Exhibit A
Robert Mondavi Reports Results for Third Quarter of Fiscal 2004
NAPA, Calif.--(BUSINESS WIRE)--April 22, 2004--The Robert Mondavi
Corporation (Nasdaq:MOND) today announced results for its third quarter of
fiscal 2004.
The company reported net income of $2.0 million, or $0.12 per diluted
share, for the quarter ended March 31, 2004, compared to a net loss of $1.8
million, or $0.11 per diluted share, a year ago. Last year's quarter included
$4.8 million, or $0.18 per diluted share, in net charges taken at the time of a
restructuring (see note 1 for more details). Net revenues for the quarter
increased 6 percent over the same period last year to $98.1 million, reflecting
a 9 percent increase in sales volume and 5 percent growth in wholesale
depletions. Wholesaler inventories of the company's products held steady at 50
days at the end of the quarter, compared to 50 days last year and 49 days at the
end of December.
Net income for the first nine months of the fiscal year increased by 34
percent to $21.3 million, or $1.29 per diluted share, from $15.9 million, or
$0.97 per diluted share, a year ago. Net revenues for the first nine months of
the fiscal year increased by 5 percent to $349.4 million, reflecting a 5 percent
increase in sales volume.
"We continue to make progress in establishing momentum behind our new
product initiatives, which are now contributing significantly to topline growth.
But, since investments behind these initiatives and competitive pressure on
Woodbridge are causing margin compression, it's important that we also remain
focused on delivering operating expense efficiencies," said Gregory M. Evans,
President and CEO.
The company said it still expects full-year fiscal 2004 earnings per
diluted share to range from $1.63 to $1.78, including approximately $0.06 per
diluted share in inventory step-up charges. The company also announced that it
will schedule a conference call in late June to discuss its outlook for fiscal
2005.
Robert Mondavi Corporation produces and markets fine wines under the
following labels: Robert Mondavi Winery, Robert Mondavi Private Selection, La
Famiglia, Woodbridge Winery, Byron Vineyards & Winery, Io, Arrowood Vineyards &
Winery and Grand Archer by Arrowood. The company also produces Opus One, in
partnership with the Baroness Philippine de Rothschild of Chateau Mouton
Rothschild of Bordeaux, France; Luce, Lucente, Danzante and the wines of Tenuta
dell'Ornellaia, in partnership with the Marchesi de' Frescobaldi of Tuscany,
Italy; and Sena and Arboleda, in partnership with the Eduardo Chadwick family of
Vina Errazuriz in Chile. Kirralaa, the first Australian wines produced by Robert
Mondavi in partnership with Southcorp and Rosemount's Oatley family, were
introduced in February 2003. In addition to the partnership wines, Robert
Mondavi Imports represents the wines of Marchesi de' Frescobaldi, Attems, Vina
Errazuriz and Vina Caliterra in the United States.
On July 29, 2004, Robert Mondavi expects to release its fourth quarter
fiscal 2004 earnings, followed by a conference call at 7:30 a.m. PT. A live
listen-only web cast and a copy of the prepared remarks of the conference call
will be available at www.robertmondavi.com under "Investor Relations."
ROBERT MONDAVI
FINANCIAL HIGHLIGHTS
(In thousands, except per share data)
Three Months Ended Nine Months Ended
March 31, March 31,
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
Cases sold 2,171 1,986 7,437 7,106
Net revenues $98,149 $92,164 $349,427 $331,864
Cost of goods sold 61,509 62,679 211,235 202,395
--------- --------- --------- ---------
Gross profit 36,640 29,485 138,192 129,469
Gross profit % 37.3% 32.0% 39.5% 39.0%
Operating expenses 30,693 22,197 95,327 88,819
Special charges - - 3,394 - - 6,504
--------- --------- --------- ---------
Operating income 5,947 3,894 42,865 34,146
Other (income) expense:
Interest 4,920 5,832 16,121 16,658
Equity (income) loss from
joint ventures (1,569) 489 (6,026) (7,906)
Other (583) 505 (771) 81
--------- --------- --------- ---------
Income before income taxes 3,179 (2,932) 33,541 25,313
Income tax provision (benefit) 1,160 (1,084) 12,242 9,366
--------- --------- --------- ---------
Net income (loss) 2,019 (1,848) 21,299 15,947
Weighted average number of
shares outstanding --
Diluted 16,579 16,290 16,489 16,363
Earnings (loss) per share --
Diluted $0.12 ($0.11) $1.29 $0.97
Net cash flows from Operating
Activities $12,635 $(9,248) $43,586 $18,377
At 3/31/04 At 6/30/03
------------- -------------
Current assets $519,051 $502,630
Total assets 962,404 961,177
Current liabilities 75,078 71,983
Total liabilities 485,000 510,183
Shareholders' equity 477,404 450,994
Working capital 443,973 430,647
Total debt 382,948 412,726
Note 1: In the third quarter of fiscal 2003, the company incurred pre-tax
inventory write-downs, asset impairment charges and employee separation expenses
totaling $7.6 million, $2.2 million and $1.2 million, respectively, which were
partially offset by a pre-tax gain of $6.1 million on the sale of non-strategic
fixed assets.
Forward-looking Statements
This announcement and other information provided from time to time by the
company contain historical information as well as forward-looking statements
about the company, the premium wine industry and general business and economic
conditions. Such forward-looking statements include, for example, projections or
predictions about the company's future growth, consumer demand for its wines,
including new brands and brand extensions, margin trends, anticipated future
investment in vineyards and other capital projects, the premium wine grape
market and the premium wine industry generally. Actual results may differ
materially from the company's present expectations. Among other things, a soft
economy, a downturn in the travel and entertainment sector, risk associated with
continued worldwide conflicts, reduced consumer spending, or changes in consumer
preferences could reduce demand for the company's wines. Similarly, increased
competition or changes in tourism to our California properties could affect the
company's volume and revenue growth outlook. The supply and price of grapes, the
company's most important raw material, is beyond the company's control. A
shortage of grapes might constrict the supply of wine available for sale and
cause higher grape costs that put more pressure on gross profit margins. A
surplus of grapes might allow for greater sales and lower grape costs, but it
might also result in more competition and pressure on selling prices or
marketing spending. Interest rates and other business and economic conditions
could increase significantly the cost and risks of projected capital spending,
which in turn could impact profit margins. For additional cautionary statements
identifying important factors that could cause actual results to differ
materially from such forward-looking information, please refer to Item 7,
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," in the company's Annual Report on Form 10-K for the fiscal year
ended June 30, 2003, on file with the Securities and Exchange Commission. For
these and other reasons, no forward-looking statement by the company can nor
should be taken as a guarantee of what will happen in the future.
CONTACT: Robert Mondavi Corporation
Robert Philipps, 707-251-4850
VP, Treasury & Investor Relations
Hilary Martin, 707-251-4487
VP Corporate Communications