Sound Advice Announces Record
Third Quarter Results, Including E.P.S. Of $0.23 Vs.
$0.03
Strong Same-Store Sales Growing Custom Design and Installation Business
Cited
DANIA BEACH, Fla., Dec. 8 /PRNewswire/ -- Sound Advice, Inc. (Nasdaq: SUND - news),
Florida's leading retailer of upscale consumer electronics products, today announced record
profits for the third quarter of fiscal year 2000.
Net sales for the three months ended October 31, 1999, increased 15.9 percent to $39.9 million,
compared with $34.4 million in the third quarter of the previous fiscal year. Net income increased
more than seven- fold to $959,000 or $0.23 per diluted share, versus $116,000 or $0.03 per
share, in the prior-year period. The company's improved profitability can be attributed to
increases in same-store sales, contributions from new stores, and a favorable sales mix.
Same-store sales increased by 9.5 percent in the third quarter, when compared to the prior-year
period, reflecting strong consumer demand for high- fidelity audio equipment, speakers, DVD
players, direct view television sets, and HDTV-ready projection television sets. Also a factor,
were the two new full-size Sound Advice stores opened during the fourth quarter of the last fiscal
year and the two new Bang & Olufsen concept stores, which opened in December 1998, and
June 1999, respectively.
Gross margins for the third quarter increased to 35.3 percent compared to 34.4 percent for the
same period of the prior-year, reflecting a favorable sales mix of higher margin audio and video
equipment.
``It is gratifying to see our niche marketing strategy of offering distinctive merchandise and
unmatched customer service working so well for us,' said Peter Beshouri, chairman and chief
executive officer of the 27-store chain. ``More and more, Sound Advice customers are choosing
our in-home custom design and installation services, which set us apart from the 'big-box'
competitors.'
As previously announced, the company relocated and expanded one of its Tampa stores in
November, just in time for the busy Thanksgiving shopping weekend. Furthermore, the company
recently leased space in the prestigious Falls Shopping Mall located in South Miami, in
preparation for the opening of its fourth Bang & Olufsen concept store in February 2000.
Fueled by strong fundamentals, net sales for the nine-month period ended October 31, 1999,
increased 18.4 percent to $120.2 million versus net sales of $101.6 million in the corresponding
period of the previous fiscal year. Net income for the first three quarters of the current fiscal year
totaled $2.46 million, or $0.59 per diluted share, compared to a virtual break-even performance
($0.00 per share) in the nine months ended October 31, 1998.
In addition to the four new Sound Advice and Bang & Olufsen stores that were previously
mentioned, strong sales of audio speakers, audio/video receivers, DVD players, direct view and
projection televisions, all contributed to the sales increases for the first nine months of fiscal year
2000. Comparable-store sales for the nine months ended October 31, 1999, increased by 12.1
percent over the corresponding period a year ago.
Any forward-looking statements in this release are made pursuant to the ``Safe Harbor'
provisions of the Private Securities Litigation Act of 1995. Investors are cautioned that actual
results may differ substantially from such forward-looking statements. Forward-looking
statements involve risks and uncertainties including, but not limited to, continued acceptance of the
company's products and services in the marketplace, competitive factors, new products and
technological changes, dependence upon third-party vendors, and other risks detailed in the
company's periodic filings with the Securities and Exchange Commission.
Founded in 1974, Sound Advice, Inc. has grown to become Florida's largest specialty retailer of
high-quality, upscale home entertainment and consumer electronics products, including home and
car audio systems, video products, large screen televisions, home theater systems, personal
electronics, and related accessories. With its unique, upscale store design, the company operates
24 Sound Advice stores throughout Florida and three concept stores under the Bang & Olufsen
name. Sound Advice, Inc. is headquartered in Dania Beach, Florida, (Ft. Lauderdale area), and
its common stock trades on the Nasdaq National Market under the symbol ``SUND.'
(-Financial Table Follows-)
SOUND ADVICE, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income (Unaudited)
For the Three and Nine Months Ended October 31, 1999, and 1998
(Thousands Except per Share Data)
Three Months Ended Nine Months Ended
October 31, October 31,
1999 1998 1999 1998
Net sales $39,880 $34,422 $120,248 $101,589
Cost of goods sold 25,806 22,572 78,621 66,497
Gross profit 14,074 11,850 41,627 35,092
Selling, general
and administrative
expenses 12,808 11,319 38,173 33,799
Income from operations 1,266 531 3,454 1,293
Other income (expense):
Interest expense (317) (309) (1,024) (1,066)
Other, net 10 29 31 65
Income before
income taxes 959 251 2,461 292
Income taxes --- 135 --- 290
Net income $ 959 $116 $ 2,461 $2
Common and common
equivalent per
share amounts:
Basic net income
per share
$0.26 $0.03 $0.66 $ 0.00
Diluted net income
per share $0.23 $0.03 $0.59 $ 0.00
Weighted average
shares-Basic 3,753 3,729 3,741 3,729
Weighted average
shares-Diluted 4,258 3,931 4,185 3,949
SOURCE: Sound Advice, Inc. |
