Exhibit 99.1
 | Featherlite, Inc. | |
P.O. Box 320 | ||
Cresco, Iowa 52136 | ||
Contact: John K. Hall, | ||
FOR IMMEDIATE RELEASE | Director of Corporate Communications, | |
563-547-6000 |
FEATHERLITE REPORTS $1.1 MILLION SECOND QUARTER NET INCOME
Net income for first six months is $2.5 million on sales of $110.5 million
CRESCO, Iowa, July 26, 2005 – Featherlite, Inc. (Nasdaq: FTHR), a leading manufacturer and marketer of specialty aluminum trailers, transporters and luxury motorcoaches, today reported net income of $1.1 million, or 9 cents per diluted share, for the second quarter ended June 30, 2005. This compares with net income of $1.5 million, or 13 cents per diluted share, for the same period in 2004. The decrease in net income was primarily the result of lower gross profit in both the trailer and motorcoach segments, partially offset by reductions in selling and administrative expenses. While the trailer segment maintained unit sales volume for the quarter, its net income was negatively impacted by greater than anticipated aluminum and other cost increases not sufficiently compensated for by production efficiencies or product price increases. Motorcoach segment net income declined as the result of reduced new and used motorcoach unit sales volume.
Net income for the first six months of 2005 was $2.5 million compared with $2.7 million for the same period in 2004. On a diluted per share basis, the Company earned 22 cents in the first six months of fiscal 2005 compared to 24 cents for the same period in 2004.
Net sales for the second quarter ended June 30, 2005 were $52.0 million, a decline of 10.6 percent over the $58.2 million reported in the same period last year. Net sales of $110.5 for the first six months of 2005 were down 3.6 percent from $114.6 million posted in the same period last year.
“After posting six consecutive quarters of earnings gains over comparable quarters in the prior year, we were disappointed that the second quarter of 2005 did not meet expectations,” Conrad Clement, Featherlite president and CEO, said. “However, we remain cautiously optimistic about the level of sales for the remaining quarters of 2005.
“We are encouraged by an increase in the motorcoach backlog to $9.2 million at June 30, 2005 compared to $5.4 million at June 30, 2004. Trailer backlog has decreased to $16.3 million compared to $21.7 million last year, but order levels have remained strong and have been filled from increased finished goods inventory. We anticipate an enthusiastic reception to the new and enhanced 2006 models now arriving at our trailer dealers and coach showrooms. Featherlite continues to introduce exciting product innovations that can capitalize on the industry’s growing leisure and recreation segment, a prime target market for the Company.”
About Featherlite
With more that 75 percent of its business in the leisure, recreation and entertainment categories, Featherlite®, Inc. has highly diversified product lines offering hundreds of standard model and custom-designed aluminum specialty trailers, specialized transporters, mobile marketing trailers and luxury motorcoaches. For more information about the Company, please visitwww.fthr.com.
Featherlite, Inc.
Condensed Balance Sheets
(Unaudited)
(In thousands)
June 30, 2005 | Dec 31, 2004 | |||||
| ASSETS | ||||||
Current assets | ||||||
Cash | $ | 113 | $ | 179 | ||
Receivables | 7,837 | 4,781 | ||||
Refundable income taxes | 497 | 497 | ||||
Inventories | 63,756 | 61,730 | ||||
Leased promotional trailers | 1,599 | 1,669 | ||||
Prepaid expenses | 1,016 | 1,827 | ||||
Deferred tax asset | 1,274 | 1,275 | ||||
Total current assets | 76,092 | 71,958 | ||||
Property and equipment, net | 16,783 | 16,003 | ||||
Other assets | 3,379 | 4,252 | ||||
| $ | 96,254 | $ | 92,213 | |||
| LIABILITIES AND SHAREHOLDERS EQUITY | ||||||
Current liabilities | ||||||
Wholesale financing and other notes payable | $ | 22,612 | $ | 22,106 | ||
Current maturities of long-term debt | 1,745 | 1,699 | ||||
Checks issued not yet presented | 5,286 | 2,900 | ||||
Accounts payable | 5,139 | 4,323 | ||||
Motorcoach shell costs payable | 5,548 | 7,277 | ||||
Accrued liabilities | 7,985 | 9,124 | ||||
Customer deposits | 1,801 | 2,698 | ||||
Total current liabilities | 50,116 | 50,127 | ||||
Bank line of credit | 5,609 | 4,243 | ||||
Other long-term debt, net of current maturities | 11,043 | 11,092 | ||||
Deferred tax liabilities | 1,340 | 1,340 | ||||
Other long-term liabilities | 41 | 48 | ||||
Shareholders’ equity | 28,105 | 25,363 | ||||
| $ | 96,254 | $ | 92,213 | |||
FEATHERLITE, INC
Condensed Statements of Income
(Unaudited)
(In Thousands, except for per share data)
| Three months Ended June 30, | Six months Ended June 30, | |||||||||||||||
| 2005 | 2004 | 2005 | 2004 | |||||||||||||
Net Sales | $ | 51,993 | $ | 58,151 | $ | 110,473 | $ | 114,567 | ||||||||
Cost of Sales | 44,159 | 49,019 | 92,994 | 96,806 | ||||||||||||
Gross profit | 7,834 | 9,132 | 17,479 | 17,761 | ||||||||||||
Selling and admininistrative expenses | 5,510 | 6,243 | 12,291 | 12,466 | ||||||||||||
Income from operations | 2,324 | 2,889 | 5,188 | 5,295 | ||||||||||||
Other income (expense) | ||||||||||||||||
Interest | (704 | ) | (580 | ) | (1,335 | ) | (1,128 | ) | ||||||||
Other, net | 104 | 58 | 239 | 130 | ||||||||||||
Total other expense | (600 | ) | (522 | ) | (1,096 | ) | (998 | ) | ||||||||
Income before taxes | 1,724 | 2,367 | 4,092 | 4,297 | ||||||||||||
Minority interest in subsidiary | 11 | 20 | (1 | ) | 51 | |||||||||||
Provision for income taxes | (660 | ) | (884 | ) | (1,555 | ) | (1,609 | ) | ||||||||
Net income | $ | 1,075 | $ | 1,503 | $ | 2,536 | $ | 2,739 | ||||||||
Net income (loss) per share - | ||||||||||||||||
Basic | $ | 0.10 | $ | 0.14 | $ | 0.23 | $ | 0.25 | ||||||||
Diluted | $ | 0.09 | $ | 0.13 | $ | 0.22 | $ | 0.24 | ||||||||
Weighted average shares outstanding - | ||||||||||||||||
Basic | 10,930 | 10,813 | 10,909 | 10,804 | ||||||||||||
Diluted | 11,788 | 11,526 | 11,738 | 11,438 | ||||||||||||
On April 9, 2005 the Company’s Board of Directors declared a three for two split of the Company’s common stock with a proportional increase in the number of issued and outstanding shares, effective May 4, 2005 to shareholders of record as of the close of business on April 22, 2005. All shares are per share amounts have been restated to reflect the retroactive effect of the stock split.
Certain prior period information has been reclassified to conform to the current year presentation.
Safe Harbor Statement under the Private Securities Litigation Reform Act: Certain statements in this release are forward-looking in nature and relate to trends and events that may affect the Company’s future financial position and operating results. Any statements that are not based upon historical facts, including the outcome of events that have not yet occurred and our expectations for future performance, are forward-looking statements. The words “believe,” “estimate,” “expect,” “intend,” “may,” “could,” “will,” “plan,” “anticipate,” and similar words and expressions are intended to identify forward-looking statements. These statements speak only as of the date of this release, are based on current expectations, are inherently uncertain, are subject to risks, and should be viewed with caution. Actual results and experience may differ materially from the forward-looking statements as a result of many factors, including but not limited to: the health of the economy and disposable income for recreational and leisure activities, product demand and acceptance of products in each segment of the Company’s markets, the need for and impact of product sales price increases, fluctuations in the price of aluminum, changes in our product sales mixes, competition, facilities utilization, the availability of additional capital as may be required to finance any future net liquidity deficiency, and certain other unanticipated events and conditions. The risks and uncertainties listed are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business operations. The Company makes no commitment to update any forward-looking statement or to disclose any facts, events, or circumstances after the date hereof that may affect the accuracy of any forward-looking statement, other than as required by law.