POMONA, Calif., Feb. 3, 1999 (PRIMEZONE) -- Keystone Automotive Industries, Inc. (NASDAQ: KEYS) today reported third quarter net income for the period ended December 25, 1998 of $4,952,000, or $0.28 per diluted share, after costs incurred to consolidate duplicate warehouse facilities, on net sales of $84,017,000, up from pro forma net income for the comparable period a year earlier of $3,396,000, or $0.23 per diluted share, on net sales of $66,247,000 reported in the comparable quarter a year ago. Year ago net income is on a pro forma basis, giving effect to an income tax adjustment to reflect taxation of the income of Inteuro and Car Body, acquired in January 1998, as "C" corporations, rather than "S" corporations, at an estimated statutory rate of approximately 39 percent. Keystone had 17,779,000 weighted average fully diluted shares outstanding in the third quarter compared with 14,876,000 for the prior year.
For the nine months ended December 25, 1998, Keystone reported net income of $12,894,000, or $0.77 per diluted share, on net sales of $235,327,000, compared with pro forma net income of $9,523,000, or $0.69 per diluted share, on net sales of $192,388,000 for the nine-month period ended December 26, 1997. Fully diluted weighted average shares outstanding for the nine-months ended December 1998 were 16,837,000 compared with 13,851,000 fully diluted weighted average shares for the comparable prior year period.
Commenting on the third quarter and year to date results, Charles Hogarty, President and Chief Executive Officer, stated, "The first nine months of this year have been very active for the Company. As of the end of the quarter we had completely divested the mechanical hard parts operations of Republic Automotive which we acquired in June of 1998. All of our attention is now focused on our core business of distributing aftermarket collision replacement parts.
"Year-to-date, same store sales increased approximately 6 percent compared with the year ago period, which is slightly below our expectations due to continued unseasonably warm weather throughout most of the country. However, we were encouraged by improvements in both gross and net operating margins. The beginning of the fourth quarter saw most of the nation experience harsh weather conditions, which has resulted in higher same store sales through January 1999. While total revenues were up 27 percent for the quarter and 22 percent year-to-date, the increases were slightly below consensus estimates due to mild weather conditions, the attention and effort required by management to divest of the hard parts operations and to consolidate duplicate facilities, and the fact that the Company only completed two acquisitions in the first nine months of this year. During the fourth quarter, the Company expects to complete one or more smaller acquisitions."
As of February 1, 1999, the Company had repurchased approximately 300,000 shares of the one million share buyback authorized by the Company's Board of Directors in November 1998.
Keystone Automotive Industries, Inc. distributes its products in the United States primarily to collision repair shops through its 100 warehouses, of which 21 serve as regional hubs. Its product lines consist of automotive body parts, bumpers, auto glass 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 nation.
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 Company's ability to find suitable acquisition candidates and acquire entities on terms favorable to 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. For a more detailed discussion of some of the ongoing risks and uncertainties of the Company's business, see the Company's filings with the Securities and Exchange Commission.
Keystone Automotive Industries, Inc.
Condensed Consolidated Statements of Income
(In thousands, except per share and share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
Dec. 25, Dec. 26, Dec. 25, Dec. 26,
1998 1997 1998 1997
Net sales $ 84,017 $ 66,247 $ 235,327 $ 192,388
Cost of sales 47,059 37,003 132,997 109,217
Gross profit 36,958 29,244 102,330 83,171
Operating expenses:
Selling and distribution
expenses 22,935 19,155 64,747 53,659
General and administrative 6,590 4,104 17,717 12,788
Service Center
consolidation costs 103 --- 505 ---
Merger costs --- 323 --- 323
Severance costs --- --- --- 705
Operating income 7,330 5,662 19,361 15,696
Other income 973 203 2,155 639
Interest expense (3) (68) (26) (471)
Income before income taxes 8,300 5,797 21,490 15,864
Income taxes 3,348 2,106 8,596 4,996
Net income $ 4,952 $ 3,691 $ 12,894 $ 10,868
Earnings per share:
Basic $ 0.28 $ 0.25 $ 0.78 $ 0.79
Diluted $ 0.28 $ 0.25 $ 0.77 $ 0.78
Weighted average shares outstanding:
Basic 17,603,000 14,642,000 16,605,000 13,674,000
Diluted 17,779,000 14,876,000 16,837,000 13,851,000
PRO FORMA
Net income, as
previously reported $ 4,953 $ 3,691 $ 12,894 $ 10,868
Pro forma tax adjustment $ --- $ (295) $ --- $ (1,345)
Pro forma net income $ 4,953 $ 3,396 $ 12,894 $ 9,523
Pro forma net income
per share-basic $ 0.28 $ 0.23 $ 0.78 $ 0.70
Pro forma net income
per share-diluted $ 0.28 $ 0.23 $ 0.77 $ 0.69
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