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Wednesday November 15, 7:51 am Eastern Time
Press Release
Rock of Ages Third Quarter Net Income Increases 28% to $0.18 Per Diluted Share
Nine Month Net Income Is $0.25 Per Diluted Share Versus $0.05
CONCORD, N.H.--(BUSINESS WIRE)--Nov. 15, 2000--Rock of Ages Corp. (Nasdaq:ROAC - news) announced today that net income for the third quarter ended September 30, 2000 increased 28% to $1,358,000, or $0.18 per diluted share, compared to net income of $1,065,000, or $0.14 per diluted share, for the third quarter of 1999. Revenue was $23,528,000 versus $24,415,000 for the same period last year.
For the nine months ended September 30, 2000, net income was $1,875,000, or $0.25 per diluted share. This compares to net income for the first nine months of 1999 of $386,000, or $0.05 per share, which included a charge of $0.02 per share for the cumulative effect on prior years of a mandated change in accounting principle for organizational costs, and a loss on disposal of assets of $0.09 per share. Revenue was $66,575,000 versus $70,919,000 a year ago.
For the first nine months of 2000, earnings before interest, taxes, depreciation and amortization (EBITDA) increased to $7,540,000 from $5,729,000 a year earlier. Total debt declined 21% during this period to $21,110,000 from $26,856,000 at December 31, 1999.
For the third quarter, revenue from the Company's retailing operations increased 15% to a record $10,185,000. Retail gross margin increased to 54% from 52% a year earlier, reflecting the growth in sales and the operational enhancements implemented in the retail business during the past year.
``Our retail operations would have performed even better in the third quarter both from the revenue and profit points of view but for lower-than-expected settings of memorials in the period,'' said Chairman and Chief Executive Officer Kurt Swenson. ``While the timing of memorial settings is determined in part by the cemeteries involved, we have implemented programs that we believe will enhance our ability to influence the timing of settings in the future.
``We currently expect higher settings in the fourth quarter than the third quarter as was the case last year. In addition, retail orders again exceeded revenue in the third quarter, with retail backlog increasing to approximately $15,500,000 at September 30th compared to $12,100,000 a year earlier and $14,200,000 at the end of June.
``This provides a solid foundation for further growth. We have completed the implementation of our memorial branding, pricing, and sales and marketing programs in nearly all of our owned retail outlets, and expect to complete the roll-out of our computerized MIS system at all locations by the end of the first quarter of 2001.''
Swenson explained that growth in retail revenue in the third quarter was offset by lower manufacturing and quarrying revenue. The decline in manufacturing revenue, which was anticipated, resulted from the planned elimination of certain lower-margin product lines, as well as higher inter-company eliminations associated with increased sales to owned retail outlets.
Gross margin in manufacturing rose to 28% from 26% and its operating income was up about 70% in the third quarter compared to last year's third quarter. The decline in quarrying revenue was primarily the result of timing of export shipments. Gross margin was adversely impacted by unusually low yields during the quarter at two quarries.
``We expect yields at our quarries to recover to historical annual norms during the current quarter, which should support stronger revenue and profit performance for this business segment,'' Swenson said.
``With the improvements we expect in our quarrying and retail operations in the fourth quarter compared to the third quarter, and assuming that winter weather conditions in our primary market areas are no better or worse than average, we currently anticipate earnings for the fourth quarter to increase approximately 50% to about $0.25 per diluted share on revenue of approximately $25,000,000,'' Swenson concluded.
For the fourth quarter of 1999, Rock of Ages reported net income of $0.17 per diluted share on revenue of $25,610,000. At September 30, 2000, Rock of Ages had shareholders' equity of approximately $87,826,000, or approximately $11.79 per share.
About Rock of Ages
Rock of Ages (www.RockofAges.com) is the largest integrated granite quarrier, manufacturer and retailer of finished granite memorials and granite blocks for memorial use in North America.
Rock of Ages has scheduled a conference call today to discuss its results for the third quarter and nine months to date. During the conference call, the Company may also discuss its future outlook as well as other matters. A Webcast of today's conference call may be accessed at www.StreetFusion.com or at www.RockofAges.com.
A replay will be available immediately following the Webcast at these same Internet addresses. For a telephone replay, dial 800/633-8284, reservation No. 16862999, beginning at approximately 1 p.m. Eastern.
The statements in this release that are not historical facts constitute or may constitute ``forward-looking statements,'' as defined under the Federal Securities Laws, and involve numerous risks and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements. These risks and uncertainties include the ability of the Company to successfully implement its retail acquisition program, demand for the Company's products, competitive conditions, and other factors disclosed previously and from time to time in Rock of Ages' filings with the U.S. Securities and Exchange Commission. |
