Excelsior-Henderson Motorcycle Manufacturing Company Announces Second Quarter 1999 Results.BELLE PLAINE Belle Plaine may refer to:
Excelsior-Henderson Motorcycle Excelsior-Henderson Motorcycle Company was founded by Dan Hanlon and Dave Hanlon (brothers) who secured the rights to the defunct Excelsior-Henderson trademark in 1994. The two brothers found a number of investors and built a state-of-the-art factory in Belle Plaine, Minnesota. Manufacturing Company (Nasdaq: BIGX) today announced financial results for the second quarter and six months ended July July: see month. 3, 1999. The Company reported 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 second quarter of $11,359,642 and $13,216,874 for the six months ended July 3, 1999. The Company shipped 724 motorcycles during the second quarter. Net loss for the second quarter of 1999 was $6,074,477 or $.45 per common share compared to a net loss of $4,690,112 or $.36 per common share for the second quarter of 1998. The Company reported a net loss for the first six months of 1999 of $13,843,651 or $1.03 per common share compared to a net loss of $8,294,857 or $.64 per common share for the first six months of 1998. "The second quarter represented the first quarter in which we produced our Super X(R) motorcycles for the entire period," stated Co-Founders Dan, Dave and Jennie Hanlon Hanlon is a surname, and may refer to
The Company also announced that it expects to maintain production volumes for the remainder of the fiscal year near the production volume levels of the second quarter. The Company's focus during the second quarter of 1999 was to predictably ramp-up production volume and determine component part cost reductions. The Company now believes it best to allow the production volume to stabilize stabilize See peg. for the remainder of the year while it focuses on expanding and improving the dealer network and sales process A sales process is a systematic approach for performing product or service sales. The reasons for having a sales process include seller and buyer risk management, achieving standardized customer interaction in sales and scalable revenue generation. , continuing to create demand for its motorcycles, component cost reductions, and recruiting and developing the new senior management team. The Company announced that in response to customer requests, it will be focusing on adding significantly to its dealer locations throughout 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. in order to minimize In a graphical environment, to hide an application that is currently displayed on screen. For example, in Windows and Mac, the application's window is removed from the screen and represented by an icon on the Windows Taskbar. In the Mac, the icon is placed in the Dock. See Win Minimize windows. customer travel time to purchase the Company's products and allow for more convenient customer service locations. The Company currently has approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 105 dealers nationwide. With the decision to stabilize production volume and focus on adding to the dealer network, reducing component costs, and recruiting and developing the new senior management team, the Company expects its 1999 net loss will exceed $23 million. The Company also announced that its existing resources and estimated negative cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses will not be sufficient to fund its cash requirements during the remainder of 1999. Accordingly, it will need to continue to obtain significant additional equity and debt financing Debt Financing When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay to fund its capital and operations requirements based on expected operating results. The Company added that it has retained an investment-banking firm to seek the additional financing. Excelsior-Henderson Motorcycle Manufacturing Company designs, manufactures, markets and sells a proprietary brand of premium heavyweight heavyweight - High-overhead; baroque; code-intensive; featureful, but costly. Especially used of communication protocols, language designs, and any sort of implementation in which maximum generality and/or ease of implementation has been pushed at the expense of mundane American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of cruiser cruiser, large, fast, moderately armed warship, intermediate in type between the aircraft carrier and the destroyer. During World War II, battle cruisers operated as small battleships, combining in one vessel maximum qualities of gun caliber, armor protection, and motorcycles, as well as related parts, apparel and accessories branded with a name that evokes an authentic AUTHENTIC. This term signifies an original of which there is no doubt. American motorcycling heritage and lifestyle. The Company distributes its products through a national dealer network. Excelsior-Henderson is one of only two authentic American motorcycle motorcycle, motor vehicle whose design is based on the bicycle. The German inventor Gottlieb Daimler is generally credited with building the first practical motorcycle in 1885. The motorcycle did not become dependable and popular, however, until after 1900. companies exclusively committed to the manufacture of motorcycles. For additional information, visit the Company's web site at www.excelsior-henderson.com. Notes Concerning Forward Looking Statements: 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. regarding future production volume, future cost expectations, future results and obtaining additional financing that involve risks and uncertainties. The Company's actual results could differ materially from those anticipated in these forward-looking statements. Potential risks and uncertainties include the ability of the Company to increase production volume, while maintaining high quality and controlling production costs, the ability of the Company to sell all of the motorcycles it produces, the ability of the Company to lower overall expense levels and the ability to obtain additional debt and equity financing Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. . Factors that may affect production volume include the ability of the Company to maintain adequate quantities of high-quality components and supplies, to refine its manufacturing processes, and to solve unanticipated manufacturing problems. Factors that may affect production costs include the ability of the Company to purchase motorcycle components and supplies at reasonable costs and to efficiently utilize personnel. Factors that may affect sales include the ability of the Company to expand its dealer network, the effectiveness of the Company's dealer network and internal sales team, the success of new sales and marketing programs, and ultimately market demand for the Company's motorcycles. Factors that may affect overall expense levels include the ability of the Company to improve management capabilities and improve its sales, marketing and production processes. Investors are also encouraged to review the factors described from time to time in the Company's reports on file with the Securities and Exchange Commission, including but not limited to the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended January January: see month. 2, 1999 and the Company's Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the quarterly period ended July 3, 1999. -0-
EXCELSIOR-HENDERSON MOTORCYCLE MANUFACTURING COMPANY
Condensed Financial Statements
(Unaudited)
Balance Sheets July 3, January 2,
1999 1999
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $4,795,911 $4,697,542
Accounts receivable, net 2,197,840 --
Inventory 6,124,697 1,865,251
Other current assets 497,406 541,371
------------- -------------
Total current assets 13,615,854 7,104,164
PROPERTY AND EQUIPMENT, net 31,830,089 30,317,118
RESTRICTED CASH 3,244,446 8,065,727
OTHER ASSETS, net 2,401,060 2,501,123
------------- -------------
$51,091,449 $47,988,132
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES $12,025,867 $10,221,789
LONG-TERM DEBT, less current maturities 23,014,613 20,569,409
------------- -------------
STOCKHOLDERS'EQUITY:
Invested capital 63,812,444 51,114,758
Accumulated deficit (47,761,475) (33,917,824)
------------- -------------
Total stockholders' equity 16,050,969 17,196,934
------------- -------------
$51,091,449 $47,988,132
============= =============
Statements of Operations
Three Months Ended
July 3, July 4,
1999 1998
------------ ------------
NET SALES $11,359,642 $--
COST OF SALES 12,843,942 --
------------ ------------
Gross margin (1,484,300) --
------------ ------------
DEPARTMENTAL EXPENSES:
Research and development 1,096,824 2,623,477
Sales and marketing 1,337,225 752,901
General and administrative 1,358,218 1,202,938
------------ ------------
Total departmental expenses 3,792,267 4,579,316
------------ ------------
OPERATING LOSS (5,276,567) (4,579,316)
INTEREST EXPENSE, net (646,677) (110,796)
------------ ------------
NET LOSS BEFORE PREFERRED
STOCK DIVIDENDS (5,923,244) (4,690,112)
Less: Preferred Stock Dividends (151,233) --
------------ ------------
NET LOSS APPLICABLE TO COMMON
STOCK $(6,074,477) $(4,690,112)
============ ============
NET LOSS PER COMMON SHARE $(0.45) $(0.36)
============ ============
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 13,584,736 13,034,553
============ ============
Statements of Operations
Six Months Ended
July 3, July 4,
1999 1998
------------ ------------
NET SALES $13,216,874 $--
COST OF SALES 17,477,168 --
------------ ------------
Gross margin (4,260,294) --
------------ ------------
DEPARTMENTAL EXPENSES:
Research and development 2,512,818 4,162,605
Sales and marketing 2,762,867 1,588,776
General and administrative 2,914,095 2,483,467
------------ ------------
Total departmental expenses 8,189,780 8,234,848
------------ ------------
OPERATING LOSS (12,450,074) (8,234,848)
INTEREST EXPENSE, net (1,242,344) (60,009)
------------ ------------
NET LOSS BEFORE PREFERRED
STOCK DIVIDENDS (13,692,418) (8,294,857)
Less: Preferred Stock Dividends (151,233) --
------------ ------------
NET LOSS APPLICABLE TO COMMON
STOCK $(13,843,651) $(8,294,857)
============ ============
NET LOSS PER COMMON SHARE $(1.03) $(0.64)
============ ============
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 13,457,312 13,031,187
============ ============
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