Anacomp(R) Announces Year-End Results
SAN DIEGO, Dec. 29 /PRNewswire/ -- Anacomp, Inc. (OTC Bulletin Board: ANCO), a leader in document-management and technical services, today reported results for the three-month and twelve-month periods ended September 30, 2000.
FULL-YEAR RESULTS
Fiscal 2000 revenues totaled $383.2 million, compared to $442.2 million reported in the previous year. EBITDA (earnings from continuing operations before interest, taxes, depreciation, and amortization, as well as restructuring and asset impairment charges) for fiscal 2000 totaled $26.9 million, compared to $94.9 million the previous year. Included in these results are a $9.0 million inventory reserve related to the cessation of the Company's manufacturing operations, which it announced in June, and $1.9 million in severance and other costs related to senior management changes also reported previously.
Phil Smoot, president and chief executive officer of Anacomp, commented, "The principal factor negatively impacting our financial performance over the course of the year has been the increased rate of decline in COM-related revenues in our DatagraphiX(R), Document Solutions, and Technical Services business units. Our digital services and third-party maintenance revenues, while growing steadily, have not yet offset that COM decline. The accelerated COM decline, combined with our significant investment in the docHarbor(SM) business, resulted in a disappointing year."
Also during fiscal 2000, Anacomp incurred additional charges totaling $44.7 million, consisting of restructuring costs of $14.6 million related to the reorganization of the Company's lines of business, impaired asset charges of $28.5 million related to the write-off of goodwill, the abandonment of certain development projects and idle facilities, the uncollectibility of a note receivable to the Company, and a $1.6 million loss related to discontinued operations.
With the release of its full fiscal 2000 results, Anacomp, as previously announced, remains in violation of certain financial covenants set forth in its senior revolving credit facility. However, the Company has reached an agreement with its senior lenders to amend the current credit facility, and the senior lenders have agreed to forbear from exercising any remedies available to them as a result of the Company's breach of those financial covenants. The forbearance is valid through February 28, 2001. The Company will have limited additional access to its senior credit facility during this time.
Anacomp had announced in October of this year that it was unable to make the interest payment on its subordinated debt due October 1, 2000, because of its current liquidity position. Also, as previously announced, Anacomp is in discussions with representatives of its subordinated debt holders regarding a possible restructuring of its subordinated debt. Credit Suisse First Boston (formerly Donaldson, Lufkin & Jenrette) is assisting the Company in these discussions.
In addition, Anacomp announced that it has deferred setting a date for the annual shareholders meeting while the restructuring process continues.
FOURTH QUARTER RESULTS
Revenues for the three months ended September 30, 2000, totaled $87.6 million, compared with $109.0 million reported in the same period last year. EBITDA was $3.6 million, compared with $23.0 million earned in the year-ago period.
BUSINESS UNIT RESULTS
In fiscal 2000, Anacomp comprised four business units: Document Solutions, which provides document-management outsource services; Technical Services, which provides third-party and Anacomp equipment maintenance; DatagraphiX, which provides hardware systems and supplies; and docHarbor, a document ASP. As of October 1, 2000, DatagraphiX was fully integrated into the Technical Services business unit.
Smoot noted that the Company is now making progress in its business unit strategies. "In docHarbor, our focus is on increasing revenues with our existing customers while controlling costs and leveraging the investments we already have made," he said. "In Document Solutions, we are deploying an expanded suite of service offerings and anticipate that these offerings will accelerate growth of digital services by attracting new customers as well as providing additional choices for our existing customers. And, in Technical Services, which now includes the remaining elements of the former DatagraphiX business unit, we continue to concentrate on building our third-party maintenance business, particularly in the storage and network markets."
docHarbor fiscal 2000 revenues increased 193%, to $4.6 million, compared with $1.6 million last year. docHarbor's EBITDA loss increased to $25.0 million, compared to $6.5 million last year. Anacomp invested more than $35 million in docHarbor during the year, including capital expenditures of $10.2 million. The Company is considering many options for the docHarbor business unit, including seeking additional funding, selling the business, re-evaluating the business model, or integrating the business into Anacomp's other business units.
Document Solutions' digital revenues worldwide increased 36%, to $71.0 million in fiscal 2000, compared to $52.3 million for fiscal 1999. These revenues accounted for 33% of total fiscal 2000 revenues, compared to 23% of total revenues in the prior year. Combined, digital and COM revenues were $214.0 million, compared to $227.3 million in the prior year. EBITDA decreased to $43.5 million, from $50.1 million a year ago. EBITDA as a percentage of revenues was 20.3% in fiscal 2000, compared to 22.0% last year. The Company continues to pursue its digital services business aggressively, particularly in the domestic market.
Technical Services' third-party maintenance revenues worldwide increased 30% to $19.2 million in fiscal 2000, compared to $14.7 million for fiscal 1999. These accounted for 30% of total revenues (excluding intercompany revenues) in fiscal 2000, compared to 20% for the prior year. Combined, third-party and COM maintenance revenues (excluding intercompany revenues) were $63.9 million, compared to $72.0 million in the prior year. EBITDA decreased to $27.6 million, compared to $30.7 million in fiscal 1999. EBITDA as a percentage of revenues was 43.2%, up from 42.6% last year. The Company continues to sign new third-party maintenance agreements with key suppliers in the storage and network support market.
DatagraphiX revenues for the year totaled $100.6 million, compared to $141.4 million last year. EBITDA for fiscal 2000 was $4.6 million (including the $9.0 million inventory write-off), compared to $42.3 million for the prior year. These results reflect continuing trends that have negatively affected the DatagraphiX business throughout fiscal 2000 and which led to the decision announced in early June to discontinue manufacturing and related operations.
The Company also announced today that David B. Hiatt has been promoted to the position of executive vice president and chief operating officer of Anacomp. Hiatt had served as executive vice president - corporate services and chief financial officer since joining Anacomp in April 1999. In his new role, Hiatt is responsible for the Document Solutions business unit and for Anacomp's internal technology services (MIS functions). The Company also announced today that Linster (Lin) W. Fox has been promoted to senior vice president and chief financial officer, replacing Hiatt. Fox most recently served as senior vice president and corporate controller. Since 1987, he has held a number of key positions in Anacomp's financial organization. |
