U.S. Home Systems Reports Record Third Quarter 2006 Financial Results.Net Income Increases 157% on 26% Revenue Growth Net Income of $2.2 million, $0.27 Per Share DALLAS -- The first sub headline should read: Net Income Increases 157% on 26% Revenue Growth (sted: Net Income Increases 255% on 26% Revenue Growth). The remainder of the release is unchanged. The corrected release reads: U.S. HOME SYSTEMS REPORTS RECORD THIRD QUARTER 2006 FINANCIAL RESULTS Net Income Increases 157% on 26% Revenue Growth; Net Income of $2.2 million, $0.27 Per Share U.S. Home Systems, 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 :USHS USHS United States Historical Society ) today reported financial results for the third quarter ended September 30, 2006. For the third quarter 2006, USHS reported consolidated revenues of $38.1 million, an increase of 26.0 percent as compared to $30.2 million in the three months ended September 30, 2005. Consolidated net income was $2.2 million, or $0.27 per share for the three months ended September 30, 2006, as compared to $863,000, or $0.11 per share, for the three months ended September 30, 2005. For the nine months ended September 30, 2006, consolidated revenues increased 22.1 percent to $94.9 million as compared with $77.7 million in the prior year period. Net income was $2.6 million, or $0.32 per share, as compared with a net loss of ($790,000), or ($0.10) per share, for the nine months ended September 30, 2005. USHS is engaged in two lines of business: the home improvement business and the consumer finance business. The Company's home improvement principal product lines include kitchen cabinet refacing products, bathroom tub liners liners, n the liquid material applied to teeth to protect them within a cavity preparation, to seal carious tissues, or to release beneficial chemicals such as fluoride. and wall surround products, wood decks and related accessories. The Company's home improvement products are marketed exclusively through The Home Depot The Home Depot (NYSE: HD) is an American retailer of home improvement and construction products and services. Headquartered in Vinings, just outside Atlanta in unincorporated Cobb County, Georgia, Home Depot employs more than 355,000 people and operates 2,164 big-box . At September 30, 2006, USHS kitchen products were available to The Home Depot customers in approximately 1,290 stores (of which 583 also offered the Company's bath products) as compared to 535 stores at September 30, 2005 (all of which offered bath products). Wood deck products were being offered in approximately 525 stores at September 30, 2006 as compared to 400 stores at September 30, 2005. The Company's consumer finance business provides sourcing and servicing of retail installment obligations. "Our results continue to demonstrate the success of our expansion program with The Home Depot and the effectiveness of the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and consolidation of our deck and kitchen businesses," commented Murray Gross, chairman, president and chief executive officer of US Home Systems, Inc. Home Improvement Segment: Revenues in the home improvement segment increased 26.7 percent to $36,316,000 in the third quarter 2006 from $28,657,000 in the third quarter 2005. Gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. improved to 54.6 percent of revenues in the current quarter as compared to 49.9 percent of revenues in the third quarter of last year. Net income was $2,389,000, or 6.6 percent of home improvement revenues in the current quarter as compared with $1,019,000, or 3.6 percent of home improvement revenues in the third quarter last year. Mr. Gross continued, "In the third quarter our installed revenues increased approximately $7.7 million over the same quarter last year. Of that amount, approximately $4.4 million, or 57 percent of the increase, was realized in markets that were opened prior to 2006. Gross profit and operating margins Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: improved during the quarter primarily due to higher revenues combined with realized benefits from consolidating our kitchen and deck business operations Business operations are those activities involved in the running of a business for the purpose of producing value for the stakeholders. Compare business processes. The outcome of business operations is the harvesting of value from assets , including increased utilization of subcontractors to complete deck installations and reduced costs related to our fleet of deck installation vehicles. Additionally, lower material prices on lumber lumber, term for timber that has been cut into boards for use as a building material. The major steps in producing lumber involve logging (the felling and preparation of timber for shipment to sawmills), sawing the logs into boards, grading the boards according to products helped improve our profit margin in the current quarter. In the prior quarter we added additional direct labor in each of our kitchen and deck manufacturing facilities and we are now benefiting from improved efficiencies. Our increased manufacturing and installation capacity in combination with higher new sales orders The sales order, sometimes abbreviated as SO, is an order received by a business from a customer. A sales order may be for products and/or services. Given the wide variety of businesses, this means that the orders can be fulfilled in several ways. have resulted in a 19 percent increase in the number of jobs installed in the current quarter as compared with last year's third quarter." Consumer Finance Operations The execution of the joint finance mission to provide financial advice and guidance, support of the procurement process, providing pay support, and providing disbursing support.See also financial management. : Revenues from our consumer finance segment were $1.8 million in the third quarter 2006, as compared with $1.6 million in the prior year quarter. Net loss for the finance segment was $(167,000) in the third quarter 2006 as compared with $(156,000) for the same prior year period. "The increase in our finance segment revenue is due to higher interest earnings resulting from the increase in our RIO portfolio," added Mr. Gross. "However, despite the increase in our RIO portfolio, we continue to experience operating losses 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. in this segment due to the volume of early payoffs, increased loan losses and higher interest expenses resulting from increased interest rates under our credit lines. On November 2, 2006 we sold a substantial portion of our RIO portfolio to an unrelated third party. As a result of entering into the agreements with the purchaser, the business of FCC (1) (Federal Communications Commission, Washington, DC, www.fcc.gov) The U.S. government agency that regulates interstate and international communications including wire, cable, radio, TV and satellite. The FCC was created under the U.S. has changed from purchasing RIOs and holding them for investment to sourcing and servicing RIO portfolios for the purchaser. Although we believe that FCC's financial condition and results of operations will improve in the long-term, we believe that net income for the year ended December 31, 2007 in the finance segment will range from an insignificant operating loss to marginal profitability." Mr. Gross concluded, "It is our opinion that the third quarter is the first quarter where we are starting to realize the earnings power of our model. As we move forward in to 2007, we believe that with our, and The Home Depot's marketing efforts, we can achieve a minimum year-over-year revenue growth rate of 20 percent." CONFERENCE CALL INFORMATION Management of USHS will host a conference call to discuss its second quarter results at 4:30 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. , Thursday, November 9, 2006. Interested parties may access the call by calling 800-289-0533 from within 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. , or 913-981-5525 if calling internationally, approximately five minutes prior to the start of the call. A replay will be available through November 16, 2006, and can be accessed by dialing 888-203-1112 (U.S.), 719-457-0820 (Int'l), passcode 2767048. This call is being web cast by ViaVid Broadcasting and can be accessed at U.S. Home Systems' website at www.ushomesystems.com. The web cast may also be accessed at ViaVid's website at www.viavid.net. The web cast can be accessed until December 9, 2006 on either site. To access the web cast, you will need to have the Windows Media Player Digital jukebox software for Windows from Microsoft that plays a variety of audio, video and streaming formats including MP3, WMA, CD audio and MIDI. Starting with Version 6.2 in 1999, the Windows Media Rights Manager was added for securing copyrighted content. on your desktop. For the free download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. of the Media Player please visit: http://www.microsoft.com/windows/windowsmedia/en/download/default.asp. About U.S. Home Systems, Inc. U.S. Home Systems, Inc. (www.ushomesystems.com) manufactures or procures, designs, sells and installs custom quality specialty home improvement products for The Home Depot in certain markets. The Company's home improvement products are marketed nationally under the The Home Depot[R] Kitchen and Bathroom Refacing and The Home Depot Installed Decks brand. The Company's product lines include kitchen cabinet refacing products utilized in kitchen remodeling remodeling /re·mod·el·ing/ (re-mod´el-ing) reorganization or renovation of an old structure. bone remodeling , bathroom tub liners and wall surround products utilized in bathroom remodeling, wood decks and related accessories. The Company manufactures its own cabinet refacing products, bathroom cabinetry cab·i·net·ry n. Cabinetwork: finely detailed cabinetry. Noun 1. cabinetry - the craft of making furniture (especially furniture of high quality) cabinetwork and wood decks. The business of the Company's consumer financing subsidiary is to source and service retail installment obligations. This press release may contain 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. within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are based on a number of assumptions, including expectations for continued market growth and anticipated revenue levels. Although the Company believes these assumptions are reasonable, no assurance can be given that they will prove correct. The Company's ability to continue to grow sales and to expand geographically and through new products and acquisitions will be key to its success in the future. If the industry's or the Company's performance differs materially from these assumptions or estimates, U.S. Home Systems' actual results could vary significantly from the estimated performance reflected in any forward-looking statements. [TABLE OMITTED] [TABLE OMITTED] |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion