PRESS RELEASE JULY 30, 2004
Published on
NEWS RELEASE
R&B, INC.
Corporate Headquarters:
R&B, Inc.
3400 East Walnut Street
Colmar, Pennsylvania 18915
Fax: (215) 997-8577
For Further Information Contact:
Mathias J. Barton, CFO
(215) 997-1800 x5132
E-mail:MBarton@rbinc.com
R&B, Inc. Reports Sales and Earnings for the Second Quarter Ended June 26, 2004
Colmar, Pennsylvania (July 30, 2004) -- R&B, Inc., (NASDAQ:RBIN) today
announced financial results for the second quarter ended June 26, 2004. For the
second quarter ended June 26, 2004, sales increased 11% to $64.3 million from
$58.1 million in the same period last year. Net income in the second quarter of
2004 was $5.3 million compared to net income of $3.5 million in the same period
last year. Diluted earnings per share in the second quarter increased 49% to
$0.58 from $0.39 in the same period last year.
For the six months ended June 26, 2004, sales increased 11% to $120.3
million from $108.3 million in the same period last year. Diluted earnings per
share for the first six months of 2004 increased 47% to $0.94 compared to $0.64
in the same period last year. Net income for the first six months of 2004 was
$8.6 million compared to net income of $5.8 million in the same period last
year.
Sales volume in 2004 increased as a result of continued sales growth
from products introduced within the last twelve months and shipments of the
Company's Pik-A-Nut home hardware product line to K-Mart, which became a
customer in the third quarter of last year. The favorable effects of foreign
currency exchange resulted in a 1% year over year increase in sales.
Mr. Richard Berman, Chairman, President and Chief Executive Officer
said, "Our sales growth in the first half of the year is the direct result of
our continued focus on new product development. Our goal is to maintain our
leadership position in the aftermarket by further accelerating our rate of new
product introductions over the next two years through our "Driving ReveNEW"
initiative. We will distribute over 700,000 copies of our new service dealer
guide in the third quarter as part of our continuing awareness program. This
offering will highlight many of the exciting new products that we have recently
introduced for the service dealer and do-it-yourself markets. We remain
committed to our strategy of accelerating opportunities for our customers and
our businesses through continued investment in new product development,
initiatives designed to create and grow aftermarket demand for new and existing
products, and supply chain excellence to ensure that the right parts are
available at the right place at the right time to satisfy demand."
The Company also announced its decision to invest approximately $5.0
million to automate its recently-expanded central distribution facility in
Warsaw, Kentucky. This initiative, which is expected to be completed shortly
after year end, will also result in approximately $0.6 million in one-time start
up and training costs, which are expected to be incurred in the second half of
this year. Once completed, this project is expected to generate significant
efficiency improvements and improved customer service capabilities for the
Company's Dorman business. Total capital spending in 2004 is expected to be
between $10.0 and $12.0 million as a result of this initiative, the 77,200
square foot expansion of the Warsaw facility, increased tooling costs for new
products and other capital projects.
R&B, Inc. is a leading supplier of OE Dealer "Exclusive" automotive
replacement parts, automotive hardware and brake products to the automotive
aftermarket and household hardware to the general merchandise markets. R&B's
products are marketed under more than thirty proprietary brand names, through
its Motormite, Dorman, Allparts, Scan-Tech, MPI and Pik-A-Nut businesses.
Forward looking statements in this release are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. Such
forward looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those projected. Readers
are cautioned not to place undue reliance on these forward looking statements
which speak only as of the date hereof. Factors that cause actual results to
differ materially include, but are not limited to, those factors discussed in
the Company's Annual Report on Form 10-K under "Business - Risk Factors."
R&B, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(in thousands, except per-share amounts)
13 Weeks 13 Weeks
------------- ---------------
Second Quarter (unaudited) 6/26/04 Pct. 6/28/03 Pct.
Net sales $64,277 100.0 $58,068 100.0
Cost of goods sold 39,317 61.2 36,885 63.5
Gross profit 24,960 38.8 21,183 36.5
Selling, general and
administrative expenses 15,846 24.6 14,811 25.5
Income from operations 9,114 14.2 6,372 11.0
Interest expense, net 769 1.2 884 1.5
Income before income taxes 8,345 13.0 5,488 9.5
Provision for income taxes 3,028 4.7 1,963 3.4
Net income $ 5,317 8.3 $ 3,525 6.1
Earnings per share
Basic $ 0.60 - $ 0.41 -
Diluted $ 0.58 - $ 0.39 -
Average shares outstanding
Basic 8,845 - 8,627 -
Diluted 9,194 - 9,033 -
26 Weeks 26 Weeks
--------------- ---------------
Year-to-date (unaudited) 6/26/04 Pct. 6/28/03 Pct.
Net sales $120,282 100.0 $108,340 100.0
Cost of goods sold 74,707 62.1 68,559 63.3
Gross profit 45,575 37.9 39,781 36.7
Selling, general and
administrative expenses 30,504 25.4 29,071 26.8
Income from operations 15,071 12.5 10,710 9.9
Interest expense, net 1,530 1.2 1,775 1.7
Income before income taxes 13,541 11.3 8,935 8.2
Provision for income taxes 4,906 4.1 3,185 2.9
Net income $ 8,635 7.2 $ 5,750 5.3
Earnings per share
Basic $ 0.98 - $ 0.67 -
Diluted $ 0.94 - $ 0.64 -
Average shares outstanding
Basic 8,804 - 8,564 -
Diluted 9,162 - 8,996 -
R&B, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands)
6/26/04 12/27/03
Assets: (Unaudited)
Cash and short term investments $ 17,888 $ 25,082
Accounts receivable 62,267 44,127
Inventories 51,339 51,170
Prepaid expenses and other 9,300 8,849
Total current assets 140,794 129,228
Property & equipment 20,562 17,590
Goodwill 29,026 29,125
Other assets 575 663
Total assets $190,957 $176,606
Liability & Shareholders' Equity:
Current portion of long-term debt$ 9,049 $ 8,571
Accounts payable 14,621 10,029
Accrued expenses and other 12,741 12,176
Total current liabilities 36,411 30,776
Long-term debt 34,759 35,213
Deferred income taxes 5,237 4,632
Shareholders' equity 114,550 105,985
Total Liabilities and Equity $190,957 $176,606
Selected Cash Flow Information:
(in thousands) 13 Weeks 26 Weeks
-------- --------
6/26/04 6/28/03 6/26/04 6/28/03
Depreciation and
amortization $ 1,155 $1,227 $ 2,235 $ 2,419
Capital Expenditures $ 3,450 $1,418 $ 5,212 $ 2,303