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DANKA REPORTS A 45 PERCENT INCREASE IN PRETAX EARNINGS

 ST. PETERSBURG, Fla., Oct. 28 /PRNewswire/ -- Danka Business Systems PLC (NASDAQ: DANKY) announced that its second quarter ended Sept. 30, 1993 showed strong gains over the same period a year ago. Revenue for the second quarter increased 27 percent to $115.0 million while pretax earnings grew a more impressive 45 percent to $10.1 million.
 Net earnings rose 7 percent to $5.8 million or $0.27 per American Depositary Share ("ADS") from $5.4 million or $0.26 per ADS last year in spite of an increase in the effective income tax rate to 42.1 percent from 21.7 percent in the second quarter a year ago. The fiscal 1993 effective income tax rate reflects the benefit from net operating loss carryforwards which were fully utilized in the prior year. Net earnings and earnings per ADS in the second quarter of fiscal 1994 were also adversely impacted by $240,000 one time adjustment related to the retroactive implementation of the Omnibus Budget Reconciliation Act of 1993.
 Results for the first half of the fiscal year were equally positive. Revenue increased 42 percent to $223.0 million while pretax earnings increased 55 percent to $18.9 million. Net earnings rose 17 percent to $11.2 million or $0.53 per ADS from $9.6 million or $0.47 per ADS a year ago.
 Daniel M. Doyle, Danka's chief executive commented, "I am very pleased with our second quarter results. Out core retail operations have continued to achieve solid equipment sales growth which is the foundation of service and supply revenue growth. Additionally, the assimilation of our recent acquisitions is progressing in line with our expectations." Doyle went on to say, "Numerous acquisition candidates remain available to us and our recent equity offering provides Danka with the financial resources necessary to continue our acquisition strategy."
 The directors are declaring an interim dividend of .75p per share (equivalent to $0.09 per American Depositary Share at today's exchange rate) which will be paid on Jan. 26, 1994 to shareholders, and ADR holders whose names appear on the register on Dec. 10, 1993. The company has amended its dividend policy to pay equal semiannual dividends. Accordingly, in the absence of unforseen conditions it is intended that the proposed final dividend will be maintained at the same level as this year's interim dividends.
 Danka Business Systems PLC, headquartered in St. Petersburg, is one of the largest independent distributors of automated office equipment and related services and supplies in the United States. Danka's ADS are listed on the NASDAQ-NMS and its Ordinary Shares are listed on the London Stock Exchange.
 DANKA BUSINESS SYSTEMS PLC
 CONSOLIDATED STATEMENTS OF EARNINGS
 (In thousands, except per ADS amounts)
 For the three months ended
 Sept. 30, Sept. 30,
 1993 1992
 (Unaudited) (Unaudited)
 REVENUE:
 Retail equipment sales $ 44,189 $ 32,194
 Retail service, supplies, and rentals 52,189 42,839
 Wholesale 18,659 15,255
 Total revenue 115,037 90,288
 COSTS AND OPERATING EXPENSES
 Cost of retail equipment sales 26,974 20,427
 Retail service, supplies, and
 rental costs 27,206 22,244
 Wholesale costs of revenue 15,143 12,582
 Selling, general and
 administrative expenses 33,612 26,898
 Amortization of intangible assets 860 408
 Total costs and operating expenses 103,795 82,559
 Earnings from operations 11,242 7,729
 Interest, net 1,183 803
 Earnings before income taxes 10,059 6,926
 Provision for income taxes 4,237 1,505
 Net earnings $ 5,822 $ 5,421
 Net earnings per ADSs $ 0.27 $ 0.26
 Weighted average ADSs 21,284 20,549
 For the six months ended
 Sept. 30, Sept. 30,
 1993 1992
 (Unaudited) (Unaudited)
 REVENUE:
 Retail equipment sales $ 84,581 $ 56,443
 Retail service, supplies, and rentals 103,234 74,500
 Wholesale 35,184 26,350
 Total revenue 222,999 157,293
 COSTS AND OPERATING EXPENSES
 Cost of retail equipment sales 51,627 35,284
 Retail service, supplies, and
 rental costs 54,184 37,926
 Wholesale costs of revenue 28,604 21,888
 Selling, general and
 administrative expenses 65,981 47,733
 Amortization of intangible assets 1,632 816
 Total costs and operating expenses 202,028 143,647
 Earnings from operations 20,971 13,646
 Interest, net 2,025 1,388
 Earnings before income taxes 18,946 12,258
 Provision for income taxes 7,711 2,685
 Net earnings $ 11,235 $ 9,573
 Net earnings per ADSs $ 0.53 $ 0.47
 Weighted average ADSs 21,252 20,322
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In Thousnads)
 Sept. 30, March 31,
 1993 1993
 (Unaudited)
 ASSETS
 CURRENT ASSETS:
 Cash $ 4,470 $ 5,755
 Accounts receivable, net 73,535 45,505
 Inventories 74,919 47,758
 Other current assets 4,527 3,007
 Total current assets 157,451 102,025
 Property and equipment, net 51,745 27,287
 Intangible assets, net 45,368 31,097
 Other assets 7,028 4,095
 Total assets $ 261,592 $ 164,504
 LIABILITIES AND SHAREHOLDERS' EQUITY
 CURRENT LIABILITIES:
 Current maturities of long-term debt $ 2,306 $ 20,811
 Accounts payable & accrued expenses 45,893 37,289
 Deferred revenue 28,858 19,538
 Total current liabilities 77,057 77,638
 Long-term debt, less current maturities 107,091 19,954
 Deferred income taxes 6,983 4,758
 Total liabilities 191,131 102,350
 SHAREHOLDERS' EQUITY
 Ordinary shares 3,543 3,523
 Additional paid-in capital 4,488 4,893
 Retained earnings 62,912 54,051
 Currency translation adjustment (482) (313)
 Total shareholders' equity 70,461 62,154
 Total liabilities and
 shareholders' equity $ 261,592 $ 164,504
 -0- 10/27/93
 /CONTACT: William T. Freeman, 813-576-6003, or Paul G. Dumond, 011- 44-71-935-4650, both of Danka Business Systems/
 (DANKY)


CO: Danka Business Systems PLC ST: Florida IN: SU: ERN

JV-AW -- FL004 -- 7703 10/28/93 08:07 EDT
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Date:Oct 28, 1993
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