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CATALINA LIGHTING REPORTS PROFIT IN FOURTH QUARTER VS. PRIOR YEAR LOSS, AS TURNAROUND BECOMES EVIDENT

 CATALINA LIGHTING REPORTS PROFIT IN FOURTH QUARTER
 VS. PRIOR YEAR LOSS, AS TURNAROUND BECOMES EVIDENT
 MIAMI, Dec. 23 /PRNewswire/ -- Catalina Lighting, Inc. (AMEX: LTG) today reported its operating results for the fourth quarter and fiscal year ended Sept. 30, 1991.
 For the three months ended Sept. 30, 1991, the company reported a net profit of $18,337 ($0.00 per share), compared with a year-earlier loss of $1,415,000 ($0.24 per share). Sales for the fourth quarter of FY1991 rose approximately 15 percent to $27.6 million, from $24.0 million in the final three months of FY1990, due in part to initial deliveries to KMart and efforts to expand Catalina's share of the market for both residential and office lighting fixtures.
 "We are very pleased with our return to profitability in the fourth quarter," noted Robert Hersh, who was elected chairman and chief executive officer of Catalina Lighting in April 1991. "During the second half of fiscal 1991, we improved our management in key areas such as sales, purchasing, finance and administration. Through everyone"s combined efforts and determination, we succeeded in nearly every aspect of turning our company around and the results are beginning to show."
 "We felt that the key to our turnaround would be reducing inventory and paying down our debt," said Dean Rappaport, chief financial officer. "We accomplished both in 1991, reducing inventory by nearly $10 million and notes payable under our credit facilities by approximately $7 million from their peak levels last spring. While we expect both to fluctuate modestly in the future due to seasonal requirements, we feel that we've turned the corner in improving both our inventory and debt management."
 For the fiscal year ended Sept. 30, 1991, Catalina's revenue increased 4.3 percent to a record $88.1 million (vs. $84.4 million in FY1990), despite the company's intentional reduction of ceiling fan sales by $10 million in 1991 as compared to 1990. The company posted a net loss of $1,864,000 ($0.34 per share), compared with net income of $812,000 ($0.14 per share) in the fiscal year ended Sept. 30, 1990. Approximately two-thirds of the FY1991 loss related to a non-operating writedown of Catalina's investment in the common stock of Windmere Corporation during the second quarter of the fiscal year. Based upon resent prices for Windmere on the New York Stock Exchange, the current market value of Catalina's investment in that company exceeds its carrying cost on Catalina's balance sheet by over $1.5 million. Earnings were further impaired by approximately $650,000 in amortization of costs related to the May 1990 settlement with former chairman, David Moss. Subsequently to May '92, earnings will not be burdened with such expense. While the company suffered a net loss for the year, its positive cash flow from operations was approximately $9 million, attributable in large part to reduced inventories.
 "By the end of November, our residential lighting products were displayed in more than 2,100 KMart stores across the nation, and several major home center chains and mass merchandisers have indicated plans to increase their purchases from Catalina during the next several months", commented Danny Stewart, executive vice president of sales and marketing. "These gains in market share should more than offset the continuing impact of the recession and further planned reductions in ceiling fan sales."
 "We anticipate significant savings from reduced interest costs during FY1992," indicated Rappaport, "and warehousing costs will be substantially lower, due to improved inventory turnover and the completion of a recent facilities consolidation program. We have also reduced our payroll expenses as a result of personnel restructuring since April, and we expect to continue to build upon our return to profitability during fiscal 1992."
 Catalina Lighting, Inc. is a premier supplier of high quality, affordably priced residential and office lighting fixtures and related products, which are imported from independent suppliers in the Far East and Europe. The Company is headquartered in Miami with warehouse/distribution facilities in Texas, California, and Massachusetts.
 Catalina shares are traded on the American Stock Exchange under the symbol "LTG."
 CATALINA LIGHTING, INC.
 CONDENSED BALANCE SHEET INFORMATION
 Sept. 30, Sept. 30,
 1991 1990
 ASSETS
 CURRENT ASSETS:
 ACCOUNTS RECEIVABLE, NET $19,095,231 $15,301,549
 INVENTORY 24,865,766 34,257,677
 MARKETABLE SECURITIES (B) 3,070,597 --
 OTHER CURRENT ASSETS 2,168,162 1,539,437
 TOTAL CURRENT ASSETS 49,199,756 51,098,663
 PROPERTY AND EQUIPMENT 3,831,976 2,641,840
 MARKETABLE SECURITIES,
 NET (B) -- 3,040,786
 OTHER ASSETS 6,854,242 6,728,052
 $59,885,974 $63,509,341
 LIABILITIES AND STOCKHOLDERS' EQUITY
 CURRENT LIABILITIES:
 NOTES PAYABLE -- CREDIT
 LINES (A) $25,398,559 $ --
 ACCOUNTS PAYABLE AND
 BANKERS ACCEPTANCES 9,035,042 4,058,126
 OTHER CURRENT LIABILITIES 1,279,806 2,842,775
 TOTAL CURRENT LIABILITIES 35,713,407 6,900,901
 NOTES PAYABLE -- CREDIT
 LINES (A) -- 32,359,467
 OTHER LONG-TERM DEBT 2,182,160 1,710,972
 TOTAL LIABILITIES 37,895,567 40,971,340
 STOCKHOLDERS' EQUITY 21,990,407 22,538,001
 $59,885,974 $63,509,341
 (A) -- Notes payable -- credit lines were reclassified in 1991
 from long-term to current liabilities, as they mature
 in 1992.
 (B) -- Marketable securities were reclassified in 1991 from
 long-term to current assets.
 INCOME STATEMENT INFORMATION
 (IN THOUSANDS EXCEPT PER SHARE DATA)
 THREE MONTHS ENDED YEARS ENDED
 SEPT. 30, SEPT. 30,
 1991 1990 (A) 1991 1990 (A)
 NET SALES $ 27,548 $ 23,960 $ 88,075 $ 84,412
 COST OF SALES 23,785 22,037 75,212 71,920
 GROSS PROFIT 3,763 1,923 12,863 12,492
 SELLING, GENERAL
 AND ADMINISTRATIVE
 EXPENSES 3,004 2,831 10,406 7,763
 OPERATING INCOME
 (LOSS) 759 (908) 2,457 4,729
 LOSS ON MARKETABLE
 SECURITIES -- -- (1,222) --
 NET INTEREST AND
 OTHER EXPENSES (626) (1,057) (3,262) (3,237)
 PRE-TAX INCOME
 (LOSS) 133 (1,965) (2,027) 1,492
 INCOME TAX
 PROVISION (BENEFIT) 115 (550) (163) 680
 NET INCOME
 (LOSS) $ 18 $ (1,415) $ (1,864) $ 812
 NET EARNINGS (LOSS)
 PER SHARE,
 FULLY DILUTED $ 0.00 $ (0.24) $ (.34) $ .14
 AVERAGE NUMBER
 SHARES, FULLY
 DILUTED 6,100 5,896 (B) 5,540 5,788 (B)
 (A) -- Certain amounts previously presented in prior year
 financial statements have been reclassified to
 to conform to the current y shares issued to
 Windmere under a price protection agreement on Feb. 7,
 1991.
 -0- 12/23/91
 /CONTACT: Dean Rappaport, chief financial officer, 305-558-4777, of Catalina Lighting; or R. Jerry Falkner, CFA, investor relations counsel, 713-334-2386, for Catalina Lighting/
 (LTG) CO: Catalina Lighting, Inc. ST: Florida IN: HOU SU: ERN


SS-JJ -- FL005 -- 4846 12/23/91 12:42 EST
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Date:Dec 23, 1991
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