Republic Industries Reports Q4 Earnings
29 January 1998
Republic Industries, Inc. Reports Earnings Of $.15 Per Share For The Fourth Quarter Exceeding Consensus Analysts' Estimates Of $.14 Per Share And Reports $.70 Per Share For The Year
FORT LAUDERDALE, Fla., Jan. 29 -- Republic Industries, Inc.
today reported that for the three months ended December 31, 1997,
net income increased to $66.9 million, or fifteen cents per share, and for the
year ended December 31, 1997, net income increased to $299.8 million, or
seventy cents per share. These results exclude the gains on the sale of the
security services division and the ADT Limited common stock as well as
restructuring and other charges.
During the three months ended December 31, 1997, the Company recorded a
$150 million pre-tax provision for restructuring and other charges from
combining its franchised automotive dealerships and AutoNation USA megastore
operations into one automotive retail division. The provision primarily
includes integration costs related to consolidating inventory, information
systems and overhead.
Additionally, during the three months ended December 31, 1997, the Company
recorded a $230 million after tax gain from the sale of its security services
division to Ameritech Corporation. Revenue and operating income for the
periods prior to the sale exclude the operating results from the Company's
security services division. Accordingly, the Company's consolidated operating
results have been restated to account for the operating results from the
Company's security services division as discontinued operations.
The Company recorded net income of $201.2 million or forty-seven cents per
share for the three months ended December 31, 1997 including the gain on the
sale of the security services division which was partially offset by
restructuring and other charges. Additionally, the Company recorded net
income of $439.7 million or $1.02 per share for the year ended December 31,
1997 including the gain on the sale of the security services division and the
ADT Limited common stock which were partially offset by restructuring and
other charges. The Company's operating results for
1996 have been restated to reflect certain mergers which were accounted for
under the pooling of interests method of accounting.
Revenue for the three months ended December 31, 1997, increased to
$2.93 billion compared to $1.60 billion for the same period in 1996, an
increase of 83%. Revenue for the year ended December 31, 1997, increased to
$10.31 billion compared to $6.09 billion for the same period in 1996, an
increase of 69%.
Operating income, before restructuring and other charges, for the three
months and year ended December 31, 1997, increased to $97.3 million and
$443.7 million, respectively, compared to a loss of $7.8 million and income of
$170.0 million, respectively, from the same periods in 1996.
Commenting on the Company's performance in the fourth quarter of 1997,
Steven R. Berrard, President and Co-CEO of Republic Industries, said, "We are
pleased with the operating performance of all of our business units. During
the quarter, our solid waste business achieved excellent growth in earnings
and margins. Although the fourth quarter is a seasonally weak period for our
rental car operations, we continued to generate impressive earnings growth.
Additionally, we expanded our presence in the European automotive rental
market with the acquisition of EuroDollar (Holdings) plc. We are beginning to
experience the benefits from combining our automotive retail operations into
one automotive retail division, and we continued to make significant strides
in our automotive retail clustering strategy. During the quarter, we added
37 automotive franchises and opened eight additional AutoNation USA
Megastores. Overall, this was an excellent quarter and 1997 was an excellent
year for our Company. We believe 1998 is shaping up to be an outstanding year
for Republic and we are poised to take advantage of the opportunities that lie
ahead in all of our business segments."
Republic Industries, Inc. operates subsidiaries in the automotive
retailing, automotive rental, automotive financial services and solid waste
services industries. The Company owns the nation's largest chain of new
vehicle dealerships and is building a chain of used car megastores which it
operates under the AutoNation brand name. Republic also owns National Car
Rental System, Inc., Alamo Rent-A-Car, Inc., Spirit Rent-A-Car, Inc., Value
Rent-A-Car, Inc., Snappy Car Rental, Inc. and EuroDollar (Holdings) plc.
REPUBLIC INDUSTRIES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
1997 1996 1997 1996
(a) (a)
Revenue $2,928.2 $1,601.2 $10,305.6 $6,094.6
Expenses:
Cost of operations 2,440.8 1,411.7 8,580.1 5,066.0
Selling, general
and administrative 390.1 254.5 1,281.8 915.8
Restructuring and
other charges 150.0 30.7 244.1 38.3
Operating income (loss) (52.7) (95.7) 199.6 74.5
Interest income (expense),
net 0.2 (1.6) 1.4 (14.0)
Other income (expense) 7.8 (7.1) 114.4 3.9
Income (loss) from
continuing operations
before income taxes (44.7) (104.4) 315.4 64.4
Provision (benefit) for
income taxes (15.9) (22.0) 115.2 57.0
Income (loss) from
continuing operations
before extraordinary
charge (28.8) (82.4) 200.2 7.4
Discontinued operations:
Income from discontinued
operations, net of
income taxes --- 2.5 9.5 8.4
Gain on sale of
electronic security
services division,
net of income taxes 230.0 --- 230.0 ---
Income from discontinued
operations 230.0 2.5 239.5 8.4
Income (loss) before
extraordinary charge 201.2 (79.9) 439.7 15.8
Extraordinary charge
related to early
extinguishment of debt,
net of income taxes --- (31.6) --- (31.6)
Net income (loss) $201.2 ($111.5) $439.7 ($15.8)
Diluted income per
common and common
equivalent share:
Continuing operations($0.07) ($0.26) $0.46 $0.02
Discontinued
operations 0.54 0.01 0.56 0.02
Extraordinary charge --- (0.10) --- (0.09)
Net income $0.47 ($0.35) $1.02 ($0.05)
Weighted average
common and common
equivalent shares 427.6 320.8 430.9 341.6
(a) Operating results for the three and twelve month periods ended
December 31, 1996 have been restated to reflect business combinations
accounted for under the pooling of interests method of accounting and to
account for the Company's electronic security services division as
discontinued operations.
REPUBLIC INDUSTRIES, INC.
UNAUDITED SUPPLEMENTAL SEGMENT DATA
(In millions)
Three Months Ended December 31,
1997 1996
Revenue:
Automotive retail $1,866.0 64% $715.2 45%
Automotive rental 769.0 26% 635.3 40%
Solid waste services 293.2 10% 250.7 15%
$2,928.2 100% $1,601.2 100%
Twelve Months Ended December 31,
1997 1996
Revenue:
Automotive retail $6,122.8 59% $2,569.7 42%
Automotive rental 3,055.1 30% 2,699.4 44%
Solid waste services 1,127.7 11% 825.5 14%
$10,305.6 100% $6,094.6 100%
Three Months Ended December 31,
1997 1996
Operating Income:
Automotive retail $26.7 1% ($5.9) (1)%
Automotive rental 19.3 3% (80.0) (13)%
Solid waste services 60.0 20% 33.5 13%
Corporate expenses (8.7) (12.6)
Restructuring and
other charges (150.0) (30.7)
($52.7) (2)% ($95.7) (6)%
Twelve Months Ended December 31,
1997 1996
Operating Income:
Automotive retail $81.6 1% $24.6 1%
Automotive rental 180.7 6% (4.9) ---
Solid waste services 211.5 19% 114.8 14%
Corporate expenses (30.1) (21.7)
Restructuring and
other charges (244.1) (38.3)
$199.6 2% $74.5 1%
Certain statements and information included in this release constitute
"forward-looking statements" within the meaning of the Federal Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance, or achievements of the Company to be
materially different from any future results, performance, or achievements
expressed or implied in such forward-looking statements. Additional
discussion of factors that could cause actual results to differ materially
from management's projections, forecasts, estimates and expectations is
contained in the Company's SEC filings.
SOURCE Republic Industries, Inc.