EXHIBIT 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
PRG-SCHULTZ REPORTS THIRD QUARTER 2004 FINANCIAL RESULTS
BOARD TO EVALUATE STRATEGIC ALTERNATIVES
ATLANTA, OCTOBER 21, 2004 - PRG-Schultz International, Inc. (Nasdaq: PRGX) today
announced financial results for the third quarter of 2004 and provided updated
outlook for the fourth quarter 2004.
THIRD QUARTER 2004 HIGHLIGHTS
o Revenues totaled $85.1 million.
o Revenues from Accounts Payable Services totaled $75.6 million.
o Revenues from Meridian VAT Reclaim totaled $9.5 million.
o $2.2 million of revenues deferred into future periods.
o Net earnings from continuing operations were 0.2% of revenues for the
quarter compared to a loss of (2.7%) a year ago.
o EBITDA margin was 7.7% of revenues for the quarter, compared to 3.0% a
year ago (see Schedule 6 for a reconciliation of net earnings (loss)
to EBITDA, a non-GAAP financial measure).
o Diluted earnings per share from continuing operations were break even
for the quarter compared with diluted loss per share of ($0.04) during
the third quarter of 2003.
o 17 new international clients signed.
o Strongest U.S. Commercial audit starts in one year, up 35% from second
quarter
o Continued benefits from strategic cost reduction initiatives achieved.
o Opened new shared service center in Dublin, Ireland.
o Generated initial revenues from launch of new freight rate auditing
program.
PRG-SCHULTZ TO EVALUATE STRATEGIC ALTERNATIVES
The Board of Directors for PRG-Schultz, in response to several inquiries
received by the company, has decided to explore the company's strategic
alternatives, including a possible sale of the company. The Board, together with
its financial advisor CIBC World Markets Corp., will evaluate the company's
options and determine the course of action that is in the best interests of its
shareholders.
The company noted that it is not engaged in any negotiations at this time and
that there can be no assurance that any transaction or other corporate action
will result from this effort. PRG-Schultz assumes no obligation to make any
further announcements regarding its exploration of strategic alternatives unless
and until a final decision is made.
John Cook, Chairman and Chief Executive Officer of PRG-Schultz stated, "We
believe this interest in PRG-Schultz is a testament to our world class
organization and the significant progress we have made during the past few
years. We have refined our business strategy, evolved the service model,
expanded our reach to new industries and geographies, and materially improved
our cost structure. Our Board is fully committed to exploring strategic
alternatives that will maximize value for all of our shareholders.
"I am enthusiastic about the momentum in our business. During the last several
months, we have signed up 17 new international clients, adding some of the
largest companies across Europe, Asia, Australia and Latin America. We opened
our new shared service center in Dublin, Ireland. We generated our first
revenues under our exciting, new freight rate auditing program and expanded our
auditing initiatives in the airline and healthcare industries. I am confident
that as we grow our international operations, focus on our business development
initiatives and continue to evolve our service model, we will see further
improvements during the fourth quarter of 2004 and even stronger results in
2005."
THIRD QUARTER 2004 FINANCIAL RESULTS
Revenues for the third quarter of 2004 totaled $85.1 million, compared to $88.2
million in the third quarter of 2003. Revenues from Accounts Payable Services
totaled $75.6 million for the quarter compared to $80.5 million a year ago.
Revenues from the company's U.S. Accounts Payable Services operations were $50.9
million, reflecting strong performance in its Sales and Use Tax operations, as
well as a $1.6 million settlement for past services rendered to an existing
client.
Revenues from the company's international Accounts Payable service operations
were $24.8 million. These results reflect a lengthened approval process and
client-specific issues in the company's operations in Canada and Europe. During
the quarter, the company re-engaged with a large U.K. retailer and as part of
that re-engagement, $2.2 million of revenues (or $0.02 earnings per share for
third quarter), which the company expected to materialize during the third
quarter, was deferred to future quarters. The company expects to achieve
significant recoveries for this client over the next year.
Revenues from Meridian VAT Reclaim for the third quarter of 2004 were $9.5
million, compared to $7.7 million a year ago, reflecting a 23% improvement
year-over-year.
Cost of revenue was $54.2 million, or approximately 64% of revenue, for the
third quarter of 2004, compared to $57.2 million, or approximately 65% of
revenue, in the same period last year. The margin improvement was driven largely
by cost reductions in the company's U.S. Accounts Payable services operations,
where model evolution has been implemented.
Net earnings for the third quarter of 2004 were $0.5 million or $0.01 per
diluted share, compared to a net loss of ($1.7) million or ($0.03) per diluted
share during the third quarter of 2003. Results in the third quarter of 2004
included after-tax charges of ($1.4) million, or ($0.02) per diluted share
relating to the company's previously disclosed strategic business initiatives.
Earnings before interest, taxes, depreciation and amortization (EBITDA) for the
third quarter of 2004 totaled $6.6 million, or 7.7% of revenues, compared to
$2.6 million, or 3.0% of revenues in the third quarter of 2003. (See Schedule 6
for a reconciliation of net earnings (loss) to EBITDA, a non-GAAP financial
measure).
Schedule 4 provides summary financial results from continuing operations for the
third quarters of 2004 and 2003 by operating segment.
CASH FLOW, DSOS AND CAPITAL EXPENDITURES
Net cash used in operating activities for the third quarter of 2004 was $1.1
million, compared to net cash provided by operating activities of $8.0 million
in the third quarter of 2003. The company noted that increased working capital
needs, which were partially offset by higher operating cash flows, accounted for
the difference in net operating cash results.
Company-wide, Days Sales Outstanding (DSOs) at the end of the third quarter of
2004 stood at 55 days, compared to 51 days a year ago.
Capital expenditures totaled approximately $1.9 million for the third quarter of
2004, compared to $2.3 million in the same period a year ago.
FIRST NINE MONTHS 2004 FINANCIAL RESULTS
Revenues for the first nine months of 2004 totaled $263.2 million, compared to
$279.8 million in the first nine months of 2003. Revenues from Accounts Payable
Services and Meridian VAT totaled $231.5 million and $31.7 million,
respectively, for the first nine months of 2004, compared to $248.2 million and
$31.6 million, respectively, for the first nine months of 2003.
Net earnings for the first nine months of 2004 were $3.4 million, or $0.05 per
diluted share, compared to $7.3 million, or $0.12 per diluted share, in the
first nine months of 2003. Net loss from continuing operations for the first
nine months of 2004 was ($4.0) million, or a loss of ($0.07) per diluted share.
This compares to net earnings from continuing operations of $5.7 million, or
$0.09 per diluted share, in the first nine months of 2003.
EBITDA for the first nine months of 2004 totaled $11.9 million, or 4.5% of
revenues, compared to $28.1 million, or 10.0% of revenues, in the first nine
months of 2003. (See Schedule 6 for a reconciliation of net earnings (loss) to
EBITDA, a non-GAAP financial measure.)
Schedule 5 provides summary financial results from continuing operations for the
first nine months of 2004 and 2003 by operating segment.
CASH FLOW AND CAPITAL EXPENDITURES
Net cash provided by operating activities for the nine months ended September
30, 2004, was approximately $1.5 million, compared to $21.6 million in the same
period of 2003. The company noted that higher operating cash flow from an
exceptionally strong first half of 2003 and increased working capital needs
account for the difference in net operating cash results.
Capital expenditures totaled approximately $9.3 million for the first nine
months of 2004, compared to $7.4 million in the same period a year ago. Amounts
for both years exclude capital expenditures related to the company's
Communications Services operations, which were declared discontinued operations
during the fourth quarter of 2003 and subsequently sold on January 16, 2004.
BANK CREDIT FACILITY
The company is in the final stages of negotiating a new senior credit agreement
that will replace the company's existing senior bank credit facility, which
expires December 31, 2004. The company expects to finalize the new agreement
within 30 days.
The company noted that as of September 30, 2004, it had borrowings of $7.9
million under its existing senior bank credit facility and was not in compliance
with one of its financial covenants. The company is working with its bank group
and expects to receive a formal waiver of the non-compliance within the next few
days.
OUTLOOK FOR THE FOURTH QUARTER OF 2004
For the fourth quarter of 2004, consolidated revenues are expected to range from
$94 to $97 million. Revenues from Accounts Payable Services are expected to
range from $86 to $89 million, and revenues from Meridian VAT Reclaim are
expected to approximate $8 million.
Diluted earnings per share from continuing operations are expected to range from
$0.05 - $0.06 in the fourth quarter of 2004. This outlook includes an earnings
reduction of approximately $0.01 per diluted share to reflect already-identified
severance and other costs related to the company's strategic business
initiatives, as disclosed in the management discussion and analysis portion of
the 10-Q filed with the SEC on August 3, 2004.
CONFERENCE CALL AND WEBCAST INFORMATION
PRG-Schultz will hold a conference call today, October 21, 2004, at 10:00 a.m.
ET. Listeners in the U.S. and Canada should dial 888-396-0289 at least 5 minutes
prior to the start of the conference. Listeners outside the U.S. or Canada
should dial 773-799-3995. To be admitted to the call, provide the leader's name
'John Cook,' reference the company, and provide the passcode 'PRGX.' A playback
of the call will be available two hours after the conclusion of the live call,
extending until midnight on October 28, 2004. To directly access the replay,
dial 866-367-6913 (US / Canadian participants) or 203-369-0240 (international
participants).
The live teleconference will also be audiocast on the Internet at www.prgx.com
(go to the Investor Relations home page). Please note that the audiocast is
'listen-only.' Microsoft Windows Media Player is required to access the
audiocast and can be downloaded from www.microsoft.com/windows/mediaplayer.
A copy of this press release is also available at www.prgx.com under the heading
"Investor Relations - News."
ABOUT PRG-SCHULTZ INTERNATIONAL, INC.
Headquartered in Atlanta, PRG-Schultz International, Inc. (PRG-Schultz) is the
world's leading profit improvement firm. PRG-Schultz employs approximately 2,900
employees, providing clients in over 40 countries with insightful value to
optimize and expertly manage their business transactions. Using proprietary
software and expert audit methodologies, PRG-Schultz industry specialists review
client invoices, purchase orders, receiving documents, databases, and
correspondence files to recover lost profits due to overpayments or
under-deductions.
FORWARD LOOKING STATEMENTS
Statements made in this news release which look forward in time involve risks
and uncertainties and are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such risks and uncertainties
include the following: (i) we have violated our debt covenants several times in
the past and are currently in violation and may inadvertently do so in the
future, (ii) any such violations of our debt covenants, including the current
violation, may not be waived and could result in an acceleration of our
outstanding bank debt (totaling $7.9 million at September 30, 2004) as well as
debt under our convertible notes (totaling $125.0 million in gross principal
balance at September 30, 2004), and we may not be able to secure sufficient
liquid resources to pay the accelerated debt, (iii) our bank credit facility,
which we rely upon to provide a meaningful portion of our liquidity, is
scheduled to expire on December 31, 2004, and there can be no assurance that we
will be successful in extending or replacing it, (iv) we may continue to
experience revenue losses or delays as a result of our U.S. retailing clients'
actual and / or potential revision of claim approval and claim processing
guidelines, (v) the bankruptcy of any of our larger clients, or of any such
clients' larger customers or suppliers, could impair then-existing accounts
receivable and reduce expected future revenues from such clients, (vi) an
indeterminate portion of $5.5 million in payments on account from a bankrupt
client of the company received during the quarter ended March 31, 2003 might be
recoverable as "preference payments" under United States bankruptcy laws and, if
so, would result in the recording of an unbudgeted expense in the company's
consolidated financial statements and the creation of an unbudgeted liquidity
demand, (vii) modifications to auditor compensation models may negatively impact
employee productivity and retention, and therefore, our ability to generate
revenues, (viii) the Meridian VAT Reclaim operating segment may require
additional time and effort of company executives and may therefore distract
management from its focus on the company's core Accounts Payable Services
business, (ix) proposed legislative and regulatory initiatives concerning the
mechanisms of European value added taxation, if finalized as currently drafted,
would reduce material portions of the revenues of Meridian VAT Reclaim, (x) we
may not achieve anticipated expense savings in connection with our strategic
business initiatives and may incur costs in excess of those currently
anticipated in order to implement these initiatives, (xi) our past and future
investments in technology may not benefit our business, (xii) our Accounts
Payable Services businesses may not grow as expected, and we may not be able to
increase the number of clients, particularly commercial clients, utilizing
broad-scope audits, (xiii) our international expansion may prove unprofitable or
may take longer to accomplish than we anticipate, and (xiv) the reorganization
of our U.S. Accounts Payable Services operations in connection with our current
strategic business initiatives may adversely affect our ability to generate
anticipated revenues and profits and may not be successful or may require more
time, management attention or expense than we currently anticipate. Other risks
and uncertainties that may affect our business include (i) the possibility of an
adverse judgment in pending securities litigation, (ii) potential timing issues
that could delay revenue recognition, (iii) future weakness in the currencies of
countries in which we transact business, (iv) changes in economic cycles, (v)
competition from other companies, (vi) changes in governmental regulations
applicable to us, (vii) until the Board has completed the process of exploring
strategic alternatives, the company may experience higher levels of customer and
employee turnover, and management's time and attention could be diverted from
the operation of the business, and other risk factors discussed in our
Securities and Exchange Commission filings, including the company's Form 10-K as
filed with the Securities and Exchange Commission on March 5, 2004, and Form
10-Q as filed with the Securities and Exchange Commission on August 3, 2004. The
company disclaims any obligation or duty to update or modify these
forward-looking statements.
SCHEDULE 1
PRG-SCHULTZ INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
------------------------------- ------------------------------
2004 2003 2004 2003
-------------- -------------- -------------- -------------
Revenues $ 85,137 $ 88,221 $ 263,192 $ 279,837
Cost of revenues 54,249 57,155 168,372 173,755
Selling, general and administrative expenses 28,425 32,649 94,875 90,382
-------------- -------------- -------------- -------------
Operating income (loss) 2,463 (1,583) (55) 15,700
Interest (expense), net (2,133) (2,234) (6,377) (6,664)
-------------- -------------- -------------- -------------
Earnings (loss) from continuing operations before income taxes
and discontinued operations 330 (3,817) (6,432) 9,036
Income tax expense (benefit) 125 (1,465) (2,445) 3,309
-------------- -------------- -------------- -------------
Earnings (loss) from continuing operations before discontinued
operations 205 (2,352) (3,987) 5,727
Discontinued operations:
Earnings from discontinued operations, net of income taxes - 438 - 1,027
Gain on disposal of discontinued operations including
operating results for phase-out period, net of income taxes 260 206 7,349 530
-------------- -------------- -------------- -------------
Earnings from discontinued operations 260 644 7,349 1,557
-------------- -------------- -------------- -------------
Net earnings (loss) $ 465 $ (1,708) $ 3,362 $ 7,284
============== ============== ============== =============
Basic earnings (loss) per share:
Earnings (loss) from continuing operations before discontinued
operations $ - $ (0.04) $ (0.07) $ 0.09
Discontinued operations 0.01 0.01 0.12 0.03
-------------- -------------- -------------- -------------
Net earnings (loss) $ 0.01 $ (0.03) $ 0.05 $ 0.12
============== ============== ============== =============
Diluted earnings (loss) per share:
Earnings (loss) from continuing operations before discontinued
operations $ - $ (0.04) $ (0.07) $ 0.09
Discontinued operations 0.01 0.01 0.12 0.03
-------------- -------------- -------------- -------------
Net earnings (loss) $ 0.01 $ (0.03) $ 0.05 $ 0.12
============== ============== ============== =============
Weighted average shares outstanding:
Basic 61,808 61,450 61,734 61,830
============== ============== ============== =============
Diluted 62,108 61,450 61,734 62,090
============== ============== ============== =============
SCHEDULE 2
PRG-SCHULTZ INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
SEPTEMBER 30, DECEMBER 31,
2004 2003
------------------- ------------------
ASSETS
Current assets:
Cash and cash equivalents $ 13,735 $ 26,658
Restricted cash 6,018 5,758
Receivables:
Contract receivables 51,562 53,185
Employee advances and miscellaneous receivables 2,670 3,573
------------------- ------------------
Total receivables 54,232 56,758
------------------- ------------------
Funds held for client obligations 15,184 18,690
Prepaid expenses and other current assets 4,218 3,779
Deferred income taxes 9,211 9,211
Current assets of discontinued operations - 3,179
------------------- ------------------
Total current assets 102,598 124,033
Property and equipment 27,627 29,466
Goodwill 170,561 170,619
Intangible assets 30,578 31,617
Deferred income taxes 65,049 65,370
Other assets 3,213 3,152
Long-term assets of discontinued operations - 1,792
------------------- ------------------
Total assets $ 399,626 $ 426,049
=================== ==================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt $ 7,900 $ 31,600
Obligation for client payables 15,184 18,690
Accounts payable and accrued expenses 22,569 25,780
Accrued payroll and related expenses 41,127 40,256
Deferred revenue 4,794 4,601
Current liabilities of discontinued operations - 1,391
------------------- ------------------
Total current liabilities 91,574 122,318
Convertible notes, net of unamortized discount of $1,943 in 2004 and
$2,605 in 2003 123,057 122,395
Deferred compensation 3,137 3,695
Other long-term liabilities 4,908 4,511
------------------- ------------------
Total liabilities 222,676 252,919
------------------- ------------------
Shareholders' equity:
Preferred stock - -
Common stock 68 67
Additional paid-in capital 493,501 492,878
Accumulated deficit (268,134) (271,496)
Accumulated other comprehensive income 319 616
Less treasury stock at cost (48,710) (48,710)
Unearned portion of restricted stock (94) (225)
------------------- ------------------
Total shareholders' equity 176,950 173,130
------------------- ------------------
Total liabilities and shareholders' equity $ 399,626 $ 426,049
=================== ==================
SCHEDULE 3
PRG-SCHULTZ INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
NINE MONTHS ENDED
SEPTEMBER 30,
-----------------------------------
2004 2003
--------------- ---------------
Cash flows from operating activities:
Net earnings $ 3,362 $ 7,284
Gain on disposal of discontinued operations (7,349) (530)
Earnings from discontinued operations - (1,027)
--------------- ---------------
Earnings (loss) from continuing operations (3,987) 5,727
Adjustments to reconcile earnings (loss) from continuing
operations to net cash provided by operating activities:
Depreciation and amortization 13,374 13,465
Restricted stock compensation expense (23) 271
Loss on sale of property and equipment 161 115
Deferred compensation expense (558) (430)
Deferred income taxes (5,542) (114)
Income tax benefit relating to stock option exercises 11 88
Changes in operating assets and liabilities:
Restricted cash securing letter of credit obligation (217) (5,756)
Receivables 2,486 19,124
Prepaid expenses and other current assets (1,203) (406)
Other assets (131) (345)
Accounts payable and accrued expenses (4,550) (858)
Accrued payroll and related expenses 916 (11,028)
Deferred revenue 348 2,021
Other long-term liabilities 397 (315)
--------------- ---------------
Net cash provided by operating activities 1,482 21,559
--------------- ---------------
Cash flows from investing activities:
Purchase of property and equipment, net of sale proceeds (9,294) (7,385)
Proceeds from sale of certain discontinued operations 19,116 -
--------------- ---------------
Net cash provided by (used in) investing activities 9,822 (7,385)
--------------- ---------------
Cash flows from financing activities:
Net repayments of debt (23,700) (2,890)
Payments for issuance costs on convertible notes (21) (12)
Net proceeds from common stock issuances 767 443
Purchase of treasury shares - (7,528)
--------------- ---------------
Net cash used in financing activities (22,954) (9,987)
--------------- ---------------
Net cash (used in) provided by discontinued operations (1,146) 1,015
Effect of exchange rate changes on cash and cash equivalents (127) 1,198
--------------- ---------------
Net change in cash and cash equivalents (12,923) 6,400
Cash and cash equivalents at beginning of period 26,658 14,860
--------------- ---------------
Cash and cash equivalents at end of period $ 13,735 $ 21,260
=============== ===============
SCHEDULE 4
PRG-SCHULTZ INTERNATIONAL, INC. AND SUBSIDIARIES
SUMMARY OPERATING SEGMENT RESULTS FROM CONTINUING OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED SEPTEMBER 30,
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
2004 2003
------------------------------------------------------------------
$ % REV. $ % REV.
- ---------------------------------------------------------------------------------------------------------
ACCOUNTS PAYABLE SERVICES
- -------------------------
Revenues $75,625 $80,487
Operating income $11,493 15.2% $12,393 15.4%
- ---------------------------------------------------------------------------------------------------------
MERIDIAN VAT RECLAIM
- --------------------
Revenues $9,512 $7,734
Operating income $1,979 20.8% $1,130 14.6%
- ---------------------------------------------------------------------------------------------------------
CORPORATE SUPPORT
- -----------------
Operating loss ($11,009) -12.9% ($15,106) -17.1%
- ---------------------------------------------------------------------------------------------------------
TOTAL
- -----
Revenues $85,137 $88,221
Operating income (loss) $2,463 2.9% ($1,583) -1.8%
Earnings (loss) from
continuing operations $205 0.2% ($2,352) -2.7%
Diluted earnings (loss) per
share from continuing
operations $0.00 ($0.04)
Diluted shares 62,108 61,450
- ---------------------------------------------------------------------------------------------------------
Notes:
Corporate Support Operating Loss % shown as a % of Total Revenues
Earnings (Loss) from Continuing Operations and Diluted Earnings (Loss) Per Share
from Continuing Operations are prior to Earnings (Loss) from Discontinued
Operations.
SCHEDULE 5
PRG-SCHULTZ INTERNATIONAL, INC. AND SUBSIDIARIES
SUMMARY OPERATING SEGMENT RESULTS FROM CONTINUING OPERATIONS
(UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30,
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
2004 2003
------------------------------------------------------------------
$ % REV. $ % REV.
- ---------------------------------------------------------------------------------------------------------
ACCOUNTS PAYABLE SERVICES
- -------------------------
Revenues $231,460 $248,185
Operating income $29,853 12.9% $42,972 17.3%
- ---------------------------------------------------------------------------------------------------------
MERIDIAN VAT RECLAIM
- --------------------
Revenues $31,732 $31,652
Operating income $8,026 25.3% $10,935 34.5%
- ---------------------------------------------------------------------------------------------------------
CORPORATE SUPPORT
- -----------------
Operating loss ($37,934) -14.4% ($38,207) -13.7%
- ---------------------------------------------------------------------------------------------------------
TOTAL
- -----
Revenues $263,192 $279,837
Operating income (loss) ($55) 0.0% $15,700 5.6%
Earnings (loss) from
continuing operations ($3,987) -1.5% $5,727 2.0%
Diluted earnings (loss) per
share from continuing
operations ($0.07) $0.09
Diluted shares 61,734 62,090
- ---------------------------------------------------------------------------------------------------------
Notes:
Corporate Support Operating Loss % shown as a % of Total Revenues
Earnings (Loss) from Continuing Operations and Diluted Earnings (Loss) Per Share
from Continuing Operations are prior to Earnings from Discontinued Operations.
SCHEDULE 6
PRG-SCHULTZ INTERNATIONAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NET EARNINGS (LOSS) TO EBITDA
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30, ENDED SEPTEMBER 30,
--------------------------------- -------------------------------
2004 2003 2004 2003
---------------- -------------- --------------- -------------
Reconciliation of net earnings (loss) to EBITDA:
- -----------------------------------------------
Net earnings (loss) $ 465 $ (1,708) $ 3,362 $ 7,284
Adjust for:
Earnings from discontinued operations 260 644 7,349 1,557
---------------- -------------- --------------- -------------
Earnings (loss) from continuing operations 205 (2,352) (3,987) 5,727
Adjust for:
Income taxes 125 (1,465) (2,445) 3,309
Interest 2,133 2,234 6,377 6,664
Depreciation and amortization 4,093 4,226 11,934 12,384
---------------- -------------- --------------- -------------
EBITDA $ 6,556 $ 2,643 $ 11,879 $ 28,084
================ ============== =============== =============
Total revenues $ 85,137 $ 88,221 $ 263,192 $ 279,837
EBITDA as % of Revenues 7.7% 3.0% 4.5% 10.0%
In this press release, the Company has provided a financial measure, EBITDA,
defined as earnings from continuing operations before taxes, interest,
depreciation and amortization. EBITDA is considered a 'non-GAAP' financial
measure within the meaning of Regulation G and may not be similar to EBITDA
measures employed by other companies. EBITDA is presented solely as a
supplemental disclosure because management believes it to be an effective
measure of the operating performance of the Company's core business activities.
EBITDA is not provided as a measure of liquidity and should not be viewed as
such. EBITDA should not be considered in isolation of, or as a substitute for,
other measures for determining operating performance that are calculated in
accordance with GAAP. This schedule provides a reconciliation of net earnings
(loss) to EBITDA in accordance with Securities and Exchange Commission guidance.
# # #
CONTACTS: James Moylan Linda Master-Parker
Chief Financial Officer VP Corporate Communications
(770) 779-6605 (770) 779-3295
Matthew Sherman
Joele Frank, Wilkinson Brimmer Katcher
(212) 355-4449