EXHIBIT 99.1
AMES TRUE TEMPER REPORTS SECOND QUARTER RESULTS
CAMP HILL, Pennsylvania, May 9, 2005 - ATT Holding Co., parent of Ames True
Temper, Inc., reported today the results of the Company's fiscal second quarter
ended March 26, 2005.
Second Quarter Results (13-week period ended March 26, 2005)
Net sales for the fiscal 2005-second quarter were $133.8 million, a 3.2 percent
increase over $129.7 million for the comparable period in fiscal 2004. Net
income was $0.2 million for the second quarter of fiscal 2005, compared to $7.0
million in the second quarter of fiscal 2004. Adjusted EBITDA (which is
reconciled to net income on the attached table) for the fiscal 2005-second
quarter was $15.4 million, compared to $19.2 million for the fiscal 2004-second
quarter.
Year-to-Date Results (26-week period ended March 26, 2005)
Net sales for the 26 weeks ended March 26, 2005 were $215.9 million, a 0.8
percent increase over $214.1 million for the 26 weeks ended March 27, 2004. Net
loss was $0.9 million for the 26 weeks ended March 26, 2005, compared to net
income of $9.7 million for the 26 weeks ended March 27, 2004. Adjusted EBITDA
(which is reconciled to net (loss) income on the attached table) for the 26
weeks ended March 26, 2005 was $22.8 million, compared to $27.8 million for the
26 weeks ended March 27, 2004.
"We have been very pleased with our product placement for the Spring 2005
season, especially with our exciting new products," said Rich Dell, President
and CEO. "However, customer comparable store point-of-sale results for the
quarter, for our product lines, were below last year. Had the POS results been
the same as last year, our sales could have been greater."
Judy Schuchart, VP of Finance and CFO, noted that commodity costs, especially
resin, continue to place significant pressure on the Company's margins.
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:
* The Company's liquidity and capital resources;
* Sales levels to existing and new customers;
* Increased concentration of its customers;
* Seasonality and adverse weather conditions;
* Competitive pressures and trends;
* Changing consumer preferences;
* New product and customer initiatives;
* Risks relating to foreign sourcing, foreign operations and
availability of raw materials;
* The Company's ability to successfully consummate and integrate
acquisitions; and
* 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: Eric Aumen, Director, Investor Relations and Public Reporting,
+1-717-730-2933, investor@amestruetemper.com, for Ames True Temper, Inc.
ATT HOLDING CO.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
PREDECESSOR
---------------------
MARCH 26, SEPTEMBER 25, MARCH 27,
2005 2004 2004
------------------ ----------------------- ---------------------
(UNAUDITED) (UNAUDITED)
ASSETS
Current assets:
Cash and cash equivalents $ 618 $ 1,250 $ 1,700
Trade receivables, net 96,342 57,904 95,354
Inventories 111,099 98,217 106,008
Deferred taxes 4,557 4,387 9,654
Other current assets 7,502 6,289 4,424
---------------- ---------------- -----------------
Total current assets 220,118 168,047 217,140
Property, plant and equipment, net 62,785 63,677 30,207
Pension asset 277 247 22,803
Intangibles, net 81,735 82,291 14,131
Goodwill 157,267 156,563 9,624
Other noncurrent assets 14,424 12,412 2,835
---------------- ---------------- -----------------
Total assets $536,606 $483,237 $296,740
================ ================ =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade accounts payable $ 42,494 $28,926 $ 44,707
Accrued expenses and other current liabilities 33,260 30,278 29,561
Revolving loan 31,300 6,300 46,518
Current portion of long-term debt - 1,400 11,343
---------------- ---------------- -----------------
Total current liabilities 107,054 66,904 132,129
Deferred taxes 25,756 26,010 12,936
Long-term debt 299,272 288,600 52,711
Other liabilities 10,371 10,334 4,533
---------------- ---------------- -----------------
Total liabilities 442,453 391,848 202,309
Stockholders' equity:
Preferred stock - - -
Common stock - - -
Additional paid-in capital 110,500 110,500 63,543
Predecessor basis adjustment (13,539) (13,539) -
Retained (deficit) earnings (8,698) (7,820) 27,810
Accumulated other comprehensive income 5,950 2,248 3,079
---------------- ---------------- -----------------
94,213 91,389 94,432
Treasury stock, at cost (60) - (1)
---------------- ---------------- -----------------
Total stockholders' equity 94,153 91,389 94,431
---------------- ---------------- -----------------
Total liabilities and stockholders' equity $536,606 $483,237 $296,740
================ ================ =================
ATT HOLDING CO.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)
(UNAUDITED)
PREDECESSOR
----------------------------
THIRTEEN WEEKS THIRTEEN WEEKS
ENDED ENDED
MARCH 26, 2005 MARCH 27, 2004
----------------------- ----------------------------
Net sales $133,806 100.0% $129,686 100.0%
Cost of goods sold 100,734 75.3% 92,505 71.3%
------------ ---------- ------------- --------------
Gross profit 33,072 24.7% 37,181 28.7%
Selling, general, and administrative expense 20,901 15.6% 20,436 15.8%
Amortization of intangible assets 446 0.3% 1,081 0.8%
------------ ---------- ------------- --------------
Operating income 11,725 8.8% 15,664 12.1%
Interest expense 10,992 8.2% 2,496 1.9%
Other (income) expense (7) 0.0% 2,006 1.5%
------------ ---------- ------------- --------------
Income before taxes 740 0.6% 11,162 8.6%
Income tax expense 498 0.4% 4,160 3.2%
------------ ---------- ------------- --------------
Net income $ 242 0.2% $ 7,002 5.4%
============ ========== ============= ==============
ATT HOLDING CO.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)
(UNAUDITED)
PREDECESSOR
---------------------------
TWENTY-SIX WEEKS TWENTY-SIX WEEKS
ENDED ENDED
MARCH 26, 2005 MARCH 27, 2004
---------------------- ----------------------------
Net sales $215,852 100.0% $214,101 100.0%
Cost of goods sold 161,719 74.9% 154,219 72.0%
------------ --------- ------------- ------------
Gross profit 54,133 25.1% 59,882 28.0%
Selling, general, and administrative expense 37,506 17.4% 37,141 17.3%
Amortization of intangible assets 860 0.4% 2,218 1.0%
------------ --------- ------------- ------------
Operating income 15,767 7.3% 20,523 9.6%
Interest expense 17,187 8.0% 4,989 2.3%
Other (income) expense (222) -0.1% 58 0.0%
------------ --------- ------------- ------------
(Loss) income before taxes (1,198) -0.6% 15,476 7.2%
Income tax (benefit) expense (320) -0.1% 5,786 2.7%
------------ --------- ------------- ------------
Net (loss) income $ (878) -0.4% $ 9,690 4.5%
============ ========= ============= ============
ATT HOLDING CO.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)
(UNAUDITED)
PREDECESSOR
-----------------------
FIFTY-TWO WEEKS FIFTY-TWO WEEKS
ENDED ENDED
MARCH 26, 2005 MARCH 27, 2004
----------------------- -----------------------
Net sales $440,238 100.0% $428,609 100.0%
Cost of goods sold 336,757 76.5% 309,169 72.1%
------------- --------- ------------- ---------
Gross profit 103,481 23.5% 119,440 27.9%
Selling, general, and administrative expense 75,809 17.2% 74,609 17.4%
Gain on disposal of fixed assets (4,843) -1.1% (1,097) -0.3%
Special Charges 772 0.2% - 0.0%
Amortization of intangible assets 2,423 0.6% 4,259 1.0%
------------- --------- ------------- ---------
Operating income 29,320 6.7% 41,654 9.7%
Interest expense 25,660 5.8% 10,786 2.5%
Other income (117) 0.0% (126) 0.0%
------------- --------- ------------- ---------
Income before taxes 3,777 0.9% 30,994 7.2%
Income tax expense 2,784 0.6% 11,692 2.7%
------------- --------- ------------- ---------
Net income $ 993 0.2% $ 19,302 4.5%
============= ========= ============= =========
ATT HOLDING CO.
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
(IN THOUSANDS)
(UNAUDITED)
PREDECESSOR
-----------------------
THIRTEEN WEEKS THIRTEEN WEEKS
ENDED ENDED
MARCH 26, 2005 MARCH 27, 2004
---------------------- -----------------------
Net income $ 242 $ 7,002
Depreciation of property, plant and equipment 2,360 1,960
Amortization of intangible assets 446 1,081
Other (income) expense (7) 2,006
Gain on disposal of fixed assets (26) (7)
Interest expense 10,992 2,496
Income tax expense 498 4,160
------------- -------------
EBITDA (a) 14,505 18,698
Adjustments to EBITDA
Equity sponsor fees and other expenses (b) 917 517
------------- -------------
Adjusted EBITDA (a) $ 15,422 $ 19,215
============= =============
(a) "EBITDA" is calculated as net income before income tax expense, interest
expense, other (income) expense and gain on disposal of fixed assets plus
depreciation and amortization. Adjusted EBITDA is EBITDA adjusted as indicated
below. 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 are a basis upon which our management assesses
financial performance and covenants in our 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.
(b) Consists of management fees paid to private equity sponsor (Castle Harlan in
fiscal 2005 and Wind Point Partners in fiscal 2004), transaction fees associated
with acquisitions, fees paid to lenders under our previous revolving loan
facility primarily related to the unused portion thereof (in fiscal 2004),
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.
ATT HOLDING CO.
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
(IN THOUSANDS)
(UNAUDITED)
PREDECESSOR
----------------------
TWENTY-SIX WEEKS TWENTY-SIX WEEKS
ENDED ENDED
MARCH 26, 2005 MARCH 27, 2004
---------------------- ----------------------
Net (loss) income $ (878) $ 9,690
Depreciation of property, plant and equipment 4,715 3,890
Amortization of intangible assets 860 2,218
Other (income) expense (222) 58
(Gain) loss on disposal of fixed assets (45) 5
Interest expense 17,187 4,989
Income tax (benefit) expense (320) 5,786
-------------- -------------
EBITDA (a) 21,297 26,636
Adjustments to EBITDA
Inventory write-up (b) - 90
Equity sponsor fees and other expenses (c) 1,518 1,075
-------------- -------------
Adjusted EBITDA (a) $ 22,815 $ 27,801
============== =============
(a) "EBITDA" is calculated as net (loss) income before income tax expense,
interest expense, other (income) expense and (gain) loss on disposal of fixed
assets plus depreciation and amortization. Adjusted EBITDA is EBITDA adjusted as
indicated below. 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 are a basis upon which our management
assesses financial performance and covenants in our 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.
(b) We are required by GAAP to adjust acquired 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), transaction fees associated
with acquisitions, fees paid to lenders under our previous revolving loan
facility primarily related to the unused portion thereof (in fiscal 2004),
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.
ATT HOLDING CO.
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA
(IN THOUSANDS)
(UNAUDITED)
PREDECESSOR
------------------------
FIFTY-TWO WEEKS FIFTY-TWO WEEKS
ENDED ENDED
MARCH 26, 2005 MARCH 27, 2004
------------------ ------------------------
Net income $ 993 $19,302
Depreciation of property, plant and equipment 9,404 7,083
Amortization of intangible assets 2,422 4,259
Other income (117) (126)
Gain on disposal of fixed assets (4,843) (1,097)
Interest expense 25,660 10,786
Income tax expense 2,784 11,692
------------- ---------------
EBITDA (a) 36,303 51,899
Adjustments to EBITDA
Inventory write-up (b) 10,069 429
Equity sponsor fees and other expenses (c) 3,336 2,132
------------- ---------------
Adjusted EBITDA (a) $49,708 $54,460
============= ===============
(a) "EBITDA" is calculated as net income before income tax expense, interest
expense, other income and gain on disposal of fixed assets plus depreciation and
amortization. Adjusted EBITDA is EBITDA adjusted as indicated below. 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 are a basis upon which our management assesses financial
performance and covenants in our 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.
(b) We are required by GAAP to adjust acquired 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
subsequent to June 27, 2004 and Wind Point Partners prior thereto), transaction
fees associated with acquisitions, fees paid to lenders under our previous
revolving loan facility primarily related to the unused portion thereof (in
fiscal 2004), 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.
