APCO Announces Q1 Results for 1997
30 April 1997
Automobile Protection Corporation Announces 40% Increase in Revenues and 162% Increase in Net Income For its First Quarter
ATLANTA, April 29 -- Automobile Protection Corporation
(APCO) announced record revenues for its first quarter ended
March 31, 1997. Revenues for the quarter were $20,095,314 compared to
$14,352,288 for 1996, an increase of 40%. Net income was $629,303 compared to
$239,976 for 1996, an increase of 162%. EPS was $0.05 compared to $0.02 for
1996.
Larry Dorfman, President & CEO stated, "We are delighted with these
results, which were produced in a difficult used car market. APCO, however,
experienced excellent sales this quarter due in significant part to its
recently launched market leading EasyCare(R) Certified Pre-Owned Vehicle
Merchandising Program. Dealers are recognizing that to be competitive in 1997
and beyond, they need to have the best marketing tools to compete. We see
significant growth potential from our certification business, as the consumer
becomes more aware of the availability of certified pre-owned vehicles as an
alternative to new vehicles and as an alternative to "as-is" used cars, which
have no warranty. We feel that the core of a certification program is the
strength of the limited warranty placed on the pre-owned vehicle by the
dealer. APCO made a decision in 1991 to position itself as a provider of high
customer satisfaction products, which is essential to the new certification
program, and we have stayed committed to that goal."
Mr. Dorfman also added, "In addition to the success of EasyCare(R)
Certified, production from our exclusive agreement with American Honda Finance
Corporation experienced a 74% increase over the first quarter of 1996. It is
extremely exciting to see this part of our business grow at this level."
"Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995: To the extent that this news release discusses financial
projections, information or expectations about our products or markets, or
otherwise makes statements about the future, our statements are forward
looking and are subject to a number of risks and uncertainties that could
cause actual results to differ materially from the statements made. These
factors include, but are not limited to, the competitive nature of the
industry in which some competitors have significantly greater financial
resources and name recognition than the Company, the availability of insurance
coverage at competitive rates and of insurance funds to make claims payments,
the Company's dependence on independent sales representatives, dealers and a
major automobile manufacturer, the cyclical nature of the automobile industry,
and other risks detailed in the Company's Form 10-K that has been filed with
the Securities & Exchange Commission in connection with its 1996 year.
APCO, established in 1984, and its subsidiary, The Aegis Group, Inc., are
leading marketers and administrators of products and services to automobile
dealers which are designed to enhance customer satisfaction and dealership
profitability. The Company's core business is the marketing and
administration of the EasyCare(R) Certified Pre-Owned Vehicle Program and
Vehicle Service Contracts. The Company also provides insurance brokerage
services for automobile dealers and others in the automotive industry.
AUTOMOBILE PROTECTION CORPORATION - APCO
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
Three months ended
3/31/97 3/31/96
Revenues $20,095,314 $14,352,288
Cost of sales 15,823,957 11,280,529
Total 4,271,357 3,071,759
Expenses:
Compensation, selling and administrative 3,386,696 2,739,551
Depreciation and amortization 104,500 99,294
Interest, dividend and other income (234,142) (165,062)
Total 3,257,054 2,673,783
Income before provision for income taxes 1,014,303 397,976
Provision for income taxes (385,000) (158,000)
Net income $ 629,303 $ 239,976
Net income per share $ 0.05 $ 0.02
Number of shares used in computing
net income per share 11,459,000 10,730,000
SOURCE Automobile Protection Corporation