Bluegreen Corporation Reports Record 2005 Second Quarter Financial Results
biz.yahoo.com
Monday August 1, 8:01 am ET
BOCA RATON, Fla.--(BUSINESS WIRE)--Aug. 1, 2005--Bluegreen Corporation--(NYSE: BXG):
Q2 2005 Highlights Versus Q2 2004
Net income increased 57.4% to $14.3 million, or $.46 per diluted share
Bluegreen Resorts sales up 12.0% to $97.0 million
Bluegreen Communities sales rose 49.2% to $62.2 million
Book value increased to $9.47 at June 30, 2005 from $8.98 at March 31, 2005
Bluegreen Corporation (NYSE: BXG), a leading provider of leisure products and lifestyle choices, today announced record financial results for the second quarter ended June 30, 2005 (see attached tables).
Net income for the second quarter of 2005 increased 57.4% to $14.3 million, or $.46 per diluted share, on approximately 31.2 million weighted average common and common equivalent shares outstanding ("shares outstanding"), compared to net income of $9.1 million, or $.31 per diluted share, on approximately 30.7 million shares outstanding for the second quarter of 2004. Net income for the first six months of 2005 rose 50.6% to $20.8 million, or $.67 per diluted share, on approximately 31.2 million shares outstanding, compared to net income of $13.8 million, or $.47 per diluted share, on approximately 30.5 million shares outstanding for the first half of 2004.
Total sales in the second quarter of 2005 increased 24.1% to $159.2 million from $128.3 million in the same period last year, reflecting higher sales at both the Resorts and Communities business segments. For the first six months of 2005, total sales increased 22.7% to $263.2 million from $214.5 million in the same period last year.
Total operating revenues in the second quarter of 2005 rose 21.7% to $185.3 million from $152.2 million in the second quarter of 2004, due primarily to higher total sales of real estate, as well as increases in other resort and communities operations revenue, interest income and gain on sale of notes receivable. For the first half of 2005, total operating revenues increased by 21.7% from the comparable period one year ago.
George F. Donovan, President and Chief Executive Officer of Bluegreen®, commented, "Our Resorts and Communities business segments continued to experience double-digit sales growth, which produced record levels of profits during the second quarter of 2005. We continue to benefit from the critical mass we have achieved in our Resorts segment. Through our points-based Bluegreen Vacation Club®, we believe that we offer our customers among the most memorable vacation experiences in our industry by providing them access to over 35 resorts and an exchange network of more than 3,700 resorts. On the Communities side, sales of our acclaimed golf properties generated substantial growth and we remain an industry leader in the direct-to-consumer sales of residential homesites.
"We were able to achieve this level of growth while maintaining a strong balance sheet at June 30, 2005, which reflected a book value of $9.47 per share compared to a book value of $8.98 per share at March 31, 2005, and a debt-to-equity ratio of 0.70:1 as compared to 0.88:1 at March 31, 2005. We completed the redemption of $55.0 million of aggregate principal amount of our 10.5% Senior Secured Notes Payable (the "Notes") in June 2005, with the remaining outstanding $55.0 million of the Notes due in 2008. Unrestricted cash at June 30, 2005, after the completion of the redemption of the Notes, was $73.3 million."
Bluegreen Resorts
Resorts sales in the second quarter of 2005 increased 12.0% to a second quarter record $97.0 million from $86.6 million in the same period last year. This increase was primarily attributable to same-Resort sales increases at many of the Company's sales offices, most notably at The Fountains(TM) resort in Orlando, FL. Significant sales increases were also generated at several of the Company's other resorts, including Shenandoah Crossing(TM) resort in Gordonsville, VA, Harbour Lights(TM) in Myrtle Beach, SC, MountainLoft(TM) in Gatlinburg, TN, and Mountain Run(TM) at Boyne in Boyne Falls, MI. New sales sites in Dallas, TX, King of Prussia, PA and The Hammocks at Marathon(TM) in Marathon, FL also contributed to higher sales during the second quarter of 2005. Resort sales for the first half of 2005 rose 16.4% to $162.7 million from $139.8 million in the same period last year.
Resort cost of sales in the second quarter of 2005 declined to 20.5% of sales from 23.9% in the same period last year. Resort cost of sales decreased to 20.3% during the first six months of 2005 from 22.6% during the same period one year ago. These decreases reflected a favorable product mix, primarily due to the additional construction of units and increased sales of vacation ownership interests ("VOIs') in The Fountains resort, which has a relatively low associated product cost. Resort cost of sales has more typically ranged from 23% to 25%, and Bluegreen expects that it will be at that level in the future as the percentage of sales associated with VOIs in The Fountains resort declines.
Bluegreen Communities
Communities sales in the second quarter of 2005 increased 49.2% to a second quarter record $62.2 million from $41.7 million in the same period last year. This increase was due primarily to strong same-site sales at Bluegreen Golf Communities' Sanctuary Cove at St. Andrews Sound(TM) and Traditions of Braselton(TM), both located in Georgia, and continued strong sales at Chapel Ridge(TM), a Bluegreen Golf Community in North Carolina that commenced sales in July 2004. Noteworthy higher sales were also generated at Mystic Shores(TM), located in the Texas Hill Country. SugarTree on the Brazos, situated near Fort Worth, TX, which commenced sales in January 2005, and Saddle Creek Ranch(TM), located in Magnolia, TX, which commenced sales in April 2005, also contributed to higher total sales during the second quarter of 2005.
Communities cost of sales declined to 50.2% of sales in the second quarter of 2005 from 55.4% in the same period last year, due primarily to a higher percentage of total Communities sales being comprised of golf properties, which generally have higher associated gross margins. Communities cost of sales declined to 50.6% in the first half of 2005 from 55.5% in the same period last year. The Company expects Communities' cost of sales percentage to return to historical levels in the future.
As of June 30, 2005, approximately $48.7 million and $20.9 million of Communities sales and profits, respectively, were deferred under the percentage-of-completion method of accounting. It is expected that these amounts will be recognized in future periods ratably with the development of the projects.
As previously announced, as a result of the significant sales achieved in the Communities segment during 2004 and in the first six months of 2005, several of the Company's properties substantially sold out or are expected to sell out earlier in 2005 than previously forecasted. The Company's Communities business has historically relied on the acquisition of new properties in order to meet its ongoing inventory needs. Bluegreen is continually exploring the acquisition of properties in markets where it currently conducts business, and in new regions of the country, in order to replenish its portfolio of properties. The Company recently acquired two new properties in Texas totaling 2,567 acres and several additional properties are currently under consideration.
Early Extinguishment of Debt
The increase in other expenses, net, for the 2005 periods included the previously disclosed prepayment penalty of approximately $962,500 and write off approximately $750,000 of debt issuance costs related to the early redemption of the Notes in the quarter ending June 30, 2005. In the aggregate, the prepayment penalty and debt issuance costs totaled $.03 per diluted share. The remaining other expenses, net, primarily consisted of amortized legal and other costs related to Bluegreen's vacation ownership receivables purchase facilities. |
