Fountain Powerboat Industries, Inc. Reports Third Quarter and Year-to-Date Results.WASHINGTON Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. , N.C.--(BUSINESS WIRE)--May 14, 1999-- Fountain fountain, natural or artificially conveyed flow of water. In ancient Greece columnar shrines were built over springs and dedicated to deities or nymphs. In ancient Rome fountains fed by the great aqueduct system furnished water in the streets, in the villa gardens, Powerboat Industries, 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 : FPWR FPWR Fire Precautions (Workplace) Regulations 1997 (UK) ). Fountain continues to press forward its initiatives aimed at 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. growth and improved shareholder value. Third quarter sales reflect a 11% improvement over 1998's record levels. The sale of the Company's first new 65' Super 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 was a prime driver. Sales for the third quarter of Fiscal 1999 were $14,041,832 as compared to $12,699,853 in the same quarter last year. Commitments to strategic spending for growth resulted in earnings below 1998's record quarter. Margins were constrained con·strain tr.v. con·strained, con·strain·ing, con·strains 1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force. 2. by engineering expenses for new product development resulting in new 27', 35' and 38' sport boats and a leaner lean 1 v. leaned, lean·ing, leans v.intr. 1. To bend or slant away from the vertical. 2. sales mix sales mix See product mix. . Selling expenses reflect investments in the Company's program to grow its defense sales, which have already yielded a contract for 6 new 38' diesel surface drive craft for the U.S. Coast Guard. It also has brought us acceptance as a participant Participant A party of a funding. It usually refers to the lowest rank or smallest level of funding. in the U.S. Marine Corp' Riverine riv·er·ine adj. 1. Relating to or resembling a river. 2. Located on or inhabiting the banks of a river; riparian: "Members of a riverine tribe ... Craft competition along with significant other domestic and international procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. contracts under development. Net income of $337,685 or $.07 per share is a good improvement over the last 2 quarters but short of last year's comparable quarter with net income of $712,620 or $.15 per share. Management believes the Company is continuing to move forward with its commitments to long term growth through its yacht yacht: see motorboating; sailing. yacht Sail- or motor-driven vessel used for racing or recreation. The term is popularly applied to large recreational engine-powered boats; the sailboats known as yachts and used for racing are usually light and program, new wide beam cruiser line as well as the increasing defense business segment. The Company expects a continued improvement in future quarters. Below is a summary of operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before over the past four quarters: -0-
4th 1st 2nd 3rd
Quarter Quarter Quarter Quarter
1998 1999 1999 1999
--------- --------- ---------- ----------
Sales (000) $13,339 $12,422 $13,254 $14,042
Operating Income
Before strategic chg. (740) (3) 185 447
Following are comparative Condensed Consolidated Statements of
Income and Condensed Balance Sheets:
FOUNTAIN POWERBOAT INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For The Three Months For The Nine Months
Ended March 31 Ended March 31
1999 1998 1999 1998
NET SALES $14,041,832 $12,699,853 $39,718,327 $37,313,090
COST OF SALES 11,094,281 8,744,319 31,172,114 26,456,149
Gross Profit 2,947,551 3,955,534 8,546,213 10,856,941
EXPENSES
Selling Expense 1,761,294 1,952,340 5,855,679 3,869,103
General &
Administrative 734,898 592,272 2,053,514 2,089,473
General &
Administrative -
related parties 4,325 - 8,758 73,853
Total Expenses 2,500,517 2,544,612 7,917,951 6,032,429
OPERATING INCOME BEFORE
STRATEGIC CHARGE 447,034 1,410,922 628,262 4,824,512
STRATEGIC CHARGE - - (2,440,000) -
OPERATING INCOME
(LOSS) 447,034 1,410,922 (1,811,738) 4,824,512
NON-OPERATING INCOME
(EXPENSE):
Other Income 25,937 21,934 80,933 62,099
Interest Expense (249,732) (199,734) (769,363) (480,867)
Interest Expense -
Related party (6,514) - (20,447) -
INCOME (LOSS)
BEFORE TAX 216,725 1,233,122 (2,520,615) 4,405,744
CURRENT TAX EXPENSE - 312,618 - 1,267,066
DEFERRED TAX EXPENSE
(BENEFIT) (120,960) 147,574 (1,477,588) 75,756
INCOME (LOSS) FROM
CONTINUING OPERATIONS 337,685 772,930 (1,043,027) 3,062,922
DISCONTINUED OPER'S:
Income (Loss)on
disposal of Operations
of Fountain Power Inc. &
Mach Performance Inc. - (60,310) - (33,710)
INCOME (LOSS) FROM
DISCONTINUED OPER'S - (60,310) - (33,710)
NET INCOME (LOSS) $337,685 $712,620 $(1,043,027) $3,029,212
FOUNTAIN POWERBOAT INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Continued)
For The Three Months For The Nine Months
Ended March 31 Ended March 31
1999 1998 1999 1998
BASIC EARNINGS PER SHARE:
Continuing Operations $ .07 $ .16 $ (.22) $ .65
Loss from Operations of
Discontinued Segments - - - -
Estimated Loss on Disposal
of Discontinued Segments (.01) (.01)
TOTAL BASIC EARNINGS
PER WEIGHTED
AVERAGE SHARE .07 .15 (.22) .64
TOTAL SHARES OUTSTANDING 4,702,608 4,740,108 4,705,017 4,738,356
DILUTED EARNINGS
PER SHARE:
Continuing Operations $ .07 $ .15 $ N/A $ .61
Loss from Operations of
Discontinued Segments - - N/A -
Estimated Loss on Disposal
of Discontinued Segments - (.01) N/A -
TOTAL DILUTED
EARNINGS PER SHARE .07 .14 N/A .60
DILUTED WEIGHTED AVERAGE
SHARES OUTSTANDING 4,794,930 5,068,713 N/A 5,088,913
FOUNTAIN POWERBOAT INDUSTRIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
ASSETS
March 31, June 30,
1999 1998
----------- -----------
CURRENT ASSETS:
Cash and cash equivalents $ 3,210,514 $ 1,376,984
Accounts receivable, net 924,701 2,715,754
Inventories 5,951,658 7,077,540
Prepaid expenses 898,239 489,290
Deferred tax assets 1,698,726 1,058,967
----------- -----------
Total Current Assets 12,683,838 12,718,535
----------- -----------
PROPERTY, PLANT AND EQUIPMENT 34,271,399 33,411,011
Less: Accumulated depreciation (15,610,403) (14,254,156)
----------- ----------
18,660,996 19,156,855
----------- ----------
OTHER ASSETS 724,972 622,003
----------- -----------
TOTAL ASSETS $32,069,806 $32,497,393
----------- -----------
FOUNTAIN POWERBOAT INDUSTRIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
(Continued)
March 31, June 30,
1999 1998
----------- -----------
CURRENT LIABILITIES:
Current portion/long-term debt $ 2,173,487 $ 981,365
Notes payable - related party 157,910 415,821
Accounts payable 2,196,417 3,591,489
Accrued expenses 2,175,425 1,939,791
Dealer territory service accrual 2,392,557 2,046,939
Customer deposits 413,996 510,967
Allowance for boat repurchases 200,000 200,000
Reserve for warranty expense 500,000 500,000
Net liabilities of discontinued operations 10,000 103,612
----------- -----------
Total Current Liabilities 10,219,792 10,289,984
----------- -----------
LONG-TERM DEBT, LESS CURRENT PORTION 10,915,956 9,499,895
DEFERRED TAX LIABILITY 88,978 926,807
COMMITMENTS AND CONTINGENCIES (NOTE 6) - -
----------- ----------
Total Liabilities 21,224,726 20,716,686
----------- -----------
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value,
200,000,000 shares authorized,
4,732,608 and 4,702,608 shares
issued and outstanding, respectively 47,326 47,026
Capital in excess of par value 10,303,640 10,196,540
Retained earnings - accumulated 604,862 1,647,889
----------- -----------
10,955,828 11,891,454
Less: Treasury stock (110,748) (110,748)
----------- -----------
Total Stockholders' Equity 10,845,080 11,780,707
----------- -----------
$ 32,069,806 $ 32,497,393
----------- -----------
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