Imperial Parking Corporation Announces 3rd Quarter Results
VANCOUVER, British Columbia--Nov. 13, 2001--Imperial Parking Corporation ("Impark") (AMEX: IPK) today reported revenues of $24.0 million for the quarter ended September 30, 2001, representing a 29.6% year-over-year increase in revenues. The Company reported net income of $292,000, or $0.15 per diluted share, for the third quarter of 2001, compared to net income of $574,000, or $0.27 per diluted share, for the same period in the prior year.The Company reported cash net income, defined as net income plus goodwill amortization and deferred income taxes of $1.0 million, or $0.54 per diluted share, for the third quarter of 2001 compared to a cash net income of $1.1 million, or $0.53 per diluted share, for the same quarter in the prior year. The Company also reported net cash flow from operations of $3.8 million for the quarter of which $2.3 million was from the release of Restricted Cash, as compared to net cash flow from operations of $0.2 million for the same period in the prior year.
The Company's increased revenues are primarily attributable to the continuing expansion into major U.S. markets including its acquisition, on July 1, 2001, of DLC Management Group Inc. ("DLC"), a major parking operator in Philadelphia and other East Coast markets. DLC contributed $2.8 million revenue this quarter and our U.S. expansion cities of Seattle, Cleveland, Cincinnati, San Francisco and Atlanta contributed $2.2 million additional revenue in the quarter. These overall revenue increases were reduced, in part, by lower revenues at several of the Company's leased facilities, as a result of the slowing economy and recent events.
Operating income this quarter was substantially unchanged from the same quarter in the prior year. The Company's gross margin percentage of 23.1% for the quarter declined from 25.5% for the same quarter in 2000 primarily as a result of its increasing emphasis on leased, as opposed to managed, parking facility operations. Much of the Company's U.S. expansion has been through long-term leases which typically have lower margins in the first few years of operation. The weakness in the U.S. and Canadian economies and recent U.S. events has further reduced the revenues and profitability of these leased properties during the quarter. However, the Company continues to believe that a roughly equal mix of managed and leased/owned parking operations provides the optimal balance of revenue growth and stability that will enable the Company to maximize long-term profitability.
Commenting on Impark's third quarter, Charles Huntzinger, the Company's President and Chief Executive Officer stated, "While we are encouraged by our expansion into several new U.S. markets and our 30% increase in revenues during quarter, we are concerned about the weakness in the U.S. and Canadian economies. With our strong balance sheet, we are committed to moving forward with our growth strategy but will do so cautiously until the economic outlook becomes more positive. As a result of the weak economy, we believe there will be attractive investment opportunities presented to us and our strong balance sheet will allow us to proceed."
Mr. Huntzinger continued, "We are encouraged by the first three months' operation from DLC, the Philadelphia, PA based parking operator we acquired in July 2001. This was an important acquisition as it provides the base operations for our East Coast US expansion. We are pleased by the contribution DLC made to the quarter's revenues and profitability and expect continued growth from that operation in the future."
For the nine months ended September 30, 2001, the Company reported revenues of $64.4 million representing a 26.2% year-over-year increase in revenues over pro forma revenues of $51.0 million in the 2000 period. The Company reported net income of $852,000, or $0.46 per diluted share, from operations for the nine months ended September 30, 2001, versus pro forma earnings of $1.4 million, or $0.65 per diluted share, for the same period in the prior year.
The Company reported cash net income of $3.3 million, or $1.81 per diluted share, for the nine-month period of 2001, a 10.9% increase over pro forma cash net income of $3.0 million or $1.42 per diluted share, for the same period in the prior year. The Company also reported net cash flow from operations of $9.7 million for the nine-month period of which $2.7 million was from the release of Restricted Cash, as compared to negative cash flow from operations of $1.0 million for the same period in the prior year.
Imperial Parking Corporation was spun-off from First Union Real Estate Equity and Mortgage Investments on March 27, 2000 and began trading on the American Stock Exchange on March 28, 2000. The spin-off was essentially the result of a detailed plan of organization that included several transactions ultimately resulting in the combination of two entities to form Impark. Because Impark, as presently constituted, existed for just four days in the first quarter of 2000 and not at all in 1999, generally accepted accounting principles (GAAP) require that our financial statements be presented on a pro forma basis, assuming that the spin-off had occurred on January 1, 1999. The pro forma results of operations are not necessarily indicative of what the actual results of the Company would have been for the periods presented, nor do they purport to represent the Company's future results of operations. For further details on the spin-off, please refer to Imperial Parking Corporation's Information Statement (Form 10) dated March 27, 2000.
Imperial Parking Corporation, headquartered in Vancouver, B.C., Canada is the largest parking operator in Canada and the fourth largest in North America. Impark currently operates more than 1,575 parking locations and 290,000 stalls in Canada and the United States.
This press release contains projections and other forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. These projections and statements reflect the Company's current views with respect to future events and financial performance. No assurance can be given, however, that these events will occur or that these projections will be achieved and actual results could differ materially from those projected, as a result of certain factors. A discussion of these factors is included in the Company's filings with the Securities and Exchange Commission.
Imperial Parking Corporation
Consolidated Statements of Operations (Unaudited)
In thousands of U.S. dollars,
except earnings per share
Three months Nine months
ended Sep 30 ended Sep 30
---------------- ------------------
2001 2000 2001 2000
(pro
forma)
Revenues $ 24,008 $ 18,529 $ 64,374 $ 51,021
Direct costs 18,461 13,796 48,890 37,832
-------- -------- -------- --------
Gross margin 5,547 4,733 15,484 13,189
Other operating expenses
General and
administrative 3,839 3,026 10,510 8,590
Depreciation and
amortization 1,176 1,204 3,407 3,465
Equity share in
Limited Liability
company losses 37 - 114 -
-------- -------- -------- -------
Total other
operating expenses 5,052 4,230 14,031 12,055
-------- -------- -------- --------
Operating income 495 503 1,453 1,134
Other income(expense) (3) 222 301 539
-------- -------- -------- --------
Income before income
taxes 492 725 1,754 1,673
Income tax expense 200 151 902 306
-------- -------- -------- --------
Net income $ 292 $ 574 $ 852 $ 1,367
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Earnings per share
Basic $ 0.16 $ 0.27 $ 0.47 $ 0.65
======== ======== ======== ========
Diluted $ 0.15 $ 0.27 $ 0.46 $ 0.65
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Other Information:
-------------------
Amortization of
goodwill $ 552 $ 547 $ 1,665 $ 1,651
======== ======== ======== ========
Deferred income taxes $ 184 $ - $ 829 $ -
======== ======== ======== ========
Weighted average
number of shares
outstanding
(diluted basis) 1,911 2,102 1,852 2,119
======== ======= ======= ========
Imperial Parking Corporation
Consolidated Balance Sheet (unaudited)
In thousands of U.S. dollars
Sep. 30, 2001
ASSETS
Current assets
Cash $ 11,236
Accounts receivable 5,732
Inventory 726
Deposits and prepaid expenses 1,641
Current portion of recoverable development costs 934
Deferred income taxes 2,494
------------
Total current assets 22,763
Recoverable development costs 4,057
Fixed assets 14,595
Management and lease agreements 458
Other assets 2,856
Goodwill 45,058
------------
$ 89,787
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Rents payable $ 7,967
Trade accounts payable and other accrued liabilities 4,307
Payable to employees and former employees 2,006
Sales tax payable 1,663
Current portion of long-term debt 514
Current portion of other long-term liabilities 1,125
Deferred revenue 1,845
----------
Total current liabilities 19,427
Long-Term debt 3,386
Other long-term liabilities 4,948
Deferred income taxes 3,216
----------
Total liabilities 30,977
Stockholders' equity
Common stock, $.01 par value,
10,000,000 shares authorized
1,816,517 shares issued and outstanding 18
Additional paid-in capital 60,431
Retained earnings 2,316
Accumulated other comprehensive loss
Foreign currency translation adjustment (3,955)
----------
Total stockholders' equity 58,810
----------
$ 89,787
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Imperial Parking Corporation
Consolidated Statements of Cash Flows
(Unaudited)
Amounts in thousands of US Dollars
Three months ended Nine months ended
30-Sep-01 30-Sep-00 30-Sep-01 30-Sep-00
Cash flows from operations
Net earnings 292 574 852 1,761
Adjustments to reconcile net
earnings to cash provided by
operating activities
Depreciation and amortization
of management and lease
agreements 624 657 1,742 1,256
Amortization of goodwill 552 547 1,665 1,158
Recovery of recoverable
development costs 270 187 806 478
Equity share of limited
liability company losses 37 - 114 -
Deferred income taxes 184 - 829 -
Stock-based compensation 127 - 516 114
Non-cash interest expense 77 - 77 -
Interest income capitalized
to note receivable - - - (697)
Interest expense capitalized
to note payable - - - 786
Changes in non-cash working
capital items, excluding
acquisitions
Restricted cash 2,270 - 2,688 -
Accounts receivable (162) (315) (164) (444)
Inventory 19 15 (19) 14
Deposits and prepaid
expenses 437 (210) (325) (215)
Rents payable 654 1,578 1,311 992
Trade accounts payable
and other accrued
liabilities (211) 962 (312) (495)
Payable to employees
and former employees 208 362 (429) (114)
Sales tax payable (97) (1,939) 193 (1,473)
Deferred revenue (1,509) (2,257) 195 (4,044)
Interest receivable on
notes receivable from
related parties - - - 8
Receivables from related
parties - - - (127)
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Net cash provided by
(used in) operating
activities 3,772 161 9,739 (1,042)
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Cash flow from investing
activities
Purchase of fixed assets (684) (318) (1,794) (711)
Increase in recoverable
development costs (38) (409) (185) (409)
Change in other assets (598) 418 (502) 1,492
Acquisition of parking
business, net of cash
acquired (4,564) - (4,564) (1,219)
Repayment of outstanding
credit facilities - - - (26,369)
Acquisition of minority
interests in FUMI parking
related business - - - (453)
Cash position of
business acquired - - - 8,123
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Net cash used in
investing activities (5,884) (309) (7,045) (19,546)
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Cash flow from financing activities
Purchase of common shares - (633) (543) (657)
Options exercised 61 - 61 -
Increase in long-term debt - - 3,900 -
Change in other liabilities (14) (93) (53) (93)
Cash contributions - - - 32,701
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Net cash provided by
financing activities 47 (726) 3,365 31,951
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Effect of exchange rate
changes on cash and
cash equivalents (323) (132) (438) (314)
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Increase in cash and
cash equivalents (2,388) (1,006) 5,621 11,049
Cash and cash equivalents,
beginning of period 13,624 14,039 5,615 1,984
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Cash and cash equivalents,
end of period 11,236 13,033 11,236 13,033
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Imperial Parking Corporation (AMEX:IPK) is a leading provider of parking services in North America. Based in Vancouver, British Columbia, Imperial Parking owns, leases or manages over 1,575 parking facilities and lots in Canada and the United States containing more than 290,000 parking spaces.