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THE MORGAN GROUP, INC. REPORTS SOLID SALES AND EARNINGS GAINS FOR THE THIRD QUARTER AND NINE MONTHS ENDED SEPT. 30, 1993

 ELKHART, Ind., Nov. 4 /PRNewswire/ -- The Morgan Group, Inc. (NASDAQ: MRGN) announced today that sales, operating income, net income, and earnings per share all rose substantially for the third quarter and for the first nine months ended Sept. 30, 1993.
 Primary earnings per share reached $.27 in the third quarter compared with $.21 in 1992, despite approximately 60 percent more weighted shares outstanding. First nine month earnings climbed to $.63 per share from $.27 per share in the first three quarters last year.
 Third quarter revenues totaled $22,813,000, compared with $18,279,000, for the same quarter last year, an increase of 24.8 percent. Operating income was $751,000 for the three months, 7 percent above $702,000 last year, while quarterly 1993 income rose 111 percent to $680,000 vs. $322,000 for the third quarter of 1992.
 Revenues for the first nine months ended Sept. 30 were $60,946,000, compared with $50,126,000 for the comparable period last year, a gain of 21.6 percent. First nine months operating income reached $1,845,000, also up 21.6 percent from $1,517,000, for the first three quarters of 1992. Net income for the first nine months was $1,249,000, about triple the $403,000 earned in the 1992 period.
 Management attributed the revenue gains to the strong demand for Morgan's services by its manufactured housing and recreational vehicle customers, results from a recent acquisition, and several important new accounts. Third quarter operating margins were affected by increased general and administrative costs, specifically by expenses related to upgrading data processing equipment and by costs associated with increasing claims reserves and establishing a new safety incentive program. Net earnings for the quarter were positively impacted by reduced interest and tax charges, while earnings per share calculations now take into account the higher number of shares outstanding following the July 1993 public offering of 1.1 million Class A Morgan shares.
 The company also announced two notable events: It agreed on terms for extending its relationship with Winnebago, a major customer, for an additional three years, and it also made its second 1993 acquisition: Low Transporation, Inc., a regional company serving the manufactured housing industry in the Northeast. Philip J. Ringo, president of The Morgan Group, Inc., noted the Winnebago extension "is consistent with the company's goal to align with market leaders." The Low Transportation acquisition, according to Charles C. Baum, chairman and chief executive officer of Morgan, "is part of our on-going strategy to grow the business via acquisitions as well as expansion of services we offer customers; we anticipate that Low, with sales approaching $2 million, will positively impact 1994 earnings per share."
 The Morgan Group is the nation's leader in providing transportation services to the manufactured housing and recreational vehicle industries. Through a national network of approximately 1,150 independent owner-operators and 900 part-time, drive-away employees, in 113 offices in 34 states, Morgan matches drivers with shipments from customers including Fleetwood Enterprises, Inc., Cavalier Homes, Inc., Oakwood Homes Corporation, Glaval Corporation and Winnebago Industries, Inc. The company also transports commercial vehicles and office


trailers and provides certain insurance services to its owner-operators through its insurance subsidiary, Interstate Indemnity Company.
 An initial public offering in July 1993 -- led by Ferris, Baker Watts, Incorporated, Gabelli & Company, Inc., and David A. Noyes & Company, Inc. -- provided funds to retire debt, provide working capital and finance the company's acquisition plans and programs to expand services to its customers. The Morgan Group currently has cash of $4.75 million and has reduced its long-term debt to $1.7 million.
 THE MORGAN GROUP, INC., AND SUBSIDIARIES
 Condensed (Unaudited) Consolidated Statements of Operations
 (In thousands, except per-share data)
 Periods ended Three Months Nine Months
 Sept. 30 1993 1992 1993 1992
 Operating revenues $22,813 $18,279 $60,946 $50,126
 Costs and expenses:
 Operating costs 20,424 16,140 54,639 44,668
 Depreciation and
 amortization 212 251 595 719
 Selling, general and
 administrative 1,426 1,186 3,867 3,222
 Operating income 751 702 1,845 1,517
 Other income (expenses):
 Interest net (86) (280) (498) (1,006)
 Income before income
 taxes 665 422 1,347 511
 Income taxes 15 (100) (98) (108)
 Net income (loss) 680 322 1,249 403
 Less preferred stock
 dividends (54) (14) (158) (14)
 Net income applicable to
 common stock 626 308 1,091 389
 Net income per share $.27 $.21 $.63 $.27
 Fully diluted .26 .19 .59 .25
 Average number of common
 shares and common stock
 equivalents 2,341,100 1,466,665 1,761,347 1,466,665
 THE MORGAN GROUP, INC. AND SUBSIDIARIES
 Condensed Consolidated Balance Sheets
 (In thousands)
 Sept. 30, 1993 Dec. 31, 1992
 (Unaudited)
 Assets:
 Current assets:
 Cash and cash equivalents $4,749 $597
 Trade accounts receivable, less
 allowance for doubtful accounts of
 $414,000 in 1993 and $373,000 in 1992 8,742 6,423
 Accounts receivable, other 530 142
 Prepaid expenses and other current
 assets 1,831 1,780
 Total current assets 15,852 8,942
 Property and equipment, net 4,316 4,276
 Intangible assets, net 2,718 2,043
 Other assets 305 344
 Total assets 23,191 15,605
 Liabilities and stockholders' equity:
 Current liabilities:
 Note payable to bank 0 650
 Accounts payable 2,386 1,632
 Accrued liabilities 1,131 1,007
 Accrued insurance claims 2,663 2,298
 Refundable deposits 914 961
 Current portion of long-term debt 460 1,002
 Total 7,554 7,550
 Long-term debt 1,686 3,915
 Redeemable Preferred Stock
 Series A, cumulative, $.01 par value,
 authorized shares-1.6 million,
 and 93,942
 Issued and outstanding shares
 including accrued dividends 3,029 2,887
 Series B, cumulative 4 percent cash
 dividend, convertible, $.01 par
 value, authorized, issued and
 outstanding shares-450,000 --- 914
 Stockholders' equity (deficit):
 Preferred stock without par value,
 authorized shares-50,000
 Common stock $.015 par value:
 Class A 20 2
 Authorized shares-7.5 million
 Issued and outstanding shares-1,366,665
 Class B 18 18
 Authorized shares-2.5 million
 Issued and outstanding shares-1.2 million
 Additional paid-in capital 10,483 980
 Retained earnings (deficit) 401 (661)
 Total stockholders' equity 10,922 339
 Total liabilities and
 stockholders' equity 23,191 15,605
 -0- 11/4/93
 /CONTACT: Charles C. Baum, chairman and chief executive officer, of The Morgan Group, 410-566-9200, or, fax, 410-947-0612/
 (MRGN)


CO: The Morgan Group, Inc. ST: Indiana IN: TRN LEI SU: ERN

JM-MP -- PH022 -- 0803 11/04/93 14:14 EST
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Date:Nov 4, 1993
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