Exhibit 99
Standard Parking Corporation Reports Strong Third Quarter
and Nine-Month 2005 Results; Updates Guidance For 2005
CHICAGO--(BUSINESS WIRE)--Nov. 9, 2005--Standard Parking
Corporation (NASDAQ:STAN), one of the nation's largest providers of
parking management services, today announced its results for the third
quarter and first nine months of 2005 with third quarter net income of
$4.2 million and earnings per share of $0.40, up 18% and 21%,
respectively.
Third Quarter Highlights
-- Revenue growth of 10%
-- Gross profit growth of 13%, despite Hurricane Katrina's impact
-- Operating income decrease of 6% due to $0.7 million impact of
Hurricane Katrina and $0.4 million cost of Sarbanes-Oxley
compliance preparation. Excluding these items, operating
income increased by 13%.
-- Net income of $4.2 million, an increase of 18% over the prior
year. Net income for the third quarter of 2005 included a $0.9
million credit valuation allowance adjustment to income tax
expense offset by the impact of Hurricane Katrina of $0.7
million and Sarbanes-Oxley compliance of $0.4 million.
Excluding these items, net income increased by 24% over last
year.
-- EPS of $0.40 per diluted share, up 21%. Includes the impact of
a credit valuation allowance adjustment to income tax expense
of $0.09 per share, offset by the impact of Hurricane Katrina
of ($0.07) per share and costs related to Sarbanes-Oxley
compliance of ($0.04) per share.
-- EPS pro forma for income taxes of $0.23 per diluted share
includes ($0.05) per share impact related to Hurricane Katrina
and ($0.03) per share impact related to Sarbanes-Oxley
compliance costs.
-- Free cash flow of $8.6 million
-- Completion of Board authorized stock repurchase program
Commentary
James A. Wilhelm, President and Chief Executive Officer, said, "We
are pleased that the underlying business continues to perform to
expectation despite the impact of Hurricane Katrina. Our average gross
profit per location grew 11%. This was due to strong same location
revenue growth in both lease and management contracts and significant
improvement in our last twelve month contract retention rate, to 91%
from 89% a year ago.
"As we have communicated previously, all of our operations in New
Orleans were affected by Hurricane Katrina. As with many other
businesses in that area, we are in the process of moving forward as
quickly as possible after the Hurricane working with our clients to
clean-up and restore their parking operations. While we expect the
City to recover, it will not be a quick process, and our results for
the second half of 2005 and most of 2006 will reflect the impact of
the Hurricane. However, during this period we expect that our business
overall will continue to produce strong results.
"You will notice that our G&A costs have grown more rapidly than
expected due primarily to the costs of Sarbanes-Oxley compliance.
While the process has been very time consuming and costly, we believe
that the testing and documentation of our internal controls mandated
by Sarbanes-Oxley are critical to our business and will give us a
competitive advantage."
Third Quarter Operating Results
Gross profit for the third quarter increased by 13% to $17.4
million from $15.4 million a year ago. Excluding the impact of
Katrina, gross profit increased 18% driven by strong same location
revenue increases at both lease and management locations. General and
administrative expenses increased by $2.1 million or 27% over the 2004
third quarter. Third quarter 2004 general and administrative expense
benefited from the receipt of $0.2 million in death benefits related
to a life insurance policy on a former Company executive as well as
the collection of a $0.2 million long-term receivable that was
previously reserved. G&A expense for the 2005 third quarter included
an increase in spending of $0.4 million for outside consultants and
auditors to assist with Sarbanes-Oxley compliance, $0.1 million in
professional fees related to the pending acquisition of the Illinois
and Wisconsin operations of System Parking, Inc. and a previously
announced one-time bonus to executive management of $0.3 million.
Adjusting for all of these items, underlying G&A grew by 11%.
Third quarter operating income decreased by 6% to $5.7 million as
compared with the third quarter of 2004. This result reflects the $0.7
million impact of Hurricane Katrina, which includes a $0.5 million
charge for the anticipated deductible related to an insurance claim
that will be filed for losses incurred and $0.4 million incurred for
Sarbanes-Oxley compliance. Excluding these items, the Company's
operating income would have increased 13%.
In the third quarter of 2005, the Company also recorded a $0.9
million credit to income tax expense for adjustments to its valuation
allowance for deferred tax assets. The decision to record this
non-cash credit resulted from the Company's sustained post-IPO
profitability, which supports the recognition of a portion of its $72
million net operating loss ("NOL") carry-forward for book purposes.
The Company will continue to reassess its ability to recognize its
remaining NOL carry-forward for book purposes during future reporting
periods. The Company's remaining NOL will continue to shield income
for many years, during which time its effective tax rate will be
significantly below the statutory tax rate. For 2005, the Company
expects its effective cash tax rate to be under 5%.
Net income for the third quarter of 2005 was $4.2 million, or
$0.40 per diluted share, as compared with $3.6 million, or $0.33 per
diluted share, a year ago. While this quarter reflects the first full
quarter in which prior year comparisons are not distorted by
IPO-related issues, three significant items did affect the quarter's
results: the previously mentioned non-cash credit valuation allowance
adjustment to income taxes of $0.09 per share, Hurricane Katrina's
($0.07) per share impact, and a ($0.04) per share impact from
Sarbanes-Oxley compliance. Net of these three items, earnings were
$0.42 per share. On a pro forma for income tax basis, net income for
the 2005 third quarter was $2.4 million, or $0.23 per diluted share,
as compared with $0.24 per diluted share in the 2004 third quarter.
Pro forma earnings for the third quarter of 2005 were adversely
impacted by ($0.05) per share due to Hurricane Katrina and ($0.03) per
share due to increased Sarbanes-Oxley compliance costs.
Total parking services revenue for the quarter, excluding
reimbursement of management contract expense, was up by 10% to $63.0
million from $57.2 million a year ago, led by 21% growth in management
contract revenue. The outstanding performance in management contracts
and a 4% increase in lease revenue are attributable to strong same
location revenue increases of 18% and 6%, respectively. Reimbursement
of management contract expense grew 11%, but is excluded because its
timing and amount fluctuate substantially for reasons unrelated to the
Company's parking services revenue and because it has no impact on
gross profit.
Cash and cash equivalents were $13.6 million at September 30,
2005, which was higher than historical levels. The Company routinely
enters into LIBOR-based contracts to fix the interest rate on a
substantial portion of the borrowings under its variable rate Senior
Credit Facility. At September, 30, 2005, the Company had $2.7 million
in overnight investments as a result of a $45 million LIBOR contract
with a maturity in mid-October 2005. Net of the change in cash, free
cash flow of $3.8 million was generated during the quarter. Of that
amount, the Company used $1.7 million to purchase shares of its stock,
completing the $6.0 million repurchase program approved by the Board
of Directors in early March of 2005. The remaining $2.1 million of
free cash flow was used to pay down debt. The Company continues to use
free cash flow to reduce debt, enabling it to benefit from a $0.2
million reduction in interest expense versus last year despite the
increase in prevailing interest rates.
Recent Developments
Operating results at Bradley International Airport continue to
improve significantly. During the 2005 third quarter, the Company
received reimbursement of deficiency payments totaling $0.4 million as
compared with having made $0.3 million in deficiency payments a year
ago. For the first nine months of 2005, the Company received net
repayments of $0.5 million compared with having made $1.8 million of
deficiency payments during the same period of 2004, resulting in a
positive swing of $2.3 million in cash flow year-to-year. The Company
expects to continue to receive additional repayments in the future.
During the third quarter, the Company expanded its relationship
with General Growth Properties, a REIT specializing in shopping malls.
The Company was awarded contracts to manage four shopping mall
properties in Miami, Coral Gables, Phoenix and Seattle, comprising a
total of 7,000 parking spaces. Water Tower Place, a premier retail
complex in the heart of Chicago's Magnificent Mile, also a General
Growth property, was recently renewed for three years. The Company's
contract to operate the parking at another General Growth property,
Providence Place in Rhode Island, was renewed for a 3 year term. The
Company has been the parking operator at that Rhode Island property
since its opening in 1999.
Other notable new contracts or renewals during the third quarter
include the following:
-- Leases to operate two parking facilities for Northwestern
University, which serve both the downtown campus of the
University as well as Northwestern Memorial Hospital, were
recently renewed for 5 year terms. One of the leased
facilities had recently been expanded to include an additional
967 spaces, further enhancing the contract. The Company has
maintained a continuing relationship with the University
dating back to the 1920s.
-- Midway Airport in Chicago recently added vehicle booting to
the list of services that the Company provides at that
airport.
-- University of Colorado Health Science Center, where the
Company has leveraged its existing parking management
relationship at the University's two campuses to include
shuttle services.
The Company has previously communicated that one of its goals for
the deployment of free cash flow is to pursue growth opportunities
from value enhancing, low-risk acquisitions. The Company has also
previously discussed its proposed disciplined approach to
acquisitions. The Company recently announced two transactions that fit
its acquisition strategy by either expanding and leveraging an
existing core market or allowing entry to an untapped market that has
the potential to become a core market:
-- The Company has signed a non-binding letter of intent to
acquire the Illinois and Wisconsin operations of System
Parking, Inc. System manages 124 locations in these two
Midwestern markets. The Company's agreement is subject to the
completion of due diligence that is currently underway as well
as finalization of definitive legal documentation.
-- In addition, the Company announced that it had signed a
definitive agreement to merge the Seattle parking activities
of Sound Parking into its operations. With 55 parking
locations and 2 shuttle operations, Sound Parking manages more
than 5,500 parking spaces in Seattle and Bellevue, Washington.
This transaction reflects the Company's increasing focus on
the development of the Pacific Northwest market.
Mr. Wilhelm commented, "Both of these transactions, if completed,
will build on our platform of concentrating on core markets. System
Parking's fine organization, with its concentration in our important
Chicago market, enables us to leverage our existing operating and
financial infrastructure. And being close to Chicago for our first
post-IPO acquisition is an added plus as we work toward a rapid and
successful integration. In Seattle, we have the opportunity to evolve
a new core market by leveraging the operating excellence and fine
reputation of Sound Parking in what we expect will be an area of
significant growth for the Company."
Year-to-Date Results
Gross profit for the first nine months of 2005 increased 8% to
$51.0 million as compared with $47.0 million for the same period in
2004 due to solid growth in same location profit from both lease and
management locations. Top line revenue, excluding reimbursed
management contract expenses, also increased year over year by over 8%
from $171.9 million in 2004 to $186.0 million in 2005. As of September
30, 2005, the Company operated 1,907 locations, an increase of 23
locations since the end of 2004 and 40 locations from a year ago. The
Company's retention rate for the twelve-month period ended September
30, 2005 was 91%, as compared with 89% for the twelve-month period
ended September 30, 2004. The retention rate represents the percentage
of locations retained for a twelve month period.
General and administrative expenses for the first nine months of
2005 increased by 13% over the same period last year due to additional
costs of being a public company such as expenses incurred with meeting
the compliance requirements of Sarbanes-Oxley.
Operating income for the nine months ended September 30, 2005 was
up by almost 27% to $17.1 million from $13.5 million a year earlier,
although several special items impacted both years. Excluding the
impact of $1.5 million in management fees to the Company's former
parent during the first nine months of 2004 and non-cash stock option
compensation of $2.3 million during the same 2004 period, and a
valuation allowance related to long-term receivables of $0.9 million
during the first nine months of 2005, operating income would have
increased by approximately 4%.
Commenting on the Company's nine-month performance, Mr. Wilhelm
said, "We are very pleased with our year to date results, especially
the strong growth in gross profit. Our ability to maintain focus on
core operations despite the distractions of Katrina-related issues
once again underscores our ability to deliver consistent, reliable
results. In addition, we are now beginning to see attractive
acquisition opportunities that we will evaluate under the framework of
our acquisition strategy to maximize shareholder value.
"While G&A is growing at a faster rate than we would like due
largely to Sarbanes-Oxley, we are committed to carefully managing our
spending, and anticipate that G&A growth will moderate in the coming
year."
Financial Outlook
Earnings per share for fiscal year 2005 now is expected to be in
the range of $1.27 to $1.32. This guidance reflects the impact of
Hurricane Katrina, which is estimated to be a ($0.14) per share
charge, and the incremental costs expected to be incurred this year
for Sarbanes-Oxley compliance of ($0.07) per share, offset by the
credit valuation allowance adjustment to income tax expense of $0.09
per share. The Company also expects to record a deferred tax expense
of $0.5 million, or ($0.05) per share, in the fourth quarter of this
year due to the deduction of goodwill for tax purposes but not for
book purposes. Excluding these adjustments, reported earnings per
share now is expected to be in the range of $1.44 to $1.49.
Earnings per share pro forma for income taxes now is expected to
be in the range of $0.90 to $0.95, which includes the impact of
Hurricane Katrina, an estimated ($0.10) per share charge on the year,
and the increased costs of Sarbanes-Oxley compliance of ($0.05) per
share. Excluding these adjustments, pro forma earnings per share now
is expected to be in the range of $1.05 to $1.10.
Guidance for free cash flow remains unchanged at $17 million or
higher.
These guidance estimates do not include the impact of any
acquisitions or mergers contemplated or completed during the year.
For pro forma guidance purposes, the statutory tax rate of 39% has
been reduced to 30% based on the Company's assumed ability to use its
substantial net operating loss carry-forwards to shield income for a
period beyond five years. The Company's reported tax rates are
expected to be substantially less than the statutory rates, due to the
ability to offset future earnings against net operating loss
carry-forwards. In addition, the Company's tax provision may further
be affected by adjustments to its valuation allowance for its deferred
tax assets. The timing of the recognition of these tax benefits may
result in significant fluctuations in reported GAAP results.
Conference Call
The Company's quarterly earnings conference call will be held at
10:00 am (CST) on Thursday, November 10, 2005 and is available live
and in replay to all analyst/investors through a webcast service. To
listen to the live call, individuals are directed to the Company's
investor relations page at www.standardparking.com or www.earnings.com
at least 15 minutes prior to the call in order to register, download
and install any necessary audio software. For those who cannot listen
to the live broadcast, replays will be available shortly after the
call on either website and can be accessed for 30 days after the call.
Standard Parking is a leading national provider of parking
facility management services. The Company provides on-site management
services at multi-level and surface parking facilities for all major
markets of the parking industry. The Company manages approximately
1,900 parking facilities, containing over one million parking spaces
in close to 300 cities across the United States and Canada. In
addition, the Company manages parking-related and shuttle bus
operations serving more than 60 airports.
More information about Standard Parking is available at
www.standardparking.com. You should not construe the information on
this website to be a part of this report. Standard Parking's 2004
annual report filed on Form 10-K, its periodic reports on Form 10-Q
and 8-K and its Registration Statement on Form S-1 (333-112652) are
available on the Internet at www.sec.gov and can also be accessed
through the Investor Relations section of the Company's website.
DISCLOSURE NOTICE: The information contained in this document is
as of November 9, 2005. The Company assumes no obligation to update
any forward-looking statements contained in this document as a result
of new information or future events or developments.
This document and the attachments contain forward-looking
information about the Company's financial results that involve
substantial risks and uncertainties. You can identify these statements
by the fact that they use words such as "anticipate," "estimate,"
"expect," "project," "intend," "plan," "believe," "outlook," and other
words and terms of similar meaning in connection with any discussion
of future operating or financial performance. Among the factors that
could cause actual results to differ materially are the following: an
increase in owner-operated parking facilities; changes in patterns of
air travel or automobile usage, including effects of changes in gas
and airplane fuel prices, effects of weather on travel and
transportation patterns or other events affecting local, national and
international economic conditions; implementation of the Company's
operating and growth strategy, including possible strategic
acquisitions; the loss, or renewal on less favorable terms, of
management contracts and leases; player strikes or other events
affecting major league sports; changes in general economic and
business conditions or demographic trends; ongoing integration of past
and future acquisitions in light of challenges in retaining key
employees, synchronizing business processes and efficiently
integrating facilities, marketing and operations; changes in current
pricing; development of new, competitive parking-related services;
changes in federal and state regulations including those affecting
airports, parking lots at airports and automobile use; extraordinary
events affecting parking at facilities that we manage, including
emergency safety measures, military or terrorist attacks and natural
disasters; the Company's ability to renew the Company's insurance
policies on acceptable terms, the extent to which the Company's
clients purchase insurance through us and the Company's ability to
successfully manage self-insured losses; the Company's ability to form
and maintain relationships with large real estate owners, managers and
developers; the Company's ability to provide performance bonds on
acceptable terms to guarantee the Company's performance under certain
contracts; the loss of key employees; the Company's ability to
develop, deploy and utilize information technology; the Company's
ability to refinance the Company's indebtedness; the Company's ability
to consummate transactions and integrate newly acquired contracts into
the Company's operations; availability, terms and deployment of
capital; the amount of net operating losses, if any, the Company may
utilize in any year and the ability of Steamboat Industries LLC and
its subsidiary to control the Company's major corporate decisions. In
addition, no assurances can be provided that any transaction will be
consummated with Sound Parking or System Parking because the
respective closings are subject to the satisfaction of certain
conditions and/or definitive documentation. A further list and
description of these risks, uncertainties, and other matters can be
found in the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 2004, in its periodic reports on Forms 10-Q and
8-K, and in its Registration Statement on Form S-1 (333-112652).
STANDARD PARKING CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except for share and per share data)
September 30, 2005 December 31, 2004
------------------ -----------------
ASSETS (unaudited)
Current assets:
Cash and cash equivalents $13,550 $10,360
Notes and accounts receivable,
net 37,214 34,608
Prepaid expenses and supplies 2,965 2,330
Deferred income taxes 5,571 -
------------------ -----------------
Total current assets 59,300 47,298
Leaseholds and equipment, net 16,652 16,481
Long-term receivables, net 5,953 7,317
Advances and deposits 1,507 1,816
Goodwill 118,716 118,342
Intangible and other assets, net 3,375 3,848
------------------ -----------------
Total assets $205,503 $195,102
================== =================
LIABILITIES AND COMMON
STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $29,170 $26,107
Accrued and other current
liabilities 25,132 25,794
Current portion of long-term
borrowings 3,375 3,512
------------------ -----------------
Total current liabilities 57,677 55,413
Long-term borrowings, excluding
current portion 99,733 106,238
Deferred income taxes 4,656 -
Other long-term liabilities 23,115 18,111
Convertible redeemable preferred
stock, series D 1 1
Common stockholders' equity:
Common stock, par value $.001
per share; 12,000,100 shares
authorized; 10,126,482 shares
issued and outstanding 10 10
Additional paid-in capital 189,075 193,565
Accumulated other comprehensive
income 452 116
Accumulated deficit (167,757) (178,352)
Treasury stock, at cost, 80,377
shares (1,459) -
------------------ -----------------
Total common stockholders' equity 20,321 15,339
------------------ -----------------
Total liabilities and common
stockholders' equity $205,503 $195,102
================== =================
STANDARD PARKING CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except for share and per share data, unaudited)
Three Months Ended Nine Months Ended
--------------------------- ---------------------------
September 30, September 30, September 30, September 30,
2005 2004 2005 2004
------------- ------------- ------------- -------------
Parking
services
revenue:
Lease
contracts $38,659 $37,125 $116,526 $109,366
Management
contracts 24,347 20,089 69,479 62,537
------------- ------------- ------------- -------------
63,006 57,214 186,005 171,903
Reimburse-
ment of
management
contract
expense 85,253 76,597 252,688 246,525
------------- ------------- ------------- -------------
Total revenue 148,259 133,811 438,693 418,428
Cost of parking
services:
Lease
contracts 35,546 33,131 106,247 99,103
Management
contracts 10,034 8,660 28,791 25,805
------------- ------------- ------------- -------------
45,580 41,791 135,038 124,908
Reimbursed
management
contract
expense 85,253 76,597 252,688 246,525
------------- ------------- ------------- -------------
Total cost of
parking
services 130,833 118,388 387,726 371,433
Gross profit:
Lease
contracts 3,113 3,994 10,279 10,263
Management
contracts 14,313 11,429 40,688 36,732
------------- ------------- ------------- -------------
Total gross
profit 17,426 15,423 50,967 46,995
General and
adminis-
trative
expenses 9,937 7,848 28,241 24,997
Depreciation
and
amortization 1,814 1,554 4,771 4,724
Management fee-
parent company - - - 1,500
Valuation
allowance
related to
long-term
receivables - - 900 -
Non-cash stock
option
compensation
expense - - - 2,293
------------- ------------- ------------- -------------
Operating
income 5,675 6,021 17,055 13,481
Other expenses
(income):
Interest
expense 2,234 2,414 7,081 10,956
Interest
income (63) (78) (217) (420)
Net gain from
extinguish-
ment of debt - 27 - (3,833)
------------- ------------- ------------- -------------
2,171 2,363 6,864 6,703
Income before
minority
interest and
income taxes 3,504 3,658 10,191 6,778
Minority
interest 62 54 270 296
Income tax
expense (799) 19 (674) 336
------------- ------------- ------------- -------------
Net income
before
preferred
stock
dividends and
increase in
value of
common stock
subject to
put/call
rights 4,241 3,585 10,595 6,146
Preferred stock
dividends - - - 7,243
Increase in
value of
common stock
subject to
put/call
rights - - - 538
------------- ------------- ------------- -------------
Net income
(loss) $4,241 $3,585 $10,595 ($1,635)
============= ============= ============= =============
Common Stock
Data:
Net income
(loss) per
common share:
Basic $0.42 $0.34 $1.03 ($0.36)
Diluted $0.40 $0.33 $1.00 ($0.36)
Weighted
average common
shares
outstanding:
Basic 10,191,044 10,464,888 10,312,219 4,564,902
Diluted 10,496,786 10,708,537 10,597,100 4,564,902
STANDARD PARKING CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, except for share and per share data, unaudited)
Nine Months Ended
----------------------------
September 30, September 30,
2005 2004
------------- -------------
Operating activities:
Net income (loss) $10,595 ($1,635)
Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operations:
Preferred stock dividends - 7,243
Increase in value of common stock
subject to put/call rights - 538
Depreciation and amortization 4,771 4,724
Non-cash interest expense - 279
Amortization of debt issuance costs 567 836
Amortization of carrying value in excess
of principal (124) (1,256)
Non-cash stock option compensation
expense - 2,407
Provision for losses on accounts
receivable 262 752
Valuation allowance related to long-term
receivables 900 -
Write-off of debt issuance costs - 2,385
Write-off of carrying value in excess of
principal related to the 14% senior
subordinated second lien notes - (8,207)
Deferred income taxes (915) -
Change in operating assets and
liabilities 4,534 (9,070)
------------- -------------
Net cash provided by (used in) operating
activities 20,590 (1,004)
Investing activities:
Purchase of leaseholds and equipment (3,286) (908)
Contingent purchase payments (242) (557)
------------- -------------
Net cash (used in) investing activities (3,528) (1,465)
Financing activities:
Net proceeds from initial public offering - 46,715
Repurchase of common stock subject to
put/call rights - (6,250)
Repurchase of common stock (5,963) -
Proceeds from exercise of stock options 14 -
Proceeds from (payments on) senior credit
facility (5,000) 22,350
Payments on long-term borrowings (203) (96)
Payments on joint venture borrowings (457) (410)
Payments of debt issuance costs (118) (1,402)
Payments on capital leases (2,339) (1,714)
Repurchase of 14% senior subordinated
second lien notes - (57,734)
------------- -------------
Net cash (used in) provided by financing
activities (14,066) 1,459
Effect of exchange rate changes on cash
and cash equivalents 194 18
------------- -------------
Increase (decrease) in cash and cash
equivalents 3,190 (992)
Cash and cash equivalents at beginning of
period 10,360 8,470
------------- -------------
Cash and cash equivalents at end of period $13,550 $7,478
============= =============
Supplemental disclosures:
Cash paid during the period for:
Interest $7,748 $13,772
Income taxes 362 191
Supplemental disclosures of non-cash
activity:
Debt issued for capital lease obligation $1,647 $2,453
Issuance of 14% senior subordinated
second lien notes - 375
Pro Forma Net Income
(in thousands, except for per share data)
Three Months Nine Months
Ended Ended
September 30, September 30,
2005 2005
--------------- ----------------
pro pro
forma forma
per per
share share
Net income - as A
reported $4,241 $0.40 $10,595 $1.00
Reported income tax B
expense (799) (0.08) (674) (0.06)
------- ------- -------- -------
Pre-tax income C = A + B 3,442 0.33 9,921 0.94
Effective income D = - (C x 30%)
tax rate @ 30%
(1) (1,033) (0.10) (2,976) (0.28)
Reported income B
tax expense (799) (0.08) (674) (0.06)
------- ------- -------- -------
Total pro forma tax E = D + B
adjustment (1,832) ($0.17) (3,650) ($0.34)
Pro forma net income F = A + E $2,409 $0.23 $6,945 $0.66
Weighted average
common shares
outstanding:
Basic shares
outstanding 10,191 10,312
Effect of dilutive
common stock
options 306 285
------- --------
Fully diluted
shares 10,497 10,597
2005 Earnings
Per Share
Guidance Range
Low High
------- -------
Expected reportable
earnings per diluted
share for 2005 $1.27 $1.32
Estimated 2005 GAAP
income tax expense 0.02 0.03
------- -------
Pre-tax income 1.29 1.35
Effective income
tax at 30% rate (1) (0.39) (0.41)
------- -------
Pro forma earnings
per diluted share
for 2005 $0.90 $0.95
(1) For pro forma guidance purposes, the statutory tax rate of 39% has
been reduced to 30% based on the Company's assumed ability to use its
substantial net operating loss carry- forwards to shield income for a
period beyond five years. The Company's reported tax rates are
expected to be substantially less than the statutory rates, due to the
ability to offset future earnings against net operating loss
carry-forwards. In addition, the Company's tax provision may further
be affected by adjustments to its valuation allowance for its deferred
tax assets. The timing of the recognition of these tax benefits may
result in significant fluctuations in reported GAAP results.
Free Cash Flow
(in thousands)
Three months Nine months
ended ended
September 30, September 30,
2005 2005
-------------- -------------
Operating income $5,675 $17,055
Depreciation and
amortization 1,814 4,771
Valuation allowance
related to long-term
receivables - 900
Income tax paid (94) (362)
Minority interest (62) (270)
Change in assets and
liabilities 7,427 6,438
Capital expenditures and
contingent purchase
payments (2,949) (3,528)
-------------- -------------
Operating cash flow $11,811 $25,004
Cash interest paid (3,213) (7,748)
-------------- -------------
Free Cash Flow (1) $8,598 $17,256
(Increase) in cash and
cash equivalents (4,832) (3,190)
-------------- -------------
Free cash flow, net of
change in cash $3,766 $14,066
(Uses)/Sources of cash:
Proceeds from (payments
on) senior credit
facility ($1,200) ($5,000)
(Payments) on long-term
borrowings (902) (2,999)
(Payments) of debt
issuance costs - (118)
Proceeds from exercise of
stock options - 14
(Repurchase) of common
stock (1,664) (5,963)
-------------- -------------
Total (uses) of cash ($3,766) ($14,066)
- ----------------------------------------------------------------------
(1) Reconciliation of Free Cash Flow to Consolidated Statements of
Cash Flow
Nine Months Six Months Three Months
September 30, June 30, September 30,
2005 2005 2005
-------------- ------------- -------------
Net cash provided by
operating activities $20,590 $9,482 $11,108
Net cash (used in)
investing activities (3,528) (579) (2,949)
Effect of exchange rate
changes on cash and cash
equivalents 194 (245) 439
-------------- ------------- -------------
Free cash flow $17,256 $8,658 $8,598
CONTACT: Standard Parking Corporation
G. Marc Baumann, 312-274-2199
mbaumann@standardparking.com