Ex 99.1
SILVERLEAF RESORTS, INC. REPORTS
FIRST QUARTER 2007 RESULTS
- - -
Vacation Interval Sales for the Quarter Increased by 28.7% to $53.4 Million
Net Income Increased by 5.6% to $6.6 Million
DALLAS, TEXAS. (May 8, 2007) --- Silverleaf Resorts, Inc. (NASDAQ: SVLF) today announced its financial results for the first quarter ended March 31, 2007.
Sharon K. Brayfield, President, commented, “We are pleased with our overall operating results for the first quarter of 2007 compared to 2006, particularly the increase in Vacation Interval sales. Our business strategy continues to focus on increasing interval sales across all of our product lines. Our encouraging first quarter sales results are due to both higher closing percentages and continued growth in customer tours. We feel confident that we are well positioned to meet our net income guidance for 2007 of approximately $25.5 million.”
2007 First Quarter Results
Vacation Interval sales increased 28.7% to $53.4 million during the first quarter of 2007 compared to $41.5 million during the same period of 2006.
Total revenue for the first quarter of 2007 increased to $58.8 million compared to $45.7 million for the first quarter of 2006.
Cost of Vacation Interval sales increased to 10.8% of Vacation Interval sales for the first quarter of 2007 from 10.1% during the same period of 2006. This increase is primarily due to an increased ratio of interval sales of units constructed in more recent years with higher inventory cost.
Sales and marketing expense as a percentage of Vacation Interval sales increased to 51.4% for the first quarter of 2007 versus 46.4% for the same period of 2006. Overall, sales and marketing expense increased $8.2 million due primarily to our increased volume of Vacation Interval sales. The increase is also due to additional costs associated with our off site sales center we opened in March 2006 as well as increased costs related to new and existing promotional programs used to generate tours. These promotional programs were a primary factor in providing us with a 26% growth in tours and a 28.7% increase in Vacation Interval sales during the first quarter of 2007 versus the first quarter of 2006.
Net income for the quarter ended March 31, 2007 increased to $6.6 million, or $0.17 per diluted share compared to net income of $6.2 million, or $0.16 per diluted share for the quarter ended March 31, 2006. For comparability purposes, the Company’s results for the first quarter of 2007 and 2006 shown below include core operations, and exclude a $499,000 gain on sale of land held for sale in the first quarter of 2006.
| | | Three Months Ended | |
| | | March 31, | | March 31, | |
| | | 2007 | | 2006 | |
| Net income, as reported | | $ | 6.6 | | $ | 6.2 | |
| Adjustments between net income as reported, and | | | | | | | |
| adjusted net income: | | | | | | | |
| Gain on sale of undeveloped land | | | - | | | (0.5 | ) |
| Provision for income taxes, as reported | | | 4.1 | | | 3.9 | |
| Adjusted income before provision for income taxes | | | 10.7 | | | 9.6 | |
| Provision for income taxes at 38.5% | | | (4.1 | ) | | (3.7 | ) |
Adjusted Net Income | | $ | 6.6 | | $ | 5.9 | |
Adjusted Fully Diluted EPS | | $ | 0.17 | | $ | 0.15 | |
2007 Outlook
The Company reaffirmed its forecast for 2007 net income of approximately $25.5 million. This represents an increase of approximately 11% compared to 2006 net income of $23.0 million.
About Silverleaf Resorts
Based in Dallas, Texas, Silverleaf Resorts, Inc. currently owns and operates timeshare resorts with a wide array of country club-like amenities, such as golf, clubhouses, swimming, tennis, boating, and many organized activities for children and adults. For additional information, please visit www.silverleafresorts.com.
This release contains certain forward-looking statements that involve risks and uncertainties and actual results may differ materially from those anticipated. The Company is subject to specific risks associated with the timeshare industry, the regulatory environment, and various economic factors. These risks and others are more fully discussed under the heading “Risk Factors” in the Company’s reports filed with the Securities and Exchange Commission, including the Company’s 2006 Annual Report on Form 10-K (pages 21 through 30 thereof) filed on March 16, 2007.
Contact:
Silverleaf Resorts, Inc., Dallas
Thomas J. Morris, 214-631-1166 x2218
or
Investor Relations
Erica Pettit, 212-850-5614
or
Media
Jessy Adams, 212-850-5684
For more information or to visit our website, click here:
http://www.b2i.us/irpass.asp?BzID=1358&Nav=0&S=0&L=1
SILVERLEAF RESORTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(Unaudited)
| | | Three Months Ended | |
| | | March 31, | |
| | | 2007 | | 2006 | |
Revenues: | | | | | |
| Vacation Interval sales | | $ | 53,365 | | $ | 41,467 | |
| Estimated uncollectible revenue | | | (8,541 | ) | | (7,186 | ) |
| Net sales | | | 44,824 | | | 34,281 | |
| | | | | | | | |
| Interest income | | | 12,547 | | | 10,095 | |
| Management fee income | | | 615 | | | 465 | |
| Other income | | | 840 | | | 831 | |
| Total revenues | | | 58,826 | | | 45,672 | |
| | | | | | | | |
Costs and Operating Expenses: | | | | | | | |
| Cost of Vacation Interval sales | | | 5,770 | | | 4,181 | |
| Sales and marketing | | | 27,449 | | | 19,232 | |
| Operating, general and administrative | | | 8,423 | | | 7,189 | |
| Depreciation | | | 858 | | | 539 | |
| Interest expense and lender fees | | | 5,651 | | | 4,425 | |
| Total costs and operating expenses | | | 48,151 | | | 35,566 | |
| | | | | | | | |
| | | | | | | | |
| Income before provision for income taxes | | | 10,675 | | | 10,106 | |
| Provision for income taxes | | | (4,110 | ) | | (3,891 | ) |
| | | | | | | | |
| | | | | | | | |
Net income | | $ | 6,565 | | $ | 6,215 | |
| | | | | | | | |
Basic net income per share | | $ | 0.17 | | $ | 0.17 | |
| | | | | | | | |
Diluted net income per share | | $ | 0.17 | | $ | 0.16 | |
| | | | | | | | |
Weighted average basic common shares issued | | | | | | | |
and outstanding | | | 37,808,154 | | | 37,494,304 | |
Weighted average diluted common shares issued | | | | | | | |
and outstanding | | | 39,362,485 | | | 38,615,036 | |
SILVERLEAF RESORTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
| | | March 31, | | December 31, | |
| ASSETS | | 2007 | | 2006 | |
| | | (Unaudited) | | | |
| | | | | | |
| Cash and cash equivalents | | $ | 22,885 | | $ | 11,450 | |
| Restricted cash | | | 15,489 | | | 15,771 | |
| Notes receivable, net of allowance for uncollectible notes of | | | | | | | |
| $68,351 and $68,118, respectively | | | 242,258 | | | 229,717 | |
| Accrued interest receivable | | | 2,996 | | | 2,936 | |
| Investment in special purpose entity | | | 11,806 | | | 13,008 | |
| Amounts due from affiliates | | | 1,511 | | | 1,251 | |
| Inventories | | | 148,397 | | | 147,759 | |
| Land, equipment, buildings, and leasehold improvements, net | | | 30,997 | | | 28,040 | |
| Land held for sale | | | 276 | | | 205 | |
| Prepaid and other assets | | | 27,057 | | | 24,393 | |
| | | | | | | | |
| TOTAL ASSETS | | $ | 503,672 | | $ | 474,530 | |
| | | | | | | | |
| | | | | | | | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | |
| | | | | | | | |
| LIABILITIES | | | | | | | |
| Accounts payable and accrued expenses | | $ | 10,074 | | $ | 14,192 | |
| Accrued interest payable | | | 2,053 | | | 1,792 | |
| Amounts due to affiliates | | | 128 | | | 246 | |
| Unearned Vacation Interval sales | | | 75 | | | - | |
| Unearned samplers | | | 6,251 | | | 6,245 | |
| Income taxes payable | | | 1,572 | | | 163 | |
| Deferred income taxes | | | 20,494 | | | 17,683 | |
| Notes payable and capital lease obligations | | | 276,765 | | | 254,550 | |
| Senior subordinated notes | | | 31,467 | | | 31,467 | |
| | | | | | | | |
| Total Liabilities | | | 348,879 | | | 326,338 | |
| | | | | | | | |
| COMMITMENTS AND CONTINGENCIES (Note 8) | | | | | | | |
| | | | | | | | |
| SHAREHOLDERS' EQUITY | | | | | | | |
| Preferred stock, 10,000,000 shares authorized, none issued and outstanding | | | - | | | - | |
| Common stock, par value $0.01 per share, 100,000,000 shares authorized, | | | | | | | |
| 37,808,154 shares issued and outstanding at March 31, 2007 and | | | | | | | |
| December 31, 2006 | | | 378 | | | 378 | |
| Additional paid-in capital | | | 112,591 | | | 112,555 | |
| Retained earnings | | | 41,824 | | | 35,259 | |
| | | | | | | | |
| Total Shareholders' Equity | | | 154,793 | | | 148,192 | |
| | | | | | | | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | | $ | 503,672 | | $ | 474,530 | |
