R&B Reports 1998 Second-Quarter Financial Results
31 July 1998
R&B Reports 1998 Second-Quarter Financial Results
COLMAR, Pa., July 31 -- R&B, Inc. today
announced financial results for its second quarter that ended June 27,
1998.
Net sales for the second quarter of 1998 increased 2.7 percent to
$42.0 million, from $41.0 million for the comparable period a year ago. Net
income rose to $2.4 million, a 6.0 percent increase from last year's second
quarter net income of $2.3 million. This is the eighth consecutive quarter in
which net income increases have outpaced growth in sales. Earnings per share
on a diluted basis of $0.28 were even with those posted for last year's second
quarter.
"Results for the second quarter showed many of the effects that we
anticipated," commented Richard Berman, President of R&B. "We faced a tough
year-over-year comparison as a result of changes in customer ordering patterns
which favored last year's second quarter. We also had five less shipping days
in 1998 as compared to last year resulting from our conversion to a new
computer system. Finally, several product roll-outs were shifted by customers
to the third and fourth quarters of this year. While this has caused our
inventories to increase for the quarter, it increases our confidence for
stronger performance in the second half of the year."
For the six months ended June 27, 1998, net sales rose 9.2 percent to
$81.1 million from $74.3 million posted for the first half of 1997. Net
income grew 10.9 percent to $3.6 million, or $0.42 per share, from
$3.2 million, or $0.40 per share, posted for the prior year period.
Mr. Berman continued, "We continue to make strides in our operational
improvement efforts. Partly through better sourcing, we increased our
gross margin for the quarter, and through better leverage of our selling,
general and administrative expenses we attained a pre-tax margin of
8.9 percent showing progress toward our three-year profitability goal of a
10 percent pre-tax margin."
Mr. Berman concluded, "Heading into the third quarter and the balance
of the year, we remain optimistic we can meet our growth goal of 15 percent in
earnings per share."
R&B, Inc. is a leading supplier of "hard-to-find" parts and fasteners
for the automotive aftermarket. R&B's parts are marketed under more than
fifty proprietary brand names, through its Motormite and Dorman divisions,
as well as under the private labels of automobile manufacturers, parts
manufacturers, and national warehouse distributors.
Forward looking statements in this release are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
Such forward looking statements are subject to certain risks and uncertainties
that could cause actual results to differ materially from those projected.
Readers are cautioned not to place undue reliance on these forward looking
statements which speak only as of the date hereof. Factors that cause actual
results to differ materially include, but are not limited to, those factors
discussed in the Company's Annual Report on Form 10-K under "Business -
Investment Considerations."
R&B, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)(A)
(in thousands, except per-share amounts)
13 weeks ended 6/27/98 Pct. 6/28/97 Pct.
Net sales $42,047 100.0 $40,959 100.0
Cost of goods sold 25,448 60.5 25,045 61.1
Gross profit 16,599 39.5 15,914 38.9
Selling, general and
administrative expenses 11,755 28.0 11,310 27.6
Income from operations 4,844 11.5 4,604 11.3
Interest expense, net 1,083 2.6 1,055 2.6
Income before taxes 3,761 8.9 3,549 8.7
Provision for taxes 1,373 3.2 1,296 3.2
Net income 2,388 5.7 2,253 5.5
Earnings per share
Basic $.29 --- $.28 ---
Diluted $.28 --- $.28 ---
Average shares outstanding
Basic 8,329 --- 8,027 ---
Diluted 8,494 --- 8,027 ---
26 weeks ended 6/27/98 Pct. 6/28/97 Pct.
Net sales $81,059 100.0 $74,258 100.0
Cost of goods sold 49,433 61.0 45,039 60.7
Gross profit 31,626 39.0 29,219 39.3
Selling, general and
administrative expenses 23,990 29.6 22,002 29.6
Income from operations 7,636 9.4 7,217 9.7
Interest expense, net 2,023 2.5 2,155 2.9
Income before taxes 5,613 6.9 5,062 6.8
Provision for taxes 2,049 2.5 1,848 2.5
Net income 3,564 4.4 3,214 4.3
Earnings per share
Basic $.43 --- $.40 ---
Diluted $.42 --- $.40 ---
Average shares outstanding
Basic 8,317 --- 7,997 ---
Diluted 8,481 --- 7,997 ---
R&B, INC. AND SUBSIDIARIES
Consolidated Balance Sheets(A)
(in thousands)
(Unaudited)
Assets 6/27/98 12/27/97
Cash and cash equivalents $3,051 $1,601
Accounts receivable 36,520 37,536
Inventories 45,950 38,264
Prepaid expenses and other 3,556 2,647
Property & equipment 17,104 16,382
Intangible assets 31,793 29,747
Other assets 2,594 2,530
Total assets $140,754 $128,707
Liabilities and Shareholders' Equity
Current portion of long-term debt $5,528 $6,611
Accounts payable 12,674 8,982
Accrued expenses and other 7,331 5,846
Long-term debt 45,744 44,336
Deferred income taxes 1,770 1,770
Shareholders' equity 67,707 61,162
Total liabilities and equity $140,754 $128,707
(A) Totals may not add due to rounding.
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