EACO Corporation EACO today reported the results for its quarter ended August 31, 2015.
Net sales, net income and earnings per share were as follows for the twelve and three months ended August 31, 2015 (dollars in thousands, except per share information):
Twelve Months Ended August 31, |
% |
|||||
2015 | 2014* |
Change |
||||
(unaudited) | ||||||
Net sales | $140,213 | $134,747 | 4.1% | |||
Net income | $3,741 | $5,611 | (33.3%) | |||
Basic and diluted earnings per common share | $0.75 | $1.14 | (34.2%) | |||
Three Months Ended August 31, |
% |
|||||
2015 | 2014* |
Change |
||||
(unaudited) | ||||||
Net sales | $35,652 | $36,537 | (2.4%) | |||
Net income | $1,052 | $2,141 | (50.9%) | |||
Basic and diluted earnings per common share | $0.21 | $0.44 | (52.3%) |
(*Net income for the three months ended August 31, 2014 includes non-operating items relating to the sale of the Sylmar properties and gain on workers compensation settlement for a pre-tax gain of $960,000 and $592,000 respectively. Additionally, the net income for the fiscal year ended August 31, 2014 includes the sale of the Orange Park property for a pre-tax gain of $535,000.)
The Company had 313 sales employees at August 31, 2015, a decrease of 5% from 329 sales employees on August 31, 2014. The company's sales force is divided into Sales Focus Teams (SFTs). The company had 96 SFTs as of August 31, 2015, an increase of 2% from 94 SFTs on August 31, 2014. The company continues to gain market share through its local presence business model. The decrease in headcount is a short-term adjustment, but management anticipates continued growth in both our headcount and SFTs in fiscal year 2016. The Company estimates that the annual North American market for our product is approximately $7.2 billion. The Company's current estimated market share is 2.0% as compared to 1.9% in the prior year.
EACO Corporation and Subsidiaries |
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Condensed Consolidated Balance Sheets |
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(in thousands, except share information) |
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(unaudited) |
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August 31, | August 31, | |||||
2015 | 2014* | |||||
ASSETS | ||||||
Current Assets: | ||||||
Cash and cash equivalents | $ | 5,269 | $ | 3,480 | ||
Restricted cash, current | 1,781 | 642 | ||||
Trade accounts receivable, net | 15,485 | 17,795 | ||||
Inventory, net | 16,733 | 14,863 | ||||
Marketable securities, trading | - | 73 | ||||
Prepaid expenses and other current assets | 591 | 1,104 | ||||
Total current assets | 39,859 | 37,957 | ||||
Non-current Assets: | ||||||
Restricted cash, non-current | 83 | 322 | ||||
Equipment and leasehold improvements, net | 1,569 | 1,603 | ||||
Other assets | 1,005 | 1,001 | ||||
Total assets | $ | 42,516 | $ | 40,883 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
Current Liabilities: | ||||||
Trade accounts payable | $ | 9,332 | $ | 11,192 | ||
Accrued expenses and other current liabilities | 4,349 | 3,508 | ||||
Liabilities of discontinued operations – short-term | 49 | 48 | ||||
Liability for short sales of trading securities | 1,781 | 642 | ||||
Total current liabilities | 15,511 | 15,390 | ||||
Non-current Liabilities: | ||||||
Liabilities of discontinued operations – long-term | 35 | 274 | ||||
Long-term debt | 33 | 1,728 | ||||
Total liabilities | 15,579 | 17,392 | ||||
Shareholders' Equity: | ||||||
Convertible preferred stock, $0.01 par value per share; 10,000,000 shares authorized; 36,000 shares outstanding (liquidation value $900) | 1 | 1 | ||||
Common stock, $0.01 par value per share; 8,000,000 shares authorized; 4,861,590 shares outstanding | 49 | 49 | ||||
Additional paid-in capital | 12,378 | 12,378 | ||||
Accumulated other comprehensive income | 860 | 1,065 | ||||
Retained earnings | 13,649 | 9,998 | ||||
Total shareholders' equity | 26,937 | 23,491 | ||||
Total liabilities and shareholders' equity | $ | 42,516 | $ | 40,883 | ||
* Derived from the Company's audited financial statements included in its Form 10-K for the year ended August 31, 2014 filed with the U.S. Securities and Exchange Commission on November 28, 2014. |
EACO Corporation and Subsidiaries |
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Condensed Consolidated Statements of Income | ||||||||||||||||
(in thousands, except for share and per share information) | ||||||||||||||||
(unaudited) | ||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||
August 31, | August 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014* | |||||||||||||
Revenues | $ | 35,652 | $ | 36,537 | $ | 140,213 | $ | 134,747 | ||||||||
Cost of revenues | 25,409 | 27,155 | 99,105 | 97,710 | ||||||||||||
Gross margin | 10,243 | 9,382 | 41,108 | 37,037 | ||||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative expenses | 9,083 | 8,351 | 35,394 | 32,178 | ||||||||||||
Income from operations | 1,160 | 1,031 | 5,714 | 4,859 | ||||||||||||
Other (expense) income: | ||||||||||||||||
Net gain (loss) on trading securities | 188 | 30 | 225 | (19 | ) | |||||||||||
Gain on sale of property | - | 960 | - | 1,495 | ||||||||||||
Interest and other income | - | (11 | ) | 3 | (307 | ) | ||||||||||
Interest expense, net | (8 | ) | - | (14 | ) | - | ||||||||||
Total other (expense) income | 180 | 979 | 214 | 1,169 | ||||||||||||
Income before income taxes | 1,340 | 2,010 | 5,928 | 6,028 | ||||||||||||
Provision for income taxes | 401 | 461 | 2,300 | 1,009 | ||||||||||||
Net income from continuing operations | 939 | 1,549 | 3,628 | 5,019 | ||||||||||||
Discontinued operations: | ||||||||||||||||
Gain on reduction of liabilities of discontinued operations | 113 | 592 | 113 | 592 | ||||||||||||
Net income | 1,052 | 2,141 | 3,741 | 5,611 | ||||||||||||
Cumulative preferred stock dividend | (19 | ) | (19 | ) | (76 | ) | (76 | ) | ||||||||
Net income attributable to common shareholders |
$ | 1,033 | $ | 2,122 | $ | 3,665 | $ | 5,535 | ||||||||
Basic and diluted earnings per share: | $ | 0.21 | $ | 0.44 | $ | 0.75 | $ | 1.14 | ||||||||
Basic and diluted weighted average common shares outstanding | 4,861,590 | 4,861,590 | 4,861,590 | 4,861,590 | ||||||||||||
* Derived from the Company's audited financial statements included in its Form 10-K for the year ended August 31, 2014 filed with the U.S. Securities and Exchange Commission on November 28, 2014. |
EACO Corporation and Subsidiaries |
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Condensed Consolidated Statements of Cash Flows | ||||||||
(in thousands) | ||||||||
(unaudited) | ||||||||
Twelve Months Ended | ||||||||
August 31, | ||||||||
2015 | 2014* | |||||||
Operating activities: | (Unaudited) | |||||||
Net income | $ | 3,741 | $ | 5,611 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 553 | 539 | ||||||
Bad debt expense | 91 | 12 | ||||||
Inventory reserve | 81 | 100 | ||||||
Gain on sale of Property | - | (1,495 | ) | |||||
Gain on Discontinued Ops, Workers Comp Settlement |
(113 | ) | (986 | ) | ||||
Net (gain) loss on investments | (225 | ) | 19 | |||||
(Increase) decrease in: | ||||||||
Trade accounts receivable | 2,219 | (3,369 | ) | |||||
Inventory | (1,951 | ) | (691 | ) | ||||
Prepaid expenses and other assets | 509 | 831 | ||||||
Increase (decrease) in: | ||||||||
Trade accounts payable | (47 | ) | 1,332 | |||||
Accrued expenses and other current liabilities | 841 | 610 | ||||||
Deposit Liability | - | (87 | ) | |||||
Liabilities of discontinued operations | (125 | ) | (1,247 | ) | ||||
Net cash provided by operating activities | 5,574 | 1,179 | ||||||
Investing activities: | ||||||||
Purchase of property and equipment | (519 | ) | (746 | ) | ||||
Sale of marketable securities, trading | 298 | 1,303 | ||||||
Proceeds from securities sold short | 1,139 | 642 | ||||||
Proceeds from sale of property | - | 9,483 | ||||||
Change in restricted cash | (900 | ) | (416 | ) | ||||
Net cash provided by investing activities | 18 | 10,266 | ||||||
Financing activities: | ||||||||
Payments on revolving credit facility | (1,684 | ) | (4,797 | ) | ||||
Preferred dividend | (76 | ) | (57 | ) | ||||
Bank overdraft | (1,827 | ) | 545 | |||||
Payments on long-term debt - real estate held for sale | - | (5,397 | ) | |||||
Payments on long-term debt | (11 | ) | (11 | ) | ||||
Net cash used in financing activities | (3,598 | ) | (9,717 | ) | ||||
Effect of foreign currency exchange rate changes on cash and cash equivalents | (205 | ) | 245 | |||||
Net increase in cash and cash equivalents | 1,789 | 1,973 | ||||||
Cash and cash equivalents - beginning of period | 3,480 | 1,507 | ||||||
Cash and cash equivalents - end of period | $ | 5,269 | $ | 3,480 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Cash paid for interest | $ | 13 | $ | 296 | ||||
Cash paid for taxes | $ | 1,342 | $ | 666 | ||||
* Derived from the Company's audited financial statements included in its Form 10-K for the year ended August 31, 2014 filed with the U.S. Securities and Exchange Commission on November 28, 2014. |
View source version on businesswire.com: http://www.businesswire.com/news/home/20151021006471/en/
EACO Corporation
Marta Arciniega
(714) 876-2490
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