Crown Group, Inc. Reports First-Quarter FY 2002 EPS of $0.17
DALLAS, Texas--Sept. 18, 2001--Crown Group, Inc. today announced its operating results for the first quarter of FY2002.For the three months ended July 31, 2001, revenues decreased 3% to $80.1 million, compared with $82.5 million in the first quarter of the previous fiscal year. Net income for the most recent quarter totaled $1,193,898, or $0.17 per diluted share, compared with $2,767,142, or $0.32 per diluted share, in the year-earlier period. The decline in both revenues and net income relates entirely to a weaker-than-expected performance within the Florida operations of Crown's 70%-owned Smart Choice Automotive Group. America's Car-Mart, the Company's 95%-owned automotive retail and finance business, generated record first-quarter operating income (defined as earnings before taxes and minority interests) of $4.9 million on revenues of $30.4 million, compared with operating income of $3.9 million on revenues of $24.1 million in the first quarter of Fiscal 2001.
Revenues for the third quarter of FY2002 (before intercompany eliminations) were derived as follows: America's Car-Mart -- $30.4 million; Paaco Automotive -- $30.1 million; Smart Choice Automotive -- $16.4 million; and Other -- $3.5 million.
"With the exception of Smart Choice's Florida operations, Crown Group had an outstanding first quarter," commented Edward R. McMurphy, President and Chief Executive Officer of Crown Group. "We are particularly pleased with the continued strong performance of America's Car-Mart, which again exceeded management expectations with revenue and earnings gains of 26% over the prior-year quarter. Paaco Automotive Group continued to generate strong sales and cash flow, while Concorde Acceptance Corporation, our residential mortgage lender, had its best quarter ever in terms of both origination volume and earnings. With Smart Choice finally beginning to show signs of improvement and our other subsidiaries performing well, we are optimistic that Crown's Fiscal 2002 earnings will exceed last year's levels."
Crown Group, Inc. is primarily engaged in automotive retailing and specialty finance activities. Through its automotive subsidiaries, Crown Group currently owns and operates 74 dealerships in eight states and is the second-largest automotive retailer in the United States focused exclusively on the "Buy Here/Pay Here" used car market segment. The Company's America's Car-Mart subsidiary operates 52 dealerships primarily in small cities and rural locations throughout the Southwestern and Midwestern United States and is one of the largest "Buy Here/Pay Here" franchises in the country. Smart Choice Automotive Group operates 10 dealerships under the First Choice brand name in Florida and 12 dealerships and three collision/repair centers under the Paaco name in Texas, most of which operate in large metropolitan areas. All of the Company's dealerships sell only used cars and trucks to predominantly non-banked customers. Both Car-Mart and Smart Choice finance approximately 98% of the vehicles they sell and perform all underwriting, financing and servicing duties related to these retail installment contracts. The primary objective of all of Crown's automotive subsidiaries is to provide quality vehicles, courteous service, flexible payment arrangements and a friendly atmosphere to their customers.
In addition to its automotive subsidiaries, the Company has historically made equity investments for long-term appreciation in companies spanning various industries through either controlling ownership or minority positions. The Company currently owns (i) 95% of America's Car-Mart, Inc. and 70% of Smart Choice Automotive Group, Inc. (OTCBB:SCHA), vertically integrated used car sales and finance companies; (ii) 80% of Concorde Acceptance Corporation, a residential mortgage lender; (iii) 50% of Precision IBC, Inc., a firm specializing in the sale and rental of intermediate bulk containers; (iv) 8.0% of Mariah Vision3, Inc., a software developer specializing in 3-D graphic design; and (v) 6.7% of Monarch Venture Partners Fund I, a venture capital fund focused on emerging technology companies. Crown Group is headquartered in Dallas, Texas, and its common stock is traded on the Nasdaq National Market under the symbol "CNGR."
CROWN GROUP, INC. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
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Three Months Ended July 31,
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(in thousands, except per-share data) 2001 2000
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Total revenues $ 80,121 $ 82,451
Costs and expenses 78,569 76,940
Equity in earnings (loss) of unconsolidated
subsidiaries 108 -
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Income before taxes and minority interests 1,660 5,511
Provision for income taxes 830 2,248
Minority interests (364) 495
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Net income $ 1,194 $ 2,767
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Earnings per share:
Basic $ 0.17 $ 0.34
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Diluted $ 0.17 $ 0.32
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Weighted average number of shares outstanding:
Basic 6,868,541 8,179,391
Diluted 7,038,749 8,582,006
SELECTED FINANCIAL HIGHLIGHTS
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Quarter Ended July 31,
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Revenue contribution ($000s) 2001 2000
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Car-Mart $ 30,357 $ 24,128
Paaco 30,115 28,923
Smart Choice 16,405 24,470
Other 3,487 5,287
Eliminations (243) (357)
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Consolidated revenues $ 80,121 $ 82,451
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Income (loss) before taxes & minority interests ($000s)
2001 2000
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Car-Mart $ 4,935 $ 3,878
Paaco 1,591 1,602
Smart Choice (4,196) 630
Other (670) (599)
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Income before taxes & minority interests $ 1,660 $ 5,511
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BALANCE SHEET DATA, July 31, 2001
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Cash $ 2,206,844
Total assets $ 302,162,819
Stockholders' equity $ 59,202,029
Shares outstanding 6,735,367
Book value per share $ 8.79