Fourth Quarter Results Continue Profitably for Jenny Craig Full Year Results Affected by First Half Loss.LA JOLLA, Calif., Aug. 24 /PRNewswire/ --Jenny Craig, Inc. (NYSE NYSE See: New York Stock Exchange : JC) today announced operating results for the quarter and fiscal year ended June 30, 2000. The Company reported operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $3.6 million on revenues of $76.5 million for the quarter ended June 30, 2000, compared with an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $6.6 million on revenues of $76.5 million for the same quarter a year ago. Last year's quarter included an $8.2 million pre-tax charge for a litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. judgment. Net income for the fourth quarter of fiscal 2000 was $2.6 million, or $0.12 per diluted share, versus a net loss of $3.8 million, or $0.18 per diluted share for the same quarter of fiscal 1999. While average revenue per Company-owned centre increased to $129,000 for the quarter ended June 30, 2000 from $111,000 for the quarter ended June 30, 1999, the number of Company-owned centres declined from 634 at June 30, 1999 to 550 at June 30, 2000 as a result of centre closures in connection with the restructuring effected in November 1999. At June 30, 2000, the Company held cash and short-term investments totaling $35.6 million, compared to $42.0 million at June 30, 1999. "We were pleased to see our second consecutive profitable quarter to close out the fiscal year," said 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. Patti Larchet, "indicating that the restructuring plan adopted in November is having the effect we desired." The Company cautioned, however, that operating results in Australia deteriorated during the fourth quarter and have continued at significantly reduced levels for the first seven weeks of fiscal 2001, with revenue down an average of approximately 31% for that seven week period compared to the same period last year. The Company cited several contributing factors, including the introduction of Xenical (a prescription drug prescription drug Prescription medication Pharmacology An FDA-approved drug which must, by federal law or regulation, be dispensed only pursuant to a prescription–eg, finished dose form and active ingredients subject to the provisos of the Federal Food, Drug, for the treatment of obesity) and a goods and services tax The Goods and Services Tax is a Value-added tax that exists in a number of countries. Please see:
For the fiscal year ended June 30, 2000, the Company reported an operating loss of $12.9 million on revenues of $291.0 million, compared to an operating loss of $2.8 million on revenues of $321.0 million last year. Contributing to the operating loss in fiscal 2000 was a net restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $6.9 million and a $3.1 million charge related to discontinued inventory. The net loss totaled $7.1 million, or $0.34 per diluted share for the fiscal year ended June 30, 2000 versus a net loss of $672,000 or $0.03 per diluted share, for the fiscal year ended June 30, 1999. About Jenny Craig Founded in 1983, Jenny Craig, Inc. is one of the largest weight management service companies in the world. The Company offers a comprehensive weight management program that helps clients learn how to eat the foods they want, increase their energy level through simple activity, and build more balance in their lives for optimal weight loss and well-being. The program includes personal, one-on-one consultations at Jenny Craig Centres, with menu plans that are nutritionally balanced according to the recommendations of the USDA USDA, n.pr See United States Department of Agriculture. Food Guide Pyramid Food Guide Pyramid n. A food pyramid devised by the US Department of Agriculture in 1992, in which grains and cereals represent the base beneath layers for fruits and vegetables, meats and dairy products, and fats and sweets at the peak. and the U.S. Dietary Guidelines dietary guidelines Cardiology A series of dietary recommendations from the Nutrition Committee of the Am Heart Assn, that promote cardiovascular health. See Caloric restriction, food pyramid, French paradox. . Jenny Craig Centres are located in the United States, Canada, Australia, New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. , and Puerto Rico. At June 30, 2000, the Company owned 550 Centres with an additional 110 Centres owned by franchisees, bringing the total number of Centres in operation to 660. This press release includes forward-looking statements about the Company's revenues, costs, earnings, margins and other future plans and objectives. Any such statements are subject to risks and uncertainties that could cause the actual results to vary materially from the results discussed in the forward- looking statements. Among the factors that could cause actual results to differ materially are: increased competition; technological and scientific developments, including appetite suppressants and other drugs which can be used in weight loss programs; increases in cost of food or services; lack of market acceptance of additional products and services; legislative and regulatory restrictions; effectiveness of marketing and advertising programs; prevailing domestic and foreign economic conditions; and the risk factors set forth from time to time in the Company's annual reports and other reports and filings with the SEC. JENNY CRAIG, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS ($ in thousands) June 30, June 30, 2000 1999 (unaudited) ASSETS Cash and cash equivalents $34,710 38,864 Short-term investments 925 3,150 Accounts receivable, net 2,271 2,617 Inventories 11,785 18,036 Prepaid expenses and other assets 4,181 4,795 Total current assets 53,872 67,462 Property and equipment, net 25,797 24,360 Deferred tax assets 19,003 13,406 Other assets 9,288 7,386 $107,960 112,614 LIABILITIES AND STOCKHOLDERS' EQUITY Accounts payable and accrued liabilities $29,629 31,503 Accrual for litigation judgment 9,649 8,203 Deferred service revenue 10,175 10,075 Total current liabilities 49,453 49,781 Note payable 5,147 5,336 Obligation under capital lease 1,732 -- Total liabilities 56,332 55,117 Stockholders' equity 51,628 57,497 $107,960 112,614 JENNY CRAIG, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ($ in thousands, except per share data) Twelve Months Ended Three Months Ended June 30, June 30, 2000 1999 2000 1999 (unaudited) (unaudited) REVENUES: Company-owned operations $ 267,780 295,002 70,745 70,338 Franchise operations 23,205 25,950 5,795 6,176 Total revenues 290,985 320,952 76,540 76,514 OPERATING COSTS AND EXPENSES: Company-owned operations 254,685 272,152 63,499 63,402 Franchise operations 15,954 17,944 3,722 4,632 General and administrative expenses 24,861 25,437 6,059 6,875 Litigation judgment 1,446 8,203 219 8,203 Restructuring charge 6,910 -- (602) -- Operating income (loss) (12,871) (2,784) 3,643 (6,598) Other income, net, principally interest 1,432 1,700 506 452 Income (loss) before taxes (11,439) (1,084) 4,149 (6,146) Income taxes (benefit) (4,347) (412) 1,576 (2,335) Net income (loss) $(7,092) (672) 2,573 (3,811) Basic and diluted net income (loss) per share $(0.34) (0.03) 0.12 (0.18) Basic weighted average shares outstanding 20,689 20,689 20,689 20,689 Diluted weighted average shares outstanding 20,689 20,689 20,770 20,689 |
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