Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : FGCI --- Family Golf, Tiger Woods, Etc. --- For Long Only -- Ignore unavailable to you. Want to Upgrade?

To: Marty Rubin who wrote (95)	8/12/1999 7:56:00 PM
From: Marty Rubin	Respond to of 101

"...Second Quarter Net Loss Of $.06 per share" Thursday August 12, 7:27 pm Eastern Time Company Press Release Family Golf Centers Reports Second Quarter Results 1999 Second Quarter Net Loss Of $.06 per share MELVILLE, N.Y.--(BUSINESS WIRE)--Aug. 12, 1999--Family Golf Centers Inc. (NASDAQ,NM: FGCI) today reported a net loss of $1.5 million for the second quarter and that the Company has received a temporary waiver of its non-compliance with substantially all of the financial covenants under its $100 million Credit Facility, which waiver expires on October 5, 1999, subject to earlier expiration under certain circumstances. The Company is currently in active discussions with its lenders and other financing sources concerning restructuring the Credit Facility and obtaining additional liquidity. There can, however, be no assurance that the Company will be successful in such restructuring. Family Golf Centers Inc. reported total revenue of $47.5 million for the second quarter of 1999 compared to $34.6 million in the second quarter of 1998. Total revenue in the quarter was comprised of $28.7 million in golf operating revenues, $6.8 million in non-golf revenues and $12.0 million in merchandise sales. Total revenue in the comparable quarter last year was comprised of $22.3 million in golf revenues, $4.0 million in non-golf revenues and $ 8.3 million in merchandise sales. The net loss for the second quarter of 1999 was $1.5 million or net loss of $0.06 per diluted share as compared to a net loss of $3.9 million or net loss of $0.19 per diluted share in 1998's second quarter. The net loss for the three months ended June 30, 1998 includes merger and acquisition charges of $7.8 million as a result of the pooling of interests with Eagle Quest Golf Centers, Inc. Total revenue for the six months ended June 30, 1999 was $82.6 million and was comprised of $46.0 million in golf operating revenues, $16.8 million in non-golf revenues and $19.8 million in merchandise sales. Total revenue for the six months ended June 30, 1998 was $56.1 million and was comprised of $33.9 million in golf operating revenues, $9.1 million in non-golf revenues and $ 13.1 million in merchandise sales. The net loss for the six months ended June 30, 1999 was $772,000 or net loss of $0.03 per diluted share as compared to a net loss of $7.6 million or net loss of $0.36 per diluted share. The net loss for the six months ended June 30, 1998 includes a $2.0 million charge representing the cumulative effect of a change in accounting principal in connection with the Company's adoption of SOP 98-5, Reporting on the Costs of Start-Up Activities and merger and acquisition charges of $7.8 million as a result of the pooling of interests with Eagle Quest Golf Centers, Inc. For the 52 golf centers that Family Golf owned and operated for both the six months ended June 30, 1999 and June 30, 1998, same-store-sales increased by 4%. Same-store-sales for the 17 golf centers owned by Eagle Quest last year and operated by Family Golf in the six months ended June 30, 1999 declined by 11%. For the 52 golf centers that Family Golf owned and operated in both of the second quarters of 1998 and 1999, same-store-sales increased by 5 %. Same-store-sales for the 17 golf centers owned by Eagle Quest Golf Centers, Inc. last year and operated by Family Golf in the most recent quarter declined by 6 %. Family Golf acquired Eagle Quest on June 30, 1998 in a merger accounted for as a pooling of interests. The solid performance of the Company's more mature golf centers did not offset the poor performance of the more recently acquired facilities. In assessing the Company's poor performance, Mr. Chang stated ''We are disappointed by the performance of Eagle Quest and other facilities acquired in 1998. Measures that have proven successful for us in the past have not worked at the newer facilities. Expenses incurred in anticipation of such measures working, such as increasing staff and expanding pro shop inventory, have compounded the problem. Another factor in our disappointing performance was unanticipated delays in the construction and opening of certain facilities due to permit issues and weather conditions.'' Until the Credit Facility is renegotiated, the $98.2 million of principle outstanding under the Credit Facility and substantially all other debt, which would otherwise be classified as long-term debt will be classified as a current liability. If the covenants are successfully renegotiated, such indebtedness will be reclassified. If such covenants are not successfully renegotiated, the payment of the $98.2 million outstanding under the Credit Facility and substantially all other indebtedness of the Company could be declared immediately due and payable. In this event, the Company would likely file a voluntary petition seeking protection under the bankruptcy laws. The Company does not have adequate working capital to meet its current obligations, including principal debt repayments of $6.1 million due October 5, 1999 (after giving effect to a recently obtained waiver) and up to $2.8 million due September 30, 1999. It also lacks the capital to meet substantial construction commitments. The Company is negotiating with the lenders to defer all or a portion of the $8.9 million and seeking additional financing to meet its construction commitments. There can be no assurance that the lenders will defer such payments or that the Company will be able to obtain additional financing. In connection with the waivers under the $100 million Credit Facility and the waiver extending the maturity date of the $6.1 million of indebtedness, the Company agreed to increase the interest rate under both facilities to the prime rate plus 2% and to pay a waiver fee of 25 basis points. In commenting on the current status of the Company, Dominic Chang, the Company's Chairman and CEO, stated that ''We are working very closely with our lenders to restructure our debt and to obtain additional liquidity to enable us to satisfy our commitments. The waivers we have received is an indication of our senior lenders continuing support of the Company. We are also in the process of analyzing our business and are reviewing and discussing a number of ways of improving operations and strategic alternatives, including the potential disposition of the non-golf operations and the disposition or closing of non-performing or under performing assets''. To assist in this effort, the Company has engaged Zolfo, Cooper, L.L.C., a business advisory firm which specializes in assisting companies in developing and implementing strategic plans and programs to return to profitability. While developing its longer term strategy, the Company has taken certain immediate steps, including staff and inventory reductions. Mr. Chang concluded, ''The next several weeks will be extremely challenging and there are no guarantees that our efforts will prove to be successful. We appreciate the tireless efforts of our employees and the continued support of our lenders and trade creditors.'' The Company also announced the resignation of Jeffery C. Key, formerly Chief Financial Officer, who resigned August 11, 1999 to pursue other opportunities. ''After evaluating many factors, Jeff has determined that his skills and interest are best applied elsewhere. On behalf of the Company, I wish Jeff good luck in his future endeavors'' said Dominic Chang. Family Golf Centers operates golf centers in North America. The Company's golf centers provide a wide variety of practice and play opportunities, including facilities for driving, chipping, putting, pitching and sand play and typically offer full-line pro shops, golf lessons and other amenities such as miniature golf and snack bars. The Company also operates complementary sports and family entertainment facilities, including ice rinks and Family Sports Supercenters. Currently, the Company owns, operates, manages or has under construction 121 golf centers and 28 ice rink and family entertainment facilities in 25 states and three Canadian provinces. (Financial Highlights #reply-10929701 [2-2]) The matters discussed in this news release may be considered ''forward-looking'' statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties including those as described in Family Golf Centers, Inc.'s 10K for the year ended December 31, 1998; actual results could differ materially from those indicated by such forward-looking statements. -------------------------------------------------------------------------------- Contact: Family Golf Centers, Inc. Krishnan P. Thampi President and Chief Operating Officer or Kerri Swain Investor Relations Manager 516/694-1666 E-mail: IR@familygolf.com biz.yahoo.com

To: Marty Rubin who wrote (95)	8/12/1999 7:57:00 PM
From: Marty Rubin	Respond to of 101

("...Second Quarter Net Loss Of $.06 per share" 2-2. [#reply-10929664 1-2]) FAMILY GOLF CENTERS, INC.Financial Highlights (in thousands except per share data)(Unaudited) Three months ended Six months ended 6/30/99 6/30/98 6/30/99 6/30/98 ------- ------- ------- ------- Operating revenues $ 35,518 $ 26,314 $ 62,847 $ 43,051 Merchandise sales 11,980 8,310 19,800 13,070 ------- -------- ------- ------- Total revenue $ 47,498 $ 34,624 $ 82,647 $ 56,121 Operating expense $ 33,578 $ 15,534 $ 55,780 $ 29,285Cost of merchandise sold 8,373 5,669 13,719 8,909 Selling, general & admin 3,989 3,011 7,581 6,673 Merger expenses 7,752 7,752 ------- -------- ------- -------Income from operations $ 1,558 $ 2,658 $ 5,567 $ 3,502 Interest expense $ 4,171 $ 2,746 $ 7,326 $ 5,375 Other income 116 234 494 1,190 ------- -------- ------- -------Income before taxes $ (2,497) $ 146 $ (1,265) $ (683)Income tax expense $ (973) $ 4,027 $ (493) $ 4,887 ------- -------- ------- ------- Income before a cumulative effect of change in accounting principle $ (1,524) $ (3,881) $ (772) $ (5,570)Cumulative effect of change in accounting principle: Preopening expenses $ 2,035 ------- -------- ------- ------- Net income (loss) $ (1,524) $ (3,881) $ (772) $ (7,605) ======= ======== ======= ======= Income (loss) before cumulative effect of change in accounting principle per diluted share $ (0.06) $ (0.19) $ (0.03) $ (0.26) Cumulative effect of change in accounting principle $ (0.10) ------- -------- ------- ------- Net income (loss) per diluted share $ (0.06) $ (0.19) $ (0.03) $ (0.36) ======= ======== ======= ======= Weighted average shares outstanding - dilutive 26,056 20,856 26,088 20,844 FAMILY GOLF CENTERS, INC.Condensed Consolidated Balance Sheets June 30, Dec. 31, 1999 1998 -------- -------- ASSETS (Unaudited) Current assets: Cash, cash equivalents and short-term investments $ 4,235 $ 21,566 Inventories 28,401 26,220 Prepaid expenses, taxes and other Current assets 16,086 10,277 -------- -------- Total current assets $ 48,722 $ 58,063 Property, plant and equipment net 486,177 444,280 Other assets 67,092 69,697 -------- -------- Total assets $601,991 $572,040 ======== ======== LIABILITIESCurrent liabilities: Accounts payable, accrued expenses and other current liabilities $ 27,460 $ 23,998 Current portion of long-term obligations 273,994 3,950 -------- -------- Total current liabilities 301,454 27,948 Long-term obligations (less current portion) 130,621 Convertible subordinated debenture 115,000 Other liabilities 10,308 9,148 -------- -------- Total liabilities $311,762 $282,717 Minority interest 40 40 STOCKHOLDERS' EQUITY Total stockholders' equity 290,189 289,283 -------- -------- Total liabilities and stockholders' equity $601,991 $572,040 ======== ======== (to continue, #reply-10929664)