Prestige Brands Holdings, Inc. Reports Third Quarter Fiscal 2007 Results.Net Income of $10.6 Million Up 14% on Total Revenues of $80.l Million IRVINGTON, N.Y. -- Prestige Brands Prestige Brands, Inc. NYSE: PBH is a company that manufactures personal care and home cleaning products. It was formed by the merger of Medtech Products, Inc., Prestige Brands International, and The Spic and Span Company. The company is headquartered in Irvington, New York. Holdings, Inc. (NYSE-PBH), a consumer products company with a diversified portfolio of well-recognized brands, today announced results for the third fiscal quarter and nine month period ended December 31, 2006. Highlights of the quarter include: * Net income of $10.6 million, or $0.21 per diluted share, up 14% over the prior year comparable period * Total revenues of $80.1 million, slightly higher than the prior year comparable period * Free cash flow of $12.4 million was 12% higher than the prior year comparable period * Term loan debt reduced by $18.5 million in the third fiscal quarter Total revenues for the third quarter ended December 31, 2006 were $80.1 million, slightly higher than total revenues of $79.9 million in the prior year comparable period. Excluding the impact of the acquisitions of Chore Boy Chore Boy is a brand name for a coarse scouring pad made of steel or copper wool. It is designed for cleaning very dirty surfaces, especially washing dishes. During the first half of the 20th century, the product was marketed under the name Chore Girl. [R], Dental Concepts and Wartner[R], organic revenue declined by 6%. Chore Boy and Dental Concepts were acquired in October and November 2005, respectively; the Wartner[R] brand was acquired in September, 2006. 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. for the third quarter ended December 31, 2006 was $24.5 million, or 1% below the operating income of $24.7 million in the third quarter of fiscal 2006. The decline in operating income period to period resulted primarily from increases in advertising and promotion spending behind key brands. Net income for the quarter grew 14% to $10.6 million or $0.21 per diluted share over net income of $9.3 million or $0.19 per diluted share for the comparable prior year period. Net income includes a $1.7 million tax benefit resulting from a reduction in the deferred income tax rate from 39.1% to 38.6% as a result of the implementation of certain tax planning Tax planning Devising strategies throughout the year in order to minimize tax liability, for example, by choosing a tax filing status that is most beneficial to the taxpayer. strategies. Q3 Results by Segment The Company conducts operations through three principal business segments: Over-the-Counter Drug over-the-counter drug A therapeutic agent that does not require a prescription, which the FDA feels can be safely self-prescribed by non-physicians. Cf Prescription drug, Under-the-counter. (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). ), Household Products, and Personal Care products. OTC Drug Revenues of the over-the-counter drug products segment for the third quarter ended December 31, 2006 were $45.6 million, 8% higher than the prior year comparable period net revenues of $42.1 million. Increases in this segment resulted from sales gains in several key brands including The Doctor's[R], Clear eyes[R], Little Remedies[R], Dermoplast[R] and New Skin[R]. These gains were partially offset by sales declines in the Chloraseptic[R] and Compound W[R] brands. Household Products Revenues for the household products segment for the third quarter ended December 31, 2006 were $28.7 million, 7% less than the prior year comparable period net revenues of $30.8 million. Comet[R] and Spic and Span Spic and Span brand of household cleaner. [Trademarks: Crowley Trade, 546] See : Cleanliness [R], the two core brands in this segment, each recorded declines, while Chore Boy[R] experienced increased sales. The Comet and Spic and Span declines were primarily the result of comparisons against unusually strong year ago shipments, which included pipeline shipments supporting new distribution and significant promotional sales to one dollar store customer. However, both brands continued to post strong consumer consumption gains during the current quarter. Personal Care Revenues for the personal care segment for the third quarter ended December 31, 2006 were $5.8 million, 17% less than the prior year comparable period net revenues of $7.0 million. The decline in revenues was generally in line with the Company's expectations. Free Cash Flow Free cash flow is a "non GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). financial measure" as that term is defined by the Securities and Exchange Commission in Regulation G. Free cash flow is presented in this news release because management believes that it is a commonly used measure of liquidity, and is indicative of cash available for debt repayment and acquisitions. The Company defines "free cash flow" as operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. less capital expenditures. The Company's free cash flow for the quarter ended December 31, 2006 was $12.4 million, composed of operating cash flows of $12.5 million, less capital expenditures of $0.1 million. Free cash flow for the nine month period ended December 31, 2006 was $54.9 million, composed of operating cash flows of $55.3 million, less capital expenditures of $0.4 million. The Company's free cash flow in 2006 is higher than reported net income as a result of the amortization of intangibles, changes in the components of working capital and the relatively low capital expenditures. During the third fiscal quarter, the Company used free cash flow to reduce its term loan debt by $18.5 million, bringing debt reduction during the nine month period ended December 31, 2006 to a total of $27.4 million. The Company's debt has been reduced to $471.2 million at December 31, 2006, from $498.6 million at March 31, 2006. Year-To-Date Results For the nine month period ended December 31, 2006, total revenues of $240.6 million were 11% higher than the prior period results of $216.7 million. Excluding the effects of acquisitions, year-to-date organic sales were up 3%. For the same period, operating income was up 13% largely as a result of the increase in sales, and lower advertising and promotion spending, partially offset by the increase in general and administrative expenses. Net income for the nine month period ended December 31, 2006 was $27.7 million, an increase of 22% over the comparable period last year. Outlook The Company expects its full year organic revenue growth will be in line with its previously stated long-term growth range of 3-4%. Total revenues will increase at a greater rate due to acquisitions. Net income is expected to grow less rapidly than total revenue growth. Conference Call The Company will host a conference call to review its third quarter and nine month results on Tuesday, February 6th at 8:30am EST EST electroshock therapy. EST abbr. electroshock therapy . The toll free number is 866-770-7125 within North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and 617-213-8066 from outside North America. The conference pass code is "prestige". Telephonic replays will be available for two weeks following completion of the call and can be accessed at 888-286-8010 within North America and at 617-801-6888 from outside North America. The pass code is 12780289. About Prestige Brands Holdings, Inc. Located in Irvington, New York Irvington is a village in Westchester County, New York, United States. The population was 6,632 at the 2000 census. The Village of Irvington is located on the western side of the Town of Greenburgh. The village is north of New York City. , Prestige Brands Holdings, Inc. is a marketer and distributor of brand name over-the-counter products, personal care and household products sold throughout the U.S. and Canada. Key brands include Compound W[R] wart wart, circumscribed outgrowth of the skin caused by a filterable virus that is readily transmitted. Warts may appear anywhere on the skin but are most common on the hands. remover, Chloraseptic[R] sore throat Sore Throat Definition Sore throat, also called pharyngitis, is a painful inflammation of the mucous membranes lining the pharynx. It is a symptom of many conditions, but most often is associated with colds or influenza. treatment, New-Skin[R] liquid bandage, Clear eyes[R] and Murine murine /mu·rine/ (mur´en) pertaining to, derived from, or characteristic of mice or rats. mu·rine adj. [R] eye care products, Little Remedies[R] pediatric pediatric /pe·di·at·ric/ (pe?de-at´rik) pertaining to the health of children. pe·di·at·ric adj. Of or relating to pediatrics. over-the-counter products, Cutex[R] nail polish remover nail polish remover n → quitaesmalte m nail polish remover nail n → dissolvant m nail polish remover nail n , Comet[R] and Spic and Span[R] household products, and other well-known brands. Forward Looking Statements Note: This news release contains "forward-looking statements" within the meaning of the federal securities laws and is intended to qualify for the Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. from liability established by the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. "Forward-looking statements" generally can be identified by the use of forward-looking terminology such as "assumptions," "target," "guidance," "outlook," "plans," "projection," "may," "will," "would," "expect," "intend," "estimate," "anticipate," "believe, "potential," or "continue" (or the negative or other derivatives of each of these terms) or similar terminology. The "forward-looking statements" include, without limitation, statements regarding the outlook for Prestige Brands Holdings' market and the demand for its products, earnings per share, future cash flows from operations, future revenues and margin requirement and expansion, the success of new product introductions, growth in costs and expenses, and the impact of acquisitions, divestitures, restructurings and other unusual items, including Prestige Brands Holdings' ability to integrate and obtain the anticipated results and synergies from its acquisitions. These projections and statements are based on management's estimates and assumptions with respect to future events and financial performance and are believed to be reasonable, though are inherently uncertain and difficult to predict. Actual results could differ materially from those projected as a result of certain factors. A discussion of factors that could cause results to vary is included in 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. and other periodic and other reports filed with the Securities and Exchange Commission. [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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