R&B Reports Record Sales for the 1999 Q4 and Full Year
3 March 2000
R&B, Inc., Reports Record Sales for the 1999 Fourth Quarter and Full Year
COLMAR, Pa., March 3 -- R&B, Inc., today
announced financial results for the fourth quarter and full year ended
December 25, 1999.
Net sales for the fourth quarter of 1999 increased approximately 1% to
$53.2 million from $52.7 million in the same period last year. As previously
announced, sales for the fourth quarter of 1999 were negatively impacted by
the continued softness in the automotive aftermarket and higher than
anticipated customer returns driven primarily by the continued consolidation
in the market. The Company recorded restructuring charges of $7.5 million
after tax in the fourth quarter of 1999. The Company reported a net loss in
the fourth quarter of 1999, after giving effect to the restructuring charges,
of $9.0 million, or $1.07 per share.
Annual sales increased 32.7% in 1999 to $236.7 million from last year's
$178.3 million. Net income, before giving effect to the restructuring
charges, decreased to $3.9 million in 1999 versus last year's $7.6 million.
Diluted earnings per share, before giving effect to the restructuring charges,
were $0.47 per share in 1999 compared to last year's $0.90 per share.
Mr. Richard Berman, Chairman, President and CEO said: "As we indicated in
January 2000, we are disappointed with our 1999 results. However, we believe
that the significant fixed cost reductions brought about by our restructuring
plan will enable us to improve profitability on a smaller sales base. The
restructuring plan is progressing better than expected as we have already
taken actions that will result in annualized fixed cost savings of over
$4 million. We are confident that we will meet our previously announced goal
of $6 million in annual savings from our initiative in the near future."
Mr. Berman further stated, "As we reported in January 2000, earnings for
the first two quarters of 2000 are expected to be below prior year levels as
planned cost reduction initiatives will not be fully implemented until the
third quarter of fiscal 2000. We continue to be committed to the growth of
our core business of hard-to-find parts and fasteners where we see several
exciting new opportunities for growth. In addition, we are excited by the
prospects for growth of our subsidiaries, particularly Allparts, Inc., which
specializes in component parts for the growing brake aftermarket. We have
intensified our focus on growing each of these businesses and will continue to
invest capital to enable these businesses to grow profitably."
R&B, Inc. is a leading supplier of "hard-to-find" parts and fasteners for
the automotive aftermarket. R&B's parts are marketed under more than fifty
proprietary brand names, through its Motormite and Dorman divisions, as well
as under the private labels of automobile manufacturers, parts manufacturers,
and national warehouse distributors.
Forward looking statements in this release are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
Such forward looking statements are subject to certain risks and uncertainties
that could cause actual results to differ materially from those projected.
Readers are cautioned not to place undue reliance on these forward looking
statements which speak only as of the date hereof. Factors that cause actual
results to differ materially include, but are not limited to, those factors
discussed in the Company's Annual Report on Form 10-K under "Business -
Investment Considerations".
R&B, INC. AND SUBSIDIARIES
Consolidated Statements of Income (1)
(in thousands, except per-share amounts)
13 weeks ended (unaudited) 12/25/99 Pct. 12/26/98 Pct.
Net sales $53,230 100.0 $52,733 100.0
Cost of goods sold 46,052 86.5 31,985 60.7
Gross profit 7,178 13.5 20,748 39.3
Selling, general and
administrative expenses 19,051 35.8 16,938 32.1
Income(loss)from
operations (11,873) (22.3) 3,810 7.2
Interest expense, net 1,732 3.3 1,566 3.0
Income(loss)before taxes (13,605) (25.6) 2,244 4.2
Provision for taxes (4,612) (8.7) 755 1.4
Net income (loss) (8,993) (16.9) 1,489 2.8
Earnings(loss) per share
Basic ($1.07) - $0.18 -
Diluted ($1.07) - $0.18 -
Average shares outstanding
Basic 8,393 - 8,337 -
Diluted 8,393 - 8,438 -
52 weeks ended 12/25/99 Pct. 12/26/98 Pct.
Net sales $236,689 100.0 $178,301 100.0
Cost of goods sold 161,676 68.3 107,897 60.5
Gross profit 75,013 31.7 70,404 39.5
Selling, general and
administrative expenses 73,380 31.0 53,985 30.3
Income from operations 1,633 0.7 16,419 9.2
Interest expense, net 6,961 2.9 4,629 2.6
Income(loss)before taxes (5,328) (2.2) 11,790 6.6
Provision (benefit) for taxes (1,726) (0.7) 4,234 2.4
Net income (loss) (3,602) (1.5) 7,556 4.2
Earnings (loss) per share
Basic ($0.43) - $0.91 -
Diluted ($0.43) - $0.90 -
Average shares outstanding
Basic 8,375 - 8,330 -
Diluted 8,375 - 8,421 -
R&B, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands)
12/25/99 12/26/98
Cash and short-term investments $1,467 $915
Accounts receivable, less allowance
for doubtful accounts and customer
credits of $8,764 and $9,715 49,979 55,585
Inventories 70,272 68,401
Deferred income taxes 4,574 1,674
Prepaids and other current assets 2,543 861
Total current assets 128,835 127,436
Property, plant & equipment, net 22,919 20,761
Intangible assets 33,212 33,640
Other assets 3,038 2,111
Total $188,004 $183,948
Liabilities & Shareholders' Equity
Current portion of long-term debt $3,410 $3,089
Accounts payable 12,867 18,309
Accrued compensation 2,820 2,652
Other accrued liabilities 4,626 5,766
Total current liabilities 23,723 29,816
Long-term debt 93,783 80,004
Deferred income taxes 2,264 2,514
Commitments and Contingencies
Shareholders' Equity
Common stock, par value $.01
Authorized 25,000,000 shares,
issued 8,393,796 & 8,344,082 84 83
Additional paid-in capital 33,517 33,133
Cumulative translation adjustments (181) (18)
Retained earnings 34,814 38,416
Total shareholder's equity 68,234 71,614
Total $188,004 $183,948
(1) Fourth quarter and fiscal 1999 amounts include restructuring charges
of $11.4 million ($7.5 million after tax or $0.90 per share). A total of
$9.8 million, representing inventory writedowns, was charged to cost of sales
and $1.6 million was charged to selling, general and administrative expenses.
Earnings per share for the year ended December 25, 1999 before giving effect
to the restructuring charges were $0.47 versus $0.90 a year earlier.