. of bank debt incurred for the purchase of The Bibb bibb n. 1. Nautical A bracket on the mast of a ship to support the trestletrees. 2. A bibcock. [Alteration of bib.] Company in October October: see month. 1998. Excluding these charges, earnings per basic share would have been $0.13 in the fourth quarter of fiscal 1998. Sales of Dan River's Home Fashions products for the fourth quarter of fiscal 1999 were $101.2 million, down $9.5 million or 8.6% from the fourth quarter of fiscal 1998. Sales of Apparel Fabrics were $36.4 million, down $3.0 million or 7.7% from the fiscal 1998 fourth quarter. Sales of Engineered Products were $11.9 million, up $2.7 million or 30.0% from the fourth quarter of fiscal 1998. The fourth quarter of fiscal 1998 included only eleven weeks of Bibb operations. Mr. Joseph L. Lanier La·nier , Sidney 1842-1881. American writer and musician noted for his melodic poems, including "The Marshes of Glynn" (1878). His novel Tiger Lilies (1867) is based on his experiences as a Confederate soldier. , Jr., Chairman and Chief Executive Officer said, &uot;We expected our Apparel Fabrics operations to be only modestly profitable in the fourth quarter because of high manufacturing costs and relatively low sales volume. Our Engineered Products segment also came in about as expected during the quarter. However, the performance of our Home Fashions segment was disappointing. Sales of Home Fashions products were negatively impacted by the conversion of our Enterprise Resource Planning See ERP. (application, business) Enterprise Resource Planning - (ERP) Any software system designed to support and automate the business processes of medium and large businesses. System to SAP sap, fluid in plants consisting of water and dissolved substances. Cell sap refers to this fluid present in the large vacuole, or cell cavity, that occupies most of the central portion of mature plant cells. during the last half of the year. We had a strong order position during the quarter but we weren't were·n't Contraction of were not. weren't were not able to convert those orders into billings because of production planning Production planning The function of a manufacturing enterprise responsible for the efficient planning, scheduling, and coordination of all production activities. problems associated with the systems conversion. As we look forward, the good news is that our Home Fashions business remains very good, the systems conversion is behind us, and its impact will be felt less and less as we move through the year.&uot; Net sales for the 52 weeks of fiscal year 1999 were $628.9 million, up $111.5 million or 21.5%, from $517.4 million for the 52 weeks of fiscal year 1998. The Company reported net income of $14.7 million or $0.64 earnings per basic share for fiscal 1999. This compares to $16.7 million or $0.84 earnings per basic share for the prior year. Both years included one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. items. Excluding the effects of unusual items and extraordinary items in both years, net income in fiscal 1999 would have been $11.8 million, or $0.51 per basic share, compared to $20.4 million or $1.03 per basic share in fiscal 1998. Fiscal 1999 included one-time income items of $2.9 million (after tax): a $1.5 million tax benefit from the charitable donation of the Company's Riverside Riverside. 1 City (1990 pop. 226,505), seat of Riverside co., S Calif.; inc. 1883. One of the fastest growing U.S. cities in the late 20th cent., it is famous for its orange industry. Long Mill; a $1.1 million gain associated with reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of reserves established in prior years for demolition Demolition is the opposite of construction: the tearing-down of buildings and other structures. It contrasts with deconstruction, which is the taking down of a building while carefully preserving valuable elements for re-use. of the Riverside property; and a $0.3 million gain on the sale of equipment that was written down in 1998 in connection with the closure of the Company's Spindale Plant. In fiscal 1998, in addition to $3.9 million in after-tax charges related to the Spindale plant closure and the refinancing of bank debt discussed above, the Company recorded a one-time gain of $0.2 million (after tax) related to the early termination of a lease. For the 1999 fiscal year, sales of Dan River Home Fashions products were $431.8 million, up $110.0 million, or 34.2%, from the prior year; sales of Apparel Fabrics were $150.4 million, down $36.1 million or 19.4%; and sales of Engineered Products were $46.7 million, up $37.5 million. Fiscal 1998 includes only eleven weeks of Bibb operations. Mr. Lanier stated, &uot;Fiscal 1999 was a very busy year for the Company. After buying Bibb in late 1998, we spent the year integrating its operations; we converted our corporate and Home Fashions systems to SAP; and we completed negotiations for a joint venture for the production of apparel fabrics in Mexico Mexico, city, Mexico Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. . Each of these initiatives has caused some short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. disruptions, but each will have a meaningful benefit to the company over the long term. The company is poised to rebound rebound (rē´bownd), n/v 1. a recovery from illness. n 2. an outbreak of fresh reflex activity after withdrawal of a stimulus rebound adjective from these interruptions, to continue reducing manufacturing costs, and to deliver quality products to our customers and value to our shareholders. &uot;We are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about our prospects for fiscal 2000. Our order book is stronger in all three divisions, cotton prices have been at 15 year lows, our manufacturing performance improves each day and we believe our systems issues are largely behind us. This bodes well for the first quarter of fiscal 2000 during which we expect to earn about $0.19 per basic share compared to $0.07 in the first quarter of fiscal 1999. For the full year of fiscal 2000, we continue to expect to earn around $1.05 per basic share.&uot; Note: This press release contains 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. under applicable securities laws. Dan River's performance could be materially and adversely affected by, among other things, unanticipated difficulties in the further integration of operations or in the further conversion of computer systems, in the initial implementation of the Mexican Mexican named after or originating in Mexico. Mexican axolotl see ambystomamexicanum. Mexican beaded lizard (Heloderma horridum Joint Venture, unexpected weakness in demand for Dan River's products, rising raw materials prices or by other market and industry factors, many of which are outside Dan River's control. Risks generally associated with Dan River's business are detailed in Dan River's Current Report on Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. which was filed with the Securities and Exchange Commission on July July: see month. 20, 1998. Management believes these forward-looking statements are reasonable; however, undue reliance should not be placed on such statements, which are based on current expectations. The following are the unaudited financial highlights:
UNAUDITED
CONSOLIDATED INCOME STATEMENT HIGHLIGHTS
(000's except per share data)
Fourth Quarter Year
1999 1998 1999 1998
---- ---- ---- ----
Net Sales $ 149,493 $ 159,315 $ 628,899 $ 517,443
Cost of Sales 123,078 129,495 512,977 406,619
Gross Profit 26,415 29,820 115,922 110,824
S, G and A 15,079 16,910 64,547 58,410
Amortization of
Goodwill 739 589 2,859 589
Other Operating
Costs, Net - 5,747 ( 2,267) 5,347
Operating Income 10,597 6,574 50,783 46,478
Other Income
(Expense) 130 ( 87) 603 334
Interest Expense 7,106 7,010 28,416 18,713
Income (Loss)
Before Taxes and
Extraordinary Item 3,621 ( 523) 22,970 28,099
Provision for Income
Taxes 1,628 82 8,255 10,998
Income (Loss) Before
Extraordinary Item 1,993 (605) 14,715 17,101
Extraordinary (Loss)
After Tax - ( 405) - ( 405)
Net Income (Loss) $ 1,993 ($ 1,010) $ 14,715 $ 16,696
Earnings (Loss) Per Share:
Basic $ 0.09 ($ 0.04) $ 0.64 $ 0.84
Diluted $ 0.09 ($ 0.04) $ 0.63 $ 0.83
Wtd. Avg. No.
Shares:
Basic 22,710 22,716 23,146 19,803
Diluted 22,712 22,716 23,236 20,035
CALCULATION OF NET INCOME AS ADJUSTED
(000's except per share data)
Fourth Quarter Year
1999 1998 1999 1998
---- ---- ---- ----
Net Income (Loss) as
Reported $ 1,933 $ (1,010) $ 14,715 $ 16,696
After-tax Effect
of One-time Items
Spindale Plant Closure - 3,532 (309) 3,532
Extraordinary Loss
Associated with Early
Retirement of Debt - 405 - 405
Reversal of Riverside
Plant Demolition
Reserves - - (1,084) -
Tax Benefit from Charitable
Donation - - (1,524) -
Gain on Lease Termination - - - (246)
Total One-time
Items $ - $ 3,937 $ (2,935) $ 3,691
Net Income as Adjusted $ 1,933 $ 2,927 $ 11,780 $ 20,387
Earnings Per Basic
Share as Adjusted $ 0.09 $ 0.13 $ 0.51 $ 1.03
Wtd. Avg. No. of
Basic Shares 22,710 22,716 23,146 19,803
SEGMENT INFORMATION
(000's)
Fourth Quarter Year
1999 1998 1999 1998
---- ---- ---- ----
Net Sales:
Home Fashions $ 101,238 $110,767 $431,828 $321,807
Apparel Fabrics 36,368 39,403 150,401 186,491
Engineered Products 11,887 9,145 46,670 9,145
Consolidated Net
Sales $ 149,493 $ 159,315 $628,899 $517,443
Operating Income:
Home Fashions $ 11,060 $ 10,097 $ 50,878 $ 33,848
Apparel Fabrics 1,121 3,811 4,358 23,656
Engineered Products 694 169 2,725 169
Corporate Items Not
Allocated to Segments:
Amortization of Goodwill ( 739) ( 589) ( 2,859) ( 589)
Other Operating Costs,
Net - ( 5,747) 2,267 ( 5,347)
Depreciation ( 1,471) ( 1,063) ( 5,633) ( 4,823)
Other ( 68) ( 104) ( 953) ( 436)
Consolidated Operating
Income $ 10,597 $ 6,574 $ 50,783 $ 46,478
UNAUDITED
OTHER FINANCIAL DATA
(000's)
Fourth Quarter Year
1999 1998 1999 1998
---- ---- ---- ----
EBITDA $ 20,580 $ 20,673 $ 90,287 $ 82,634
Depreciation &
Amortization
of Property, Plant and
Equipment $ 9,243 $ 7,763 $ 38,912 $ 30,220
Capital Expenditures
in Cash $ 10,654 $ 9,611 $ 36,729 $ 39,454
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEET
(000's)
1999 1998
---- ----
Assets:
Cash $ 2,084 $ 3,356
Accounts Receivable 77,009 94,374
Inventories 168,487 175,045
Other Current Assets 17,513 31,936
Total Current Assets 265,093 304,711
Property, Plant &
Equipment, Net 296,733 296,640
Goodwill 110,384 110,727
Other Assets 12,372 8,132
Total Assets $684,582 $720,210
Liabilities and Shareholders' Equity:
Current Maturities of
Long-Term Debt $ 22,368 $ 2,329
Accounts Payable &
Accrued Expenses 68,860 80,528
Total Current Liabilities 90,728 82,857
Long-Term Debt 292,416 351,939
Deferred Income Taxes and
Other Liabilities 30,486 26,640
Shareholders' Equity 270,952 258,774
Total Liabilities &
Stockholders' Equity $684,582 $720,210
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