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THE PRICE COMPANY REPORTS THIRD QUARTER RESULTS FISCAL 1992

     THE PRICE COMPANY REPORTS THIRD QUARTER RESULTS FISCAL 1992
    SAN DIEGO, June 25 /PRNewswire/ -- The Price Company (NASDAQ: PCLB) announced today results for the third quarter of fiscal 1992 ending June 7, 1992.
    In the 12-week third quarter ended June 7, 1992, the reported sales were $1.658 billion, compared with $1.504 billion last year, an increase of 10.2 percent.  Real estate operations, net, were $15.1 million, compared to $3.7 million last year.  This increase includes the $11.2 million pre-tax gain on the sale of properties to the Price REIT in May 1992.  Income before interest and taxes was $50.4 million, compared with $41.3 million, an increase of 22.0 percent.  Net income was $28.5 million, compared with $25.1 million last year, an increase of 13.4 percent.  Fully diluted earnings per share were $.57 compared, with $.50 last year, an increase of 14 percent.
    In the 40 weeks of fiscal 1992, sales were $5.631 billion, compared with $5.028 billion last year, an increase of 12.0 percent. Income before interest and taxes was $172.0 million, compared with $158.6 million, an increase of 8.4 percent.  Net income was $99.5 million, compared with $100.0 million last year, a decrease of .6 percent.  Fully diluted earnings per share for the 40 weeks were $1.94, compared to $1.98 last year, a decrease of 2.0 percent.
    Comparable warehouse sales for all Price Clubs which were operating during the same period last year increased 2.5 percent in the third quarter and increased 3.3 percent for the 40-week period.
    Robert Price, chairman and chief executive officer, had the following comments:  "During the third quarter, sales increased at a slightly lower rate than the first and second quarters primarily because of the slower sales growth in Price Club Canada locations. The restriction on Sunday sales, along with the maturing of many high volume warehouses, impacted Canada's third quarter results.  The good news is that Ontario Province has now lifted the ban on Sunday sales, and we are hopeful that Quebec Province will soon follow.
    "Earnings from operations (excluding real estate) for the third quarter were 6 percent less than a year ago.  This compares to a 15 percent decline reported in the second quarter.  Earnings continue to be negatively affected by most of the factors mentioned in the second quarter letter:  substantial capital invested in Price Clubs not yet opened, losses in some of the new Price Clubs, cannibalization and the weak California economy.  We expect that these factors will continue to affect earnings performance during the fourth quarter.  In addition, fourth quarter Canadian sales and earnings on a comparative basis will be adversely affected because last year Price Club Canada's fourth quarter was 13 weeks whereas this year's is 12 weeks.
    "During the third quarter we opened two locations.  The Price Club in Bensalem (Philadelphia) has started very slowly.  We are one of four warehouse clubs in the Philadelphia market, none of which appears to be doing well.  We also opened in Santa Clarita, north of Los Angeles, and sales are above our expectations.  By the time you receive this letter Price Clubs in Dallas, Texas and Manassas, Virginia will have opened giving us a total of 13 new locations in fiscal 1992.
    "During the 1993 first quarter, beginning Aug. 31, we plan to open 15 locations including 6 in the West, 3 in the East, 5 in Canada and 1 in Mexico.  Most of these Price Clubs are located in markets where we are well known, and therefore, we expect that sales will be good.  Although there will be some initial transfer of business from older Price Clubs to the new ones, based on our past experience, we anticipate a net sales and earnings improvement in the markets where the expansion is taking place."
    The company currently operates 80 Price Clubs in the United States and Canada (12 in Canada).  In addition, the company, in a joint venture with Controladora Comercial Mexicana S.A. de C.V., operates one Price Club in Mexico City.
                          THE PRICE COMPANY
                    Consolidated Income Statement
                 Third Quarter Fiscal 1992 and 1991
              (Unaudited) (000s except per share data)
                              Third Quarter         Year-to-Date
                               (12 Weeks)            (40 Weeks)
                           June 7,    June 9,    June 7,     June 9,
                            1992       1991       1992        1991
    Operating revenues:
     Sales               $1,658,323 $1,504,349 $5,631,220 $5,028,376
     Membership fees
      and other income       33,093     31,317    122,142    108,870
     Real estate
      operations, net        15,068      3,697     28,752     12,330
     Total operating
      revenues            1,706,484  1,539,363  5,782,114  5,149,576
     Operating costs
      and expenses:
       Cost of sales      1,511,314  1,376,079  5,132,716  4,594,655
       Selling, general and
        administrative      144,806    122,017    477,438    396,316
       Total operating
        expenses          1,656,120  1,498,096  5,610,154  4,990,971
    OPERATING INCOME         50,364     41,267    171,960    158,605
    Non-operating items:
     Income from investments  3,603      7,038     16,413     19,484
     Interest expense        (6,631)    (7,100)   (23,164)   (14,115)
    INCOME BEFORE
     INCOME TAXES            47,336     41,205    165,209    163,974
    Income taxes            (18,840)   (16,070)   (65,753)   (63,950)
    NET INCOME              $28,496    $25,135    $99,456   $100,024
    Net income per share:
     Primary                   $.59       $.51      $1.99      $2.01
     Fully diluted             $.57       $.50      $1.94      $1.98
    Number of shares used
     in calculation:
      Primary                50,959     52,183     52,235     52,071
      Fully diluted          56,949     58,446     58,224     54,409
                          THE PRICE COMPANY
                     Consolidated Balance Sheet
                 Third Quarter Fiscal 1992 and 1991
                         (Unaudited) (000s)
                                           June 7,    June 9,
                                            1992       1991
    ASSETS
    CURRENT ASSETS
     Cash                                  $13,406         $0
     Short-term investments                122,348    313,212
     Merchandise inventories               389,130    329,719
     Receivables, net                       47,124     64,191
     Prepaid expenses and
      other current assets                  11,742     26,340
    TOTAL CURRENT ASSETS                   583,750    733,462
    PROPERTY, PLANT AND EQUIPMENT
     Land                                  448,928    275,821
     Buildings and improvements            313,618    272,777
     Equipment and fixtures                173,288    124,997
     Construction in progress               47,107     15,212
     Total                                 982,941    688,807
     Less accumulated depreciation        (136,021)  (106,754)
     Total                                 846,920    582,053
    OTHER ASSETS
     Property held for development or
      lease to others, net                 269,830    264,771
     Investment in and advances
      to joint ventures                     50,039     24,063
     Goodwill, net                          49,758     52,731
     Notes receivable                       55,008     48,556
     Miscellaneous other assets             16,525     21,613
     Total                                 441,160    411,734
    TOTAL ASSETS                        $1,871,830 $1,727,249
    LIABILITIES AND SHAREHOLDERS' EQUITY
    CURRENT LIABILITIES
     Bank checks outstanding,
      less cash on deposit                      $0     $2,856
     Accounts payable                      382,349    351,672
     Payroll and related accruals           76,220     68,982
     Accrued sales and other taxes          40,855     35,816
     Income taxes payable                   10,928     10,108
     Other current liabilities              37,340     37,703
    TOTAL CURRENT LIABILITIES              547,692    507,137
    LONG-TERM LIABILITIES
     Long-term debt                        512,092    487,489
     Deferred taxes                         13,888      8,215
     Other                                   8,380      6,856
     Total                                 534,360    502,560
    SHAREHOLDERS' EQUITY
     Common stock                            4,673      4,849
     Paid-in capital                        53,656    110,335
     Retained earnings                     733,472    599,967
     Foreign currency translation           (2,023)     2,401
     Total                                 789,778    717,552
    TOTAL LIABILITIES AND
     SHAREHOLDERS' EQUITY               $1,871,830 $1,727,249
    NOTE:  During the third quarter of fiscal 1992 the LIFO reserve increased by $1,500,000 to a balance of $14,300,000.  This compares to an increase of $1,800,000 in the third quarter of fiscal 1991 to an ending balance of $14,600,000.
                          THE PRICE COMPANY
                     Press Release June 25, 1992
                         Questions & Answers
    (1) Do PCLB's Third Quarter Results Reflect Any Real Estate
         Gains?
     As mentioned in the press release, PCLB sold $62.5 million of real estate to The Price REIT during the third quarter and recognized an $11.2 million pre-tax gain.  The properties include the College Square Shopping Center (Cerritos, Calif.), the Corona Hills Shopping Center (Corona, Calif.) and the Corona Price Club real estate.
    For the 40 weeks ended June 7, 1992, approximately $135 million of real estate has been sold to The Price REIT, and PCLB has recognized approximately $15.6 million of pre-tax gains.
    (2) What was the Impact of the Stock Repurchases on PCLB's Third
         Quarter E.P.S.?
    During fiscal 1992, PCLB has repurchased more than 2,200,000 shares for approximately $76 million.  The third quarter's earnings per share was improved by approximately 1 cent per share as a result of these transactions after taking into account the lost interest income attributable to this cash outflow.
    (3) How was Earnings per Share Calculated?
    Earnings per share was calculated as follows (000's):
                             Third Quarter          Year-to-Date
                          Primary   F. Diluted   Primary F. Diluted
    Shares outstanding
     (wtd. avg.)          47,376      47,376     48,407     48,407
    Impact of
     options/warrants         41          41        285        285
    Add'l shares
     (5.5 percent
      converts)            3,542       3,542      3,542      3,542
    Add'l shares
     (6.75 percent
      converts)                0       5,990          0      5,990
    Total shares used     50,959      56,949     52,234     58,224
    After-tax earnings   $28,496     $28,496    $99,456    $99,456
    Interest, net
     (5.5 percent
      converts)            1,367       1,367      4,555      4,555
    Interest, net
     (6.75 percent
      converts)                0       2,695          0      8,987
    Adjusted income      $29,863     $32,558   $104,011   $112,998
    Earnings per share     $0.59       $0.57      $1.99      $1.94
    NOTE: The number of common stock shares outstanding at June 7, 1992, were approximately 46,726,000.
    -0-                      6/25/92
    /CONTACT: Daniel T. Carter, VP-finance, 619-581-4889/
    (PCLB) CO:  The Price Company ST:  California IN:  REA SU:  ERN JL -- SD002 -- 3634 06/25/92 09:04 EDT
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Copyright 1992 Gale, Cengage Learning. All rights reserved.

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