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G&K SERVICES' FOURTH QUARTER RESULTS PROVIDE A STRONG FINISH TO FISCAL 1993; COMPANY SAYS EARNINGS MOMENTUM IS CONTINUING

 MINNEAPOLIS, Aug. 25 /PRNewswire/ -- G&K Services, Inc. (NASDAQ-NMS: GKSRA) today reported fourth quarter and year end results that provided a strong finish to the 1993 fiscal year ended July 3, 1993. Based on a double-digit U.S. internal growth rate and continued improvement in Canadian operating margins, the Minneapolis-based uniform leasing company expects earnings gains to continue in fiscal 1994.
 For the fourth quarter of fiscal 1993, revenues were $56,748,000, up 16 percent from last year's $48,906,000. Net earnings grew to $3,634,000 or 27 cents per share, compared with last year's $2,163,000, or 16 cents per share. The company noted that results reflect the fact that the fourth quarter of 1993 was a 14 week period compared with a normal 13 week period one year earlier.
 In addition to the extra week, fourth quarter results reflect the recently increased federal income tax rate retroactive to Jan. 1, 1993, which reduced net earnings by 2.5 cents. Results also included a non-operating gain from an insurance settlement, which added 6 cents after taxes to fiscal 1993 results. Excluding the effects of the tax change and the insurance settlement, net income for the fourth quarter increased 45 percent.
 Total revenues for fiscal 1993, a 53 week period, were $207,904,000, a 7 percent increase over $194,716,000 in fiscal 1992. Net earnings totaled $11,123,000 or 82 cents per share, versus $8,582,000, or 64 cents per share, a year ago. Excluding the effects of the federal income tax increase and the non-operating gain, net income for fiscal 1993 increased 24 percent.
 Chairman and CEO Richard Fink said, "These results confirm the value of our quality and service approach to the expanding U.S. uniform leasing market. On a 52-week basis, U.S. revenues rose 11 percent as we continued to set records in the amounts of new accounts written. And in the fourth quarter, after adjusting to a normal 13 week period, our revenue growth accelerated to 13 percent from the year earlier period."
 Mr. Fink added that the company's U.S. growth rate was achieved without the benefit of acquisitions.
 "In Canada, revenues for the full year declined by 10 percent due to a soft economy and a sharp swing in the Canadian-U.S. exchange rate. However, the trend toward revenue stabilization showed continued improvement in the fourth quarter, during which revenues (in Canadian dollars and adjusted to a 13 week period) were down only slightly from a year ago."
 "Twelve month earnings increases were based on a substantial rise in Canadian operating income, as well as from continued strong results in our U.S. locations," Mr. Fink said. He added that fiscal 1993 consolidated earnings also benefited from reduced interest expense due to lower interest rates and borrowing levels compared with a year ago. Long-term debt dropped to $59.8 million at July 3, 1993, from $68.4 million a year ago.
 Mr. Fink noted that, following the close of the 1993 fiscal year, G&K entered the Charlotte, N.C., market with a startup operation, continuing its strategy of expansion into new geographic areas.
 Speaking about fiscal 1994, he said, "The current momentum in our U.S. business should continue to generate healthy gains throughout the year. In Canada, we are encouraged by the progress made in our operations last year, and anticipate further gains during the coming year. Overall, we anticipate strong continued progress for G&K in fiscal 1994."
 G&K Services is one of North America's largest suppliers of uniforms and related textile products. In the United States, the company operates in 24 states, serving customers from 21 processing plants and 30 sales and service centers. In Canada, G&K serves customers from 22 locations, including 8 processing plants in the provinces of Ontario and Quebec.
 To receive the latest information about G&K Services, Inc. via FAX, at no cost, dial 1-800-PRO-INFO, code 078.
 G&K SERVICES, INC. and SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME
 (In thousands, except per share amounts)
 July 3, 1993
 For the Three For the Twelve
 Months Ended Months Ended
 July 3, June 27, July 3, June 27,
 1993 1992 1993 1992
 REVENUES $56,748 $48,906 $207,904 $194,716
 EXPENSES
 Operating 31,283 27,472 115,718 110,000
 Cost of merchandise sold 1,708 1,275 5,944 4,663
 Selling and administrative 12,701 11,623 46,750 44,486
 Depreciation 3,028 2,726 11,454 10,877
 Amortization of intangibles 750 779 3,044 3,150
 49,470 43,875 182,910 173,176
 INCOME FROM OPERATIONS 7,278 5,031 24,994 21,540
 Interest expense 1,931 2,028 7,249 8,461
 Interest income (141) (121) (399) (369)
 Other (income) expense, net 153 39 377 (669)
 INCOME BEFORE INCOME TAXES,
 UNUSUAL ITEM 5,335 3,085 17,767 14,117
 Gain from fire insurance
 settlement 1,346 -- 1,346 --
 Provision for income taxes 3,047 922 7,990 5,535
 NET INCOME $3,634 $2,163 $11,123 $8,582
 Weighted Average Number of
 shares outstanding 13,554 13,485 13,527 13,492
 NET INCOME PER SHARE $0.27 $0.16 0.82 0.64
 Dividends per share $0.025 $0.025 $0.100 $0.100
 -0- 8/24/93
 /CONTACT: Richard Fink, chairman of G&K Services, 612-546-7440; or Nick Farina, 312-266-7800, or Karen Griffiths, 212-661-8030, both of the Financial Relations Board/
 (GKSRA)


CO: G&K Services, Inc. ST: Minnesota IN: TEX SU: ERN

PS-MG -- NY043 -- 5455 08/24/93 12:44 EDT
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Date:Aug 24, 1993
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