Form: 8-K

Current report filing

May 7, 2004

EXHIBIT 99.1

 

FOR IMMEDIATE RELEASE

 

                                             Contact:   Andrew Tammen
    Central Garden & Pet
    (925) 283-4573

 

CENTRAL GARDEN & PET REPORTS SECOND QUARTER

RESULTS FOR FISCAL 2004

 

SECOND QUARTER EARNINGS PER SHARE INCREASED 34%

 

RAISES FISCAL 2004 EARNINGS GUIDANCE

DUE TO SUSTAINED ORGANIC GROWTH AND ACQUISITIONS

 


 

LAFAYETTE, CALIFORNIA, May 6, 2004 – Central Garden & Pet Company (NASDAQ: CENT) today announced its financial results for the fiscal second quarter of 2004, ended March 27, 2004.

 

Net sales for the second quarter were $359.0 million, an 8.6% increase from $330.5 million in the comparable fiscal 2003 period. The Company recorded net income for the quarter of $18.8 million, or $0.91 per diluted share, compared with net income of $13.5 million, or $0.68 per diluted share, in the comparable year-ago period. Year-over-year second quarter earnings per share increased 34%.

 

The improved results for the second fiscal quarter of 2004 versus 2003 were primarily driven by continued growth of the Company’s branded products, including contributions from the recent Kent Marine and New England Pottery acquisitions, improved gross margins and lower interest expense.

 

Income from operations for the second quarter of 2004 improved 22% to $34.4 million from $28.2 million in the year-ago period. Depreciation and amortization for the most recent quarter totaled $4.3 million, the same as the prior year.

 

Net sales for the first six months of fiscal 2004 were $581.3 million, up 7.2%, compared with $542.4 million in the comparable 2003 period. Net income for the first half of 2004 was $18.2 million, or $0.88 per diluted share, compared with $12.8 million, or $0.64 per diluted share, in the comparable year ago period.

 

-more-


Central continues to anticipate earnings growth from its existing operations and recent acquisitions, and is raising its estimate for fiscal 2004 net income from a range of $2.10-$2.20 per diluted share to a range of $2.15-$2.23 per diluted share, a 24% to 29% increase over fiscal 2003. This earnings guidance includes the recently completed acquisition of Interpet.

 

The Company will discuss its fiscal second quarter 2004 results and the Interpet acquisition on an earnings conference call today at 4:30 p.m. EST. The earnings conference call will be simultaneously broadcast over the Internet through Central’s website, http://www.centralgardenandpet.com/. To listen to the webcast, please log on to the website prior to the scheduled call time to register and download any necessary audio software.

 

Central Garden & Pet Company is a leading innovator, marketer and producer of quality branded products for the pet and lawn and garden supplies markets. Our pet products include pet bird and small animal food, aquarium products, flea, tick, mosquito and other pest control products, edible bones, cages, carriers, pet books, and other dog, cat, reptile and small animal products. These products are sold under a number of brand names, including Kaytee, All-Glass Aquarium, Oceanic, Kent Marine, Zodiac, Pre-Strike, Altosid, Nylabone, TFH, Four Paws and Interpet. Our lawn and garden products include grass seed, wild bird food, weed and insect control products, decorative outdoor patio products and ant control products. These products are sold under a number of brand names, including Pennington, Norcal Pottery, New England Pottery, GKI/Bethlehem Lighting, Lilly Miller, Matthews Four Seasons, AMDRO and Grant’s. For additional information on Central Garden & Pet, including access to the Company’s SEC filings, please visit the Company’s website at http://www.centralgardenandpet.com/.

 

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this release which are not historical facts, including future earnings guidance, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by forward-looking statements. These risks are described in the Company’s Securities and Exchange Commission filings. Central undertakes no obligation to publicly update these forward-looking statements to reflect new information, subsequent events or otherwise.

 

# # #

 

(Tables follow)


Central Garden & Pet Company

 

Consolidated Statements of Income

 

(Unaudited)

(In thousands, except per share amounts)

 

     Three Months Ended

    Six Months Ended

 
     March 27,
2004


    March 29,
2003


    March 27,
2004


    March 29,
2003


 

Net Sales

   $ 358,985     $ 330,509     $ 581,335     $ 542,445  

Cost of Goods Sold and Occupancy

     246,959       231,419       407,238       382,137  
    


 


 


 


Gross Profit

     112,026       99,090       174,097       160,308  

Selling, General and Administrative Expenses

     77,669       70,916       136,180       130,170  
    


 


 


 


Income from Operations

     34,357       28,174       37,917       30,138  

Interest Expense

     (4,459 )     (6,341 )     (8,564 )     (9,184 )

Interest Income

     123       44       322       70  

Other Income

     985       671       270       330  
    


 


 


 


Income Before Income Taxes

     31,006       22,548       29,945       21,354  

Income Taxes

     12,162       9,019       11,746       8,542  
    


 


 


 


Net Income

   $ 18,844     $ 13,529     $ 18,199     $ 12,812  
    


 


 


 


Earnings Per Common Share:

                                

Basic

   $ 0.94     $ 0.70     $ 0.91     $ 0.67  

Diluted

   $ 0.91     $ 0.68     $ 0.88     $ 0.64  
    


 


 


 


Weighted Average Shares Outstanding

                                

Basic

     20,030       19,234       19,939       19,147  

Diluted

     20,803       20,009       20,646       19,900  


Central Garden & Pet Company

 

Condensed Consolidated Balance Sheets

 

(Unaudited)

(In thousands)

 

     March 27,
2004


   March 29,
2003


   September 27,
2003


Assets

                    

Current Assets:

                    

Cash and Equivalents

   $ 12,568    $ 7,007    $ 77,604

Restricted Investments

     15,179      —        —  

Accounts Receivable

     225,381      200,954      146,075

Inventories

     252,614      231,438      217,156

Other Current Assets

     10,766      13,926      15,222
    

  

  

Total Current Assets

     516,508      453,325      456,057

Property & Equipment - Net

     101,347      99,235      101,538

Other Assets

     335,482      272,936      271,503
    

  

  

Total

   $ 953,337    $ 825,496    $ 829,098
    

  

  

Liabilities & Shareholders’ Equity

                    

Current Liabilities:

                    

Notes Payable

   $ —      $ 81,747    $ —  

Accounts Payable

     133,543      129,848      105,103

Accrued Expenses

     55,663      48,220      47,061

Current Portion of Long-Term Debt

     1,027      6,503      1,028
    

  

  

Total Current Liabilities

     190,233      266,318      153,192

Long-Term Debt

     311,296      160,922      249,225

Other Long-Term Obligations

     1,580      2,128      1,585

Shareholders’ Equity

     450,228      396,128      425,096
    

  

  

Total

   $ 953,337    $ 825,496    $ 829,098