[REX LOGO]
News Announcement For Immediate Release
For further information contact:
Douglas Bruggeman Joseph N. Jaffoni, Stewart A. Lewack
Vice President, Finance Jaffoni & Collins Incorporated
937/276-3931 212/835-8500 or rsc@jcir.com
REX STORES REPORTS SECOND QUARTER RESULTS
Dayton, Ohio (September 4, 2003) -- REX Stores Corporation (NYSE: RSC), a
specialty retailer of consumer electronic products and appliances, today
announced financial results and comparable store merchandise sales for the
Company's fiscal 2003 second quarter ended July 31, 2003.
Net income in the fiscal 2003 second quarter was $3.2 million, or $0.25 per
diluted share, compared to net income of $5.4 million, or $0.37 per diluted
share, in the second quarter of fiscal 2002. Per share results are based on
12,626,000 and 14,728,000 diluted weighted average shares outstanding for the
fiscal 2003 and 2002 periods, respectively.
Net sales in the fiscal 2003 second quarter fell 2% to $91.4 million from $93.1
million in the fiscal 2002 second quarter. Comparable store sales for the three
months ended July 31, 2003 were flat when compared to the same period in 2002.
The Company reports sales performance quarterly and considers a store to be
comparable after it has been open six full fiscal quarters. Comparable store
sales figures do not include sales of extended service contracts.
Net income in the first half of fiscal 2003 was $6.3 million, or $0.50 per
diluted share, compared to net income of $9.6 million, or $0.65 per diluted
share, in the first half of fiscal 2002. Per share results are based on
12,567,000 and 14,755,000 diluted weighted average shares outstanding for the
first halves of fiscal 2003 and 2002, respectively, and reflect a 3-for-2 stock
split paid in February 2002. Net sales in the first half of fiscal 2003 were
essentially flat at $186.8 million compared to the first half of fiscal 2002,
while comparable store sales rose 2%.
-more-
REX Stores Reports Second Quarter Results, 9/4/03 page 2
Net income for the second quarter and first half of 2003 reflects approximately
$3.1 million and $6.2 million, respectively, of pre-tax investment income from
the sales of the Company's entire Partnership interest in a synthetic fuel
limited partnership. As previously disclosed, the IRS is auditing this limited
partnership. Of the amount stated above, approximately $1.9 million and $3.7
million for the second quarter and first half of 2003, respectively, of the
payments relating to sales of certain portions of the limited partnership
interest due the Company during the periods are being held in escrow pending the
results of the IRS audit. Future payments due the Company relating to certain of
these sales will also be held in escrow pending the completion of the IRS audit.
Commenting on the results, Stuart Rose, Chairman and Chief Executive Officer,
stated, "Fiscal 2003 second quarter air conditioner sales were lower than those
in the year-ago period. Excluding this product, comparable store sales, which
were flat for the fiscal 2003 second quarter, would have risen approximately 5%,
an overall sales trend consistent with fiscal 2003 first quarter results."
During the fiscal 2003 second quarter, REX purchased approximately 187,200
shares of its common stock. As of September 3, 2003, the Company had
approximately 170,500 authorized shares remaining available to purchase under
its authorized stock buy-back program.
The Company will host a conference call and webcast today at 11:00 a.m. EDT,
which are open to the general public. The conference call numbers are
212-346-6424 or 415-537-1836; please call ten minutes in advance to ensure that
you are connected prior to the presentation. Interested parties may also access
the call live via the Investor Relations page of the Company's website,
www.rextv.com, or at www.vcall.com; please allow 15 minutes to register and
download and install any necessary software. Following its completion, a
telephonic replay of the call can be accessed from 1:00 p.m. to 8:00 p.m. EDT
that day by dialing 800/633-8284 or 402/977-9140 (international callers). The
access code for the audio replay is 21159408. Alternatively, a replay will be
available on the Internet for 30 days at www.rextv.com or www.vcall.com.
REX Stores Corporation is a leading specialty retailer of consumer electronic
products and appliances. As of July 31, 2003, the Company operated 249 stores in
37 states under the trade name "REX."
This news announcement contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Such statements can be
identified by use of forward-looking terminology such as "may," "expect,"
"believe," "estimate," "anticipate" or "continue" or the negative thereof or
other variations thereon or comparable terminology. Readers are cautioned that
there are risks and uncertainties that could cause actual events or results to
differ materially from those referred to in such forward-looking statements.
These risks and uncertainties include among other things, the highly competitive
nature of the consumer electronics retailing industry, changes in the national
or regional economies, weather, the effects of terrorism or acts of war on
consumer spending patterns, the availability of certain products and
technological changes.
-tables follow-
REX Stores Reports Second Quarter Results, 9/4/03 page 3
REX STORES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
Three Months Ended, Six Months Ended
July 31, July 31, July 31, July 31,
2003 2002 2003 2002
-------- -------- -------- --------
NET SALES $91,436 $93,070 $186,847 $186,606
COSTS AND EXPENSES:
Cost of merchandise sold 63,079 63,740 130,652 130,022
Selling, general and administrative
expenses 25,979 26,012 51,901 51,017
------- ------- -------- --------
Total costs and expenses 89,058 89,752 182,553 181,039
------- ------- -------- --------
INCOME FROM OPERATIONS 2,378 3,318 4,294 5,567
INVESTMENT INCOME 23 133 40 283
INTEREST EXPENSE (1,297) (1,267) (2,497) (2,850)
GAIN ON SALE OF REAL ESTATE -- -- 386 --
INCOME FROM LIMITED PARTNERSHIPS 3,119 5,004 6,183 9,640
------- ------- -------- --------
Income before provision for income taxes 4,223 7,188 8,406 12,640
PROVISION FOR INCOME TAXES 1,056 1,797 2,101 3,065
------- ------- -------- --------
NET INCOME $ 3,167 $ 5,391 $ 6,305 $ 9,575
======= ======= ======== ========
WEIGHTED AVERAGE SHARES
OUTSTANDING - BASIC 10,705 12,522 10,821 12,411
======= ======= ======== ========
BASIC NET INCOME PER SHARE * $ 0.30 $ 0.43 $ 0.58 $ 0.77
======= ======= ======== ========
WEIGHTED AVERAGE SHARES
OUTSTANDING - DILUTED 12,626 14,728 12,567 14,755
======= ======= ======== ========
DILUTED NET INCOME PER SHARE * $ 0.25 $ 0.37 $ 0.50 $ 0.65
======= ======= ======== ========
* All per share amounts have been adjusted to reflect a 3-for-2 split of the
Company's common stock paid on February 11, 2002.
(more)
REX Stores Reports Second Quarter Results, 9/4/03 page 4
REX STORES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
July 31, January 31, July 31,
2003 2003 2002
--------- ----------- --------
ASSETS:
Cash and cash equivalents $ 2,116 $ 1,380 $ 10,039
Accounts receivable, net 1,844 3,413 548
Synthetic fuel receivable 400 6,619 3,327
Merchandise inventory 169,101 142,063 138,860
Prepaid expenses and other 3,068 2,567 3,073
Future income tax benefits 10,350 10,350 12,614
--------- --------- ---------
Total current assets 186,879 166,392 168,461
PROPERTY AND EQUIPMENT, NET 133,439 134,563 136,940
OTHER ASSETS 2,434 1,656 --
FUTURE INCOME TAX BENEFITS 6,070 6,070 7,320
SYNTHETIC FUEL ESCROW 10,042 -- --
RESTRICTED INVESTMENTS 2,250 2,241 2,232
--------- --------- ---------
Total assets $ 341,114 $ 310,922 $ 314,953
========= ========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY:
CURRENT LIABILITIES:
Notes payable $ 30,775 $ 13,451 $ 65
Current portion of long-term debt 6,478 5,657 4,783
Current portion, deferred income and deferred gain
on sale and leaseback 11,301 11,107 11,096
Accounts payable, trade 45,407 27,417 41,138
Accrued income taxes 51 -- 2,847
Accrued payroll 4,495 6,750 4,914
Other current liabilities 8,738 8,669 9,454
--------- --------- ---------
Total current liabilities 107,245 73,051 74,297
--------- --------- ---------
LONG-TERM LIABILITIES:
Long-term mortgage debt 60,504 64,426 67,723
Deferred income 13,015 13,993 14,069
Deferred gain on sale and leaseback 49 348 646
--------- --------- ---------
Total long-term liabilities 73,568 78,767 82,438
--------- --------- ---------
SHAREHOLDERS' EQUITY:
Common stock 278 277 277
Paid-in capital 121,786 121,282 119,026
Retained earnings 163,945 157,640 144,283
Treasury stock (125,708) (120,095) (105,368)
--------- --------- ---------
Total shareholders' equity 160,301 159,104 158,218
--------- --------- ---------
Total liabilities & shareholders' equity $ 341,114 $ 310,922 $ 314,953
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