Smart Choice Automotive Announces Sharply Higher Net Income in Q1
14 September 2000
Smart Choice Automotive Group Announces Sharply Higher Net Income in First Quarter of FY2001
TITUSVILLE, Fla., Sept. 14 Smart Choice Automotive Group,
Inc. (OTC Bulletin Board: SCHA), which sells and finances used cars in Florida
and Texas, today announced operating results for the first quarter of FY2001.
For the three months ended July 31, 2000, sales of used cars increased
124% to $43.8 million, compared with sales of $19.5 million in the first
quarter of the previous fiscal year, while interest income increased 226% to
$9.4 million, versus $2.9 million in the quarter ended July 31, 1999. Net
income increased 581% to $1,402,000, or $0.14 per diluted share, in the most
recent quarter, compared with $206,000, or $0.03 per diluted share, in the
first quarter of FY2000. Diluted earnings per share were calculated on
9,792,149 weighted average diluted shares outstanding for the quarter ended
July 31, 2000, versus 6,015,080 diluted shares outstanding in the year earlier
quarter.
"We were very pleased with first quarter operating results, which
reflected a continuation of the earnings turnaround which has been
accomplished since our reverse merger with PAACO Automotive Group and the
Company's operating and financial restructuring last December," stated Ed
Ernst, Chief Executive Officer of Smart Choice Automotive Group, Inc. "The
number of used cars sold during the most recent quarter was more than double
those of the prior-year quarter, primarily due to the inclusion of Florida
sales in this year's results and sales increases in our Texas operations. We
are pleased to report that PAACO has firmly established itself as a leading
used car retailer in the Houston market, which we entered less than two years
ago. Gross profit margins improved significantly during the first quarter,
when compared with prior-year levels, and we have continued to expand our
allowance for credit losses on our customer receivables portfolios."
"The outlook for the balance of our fiscal year remains bright," continued
Ernst. "We shall continue to implement cost-reduction initiatives which do
not compromise our ability to provide our customers with quality vehicles and
superb service. Our recently-opened centralized vehicle reconditioning center
in Grand Prairie, Texas, should greatly improve our ability to efficiently
evaluate newly-purchased vehicles, repair any problems, and deliver them to
our retail lots on a timely basis. We also use the facility to provide
aftermarket warranty service to our customers in the Dallas-Ft. Worth market
area. Subsequent to the quarter end we opened a body shop operation at the
Grand Prairie location to repair our customers' wrecked vehicles which allows
PAACO to better control its collateral during the repair process."
SMART CHOICE AUTOMOTIVE GROUP, INC.
AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(In thousands except per share amounts)
(unaudited)
Three Months Ended
July 31 July 31
2000 1999
Sales of used cars $43,789 $19,507
Less: Cost of used cars sold 26,188 12,960
Provision for credit losses 10,592 2,633
7,009 3,914
Interest income
Interest income 9,373 2,871
Portfolio interest expense 4,198 1,351
5,175 1,520
Income before operating expenses 12,184 5,434
Operating expenses
Selling, general and administrative 9,766 5,015
Depreciation and amortization 379 92
Other expense (income) (193) --
9,952 5,107
Income before income taxes 2,232 327
Income tax expense 830 121
Net income $1,402 $206
Net income per common share
Diluted $0.14 $0.03
Weighted average shares outstanding
Diluted 9,792,149 6,015,080
SMART CHOICE AUTOMOTIVE GROUP, INC.
AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
CONSOLIDATED BALANCE SHEET DATA
(In thousands except per share data)
July 31, April 30,
2000 2000
Cash and cash equivalents $1,180 $1,883
Finance receivables, net $138,982 $132,855
Total Assets $185,979 $178,965
Total Liabilities $167,949 $162,337
Total Shareholders' Equity $17,497 $16,095