Mace Announces Significant Increases In Revenues and Operating Results
15 November 1999
Mace Security International Announces Significant Increases In Revenues and Operating Results for the Third Quarter 1999
MOUNT LAUREL, N.J., Nov. 10 -- Mace Security International,
Inc. (Mace) today announced operating results for the third
quarter ended September 30, 1999. Net income from continuing operations,
excluding non-recurring merger costs, for the third quarter of 1999 was
$438,000 compared to $26,000 in the third quarter of 1998. Earnings per
share, excluding merger costs, on a fully diluted basis for the third quarter
of 1999 was $.02 per share compared to $.00 per share in the third quarter of
1998.
Reported revenues for the third quarter of 1999 were $8.3 million
($12.4 million of gross revenues including revenues of facilities the Company
operated under operating agreements) compared to $2.2 million for the third
quarter of 1998. Operating income, excluding non-recurring charges, for the
quarter was $835,000 or 10% of reported revenues, up from $4,000 in the third
quarter of 1998. EBITDA, excluding non-recurring charges, for the quarter was
$1.2 million or 13.9% of revenues ($1.7 million or 13.9% of revenues on a
gross basis including revenues and EBITDA of facilities the Company operated
under operating agreements) compared to $172,000 or 7.9% of revenues in the
same quarter of 1998. The third quarter results exclude merger costs related
to "pooling of interests" transactions, net of related income taxes including
S-Corporation termination income taxes, of $1,363,000 and income generated by
discontinued operations of $96,000. These merger costs and discontinued
operations earnings have the net effect of reducing basic earnings per share
$.08 in the current quarter. Additionally, prior year third quarter results
exclude income from discontinued operations of $60,000, or less than $.01 per
share, net of related income taxes, and are restated to reflect the merger
transactions consummated in the current quarter with Innovative Control
Systems, Inc., 50's Classic Car Wash of Lubbock, Inc. and Eager Beaver Car
Wash, Inc. accounted for as "poolings of interests."
Reported revenues for the nine months ended September 30, 1999 were
$16.6 million ($25 million of gross revenues including revenues of facilities
the Company operated under operating agreements) compared to $6.7 million for
the same period in 1998. Operating income, excluding non-recurring charges,
for the nine months ended September 30, 1999 was $1.6 million, a
432% improvement over operating income of $304,000 for the same period in
1998. Earnings per share, excluding non-recurring charges, on a fully diluted
basis for the nine months was $.08 per share. EBITDA, excluding non-recurring
charges, for the nine months was $2.3 million or 13.6% of revenues
($3.4 million or 13.8% of revenues on a gross basis including revenues and
EBITDA of facilities the Company operated under operating agreements) compared
to EBITDA of $863,000 or 13% of revenues for the same period in 1998. The
nine month results exclude the previously mentioned merger costs, net of
related taxes, of $1,363,000; the restructuring and change in control charges,
net of related income taxes, of $1,171,000 recorded in the June 30, 1999
quarter; and income generated by discontinued operations of $24,000. The
merger costs, restructuring and change in control charges and discontinued
operations results had the net effect of reducing basic earnings per share
$.22 in the current year. Prior year nine month results exclude a loss from
discontinued operations of $498,000 or $.06 per share, net of related income
taxes.
Louis D. Paolino, Jr., CEO and Chairman of Mace, said, "We are very
pleased with the operating results for the third quarter. Revenues and
earnings continue to increase as a result of Mace's disciplined regional
acquisition program and the successful operational management of our car wash
locations. Additionally, we continue to solidify our presence in our existing
regions through gaining strategic concentration and consistently providing
quality car care services. This strong foothold enables regional management
to effectively maximize internal growth opportunities and increase operating
margins."
In the third quarter of 1999, Mace completed seven acquisitions that
represented 24 car washes in Arizona, Delaware, Florida, New Jersey,
Pennsylvania and Texas, as well as the merger with Innovative Control Systems,
Inc., the premier manufacturer and supplier of the industry's leading
computerized car wash tunnel control system.
Mr. Paolino added, "During the quarter, we completed acquisitions with
approximately $18 million in annualized projected revenue bringing the
Company's quarter ending annual run rate to approximately $57 million. In our
ongoing efforts of maximizing shareholder value, our goal is to continue to
increase revenues through disciplined acquisitions in our established regions,
while creating a solid national car wash operation that will consistently
improve operating efficiencies and increase internal growth percentages."
Mace Security International, Inc. is a provider of car care services which
owns and operates numerous car washes nationwide. The Company is also a
leading producer of less lethal defense sprays for the consumer market and a
marketer of consumer safety and security products.
Certain statements and information included in this press 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 achievement of the Company
to be materially different from any future results, performance or achievement
expressed or implied in such forward-looking statements. Additional
discussion of factors that could cause actual results to differ materially
from management projections, forecasts, estimates and expectations is
contained in the Company's SEC filings.
MACE SECURITY INTERNATIONAL, INC.
Condensed Consolidated Statements of Operations
(dollars in thousands, except per share data)
(Unaudited)
Three Months Ended September 30,
1999 1999 1998 1998
(Restated)
(pro forma)(1) Restated(2) (proforma)(1)(2)
Revenues
Car wash and
detailing services $5,134 $5,134 $805 $805
Lube and other
automotive services 1,025 1,025 14 14
Fuel and merchandise
sales 642 642 54 54
Security Product Sales 693 693 719 719
Computer products
and services 786 786 585 585
Operating agreements 46 46 -- --
8,326 8,326 2,177 2,177
Cost of revenues
Car wash and
detailing services 3,416 3,416 553 553
Lube and other
automotive services 694 694 12 12
Fuel and merchandise
sales 530 530 36 36
Security Product Sales 345 345 346 346
Computer products
and services 458 458 360 360
5,443 5,443 1,307 1,307
Selling, general and
administrative
expenses 1,725 1,725 698 698
Depreciation and
amortization 323 323 168 168
Merger costs 1,875 -- -- --
Operating (loss)
income (1,040) 835 4 4
Interest expense,
net (352) (352) (45) (45)
Other income 132 132 67 67
(Loss) income from
continuing operations
before income taxes (1,260) 615 26 26
Income tax
(benefit) expense (335) 177 -- --
(Loss) income from
continuing operations (925) 438 26 26
Income from
discontinued operations,
net of applicable
income taxes 96 -- 60 --
Net (loss) income $(829) $438 $86 $26
Basic (loss)
earnings per share
From continuing
operations $(0.05) $0.03 -- --
From discontinued
operations -- -- 0.01 --
Total $(0.05) $0.03 $0.01 --
Weighted average
shares
outstanding 17,245,703 17,245,702 8,317,880 8,317,880
Diluted earnings
per share
From continuing
operations $(0.05) $0.02 -- --
From discontinued
operations -- -- 0.01 --
Total $(0.05) $0.02 $0.01 --
Weighted average
shares
outstanding 17,245,702 20,252,340 8,327,890 8,327,890
EBITDA $(717) $1,158 $172 $172
EBITDA % n/a 14.0% 7.9% 7.9%
(1) Pro forma results exclude merger costs, net of related income taxes,
including S-Corporation termination income taxes related to
"pooling of interests" transactions and income from discontinued
operations.
(2) Prior period financial statements have been restated to reflect the
merger transactions accounted for as "poolings of interests" with
Innovative Control Systems, Inc., 50's Classic Car Wash of Lubbock,
Inc. and Eager Beaver Car Wash, Inc.
MACE SECURITY INTERNATIONAL, INC.
Condensed Consolidated Statements of Operations
(dollars in thousands, except per share data)
(Unaudited)
Nine Months Ended September 30,
1999 1999 1998 1998
(Restated)
(pro forma)(1) Restated(2) (pro forma)(1)(2)
Revenues
Car wash and
detailing services $8,924 $8,924 $3,207 $3,207
Lube and other
automotive services 1,567 1,567 48 48
Fuel and merchandise
sales 972 972 203 203
Security Product
Sales 2,298 2,298 2,080 2,080
Computer products
and services 2,399 2,399 1,113 1,113
Operating agreements 481 481 -- --
16,641 16,641 6,651 6,651
Cost of revenues
Car wash and
detailing services 5,623 5,623 1,903 1,903
Lube and other
automotive services 1,152 1,152 41 41
Fuel and merchandise
sales 781 781 129 129
Security Product
Sales 1,190 1,190 933 933
Computer products
and services 1,427 1,427 560 560
10,173 10,173 3,566 3,566
Selling, general
and administrative
expenses 4,205 4,205 2,222 2,222
Depreciation and
amortization 645 645 559 559
Merger costs 1,875 -- -- --
Restructuring and
change in
control costs 1,519 -- -- --
Operating (loss)
income (1,776) 1,618 304 304
Interest expense,
net (548) (548) (285) (285)
Other income 148 148 154 154
(Loss) income
from continuing
operations before
income taxes (2,176) 1,218 173 173
Income tax
(benefit) expense (685) 175 4 4
(Loss) income from
continuing
operations (1,491) 1,043 169 169
Income (loss) from
discontinued
operations, net
of applicable
income taxes 24 -- (498) --
Net (loss) income $(1,467) $1,043 $(329) $169
Basic (loss)
earnings per share
From continuing
operations $(0.13) $0.09 $0.02 $0.02
From discontinued
operations -- -- (0.06) --
Total $(0.13) $0.09 $(0.04) $0.02
Weighted average
shares
outstanding 11,652,009 11,652,009 8,396,384 8,396,384
Diluted earnings
per share
From continuing
operations $(0.13) $0.08 $0.02 $0.02
From discontinued
operations -- -- (0.06) --
Total $(0.13) $0.08 $(0.04) $0.02
Weighted average
shares
outstanding 11,652,009 13,111,976 8,396,384 8,403,998
EBITDA $(1,131) $2,263 $863 $863
EBITDA % n/a 13.7% 12.9% 12.9%
(1) Pro forma results exclude merger costs, net of related income taxes,
including S-Corporation termination income taxes related to
"pooling of interests" transactions, restructuring and change in
control costs, net of related income taxes, and income (loss) from
discontinued operations.
(2) Prior period financial statements have been restated to reflect the
merger transactions accounted for as "poolings of interests" with
Innovative Control Systems, Inc., 50's Classic Car Wash of Lubbock,
Inc. and Eager Beaver Car Wash, Inc.