Exhibit 99.1
Rexhall Industries Announces First Quarter Results
LANCASTER, Calif., May 19, 2004 (BUSINESS WIRE) -- Rexhall Industries, Inc.
(Nasdaq: REXL) today reported its financial results for its first quarter ended
March 31, 2004. Net revenues for the first quarter decreased 63% to $4,779,000
from $12,946,000 for the same period in 2003. Gross profit for the first quarter
was $491,000 versus $1,602,000 last year, which is a 69% decrease. Net loss for
the quarter was $430,000, or $0.07 per diluted share, compared to a net loss of
$57,000 or $0.01 per diluted share for the first quarter last year.
The Company's sales continued to be below prior year levels and have declined
significantly while the industry, in general, has experienced increased sales.
Management believes the decline may be a result of two major factors.
Availability of external flooring sources has diminished for many of the
Company's dealers, and as a result, its dealer network has similarly diminished.
In contrast, many of the Company's larger competitors provide flooring for its
dealers -- making it easier for dealers to do business with the larger
manufacturer. Management also believes its announcement of the new T-Rex
floorplans may have caused sales of its standard-line products to suffer, while
its dealers opt to "wait and see" how the T-Rex will be received by the public,
and to reserve its limited flooring. William J. Rex, President, Chairman and
CEO, stated, "Because of this, Rexhall will sell T-Rex through its own
dealership. We also believe our new 2005 standard-line models coming out in June
may help our sales."
REXHALL INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
March 31, December 31,
2004 2003
----------- -----------
ASSETS
CURRENT ASSETS
Cash $ 406,000 $ 1,883,000
Accounts Receivables, net 1,077,000 1,332,000
Income Tax Receivable 549,000 551,000
Inventories 18,131,000 17,848,000
Deferred Income Taxes 159,000 124,000
Other Current Assets 199,000 265,000
----------- -----------
TOTAL CURRENT ASSETS $20,521,000 $22,003,000
Property and Equipment at Cost Net
of Accumulated Depreciation 4,342,000 4,613,000
Property Held for Sale 1,390,000 1,189,000
Other Assets 194,000 194,000
----------- -----------
TOTAL ASSETS $26,447,000 $27,999,000
=========== ===========
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable $ 2,412,000 1,836,000
Chassis Vendor Line of Credit 3,291,000 4,432,000
Notes Payable and Current Portion of
Long-Term Debt 54,000 54,000
Accrued Warranty 619,000 980,000
Accrued Legal 1,408,000 1,594,000
Accrued Dealer Incentives 391,000 384,000
Other Accrued Liabilities 1,180,000 1,102,000
Accrued Compensation and Benefits 202,000 280,000
----------- -----------
TOTAL CURRENT LIABILITIES 9,557,000 10,662,000
Long-Term Debt, less Current Portion 925,000 942,000
----------- -----------
TOTAL LIABILITIES 10,482,000 11,604,000
----------- -----------
STOCKHOLDERS' EQUITY
Preferred Stock - no par value,
Authorized, 1,000,000 shares; none issued -- --
Common Stock - no par value,
Authorized, 10,000,000 shares;
issued and outstanding
5,872,700 at March 31, 2004
and 5,872,700 December 31, 2003 5,580,000 5,580,000
Retained Earnings 10,385,000 10,815,000
----------- -----------
TOTAL STOCKHOLDERS' EQUITY 15,950,000 16,395,000
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $26,447,000 $27,999,000
=========== ===========
REXHALL INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended
March 31, March 31,
2004 2003
------------ ------------
Net Revenues $ 4,779,000 $ 12,946,000
Cost of Sales 4,288,000 11,344,000
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Gross Profit $ 491,000 $ 1,602,000
Operating Expenses:
Selling, General, Administrative Expenses
and Other Expenses 919,000 1,691,000
------------ ------------
Income/(Loss) before Income Taxes (428,000) (89,000)
Income Tax Expense/(Benefit) 2,000 (32,000)
------------ ------------
Net Income/(Loss) $ (430,000) $ (57,000)
============ ============
Basic and Diluted Income/(Loss) - Per Share $ (0.07) $ (0.01)
============ ============
Weighted Average Shares Outstanding
Basic and Diluted 5,872,700 5,997,700
============ ============
Rexhall Industries, Inc. (www.rexhall.com) designs, manufactures and sells
various models of Class A motorhomes used for leisure travel and outdoor
activities. Rexhall's lines of Class A motorhomes are sold through dealer
locations across the U.S., Canada and Europe and include RoseAir(TM), RexAir(R),
Aerbus(TM), Vision(TM) and American Clipper(TM).
FORWARD-LOOKING STATEMENTS: Our statements of our intentions or expectations
made in this press release are "forward-looking statements" based on assumptions
and on facts known to us today. For example, our expectations regarding our
upgraded 2004 and new 2005 product line, and sales of our new T-Rex Double &
Wide(TM) motorhomes are forward-looking statements. There can be no guarantee
that a market will exist for our new T-Rex Double & Wide(TM) motorhomes or that
our new coaches will adequately respond to market trends or appeal to the mass
market. Customers might delay or forgo purchasing our conventional motorhomes
preferring to wait for the release of our T-Rex Double & Wide(TM) product line,
because they prefer coaches of our competitors, because they fear increases in
fuel prices or interest rates, because of general economic conditions or for
other reasons. This would have a negative effect on our sales and could
adversely affect our operating results and financial condition. Further, if a
market does not develop for our new motorhomes or if we fail to receive
sufficient orders for them, our sales may decline and our business and operating
results could be seriously harmed. Even if the market for our new T-Rex Double &
Wide(TM) motorhomes does develop, it may not grow at an adequate pace. Moreover,
we may not be able to predict precisely the time and expense required to
overcome unexpected production problems and to ensure production within the time
limits we expect, or the reliability and high quality of the coach at an
acceptable cost. Increased costs and other difficulties associated with
manufacturing these motorhomes such as our inability to obtain critical parts
and components from suppliers timely or at all could have a negative impact on
our sales during particular periods and on our future gross margins. Our
business is seasonal and cyclical. Most of our competitors are substantially
larger, and many of our suppliers and dealers have greater economic power, so
that the volume and prices of both supplies and sales may be adversely affected
by competitive action.
For further information regarding risks and uncertainties associated with
Rexhall's business, please refer to the "Management's Discussion and Analysis of
Results of Operations and Financial Condition - Certain Risk Factors That Could
Affect Future Results" of Rexhall's SEC filings, including, but not limited to,
its Quarterly Report on Form 10-Q for the three months ended March 31, 2004,
copies of which may be requested by contacting Rexhall's Investor Relations
Department either by mail at our corporate headquarters, by telephone at
661-726-0565 or from our website at www.rexhall.com.
SOURCE: Rexhall Industries, Inc.
CONTACT: Rexhall Industries, Inc.
William Rex or Investor Relations, 661-726-0565