Action Performance Announces 1999 Fourth Quarter and Year End Results
16 November 1999
Action Performance Announces 1999 Fourth Quarter and Year End Results
PHOENIX--Nov. 16, 1999--Action Performance Companies, Inc. today announced operating results for its fiscal fourth quarter and year ended Sept. 30, 1999.For the fiscal fourth quarter, sales grew 14.4 percent to a record $90.4 million from $79.0 million for the comparable quarter of 1998.
Net income for the period was $8.0 million, or $0.46 per diluted share, excluding non-recurring pretax charges of $3.6 million for the settlement of litigation and $800,000 of expenses related to a change in accounting treatment of an acquisition from the pooling-of-interest method to the purchase method. As reported, net income and earnings per diluted share were $5.4 million and $0.31, respectively.
For fiscal 1999, the Company posted record sales of $342.4 million, an increase of 36 percent from sales of $251.9 million in fiscal 1998. Excluding the effects of non-recurring charges of $4.4 million in 1999 and $950,000 in 1998, net income increased 23 percent to $31.0 million, or $1.78 per diluted share, from $25.2 million, or $1.51 per diluted share for fiscal 1998.
"We continue to set new sales records quarter after quarter, capitalizing on the strength of our marketing assets, product innovation, and distribution channels," said Fred W. Wagenhals, Action chairman, president and CEO. "With the announcement of new TV deals for motorsports, our industry will continue to grow, creating even more demand for our products and services."
"As we move into fiscal 2000, our objective is to fine-tune our operations to continue to exceed our customers' expectations," Wagenhals added. "We remain committed to delivering the highest quality marketing programs, products and services in a coordinated, timely manner such that each opportunity is maximized for the consumer and our Company."
Action Performance Companies, Inc. is the leader in the design, marketing, promotion and distribution of licensed motorsports merchandise. Its products include a broad range of motorsports-related die-cast car replica collectibles, apparel, souvenirs, and other memorabilia.
The Company markets and distributes products through a variety of channels, including the 170,000-member Racing Collectables Club of America (RCCA), online through SpeedMall at goracing.com, trackside at racing events, mass retail department stores, and a worldwide network of wholesale distributors and specialty dealers.
Action Performance recently was ranked number 24 on both Fortune magazine's list of "100 Fastest Growing Companies" (September 1999) and Forbes magazine's list of "200 Best Small Companies" (November 1999).
The Company from time to time makes forward-looking statements in its public disclosures; including statements regarding sales and earnings growth, expectations regarding the continued popularity of motorsports and growth in the market for licensed motorsports merchandise. Important risks and uncertainties that could cause the Company's results to differ materially from those contained in such forward-looking statements are detailed in the Company's filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-KA for the year ended Sept. 30, 1998.
ACTION PERFORMANCE COMPANIES, INC.
Summary Consolidated Balance Sheets
(In thousands)
Sept. 30, Sept. 30,
1999 1998
------------ ------------
Current Assets:
Cash $ 58,523 $ 60,867
Accounts receivable, net 44,988 36,314
Inventories 45,310 35,790
Prepaid royalties 7,271 5,745
Other assets 6,860 4,961
-------- --------
Total Current Assets 162,952 143,677
Property and equipment, net 56,162 46,053
Goodwill and other intangibles, net 110,421 106,146
Other assets 8,906 10,058
-------- --------
$338,441 $305,934
-------- --------
Current Liabilities:
Accounts payable $ 20,128 11,430
Accrued royalties 13,519 $ 10,589
Accrued expenses and other 20,034 $ 10,973
Current portion of long term-debt 2,713 $ 23,746
-------- --------
Total Current Liabilities 56,394 56,738
Long-term debt 109,207 111,850
Minority interest in subsidiaries 2,299 914
Shareholders' Equity 170,541 136,432
-------- --------
$338,441 $305,934
-------- --------
ACTION PERFORMANCE COMPANIES, INC.
Summary Consolidated Statements of Operations
(In thousands, except per share data)
Three Months Ended Twelve Months Ended
Sept. 30, Sept. 30,
1999 1998 1999 1998
--------- --------- --------- ---------
Sales:
Collectibles $ 58,316 $ 50,017 $ 214,429 $ 142,026
Apparel and souvenirs 30,059 27,985 119,922 106,712
Other 2,052 1,009 8,094 3,139
--------- --------- --------- ---------
Net sales 90,427 79,011 342,445 251,877
Cost of sales 55,316 48,959 210,768 157,079
--------- --------- --------- ---------
Gross profit 35,111 30,052 131,677 94,798
Gross profit percentage 38.8% 38.0% 38.5% 37.6%
Operating expenses:
Selling, general and
administrative 19,059 13,395 68,036 45,344
Non-recurring charge for
litigation settlement 3,600 -- 3,600 950
Amortization 2,257 1,421 6,818 4,392
--------- --------- --------- ---------
Total operating
expenses 24,916 14,816 78,454 50,686
--------- --------- --------- ---------
Income from operations 10,195 15,236 53,223 44,112
Interest and other
expenses, net (957) (1,223) (4,398) (2,945)
Minority interest in
earnings (672) (101) (1,930) (189)
--------- --------- --------- ---------
Income before provision
for income taxes 8,566 13,912 46,895 40,978
Provision for income taxes (3,194) (5,565) (18,526) (16,391)
--------- --------- --------- ---------
Net income $ 5,372 $ 8,347 $ 28,369 $ 24,587
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Net income per
common share:
Diluted $ 0.31 $ 0.49 $ 1.65 $ 1.48
========= ========= ========= =========
Weighted average shares
outstanding:
Diluted 17,137 18,781 19,179 16,647
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