POMONA, Calif., Oct. 28, 2005 (PRIMEZONE) -- Keystone Automotive Industries, Inc. (Nasdaq:KEYS) today reported record second quarter revenues for its fiscal 2006 second quarter ended September 30, 2005, reflecting continued strength within its core-product categories.
Net income for the fiscal second quarter climbed 19.8 percent to $2.9 million, or $0.18 per diluted share, from $2.4 million, or $0.15 per diluted share, a year ago. Net sales for the same period increased 9.3 percent to $139.2 million from $127.4 million last year.
For the 26-week period of fiscal 2006, net income jumped 28.6 percent to $7.6 million, or $0.47 per diluted share, from $5.9 million, or $0.37 per diluted share, for the 27-week period a year earlier. Net sales for the same period increased 5.8 percent to $284.0 million from $268.5 million a year ago (9.8% when adjusted for the one less week in the current fiscal year). Prior-year results were restated to include an expense of $897,000 as a result of the SFAS No. 13 lease expense adjustment. Excluding the SFAS No. 13 adjustment, prior-year net income as originally reported was $0.41 per diluted share.
Same store sales for the fiscal second quarter and the six-month period increased 8.5 percent and 8.9 percent (adjusted to reflect the 27-week period a year ago), respectively.
"Results for second fiscal quarter were solid, supported by a 14 percent increase in Keystone's bumper business, a 12 percent climb in crash parts. Excluding the impact of Hurricane Katrina and the fire in Michigan, results would have been even more robust -- underscoring progress being made in the areas of supply-chain management and cost controls," said Richard L. Keister, president and chief executive officer.
As previously announced, second quarter results were impacted by Hurricane Katrina's damage to Keystone's operations in the Gulf region, with sales reduced by approximately $700,000 and write-offs totaling $350,000 relating to account receivables and insurance deductibles for property damage. The New Orleans facility will take several months to rebuild. In addition, Keystone experienced damage from Hurricane Katrina to its Mobile, Alabama, facility and is in the process of relocating operations from this location.
In addition, results for the fiscal second quarter were impacted by a fire that destroyed a bumper remanufacturing facility located in Greenville, Michigan, which recycles plastic bumpers. As previously announced, operations have been temporarily relocated to its facility in Saranac, Michigan. The non-insured losses were $250,000.
Keister highlighted a major industry development during the second quarter with the Illinois Supreme Court overturning a lower court ruling in a national class action case involving aftermarket crash parts - Avery vs. State Farm Insurance Company. He reiterated his belief that this "represents a significant victory for consumers as generic collision replacement parts are a high quality cost-savings alternative to car maker's parts in a $16.0 billion collision parts industry that is 72 percent controlled by automobile manufacturers."
Subsequent to the close of the fiscal second quarter, Keystone announced the signing of a definitive agreement to acquire the assets of Veng USA, with an expected closing date on October 31, 2005. Headquartered in Seekonk, Massachusetts, Veng USA is the premier provider of generic collision parts in New England and recorded trailing revenues of approximately $37.1 million over the twelve months ended August 31, 2005.
Last week the company announced it has established a $75.0 million secured credit facility lead by Wells Fargo Bank, NA, with JP Morgan Chase Bank, NA participating. The credit agreement includes an option to extend the facility to $100.0 million. The new facility increases the aggregate commitment available for borrowing from a previous $40.0 million agreement and extends the maturity date to October 2010.
Teleconference and Web Cast
Richard L. Keister, president and chief executive officer, and John M. Palumbo, chief financial officer, will host an investor conference call today at 11:00 a.m. Pacific Time to discuss the company's financial results and operations for the fiscal year. The call will be open to all interested investors either through a live audio Web broadcast via the Internet at www.keystone-auto.com and www.vcall.com, or live by calling (877) 440-9648 with call ID number 1749371. For those who are not available to listen to the live broadcast, the call will be archived for two weeks on both Web sites. A telephone playback of the conference call will also be available from 2:00 p.m. Friday, October 28 through 9:00 p.m. Wednesday, November 2 by calling (800) 642-1687 (domestic) or (706) 645-9291 (international) and using access code: 1749371.
About Keystone
Keystone Automotive Industries, Inc. distributes its products primarily to collision repair shops through its 129 distribution facilities, of which 22 serve as regional hubs, located in 38 states and Canada. Its product lines consist of automotive body parts, bumpers, and remanufactured alloy wheels, as well as paint and other materials used in repairing a damaged vehicle. These products comprise more than 19,000 stock keeping units that are sold to more than 25,000 repair shops throughout the United States and Canada.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained in this press release that are not historical facts are forward-looking statements based on the company's current expectations and beliefs concerning future developments and their potential effects on the company. There can be no assurance that future developments affecting the company will be those anticipated by the company. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the company) and are subject to change based upon various factors, including but not limited to the impact on the company, if any, of the reversal of the Avery vs. State Farm Insurance Company case by the Illinois Supreme Court and the acquisition, expected to close on October 31, 2005, of Veng USA. Reference is also made to the Cautionary Statements set forth in the company's Form 10-K Annual Report filed with the Securities and Exchange Commission on June 15, 2005 for additional risks and uncertainties facing the company. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise.
Keystone Automotive Industries, Inc.
Condensed Consolidated Statements of Income
(In thousands, except share and per share amounts)
(Unaudited)
Thirteen Thirteen Twenty-six Twenty-seven
Weeks Ended Weeks Ended Weeks Ended Weeks Ended
Sept. 30, Oct. 1 Sept. 30 Oct. 1, 2004
2005 2004 2005 (restated)
--------- --------- ---------- ----------
Net Sales 139,221 $ 127,408 284,002 $ 268,525
Cost of Sales 77,677 72,397 158,305 152,309
--------- --------- ---------- ----------
Gross Profit 61,544 55,011 125,697 116,216
Operating
Expenses:
Selling &
Distribution 44,098 39,409 87,597 81,997
General &
Administrative 13,382 12,369 26,836 26,003
--------- ---------- ---------- ----------
Operating Income 4,064 3,233 11,264 8,216
Other Income 701 804 1,381 1,700
Interest Expense (51) (63) (132) (158)
--------- ---------- ---------- ----------
Income Before
Income Taxes 4,714 3,974 12,513 9,758
Income Taxes 1,849 1,582 4,926 3,857
---------- ---------- ---------- ----------
Net Income $ 2,865 $ 2,392 $ 7,587 $ 5,901
========== ========== ========== ==========
Per Common Share
Income
Basic: $ 0.18 $ 0.15 $ 0.48 $ 0.38
========== ========== ========== ==========
Diluted: $ 0.18 $ 0.15 $ 0.47 $ 0.37
========== ========== ========== ==========
Weighted average
common shares
outstanding:
Basic: 15,984,000 15,570,000 15,931,000 15,518,000
========== ========== ========== ==========
Diluted: 16,151,000 15,789,000 16,059,000 15,752,000
========== ========== ========== ==========
Keystone Automotive Industries, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
September
30, April 1,
2005 2005
--------- ---------
(Unaudited) (Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 6,633 $ 4,054
Accounts receivable,
net of allowance of $1,278 at September
2005 and $1,270 at
April 2005 45,504 49,719
Inventories, primarily finished goods 126,572 119,679
Other current assets 14,627 12,018
--------- ---------
Total current assets 193,336 185,470
Plant, property and equipment, net 29,608 31,079
Goodwill 11,644 11,309
Other intangibles, net of
accumulated amortization of $4,025
at September 2005 and $3,851
at April 2005 834 925
Other assets 6,283 5,801
--------- ---------
Total assets $ 241,705 $ 234,584
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Credit facility $ 370 --
Accounts payable 23,508 25,950
Accrued liabilities 15,087 14,274
--------- ---------
Total current liabilities 38,965 40,224
Other long-term liabilities 2,194 2,583
Shareholders' Equity:
Preferred stock, no par value:
Authorized shares -- 3,000,000
None issued and outstanding -- --
Common stock, no par value:
Authorized shares -- 50,000,000
Issued and outstanding shares
16,001,000 at September 2005
and 15,839,000 at April 2005,
at stated value 93,892 93,244
Restricted Stock 781 460
Additional paid-in capital 7,695 7,695
Retained earnings 98,688 91,101
Accumulated other comprehensive loss (510) (723)
--------- ---------
Total shareholders' equity 200,546 191,777
--------- ---------
Total liabilities and shareholders'
equity $ 241,705 $ 234,584
========= =========
Note: The balance sheet at April 1, 2005 has been derived from the
audited consolidated financial statements at that date but does not
include all of the information and footnotes required by accounting
principles generally accepted in the United States for complete
financial statements.