Automotive Performance Group Substantially Reduces Operating Losses in 1st Quarter
31 July 2000
Automotive Performance Group Substantially Reduces Operating Loss In The First Quarter Of 2000
NEW YORK - Automotive Performance Group, Inc. today reported a significant reduction in its operating loss for the first quarter of 2000, ended March 31, 2000, compared with the year-ago period.Operating loss for the first three months of 2000 was $209,000 versus an operating loss of $773,000 for the first quarter of 1999. The Company reported substantial declines in its Selling, General and Administrative, Salaries, Payroll Taxes and Benefits, and Professional Expenses.
The Company reported a net loss of $2.19 million, or ($0.18) per share, for the first quarter of 2000, compared with a net loss of $1.42 million, or ($0.23) per share, a year ago. The weighted average of common shares outstanding was 12.4 million and 6.2 million for the three months ended March 31, 2000 and March 31, 1999, respectively.
First-quarter 2000 net loss includes a non-cash charge of $2.04 million, or ($0.16) per share, related to Automotive Performance Group's share of the net loss recognized by PBT Brands, Inc. (PBT). APG owned 22% of the equity of PBT during the first quarter of 2000. The Company sold an amount equal to 4% of the outstanding equity in PBT on April 7, 2000. This loss primarily is due to the accelerated amortization of intangibles, which resulted in a loss for financial statement reporting purposes even though PBT showed a profit at the EBITDA (earnings before interest and taxes, depreciation and amortization) level.
"Our first-quarter results reflect the initial benefits of the dramatic restructuring program we instituted last year," said APG Chairman and Chief Executive Officer, Dean M. Willard. "Our goal is to be near breakeven from operations in the second quarter and to show a profit during the second half of the year." Mr. Willard noted that APG's business at March 31, 2000 primarily consisted of three elements:
| - | PBT Brands, which owns Permatex, Inc., a leading manufacturer and distributor of premium functional chemical products to the automotive maintenance and repair markets, and Advanced Chemistry and Technology, Inc., which develops and manufactures sealants for the aerospace and aircraft industry. PBT's annual sales exceed $130 million. |
| - | Boyd's Wheels, Inc., which designs, manufactures via contact with others, and sells specialty wheels to the automotive, truck, trailer and recreational vehicle markets. In April 2000, APG announced its interest to sell the wheel business of Boyds. |
| - | D'Artagnan Associates, Inc., a full-service management consulting organization. D'Artagnan recently served as consultant to Zero. Net to facilitate a series of transactions which resulted in the sale of a subsidiary of Envision Development Corporation (ASE: EDV), 43% owned by Zero.Net. |
Mr. Willard added that the Company's first-quarter 2000 operating loss was slightly less than the prior three months (before extraordinary items) and significantly below the operating losses recorded in last year's second and third quarters. "For 1999, APG had an operating loss of $2.4 million before unusual items," Mr. Willard noted.
Automotive Performance Group's common stock was no longer traded on the OTC Bulletin Board, effective June 1, 2000. The OTC Bulletin Board indicated that it had delisted APG's stock because the Company filings with the U.S. Securities and Exchange Commission (SEC) were not current. The Company was unable to obtain all documents required to complete its Current Report on Form 8-K for August 1999 and its Annual Report on Form 10-KSB for the year ended December 31, 1999, on a timely basis. Some of the documents had to be prepared by other entities that APG did not control. The missing documents have been obtained and all delinquent reports have been filed with the SEC. APG is now in full compliance with all SEC filings requirements. The Company will soon apply to have its common stock relisted on the OTC Bulletin Board. Public trading in APG's common stock currently is reported on the "Pink Sheets," which are published daily by the National Quotation Bureau.
Automotive Performance Group, Inc., participates in the fast-growing high-performance automotive and specialty chemical industries through its 18% equity ownership in PBT Brands Inc., a leading manufacturer, distributor, and marketer of premium functional chemical products to the automotive maintenance and repair markets, and Advanced Chemistry and Technology, Inc. (AC Tech), which develops and manufacturers sealants for the aerospace and aircraft industry.
Automotive Performance Group, Inc. and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(In Thousands, Except Per-Share Data)
Three months ended March 31,
2000 1999
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Revenues $ 44 $
Expenses
Direct expenses 31 0
Selling, general and administrative 47 181
Salaries, payroll taxes and benefits 33 232
Professional expenses 106 358
Depreciation and amortization 36 2
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253 773
Operating loss (209) (773)
Other income (expense)
Equity in losses of affiliate (2,045)
Interest expense (155)
Other income 98 12
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(1,947) (143)
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Loss from continuing
operations before
discontinued
operations (2,156) (916)
Discontinued operations
Loss from operations of discontinued
specialty chemical subsidiary (35) (309)
Loss from operations of automotive
parts and accessories subsidiaries (198)
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Loss from discontinued
operations (35) (507)
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NET LOSS $ (2,191) $ (1,423)
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Loss per common share basic and diluted
Loss before discontinued
operations $ (0.18) $ (0.15)
Discontinued operations 0.00 (0.08)
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$ (0.18) $ (0.23)
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