Heafner Continues Record Sales and Earnings
13 August 1999
Heafner Continues Record Sales and Earnings
Business Editors/Automotive Writers
CHARLOTTE, N.C.--Aug. 12, 1999--Heafner Tire
Group/J.H. Heafner Company today announced significantly stronger
operating results in the quarter ended June 30, 1999.
Net sales for the quarter ended June 30, 1999 totaled $266.5
million, an increase of $111.7 million, or 72.2%, from sales in the
second quarter of 1998 of $154.7 million. Total sales for the six
months ended June 30, 1999 reached $505.8 million, an increase of
$262.4 million, or 107.8%, from sales of $243.4 million in the same
period of 1998. Operating earnings before interest, taxes,
depreciation, and amortization (EBITDA) totaled $11.8 million in the
quarter ended June 30, 1999, an increase of $6.6 million, or 126.9%,
from $5.2 million in the second quarter of 1998. EBITDA for the first
six months of 1999 totaled $19.1 million, an increase of $11.4
million, or 148.1%, from $7.7 million in the first six months of 1998.
"We are very pleased with our financial performance in the second
quarter," said Donald C. Roof, President and CEO. "Once again we
achieved strong operating results in both the Southeast and
California. Although the increase in sales was primarily driven by
acquisitions which we have made over the past year, the underlying
sales increases at our divisions were significantly higher than the
overall industry growth rate. Our western distribution operations,
Competition Parts Warehouse and California Tire, had particularly
strong sales growth during the quarter. With our record first half
results, we are well on our way towards exceeding $1 billion in
revenue for 1999."
Mr. Roof continued, "The level of EBITDA earnings in the second
quarter was particularly pleasing, and reflect the operating strength
of the divisions, as well as the positive benefits of bringing
together strong companies over the past two years. We believe that our
underlying sales growth should continue to outperform the industry
growth rate. Additionally, we believe that the benefits of the
acquisitions the Company completed last year will contribute to
earnings for the remainder of the year, and the rate of earnings
growth will continue to exceed the level of sales growth."
Heafner Tire Group is the country's largest independent marketer
of tires and tire-related products. The Company includes Heafner-Itco
Tires & Products in the Southeast, and Competition Parts Warehouse
(CPW), Winston Tire, and California Tire, in California and Arizona.
It operates over 65 distribution centers and 210 retail tire and auto
service stores, and has revenues in excess of $1 billion. For
information contact Donald C. Roof, CEO at (704) 423-8989.
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Heafner Tire Group
Financial Highlights
(in million $)
Quarter Ended Six Months Ended
6-30-99 6-30-98 6-30-99 6-30-98
Reported Results:
Net Sales $266.5 $154.7 $505.8 $243.4
EBITDA(1) 11.8 5.2 19.1 7.7
Pro Forma Results(2):
Net Sales $266.5 $252.6 $505.8 $469.5
EBITDA(3) 11.8 9.3 19.1 15.4
(1) - results for 1998 exclude special and extraordinary charges
recorded in second quarter of 1998.
(2) - results assume that the inclusion of ITCO, CPW, and Cal
Tire occurred on January 1, 1998. CPW was acquired by Heafner on May
20, 1998, the merger with ITCO also occurred on May 20, 1998, and the
acquisition of Cal Tire occurred on January 12, 1999. Certain
reclassifications of acquired retail stores are reflected in 1998
results.
(3) - no adjustments have been recorded for unrealized synergies
in these amounts. Adjustments have been made in 1998 reflecting the
pro-forma handling of certain vendor rebates.
Certain information included in this release is forward-looking.
Such forward-looking information must be considered in light of
important risks and uncertainties that could materially alter results
in the future from those expressed in any forward-looking statements
made by, or on behalf of, the Company. These risks and uncertainties
include, among others, the ability of the Company to successfully
implement its business strategy, integrate the new divisions, and
market and sell new products, as well as general economic conditions
and competition in the industry. Additional information on factors
that could potentially affect the Company or its financial results may
be found in the Company's filings with the Securities and Exchange
Commission.