Samsonite Announces Fourth Quarter and Annual Operating Results
April 12, 2005 4:30:00 PM ET
DENVER, April 12 /PRNewswire-FirstCall/ -- SAMSONITE CORPORATION (OTC Bulletin Board: SAMC) today announced financial results for the fourth quarter and fiscal year ended January 31, 2005.
Revenues and operating income for the fourth quarter were $243.5 million and $22.6 million, respectively, compared to revenues of $215.3 million and operating income of $23.7 million in the prior year quarter. Fiscal 2005 fourth quarter operating income includes a charge of $2.8 million related to a restructuring plan to streamline certain operating overhead functions in Canada and the United States and to recognize impairment of certain apparel trademark intangible assets. Income to common stockholders was $3.3 million or $0.01 per weighted average share outstanding for the fourth quarter compared to $4.0 million or $0.02 per weighted average share outstanding in the prior year quarter.
Revenues and operating income for the fiscal year ended January 31, 2005 were $902.9 million and $65.0 million, respectively, which compares to $776.5 million and $69.7 million in the prior year. Operating income for the current fiscal year includes charges totaling $10.6 million for restructuring provisions and expenses and asset impairment charges related to the elimination of production operations in Spain and Mexico, the restructuring plan to streamline certain operating overhead functions in Canada and the United States, the impairment of certain apparel trademark intangible assets, and executive severance. Operating income for the prior fiscal year includes charges totaling $5.7 million for restructuring provisions and asset impairments related to the closure of the Company's Nogales, Mexico manufacturing facility and the impairment of certain apparel trademark intangible assets. In addition, operating income includes a charge of $4.0 million for stock compensation expense related to options granted to executive officers which was not incurred in the prior year. Loss to common stockholders for the fiscal year was $22.7 million or $0.10 per share, compared to $27.5 million or $0.22 per share in the prior fiscal year.
Adjusted EBITDA (earnings before interest expense, taxes, depreciation, amortization and minority interest, adjusted for items which management believes should be excluded to reflect recurring operations, including stock compensation expense and executive severance, asset impairment charges, restructuring charges and expenses and to include realized currency hedge gains and losses) was $31.3 million for the fourth quarter which compares with $34.1 million for the same period in the prior year. Adjusted EBITDA for the year ended January 31, 2005 was $100.7 million compared to $93.1 million in the prior year. Cash provided by operating activities (as reflected in the Company's consolidated statements of cash flows) for the fourth quarter was $26.9 million, which compares to $21.8 million for the same period in the prior year. Cash provided by operating activities for the year ended January 31, 2005 was $34.7 million compared to $28.0 million in the prior year. A reconciliation of Adjusted EBITDA to cash provided by operating activities is included in the tables appearing at the end of this press release. Neither EBITDA nor Adjusted EBITDA is an accounting term used in generally accepted accounting principles.
Chief Executive Officer, Marcello Bottoli, stated: "With the economic recovery in the first half of the year, increased marketing and advertising expenditures in the latter half, and the effects of the stronger euro, the Company's sales growth approximated 16% for the year. Expanded product diversity and increased market penetration drove sales growth in our non- luggage product categories, with casual and outdoor bag sales increasing 28%, and business case and computer bag sales increasing 17%. Fueled by new product introductions and marketing and advertising expenditures, sales of traditional luggage products also grew at 14%. Sales in each of our three major geographic regions grew at double-digit rates with Europe increasing 17.6%, the Americas at 12.8% and Asia at 33.6%. In addition, in January we completed negotiations and signed definitive agreements to commence our direct market entry into Japan by consummating a joint venture agreement with a local partner. We should begin to see the benefits of Japan's sales in our operations in the latter half of fiscal 2006.
We continue to improve our cost structure by pursuing lower cost methods to produce and engineer our products and by streamlining operating functions to reduce expenses. Our gross profit margin improved 100 basis points over the prior year to 46.1% and Adjusted EBITDA increased $7.6 million to $100.7 million, despite increasing our investment in marketing and advertising expenses by $14.9 million or 35%. We plan to increase investment in our brands by adding additional marketing and advertising expenditures to our operating budgets and by increasing expenditures in the product research and development area." |
