EXHIBIT 99.1
AMES TRUE TEMPER REPORTS FIRST QUARTER RESULTS
CAMP HILL, Pennsylvania, January 28, 2005 - ATT Holding Co., parent of Ames True
Temper, Inc., reported today the results of the Company's fiscal first quarter
ended December 25, 2004.
First Quarter Results (13-week period ended December 25, 2004)
Net sales for the fiscal 2005 13-week first quarter were $82.0 million, versus
$84.4 million for the comparable period in fiscal 2004. Net loss was $1.1
million for the first quarter of fiscal 2005, compared to net income of $2.7
million in the first quarter of fiscal 2004. Adjusted EBITDA (which is
reconciled to net income on the attached table) for the fiscal 2005 first
quarter was $7.4 million, compared to $8.6 million for the fiscal 2004 first
quarter.
"We continue to be challenged by the significant increases in commodity costs.
We have initiated a third price increase that was effective January 15," said
Rich Dell, President and CEO. Dell noted that revenues decreased despite
increased prices. "Our first quarter of fiscal 2005 faced a tough comparable
period in fiscal 2004, as we benefited from multiple snow storms during fiscal
2004. When compared to the first quarter of fiscal 2003, which was more
comparable for snowfall, our sales and adjusted EBITDA increased significantly
over the $64.2 million of net sales and $3.4 million of adjusted EBITDA achieved
during that period."
Debt Transactions
On January 14, 2005, Ames True Temper, Inc. completed the offering of $150.0
million of Senior Floating Rate Notes Due 2012 in an unregistered offering to
qualified institutional buyers in accordance with Rule 144A under the Securities
Act of 1933, as amended, and outside the United States pursuant to Regulation S
under the Securities Act. These notes were priced at LIBOR plus 4.0% and were
issued at a 0.5% discount. The proceeds of the issuance repaid the $140.0
million Senior Secured Credit Facility Term Loan B and paid down a portion of
the existing revolver balance. On January 14, 2005, simultaneously with the
completion of the offering of the Senior Floating Rate Notes, Ames True Temper,
Inc. entered into an amendment to the terms of the credit agreement for the
Senior Secured Credit Facility. A Form 8-K was filed on January 18, 2005
describing the above transactions.
"We are pleased with the results of our recent debt transactions. We believe
that we have positioned our company to have the flexibility needed to implement
various cost saving measures, as well as growing the business," commented Judy
Schuchart, VP of Finance and CFO.
Ames True Temper, Inc. is a leading North American manufacturer and marketer of
non-powered lawn and garden tools and accessories.
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of
Section 27A of the Securities Act, and Section 21E of the Securities Exchange
Act of 1934. All statements other than statements of historical fact are
"forward-looking statements" for purposes of federal and state securities laws.
Forward-looking statements may include the words "may," "will," "plans,"
"estimates," "anticipates," "believes," "expects," "intends" and similar
expressions. Although Ames believes that such statements are based on reasonable
assumptions, these forward-looking statements are subject to numerous factors,
risks and uncertainties that could cause actual outcomes and results to be
materially different from those projected or assumed in its forward-looking
statements. These factors, risks and uncertainties include, among others, the
following:
o The Company's liquidity and capital resources;
o Sales levels to existing and new customers;
o Increased concentration of its customers;
o Seasonality and adverse weather conditions;
o Competitive pressures and trends;
o Changing consumer preferences;
o New product and customer initiatives;
o Risks relating to foreign sourcing, foreign operations and availability
of raw materials;
o The Company's ability to successfully consummate and integrate
acquisitions; and
o General economic conditions.
The Company's actual results, performance or achievements could differ
materially from those expressed in, or implied by, the forward-looking
statements. The Company can give no assurances that any of the events
anticipated by the forward-looking statements will occur or, if any of them do,
what impact they will have on its results of operations and financial condition.
The Company does not intend, and undertakes no obligation, to update any
forward-looking statement.
CONTACT: Judy Schuchart, +1-717-730-2576, investor@amestruetemper.com, for Ames
True Temper, Inc.
ATT HOLDING CO.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
DECEMBER 25, SEPTEMBER 25,
2004 2004
------------------- -------------------
ASSETS
Current assets:
Cash and cash equivalents $ 2,615 $ 1,250
Trade receivables, net 46,337 57,904
Inventories 113,932 98,217
Deferred taxes 4,518 4,888
Other current assets 8,738 6,289
------------------- -------------------
Total current assets 176,140 168,548
Property, plant and equipment, net 63,300 63,677
Pension asset 235 7,072
Intangibles, net 82,131 82,291
Goodwill 158,127 147,325
Other noncurrent assets 12,960 12,412
------------------- -------------------
Total assets $ 492,893 $ 481,325
=================== ===================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade accounts payable $ 34,912 $ 28,926
Accrued payroll and related taxes 3,480 3,593
Accrued interest payable 8,572 4,804
Accrued expenses and other current liabilities 20,769 21,881
Revolving loan 7,100 6,300
Current portion of long-term debt 1,400 1,400
------------------- -------------------
Total current liabilities 76,233 66,904
Deferred taxes 25,619 24,098
Long-term debt 288,250 288,600
Other liabilities 10,332 10,334
------------------- -------------------
Total liabilities 400,434 389,936
Stockholders' equity:
Preferred stock - -
Common stock - -
Additional paid-in capital 110,500 110,500
Predecessor basis adjustment (13,539) (13,539)
Retained deficit (8,940) (7,820)
Accumulated other comprehensive income 4,438 2,248
------------------- -------------------
Total stockholders' equity 92,459 91,389
------------------- -------------------
Total liabilities and stockholders' equity $ 492,893 $ 481,325
=================== ===================
ATT HOLDING CO.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)
(UNAUDITED)
THIRTEEN WEEKS THIRTEEN WEEKS THIRTEEN WEEKS
ENDED ENDED ENDED
DECEMBER 25, 2004 DECEMBER 27, 2003 DECEMBER 28, 2002
----------------------- ---------------------- ----------------------
Net sales $ 82,046 100.0% $ 84,415 100.0% $ 64,247 100.0%
Cost of goods sold 60,985 74.3% 61,714 73.1% 48,385 75.3%
------------------------ ----------------------- ----------------------
Gross profit 21,061 25.7% 22,701 26.9% 15,862 24.7%
Selling, general, and administrative expense 16,624 20.3% 16,693 19.8% 15,434 24.0%
(Gain) loss on disposal of fixed assets (19) 0.0% 12 0.0% (193) -0.3%
Special Charges - 0.0% - 0.0% 797 1.2%
Amortization of intangible assets 414 0.5% 1,137 1.3% 489 0.8%
------------------------ ----------------------- ----------------------
Operating income (loss) 4,042 4.9% 4,859 5.8% (665) -1.0%
Interest expense 6,195 7.6% 2,493 3.0% 2,293 3.6%
Other income (215) -0.3% (1,948) -2.3% (313) -0.5%
------------------------ ----------------------- ----------------------
(Loss) income before taxes (1,938) -2.4% 4,314 5.1% (2,645) -4.1%
Income tax (benefit) expense (818) -1.0% 1,626 1.9% (802) -1.2%
------------------------ ----------------------- ----------------------
Net (loss) income $ (1,120) -1.4% $ 2,688 3.2% $ (1,843) -2.9%
======================== ======================= ======================
ATT HOLDING CO.
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
(IN THOUSANDS)
(UNAUDITED)
THIRTEEN WEEKS THIRTEEN WEEKS THIRTEEN WEEKS
ENDED ENDED ENDED
DECEMBER 25, 2004 DECEMBER 27, 2003 DECEMBER 28, 2002
--------------------- ---------------------- -----------------------
Net (loss) income $ (1,120) $ 2,688 $ (1,843)
Depreciation of property, plant and equipment 2,355 1,930 2,059
Amortization of intangible assets 414 1,137 489
Other income (215) (1,948) (313)
(Gain) loss on disposal of fixed assets (19) 12 (193)
Interest expense 6,195 2,493 2,293
Income tax (benefit) expense (818) 1,626 (802)
--------------------- ---------------------- -----------------------
EBITDA 6,792 7,938 1,690
Adjustments to EBITDA
Special charges (a) 7 - 797
Inventory write-up (b) - 90 369
Equity sponsor fees and other expenses (c) 594 558 517
--------------------- ---------------------- -----------------------
Adjusted EBITDA (d) $ 7,393 $ 8,586 $ 3,373
===================== ====================== =======================
(a) In fiscal 2005, we incurred certain non-capitalizable transaction costs. In
fiscal 2003, we incurred a $0.8 million special charge as a result of medical
expenses related to an employee.
(b) We are required by GAAP to adjust inventory to fair market value for each
acquisition. These amounts represent additional costs of goods sold as a result
of these adjustments.
(c) Consists of management fees paid to private equity sponsor (Castle Harlan in
fiscal 2005 and Wind Point Partners in fiscal 2004 and 2003), fees paid to
lenders under our previous revolving loan facility primarily related to the
unused portion thereof, non-cash (income) expense related to our pension plan
and non-cash charges recorded in accordance with SFAS 13 due to the expensing of
escalating rent on a straight-line basis.
(d) "EBITDA" is calculated as net (loss) income before income tax expense,
interest expense, other expense (income) and gain on disposal of fixed assets
plus depreciation and amortization. Adjusted EBITDA is EBITDA adjusted for
management fees, and non-recurring items. Adjusted EBITDA is not intended to
represent cash flow from operations as defined by GAAP and should not be used as
an alternative to net income as an indicator of operating performance or to cash
flow as a measure of liquidity. EBITDA and Adjusted EBITDA is a basis upon which
our management assesses financial performance and covenants in our new senior
credit facility are tied to ratios based on this measure. While EBITDA and
adjusted EBITDA are frequently used as a measure of operations and the ability
to meet debt service requirements, they are not necessarily comparable to other
similarly titled captions of other companies due to potential inconsistencies in
the method of calculation.
