Diamond Triumph Auto Glass, Inc. Announces First Quarter 2004 Results
KINGSTON, Pa., May 17, 2004 -- Diamond Triumph Auto Glass, Inc. announced today that net sales for the quarter ended March 31, 2004 decreased $0.7 million, or 1.3%, to $53.4 million as compared to $54.1 million for the quarter ended March 31, 2003. Net income for the quarter ended March 31, 2004 decreased by $0.8 million to a $0.1 million net loss from $0.7 million of net income for the quarter ended March 31, 2003. EBITDA for the quarter ended March 31, 2004 decreased $2.0 million to $2.3 million from $4.3 million for the quarter ended March 31, 2003.
Diamond Triumph Auto Glass, Inc.
($'s in Millions)
(Unaudited)
Quarter Ended
March 31,
2004 2003
Net Sales $53.4 $54.1
Cost of Sales 15.2 16.2
Gross Profit 38.2 37.9
Operating Expenses 36.5 34.4
Income From Operations $1.7 $3.5
Net (Loss) Income ($0.1) $0.7
EBITDA (1) $2.3 $4.3
Total Long-Term Debt $81.3 $93.0
Norm Harris, Diamond Triumph's Chief Executive Officer, had the following comments regarding the Company. "The Company's operating results have continued to be impacted by the very challenging pricing conditions throughout the industry. This industry has been faced with challenging periods before, and our short-term challenge as a company will be to continue to explore opportunities to reduce and leverage costs throughout the organization."
Michael Sumsky, Diamond Triumph's President and Chief Financial Officer, added, "Our capital structure and low cost strategy has enabled our Company to endure periods of weaker operating performance. Even given the challenging environment, during the first quarter we maintained positive cash flow and continued to reduce our debt."
Diamond Triumph Auto Glass, Inc., headquartered in Kingston, PA, is a leading provider of automotive glass replacement and repair services. Diamond Triumph currently operates 270 company owned automotive glass service centers, approximately 1,100 mobile installation vehicles and six distribution centers in 45 states. For more information about Diamond Triumph, visit the website at www.diamondtriumph.com.
(1) EBITDA represents net income before interest, taxes, depreciation
and amortization. EBITDA is a measurement of Diamond Triumph's
performance that is not required by, or presented in accordance
with, GAAP. EBITDA is not a measurement of Diamond Triumph's
financial performance under GAAP and should not be considered an
alternative to net income, operating income or any other performance
measures derived in accordance with GAAP or as an alternative to
cash flow from operating activities as a measure of our liquidity.
Diamond Triumph presents EBITDA because it considers it an important
supplemental measure of its performance and believes it is
frequently used by securities analysts, investors and other
interested parties in the evaluation of companies in its industry,
many of which present EBITDA when reporting their results.
Diamond Triumph believes issuers of "high yield" securities also
present EBITDA because investors, analysts and rating agencies
consider it useful in measuring the ability of those issuers to meet
debt service obligations. Diamond Triumph believes EBITDA is an
appropriate supplemental measure of debt service capacity, because
cash expenditures on interest are, by definition, available to pay
interest, and tax expense is inversely correlated to interest
expense because tax expense goes down as deductible interest expense
goes up; depreciation and amortization are non-cash charges.
Diamond Triumph also uses EBITDA for the following purposes: (i)
its executives' compensation plans base incentive compensation
payments on its EBITDA performance measured against budgets; and
(ii) its credit agreement and its indenture for its Notes use EBITDA
to measure Diamond Triumph's compliance with covenants such as
interest coverage and debt incurrence. EBITDA has limitations as an
analytical tool, and should not be considered in isolation, or as a
substitute for analysis of Diamond Triumph's results as reported
under GAAP. Some of these limitations are:
* EBITDA does not reflect our cash expenditures, or future
requirements, for capital expenditures or contractual
commitments;
* EBITDA does not reflect changes in, or cash requirements for, our
working capital needs;
* EBITDA does not reflect the significant interest expense, or the
cash requirements necessary to service interest or principal
payments, on our debt;
* Although depreciation and amortization are non-cash charges, the
assets being depreciated and amortized will often have to be
replaced in the future, and EBITDA does not reflect any cash
requirements for such replacements; and
* Other companies in Diamond Triumph's industry may calculate
EBITDA differently than Diamond Triumph does, limiting its
usefulness as a comparative measure.
Because of these limitations, EBITDA should not be considered as a measure of discretionary cash available to Diamond Triumph to invest in the growth of its business. Diamond Triumph compensates for these limitations by relying primarily on its GAAP results and using EBITDA only supplementally.
Reconciliation of EBITDA to net income follows for the periods indicated:
Three Months Ended March 31,
2004 2003
(dollars in millions)
Net income (loss) $(0.1) $0.7
Interest expense 2.1 2.4
Depreciation and amortization 0.6 0.8
Provision (Benefit) for income taxes (0.3) 0.4
EBITDA $2.3 $4.3