Lucor Reports Third Quarter 1998 Results
22 December 1998
Lucor Reports Third Quarter 1998 Results
-- Company Acquired Three Jiffy Lube Stores During Quarter
-- One-Time Charge Expected in Fourth Quarter
RALEIGH, N.C., Dec. 21 -- Lucor, Inc. , the
largest Jiffy Lube franchisee in the United States, today announced third
quarter 1998 net sales $14.7 million, gain of 33 percent over $11.0 million a
year earlier.
Stephen P. Conway, chairman and chief executive officer, attributed the
increase to gains in same-store sales, the acquisition of three Jiffy Lube
stores from independent operators during the third quarter, and the fact that
Lucor had 128 stores in operation at the end of the quarter, compared with 100
a year earlier.
Lucor reported a net loss of $250,363, or $0.09 per share, in this year's
third quarter, compared with a net loss of $572,357 or $0.20 per share in the
third quarter of 1997. Lucor attributed a significant portion of its third
quarter 1998 losses to hurricanes in North Carolina and Virginia.
The third quarter 1998 net loss figures reflect a restatement of the
company's allocation of the purchase price of an April 1, 1998 acquisition.
As a result of management's final determination of the nature of the
intangible assets involved in the acquisition, the amortization period for
these assets changed and the third quarter's net loss increased by $0.01 per
share. For the same reason, the company's net income in the second quarter of
1998 net income declined by $0.01 to $0.06 per share.
Store operating income (results before interest, taxes, extraordinary
items, depreciation, marketing, and general and administrative expense) was
$3.0 million in this year's third quarter, compared with $1.7 million a year
earlier.
Mr. Conway said he was pleased with the sales gain of the third quarter of
1998 and is encouraged about the company's outlook for next year. He added
that Lucor expects to incur a one-time charge of between $0.40 and $0.50 per
share in this year's fourth quarter as a result of writing off certain assets
associated with its Sears auto service units and adjustments in obsolete
inventory.
"The sales of the Sears units have fallen far short of our original
expectations," Mr. Conway said. "However, our freestanding stores continue to
grow in same-store revenue and cash flow. We expect to be close to breaking
even in the fourth quarter when the one-time charge is excluded from
consideration, and we look forward to returning to profitability in 1999. We
will continue to pursue our strategic plan, which involves both acquisitions
and opening new stores in our current markets, and we expect to make
substantial acquisitions in other markets in 1999."
LUCOR, INC.
Consolidated Statements of Income
(Unaudited)
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1998 1997 1998 1997
Net sales $14,650,479 $11,004,719 $40,345,455 $31,800,784
Cost of sales 3,442,815 2,564,277 9,348,765 7,405,525
Gross profit 11,207,664 8,440,442 30,996,690 24,395,259
Costs and expenses:
Direct 5,345,623 4,373,477 14,991,442 12,173,403
Operating 2,895,292 2,334,786 8,065,279 6,667,092
Depreciation 656,833 507,402 1,636,895 1,633,414
Selling, general
and administrative 1,909,681 1,534,034 5,322,148 4,358,873
10,807,429 8,749,699 30,015,764 24,832,782
Income (loss) from
operations 400,235 (309,257) 980,926 (437,523)
Other income 42,059 23,167 175,476 47,487
Interest expense (745,131) (369,031) (1,935,558) (1,093,175)
Income (loss) before
provision of
income taxes (302,837) (655,121) (779,156) (1,483,211)
Provision for income
taxes (87,474) (117,764) (249,422) (415,876)
Net income (loss) (215,363) (537,357) (529,734) (1,067,335)
Preferred dividend (35,000) (35,000) (105,000) (105,000)
Net income (loss)
available for common
shareholders ($250,363) ($572,357) ($634,734) (1,172,335)
Average number of
common shares
outstanding 2,812,388 2,846,888 2,827,055 2,841,888
Basic income (loss)
per common share
outstanding ($0.09) ($0.20) ($0.22) ($0.41)