TBC Achieves Record Results for 1999
17 February 2000
TBC Achieves Record Results for 1999; Year-to-year Earnings Gains Achieved in Each Quarter
MEMPHIS, Tenn.--Feb. 7, 2000--TBC Corporation (Nasdaq/NM:TBCC) today reported record net sales and earnings for 1999.Income for the year, excluding a special $2.8 million after-tax charge in the second quarter and a net gain from the sale of certain assets in the fourth quarter, rose 19% to $20.1 million, or $0.95 per share, compared with net income of $16.9 million, or $0.75 per share, in 1998. Net sales for the year increased 15% to $743.1 million compared with $646.1 million in 1998.
Income for the fourth quarter, excluding a net gain on the sale of certain assets, was $4.6 million, or $0.22 per share, compared with $4.5 million, or $0.21 per share, in the fourth quarter of last year. During the fourth quarter, the Company recognized income of $0.03 per share after taxes from the net gain on the sale of a subsidiary distribution center. Net sales for the fourth quarter increased 10% to $182.7 million compared with $165.8 million in the year-earlier period.
"TBC not only recorded solid progress during 1999 but also ended the year on a strong note," remarked Larry Day, President and Chief Executive Officer. "We achieved higher net earnings in each quarter versus the comparable year-earlier period, excluding a special charge in the second quarter. Aided by the incremental volume from a distributor we acquired in 1998, our unit shipments of tires rose 9.3% for the year. This increase is well above that of the industry as a whole, signifying our success in increasing TBC's market share and enhancing the Company's fundamental competitive position."
"Our core emphasis during 1999 continued to be on serving independent tire dealers, who remain the dominant force in the replacement tire market. The successful opening of our mid-Atlantic distribution center during the third quarter shortened the supply chain with many of our key distributors and thus strengthened our link with the dealers they serve. We also worked closely with our global network of suppliers during the year to maintain the broadest line of passenger and truck tires available in the replacement market. Our focus on delivering value has established TBC as the leading private brand tire marketer, and we have the resources to sustain this strong competitive position."
Day added, "Our growth is being aided by the ongoing expansion of our Big O Tire system that comprised 454 units at the close of 1999, up from 436 a year ago. Our plans are to continue opening additional franchised locations as well as to pursue other opportunities to build the market presence of Big O Tires.
"We are optimistic about realizing continued progress in the coming year. We have the benefit of a strong financial position that is supporting our internal initiatives as well as enabling us to consider opportunities to accelerate our growth. Strategic acquisitions have contributed positively to our gains in recent years, and we remain committed to exploring other business combinations that mesh with our core strengths and enhance the Company's long-term prospects."
TBC Corporation is one of the nation's largest marketers and distributors of tires for the automotive replacement market.
This release may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain risks, uncertainties and other factors which could cause actual results to differ materially, including but not limited to, the degree of competition in the replacement tire industry, changes in consumer spending on automobiles and replacement automotive products and the Company's ability to continue to obtain products in sufficient quantity and at competitive prices. 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.
TBC CORPORATION
Condensed Consolidated Financial Results
Three Months Ended
December 31,
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1999 1998
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Net sales $182,715,000 $165,816,000
Income before income taxes 8,305,000 7,367,000
Income taxes 3,039,000 2,848,000
Net earnings $ 5,266,000(a) $ 4,519,000
Earnings per share (basic
and diluted) $ 0.25(a) $ 0.21
Average number of shares
outstanding 21,186,000 21,207,000
Years Ended
December 31,
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1999 1998
------------ ------------
Net sales $743,050,000 $646,135,000
Income before income taxes 29,260,000 27,809,000
Income taxes 11,321,000 10,915,000
Net earnings $ 17,939,000(b) $ 16,894,000
Earnings per share (basic
and diluted) $ 0.85(b) $ 0.75
Average number of shares
outstanding 21,189,000 22,481,000
(a) Results for the three months ended December 31, 1999 include
income of $700,000, or $0.03 per share, after taxes from the net gain
on the sale of a subsidiary distribution center.
(b) Results for the year ended December 31, 1999 include the
fourth quarter net gain of $0.03 per share as well as an after-tax
charge of $2.8 million, or $0.13 per share, related to the write-off
of a note receivable that had been the subject of litigation since
1989.