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FINGERHUT REPORTS 20 PERCENT REVENUES INCREASE FOR FIRST QUARTER DECLARES QUARTERLY DIVIDEND

 MINNEAPOLIS, April 15 /PRNewswire/ -- Fingerhut Companies, Inc. (NYSE: FHT) announced that 1993 first quarter net revenues were $371.8 million compared with net revenues of $309.5 for the same period in 1992, an increase of approximately 20 percent. Net earnings were $7.8 million or $.31 per share compared with first quarter 1992 net earnings of $9.6 million or $.37 per share.
 "We are pleased with our performance for the first quarter," said Ted Deikel, Fingerhut chairman and chief executive officer. "Sales and earnings were stronger than planned and we continue on target for another record year."
 As planned, net earnings for the first quarter of 1993 were affected by additional depreciation on the company's investment in its Tennessee distribution center and other capital and software investments which became operational in the fourth quarter of 1992 as well as interest expense related to the company's repurchase of 1.5 million of its shares in December 1992. In addition, Fingerhut Corporation acquired approximately 140 thousand more new customers in the first quarter of 1993 compared with the same period in 1992. Net earnings were also affected by higher fulfillment costs related to the Tennessee facility and improved performance from the subsidiaries.
 "We are continuing to refine our processes and systems in our Tennessee facility in preparation for the second half sales volume," said Glenn Habern, senior vice president and chief information officer. "While our apparel fulfillment is ramping up quickly and is operating consistent with our expectations, we have not yet achieved the efficiencies expected in the non-apparel replenishment area."
 Net sales for the thirteen week period ended March 26, 1993 were $341.0 million compared to $284.9 million for the related period in 1992, an increase of approximately 20 percent. Fingerhut Corporation (Fingerhut), the core business, had first quarter net sales of $275.4 million compared to $240.4 million in 1992, an increase of 14.5 percent. Net sales from Fingerhut's existing customer list increased approximately 14 percent to $214.8 million primarily as a result of improved sales per mailing. Net sales from Fingerhut's new customer acquisition programs increased approximately 16 percent to $60.6 million primarily as a result of increased customer solicitations and improved sales per advertising dollar spent. Net sales from USA Direct were $30.1 million compared to $10.0 million for the same period in 1992. Net sales from Figi's were $6.8 million compared to $9.3 million in 1992 as a result of a planned reduction in mailings. Net sales from COMB were $24.2 million compared to $21.1 million in the prior year as a result of improved sales per mailing partially offset by a planned reduction in mailings.
 Net finance income for the current thirteen week period was $30.8 million compared to $24.5 million in 1992. The increase was primarily due to Fingerhut's increased sales and extended payment plans.
 Product cost for the thirteen week period ended March 26, 1993 was $171.6 million or 50.3 percent of net sales compared to $131.8 million or 46.3 percent of net sales during the comparable prior year period. The increase as a percentage of net sales primarily resulted from continuation of the price/value strategy implemented in the fall of 1992 and, to a lesser extent, higher fulfillment costs.
 Administrative and selling expenses for the current thirteen week period were $132.6 million or 38.9 percent of net sales compared to $113.2 million or 39.7 percent of net sales in the comparable prior year period. As expected, Fingerhut's selling expenses as a percentage of net sales decreased due to the price/value strategy, but were partially offset by higher depreciation costs included in administrative expenses.
 The provision for uncollectible accounts for the first quarter of 1993 was $43.1 million or 12.7 percent of net sales compared with $38.4 million or 13.5 percent of net sales for the same period in the prior year. The decrease as a percent of net sales was primarily due to improvements in Fingerhut's new customer acquisition programs.
 Discount on sale of accounts receivable for the thirteen week period ended March 26, 1993 was $3.5 million compared to $4.0 million for the comparable period in 1992. The decrease resulted from lower average commercial paper rates in 1993 partially offset by an increase in the amount of accounts receivable sold.
 Net interest expense for the current thirteen week period was $9.7 million compared to $7.5 million in the comparable prior year period. The increase of $2.2 million was primarily attributable to interest expense related to the company's repurchase of stock in 1992, amounts payable under the interest rate swap agreements, and the 1992 replacement of current debt with longer-term debt agreements.
 The effective tax rate for the first quarter of 1993 was 31.0 percent compared with 34.7 percent in the prior year. The current first quarter tax rate reflected a one-time favorable cumulative effect of $.3 million due to the adoption of FAS 109.
 The company also announced that it has declared a quarterly cash dividend in the amount of $.08 per share, payable on May 20, 1993, to the shareholders of record at the close of business on April 29, 1993.
 Fingerhut Companies, Inc., one of the nation's largest catalog marketing companies, sells brand name and private label merchandise primarily through the mail to an active customer base of 13 million customers. The company employs approximately 8,500 people in Minnesota, Wisconsin and Tennessee. Fingerhut Companies, Inc. common stock trades on the New York Stock Exchange under the symbol FHT.
 FINGERHUT COMPANIES, INC. AND SUBSIDIARIES
 Consolidated Statements of Earnings
 (Unaudited, In Thousands of Dollars, Except Per Share Data)
 Thirteen Weeks Ended 3/26/93 3/27/92
 Revenues:
 Net sales $ 340,962 $ 284,935
 Finance income, net 30,845 24,537
 Total revenues 371,807 309,472
 Costs and expenses:
 Product cost 171,591 131,801
 Administrative and selling expenses 132,582 113,163
 Provision for uncollectible accounts 43,146 38,391
 Discount on sale of accounts receivable 3,513 3,950
 Interest expense, net 9,715 7,470
 Total cost and expenses 360,547 294,775
 Income before income taxes provision 11,260 14,697
 Provision for income taxes 3,496 5,107
 Net income $ 7,764 $ 9,590
 Earnings per share of common stock
 and common stock equivalents $ .31 $ .37
 Weighted average shares of common
 stock and common stock equivalents 24,770,842 26,107,880
 FINGERHUT COMPANIES, INC. AND SUBSIDIARIES
 Consolidated Statements of Financial Position
 (Unaudited, In Thousands of Dollars)
 Periods Ended 3/26/93 12/25/92
 Assets
 Current Assets:
 Cash and cash equivalents $ 25,229 $ 86,682
 Customer accounts receivable, net 300,997 320,692
 Inventories, net 163,223 147,415
 Promotional material 59,121 49,649
 Deferred and other income taxes 118,484 69,368
 Other 7,151 8,308
 Total current assets 674,205 682,114
 Property, plant and equipment, net 169,343 167,697
 Excess of cost over fair value of net
 assets acquired, net 47,315 47,506
 Customer lists, net 15,520 15,692
 Deferred income taxes 22,302 --
 Other assets 11,975 12,640
 Total $ 940,660 $ 925,649
 Liabilities
 Current Liabilities:
 Accounts payable $ 115,580 $ 151,419
 Accrued payroll and employee benefits 31,539 36,098
 Other accrued liabilities 51,606 60,546
 Revolving credit facility -- --
 Current portion of long-term debt 337 333
 Deferred income taxes 50,307 --
 Current income taxes payable -- 20,717
 Total current liabilities 249,369 269,113
 Long-term debt, less current portion 247,120 247,190
 Deferred income taxes 32,100 5,940
 Other non-current liabilities 4,298 3,815
 Total 532,887 526,058
 Stockholders' Equity
 Preferred stock, $.01 par value;
 5,000,000 share authorized;
 none issued or outstanding -- --
 Common stock, $.01 par value;
 50,000,000 share authorized;
 22,974,749 and 22,875,699 issued
 and outstanding in 1993 and 1992,
 respectively 230 229
 Additional paid-in capital 252,634 250,382
 Earnings reinvested 407,773 399,591
 Total stockholders' equity $ 940,660 $ 925,649
 FINGERHUT COMPANIES, INC. AND SUBSIDIARIES
 (Unaudited, In Thousands of Dollars, Except Per Share Data)
 Thirteen Weeks Ended 3/26/93 3/27/92
 Revenues $ 371,807 $ 309,472
 Net income 7,764 9,590
 Earnings per share of common stock
 and common stock equivalents $ 0.31 $ 0.37
 Weighted average shares of common
 stock and common stock equivalents
 (000's) 24,771 26,108
 -0- 4/15/93
 /CONTACT: Theodore Deikel of Fingerhut Companies, Inc., 612-936-5410/
 (FHT)


CO: Fingerhut Companies, Inc. ST: Minnesota IN: REA SU: ERN

LD -- NY004 -- 5971 04/15/93 06:02 EDT
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Date:Apr 15, 1993
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