EXHIBIT 99.2
(CENTRAL PARKING CORPORATION LOGO)
NEWS
2401 21ST AVENUE SOUTH, SUITE 200, NASHVILLE, TN 37212
(615) 297-4255 FAX: (615) 297-6240
Investor Contact: Jeff Heavrin
Senior Vice President and Chief Financial Officer
(615) 297-4255
jheavrin@parking.com
CENTRAL PARKING ANNOUNCES NEW STRATEGIC PLAN
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MANAGEMENT REORGANIZATION
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PLANS TO CONDUCT A DUTCH AUCTION TENDER OFFER
NASHVILLE, TENN. (AUG. 3, 2005) - Central Parking Corporation (NYSE: CPC) today
announced a new strategic plan designed to improve profitability. The Company
also announced changes in senior management and plans to conduct a "Dutch
Auction" tender offer.
STRATEGIC PLAN
The Company's new strategic plan is designed to streamline operations and focus
on core competencies and key markets with the greatest potential for growing
profits. The plan includes the following components:
o EXIT MARGINAL AND LOW GROWTH MARKETS (CITIES AND COUNTRIES) - As a key
component of its strategy to reduce costs and become more focused on
high-growth markets, the Company plans to divest operations in up to 15
cities in the United States and up to eight foreign countries. Most of
the operations to be divested in the United States are in small to
medium-sized markets that management believes have limited growth
potential. The Company intends to maintain a strong presence and focus
its growth in the major metropolitan areas throughout the United
States. Internationally, the operations to be divested are primarily in
countries in which the Company has a small market share and significant
barriers to growth. The Company intends to seek buyers for the
operations to be divested and the sale process is expected to take up
to 12 months. The operations that the Company plans to divest represent
less than 4% of revenues. In addition to reducing costs at the local
level, these divestitures will enable the Company to reduce general and
administrative costs by over 10% at the regional and corporate levels.
o REDUCE THE NUMBER OF MARGINAL AND UNPROFITABLE OPERATING AGREEMENTS -
In its remaining markets, the Company intends to improve profit margins
by reducing the number of marginal and unprofitable operating
agreements and focus on fewer but more profitable locations. The
Company will continue its successful program of eliminating
unprofitable leases through renegotiation, operational improvements and
selective buyouts. Low-margin management agreements and leases will be
targeted for renegotiation or termination, and corresponding reductions
will be made in general and administrative costs as locations are
eliminated.
o TARGET NATIONAL ACCOUNTS AND OTHER MARKET SEGMENTS WITH HIGH GROWTH
POTENTIAL - The Company intends to place more focus on national
accounts and other specialized parking market segments,
including stadiums and arenas, airports, on-street and hospitality
valet. The Company believes there are significant opportunities to gain
additional market share in these segments. Additional resources will be
dedicated to these specialized markets, including the addition of a
senior-level executive to lead the Company's national accounts program.
A senior-level manager already has been named to focus on the stadium
and arena market segment. In addition, the Company's USA Parking
subsidiary, which is focused on the high-end hospitality industry, will
expand its marketing activities outside of its traditional home base of
Florida. The Company will continue to focus on expanding its share of
the airport parking segment and plans to leverage its substantial
on-street experience and systems in the United Kingdom to grow its
on-street business in the U.S.
o RE-EMPHASIZE THE IMPORTANCE OF CLIENT RELATIONSHIPS IN RETAINING AND
GROWING THE MANAGEMENT CONTRACT SEGMENT - The Company intends to
re-emphasize the importance of developing and maintaining strong client
relationships at the local, regional and national levels through new
training initiatives and incentives with the primary goals of improving
the Company's management contract retention rates and increasing its
share of the management contract business.
o EXPAND THE OPERATIONAL EXCELLENCE INITIATIVE COMPANY-WIDE - The Company
will dedicate additional resources to its Operational Excellence
initiative to expand its operational audit and training programs on a
Company-wide basis and add Operational Excellence managers in several
key markets. The Company also intends to modify its local and regional
bonus plans to focus on margin improvement. The focus of this
initiative is to maximize revenues, improve margins and increase
profits at the location level.
o INCREASE INVESTMENT IN TECHNOLOGY TO REDUCE COSTS AND IMPROVE
OPERATIONAL EFFICIENCIES - The Company plans to invest up to $10
million over the next two years to deploy additional technology at the
lot level, including automated pay stations and other revenue
collection technology. In addition, the Company will continue to
automate more field and corporate accounting processes. Management
believes this investment will streamline payment processing, improve
timeliness of reporting and drive operational efficiencies. The Company
also intends to invest in improvements to its industry-leading
proprietary solutions for management clients.
o CONTINUE TO PURSUE OPPORTUNISTIC SALES OF REAL ESTATE - The Company
plans to continue its previously announced strategy of pursuing
opportunistic sales of real estate in situations where the Company can
achieve a purchase price that represents a substantial multiple to
earnings.
"This new strategic plan is designed to capitalize on Central Parking's brand,
experience and relationships to grow the profits of the Company," said Emanuel
Eads, President and Chief Operating Officer. "This plan recognizes that bigger
is not necessarily better. We intend to become a leaner organization that is
more focused on those geographic markets and market segments with the greatest
potential for profit growth. Our renewed emphasis on strong client relationships
and providing value-added services to our clients also will play an important
part in growing profits."
Eads added, "We are moving ahead to implement this plan immediately but it is
important to understand that it will take 9 to 12 months to fully implement all
aspects of the plan, and we will not begin to see the benefits of many of these
changes until the second half of fiscal 2006."
MANAGEMENT REORGANIZATION
The Company also announced that Emanuel Eads, age 54, who has served as
President and Chief Operating Officer since May 2003, has been named President
and Chief Executive Officer, effective immediately. Monroe Carell, Jr., Chairman
and Chief Executive Officer, will become Executive Chairman of the Board of
Directors. In his new role, Mr. Carell will continue to be involved in all
strategic aspects of the business and will lead the Company's efforts to
re-emphasize the importance of client relationships.
"Emanuel Eads has done an outstanding job as President and Chief Operating
Officer and is uniquely qualified to serve as Chief Executive Officer of the
Company," said Mr. Carell. "With more than 30 years of experience with the
Company, Mr. Eads has worked at every level in the organization and is
recognized as one of the most respected leaders in the parking industry."
Two of the Company's senior vice presidents, Alan Kahn, age 44, and Gregory
Stormberg, age 44, have been promoted to the newly created position of Executive
Vice President, reporting to Mr. Eads. Under the new management structure, the
position of Chief Operating Officer has been eliminated. In addition to their
current responsibilities, Mr. Kahn will oversee the international operations and
Mr. Stormberg will have direct responsibility for New York City.
DUTCH AUCTION TENDER OFFER
The Company also announced that it intends to commence a modified "Dutch
Auction" tender offer to purchase up to approximately 12% of its common stock.
The final number of shares, timing, the price range and other details of the
offer will be determined on the date the tender offer is commenced. The Company
expects to finance the purchase of the shares from cash proceeds from property
sales and from the Company's credit facility. The credit facility will require
certain changes in order to conduct a tender offer of the size being considered,
and the Company is seeking the requisite approvals from its bank group.
Monroe J. Carell, Jr., has advised the Company that neither he nor other members
of the Carell family intend to tender any of their shares in the event the
Company proceeds with the tender offer that is under consideration.
The Company currently expects to commence the tender offer in the near term, but
there can be no assurance that the Company will commence a tender offer nor any
assurances regarding the number of shares, timing, price range or other details
of any such tender offer.
Central Parking Corporation, headquartered in Nashville, Tennessee, is a leading
global provider of parking and transportation management services. As of June
30, 2005, the Company operated more than 3,400 parking facilities containing
more than 1.5 million spaces at locations in 37 states, the District of
Columbia, Canada, Puerto Rico, the United Kingdom, the Republic of Ireland,
Mexico, Chile, Peru, Colombia, Venezuela, Germany, Switzerland, Poland, Spain,
Greece and Italy.
This press release contains historical and forward-looking information. The
words "believe," "currently expects,' "expects," expectations," "estimates,"
"anticipates," "guidance," "goal," "outlook," "assumptions," "intend," "plan,"
"continue to expect," "should," "project," "objective," "outlook," "forecast,"
"will likely result," or "will continue" and similar expressions identify
forward-looking statements. The forward-looking statements are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. The Company believes the assumptions underlying these forward-looking
statements are reasonable; however, any of the assumptions could be inaccurate,
and therefore, actual results may differ materially from those projected in the
forward-looking statements. The factors that may result in actual results
differing from such forward-looking information include, but are not limited to:
the Company's ability to achieve the
goals described in this release and other communications, including but not
limited to, the Company's ability to maintain reduced operating costs, reduce
indebtedness and sell real estate at projected values as well as continued
improvement in same store sales, which is dependent on improvements in general
economic conditions and office occupancy rates; the loss or renewal on less
favorable terms, of management contracts and leases; the timing of pre-opening,
start-up and break-in costs of parking facilities; the Company's ability to
cover the fixed costs of its leased and owned facilities and its overall ability
to maintain adequate liquidity through its cash resources and credit facilities;
the Company's ability to comply with the terms of the Company's credit
facilities (or obtain waivers for non-compliance); interest rate fluctuations;
acts of war or terrorism; changes in demand due to weather patterns and special
events including sports events and strikes; higher premium and claims costs
relating to the Company's insurance programs, including medical, liability and
workers' compensation; the Company's ability to renew and obtain performance and
surety bonds on favorable terms; the impact of claims and litigation; and
increased regulation or taxation of parking operations and real estate.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this release. The Company
undertakes no obligation to publicly update or revise any forward-looking
statements contained herein to reflect events or circumstances occurring after
the date of this release or to reflect the occurrence of unanticipated events.
We have provided additional information in our Annual Report on Form 10-K for
our fiscal year ended September 30, 2004, and in our Quarterly Report on Form
10-Q for the quarter ended March 31, 2005, filed with the Securities and
Exchange Commission and other filings with the Securities and Exchange
Commission, which readers are encouraged to review, concerning other factors
that could cause actual results to differ materially from those indicated in the
forward-looking statements.
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