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CROWNAMERICA REPORTS MID-YEAR OPERATING RESULTS

 DALTON, Ga., April 19 /PRNewswire/ -- CrownAmerica, Inc., a leading processor of filament yarn for U.S. and international carpet manufacturers, today reported operating results for the second quarter and first half of its 1993 fiscal year.
 Lane Hamilton, president and chief executive officer, said revenues for the quarter ended Feb. 27 were $8,631,230, as compared to $14,322,647 recorded in the same quarter a year ago. CrownAmerica had net income of $125,738, or $.12 per share, for the second quarter of fiscal 1993, as compared to a net loss of $386,968, or $.37 per share, reported in the second period of fiscal 1992.
 Revenues for the six months ended Feb. 27 reached $22,475,625, as compared to $31,651,893 posted for the first half of fiscal 1992. The company had a net loss of $212,732, or $.20 per share, in the first six months of the current year, as compared to a net loss of $289,068, or $.27 per share, in the corresponding period a year ago.
 In commenting on results, the company released the text of its Management's Discussion and Analysis of Financial Condition and Results of Operations as incorporated in its Form 10-Q for the period ended Feb. 27.
 "Management of the registrant believes that its financial condition is sound and that its present working capital, together with any future profits and its ability to borrow on a satisfactory basis from others, will meet its needs for liquidity both on a short-term and long-term basis. Cash and cash equivalents increased by $9,292,211 during the first six months because of the sale of assets to Aladdin, despite an operating loss. The company currently has a tender offer outstanding for up to 525,000 shares at a price of from $8.50 to $11.50 per share, which will reduce the current level of cash, if the offer is completed successfully.
 "Domestic revenues declined for the second quarter and the first six months of fiscal year 1993, as compared to the corresponding periods of the prior year, because of a lower volume of pounds processed, a shift in the product mix from packaged yarn sales to processed yarn sales (for which revenues reflect only a processing fee and not the price of yarn), and the loss of Aladdin Mills, Inc., as a significant customer due to the sale of the Dalton plant to it in February 1993. Revenues from the plant in the Netherlands for the same periods continued at about the same level as the second quarter and the first six months, respectively, of the prior fiscal year.
 "The company believes that the volume of pounds processed is a more relevant measure of operational results than are revenues. In the United States, volume of pounds processed continued at an unacceptably low level. Due to the sale of the Dalton plant to Aladdin, the company's largest U.S. customer, pounds processed declined as compared to the same periods a year earlier. In the Netherlands, the volume of pounds processed did not change significantly.
 "Domestic gross profit declined from the corresponding periods of 1992 because of the loss of Aladdin's business as well as a decrease in the demand for twisted and heat-set yarns, which is relatively more profitable than the other product line, air-entangled yarn, but carries higher fixed costs.
 "Furthermore, in the United States, the company had high nonrecurring severance and start-up costs during the first six months of fiscal year 1993 associated with the sale of assets to Aladdin and the move of operations to a new location, as well as increased insurance expenses due to an unusually high incidence of illness.
 "The company believes that its domestic plant can operate more efficiently after the sale to Aladdin and will not be as dependent on high-volume, low-margin accounts.
 "In the Netherlands, operating results for the second quarter and the first six months of fiscal year 1993 suffered from increased manufacturing costs due to the addition of a fourth manufacturing shift that was not fully utilized. In addition, a revaluation of obsolete inventory increased the net loss during the second quarter. The company has hired a new managing director to reduce labor and other costs and to improve the product mix.
 "For the reasons discussed above, the company had a loss from operations of $946,248 during the second quarter and $1,236,500 for the first six months of the current fiscal year, due primarily to larger- than-expected losses from domestic operations.
 "The consolidated condensed financial statements reflect a gain on the sale of the Dalton plant to Aladdin of approximately $1,465,000. This gain differs from the approximately $880,000 estimated gain reported in the pro-forma financial statements issued in connection with filings of Schedule 13E-4 and Form 8-K with the Securities and Exchange Commission. The difference exists because the gain reported in those filings did not include current year depreciation expense on the assets sold. This information was not available, and therefore was not taken into consideration in the calculation of the gain previously published. While this change results in an increase in the amount of the reported gain, it has no impact on net income for the six months ended February 27, 1993, because the additional gain is offset by a corresponding amount of depreciation expense."
 CrownAmerica, Inc., through its Texture-Tex subsidiaries, has for a number of years been a leading supplier of processed filament yarns for carpet manufacturers. The company is based in Dalton, Ga.
 CROWNAMERICA, INC. (0)
 Financial Highlights
 3 mos. ended 2/27/93 2/29/92
 Revenues $8,631,230 $14,322,647
 Net income (loss) 125,738 (386,968)
 Net income (loss) per share $.12 ($.37)
 Wtd. avg. shares outstanding 1,053,000 1,053,000
 6 mos. ended 2/27/93 2/29/92
 Revenues $22,475,625 $31,651,893
 Net income (loss) (212,732) (289,068)
 Net income (loss) per share ($.20) ($.27)
 Wtd. avg. shares outstanding 1,053,000 1,053,000
 NOTE: The consolidated condensed financial statements reflect a gain on the sale of the Dalton plant to Aladdin of approximately $1,465,000.
 -0- 4/19/93
 /CONTACT: Lane Hamilton or George Hamilton of CrownAmerica, 706-278-1422/


CO: CrownAmerica, Inc. ST: Georgia IN: TEX SU: ERN

BR-BN -- AT003 -- 7207 04/19/93 09:20 EDT
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Date:Apr 19, 1993
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