PRESS RELEASE
Published on November 27, 2007
Exhibit 99.1
FOR IMMEDIATE RELEASE
Contact: | Paul Warburg | |
Central Garden & Pet | ||
925.948.3686 |
CENTRAL GARDEN & PET ANNOUNCES FOURTH QUARTER AND FULL YEAR RESULTS FOR FISCAL 2007
WALNUT CREEK, CALIFORNIA, November 27, 2007 Central Garden & Pet Company (NASDAQ: CENT/CENTA) today announced fourth quarter and full year results for its fiscal year ended September 29, 2007.
For the fourth quarter of fiscal 2007, the Company reported net sales of $401 million, a decline of $20 million or 5% from $421 million in the comparable 2006 period. Income from operations for the quarter decreased 53% to $10.1 million from $21.4 million in the year ago period. The net loss for the quarter was $1.7 million, or $0.02 per fully diluted share, compared to net income of $6.0 million, or $0.08 per fully diluted share, in the year ago period. Depreciation and amortization for the quarter was $8.8 million compared to $5.3 million in the year ago period. Branded product sales decreased 2% to $342 million. Sales of other manufacturers products declined 16% or $11.3 million to $59.5 million.
Net sales for the Garden Products segment were $180 million, a decrease of $4 million or 2% compared to the fourth quarter of fiscal 2006. Garden branded products sales increased approximately $3 million or 2% while sales of other manufacturers products, as anticipated, declined 23%. The Garden Products segment operating income was $2.8 million in the quarter, a decrease of $1.4 million, or 34% when compared to the fourth quarter of fiscal 2006. Net sales for the Pet Products segment were $221 million, a decrease of $16 million or 7% compared to the fourth quarter of fiscal 2006. Pet branded products sales decreased $11 million or 6% and sales of other manufacturers products decreased 11%. Operating income for the Pet Products segment was $17.3 million in the quarter, a decrease of $13.9 million, or 45%, when compared to the fourth quarter of fiscal 2006.
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Net sales for fiscal year 2007 were $1.67 billion, an increase of 3% from $1.62 billion in fiscal 2006. Operating income decreased 27% to $99.4 million compared to last year. Net income for the year decreased 51% to $32.3 million from $65.5 million in the prior year. Diluted earnings per share was $0.45, a 53% decrease compared to the prior year. Depreciation and amortization for the year was $30.7 million compared to $24.0 million in the prior year. Branded product sales increased 6% to $1.40 billion. Sales of other manufacturers products, as anticipated, declined 9% to $270.3 million. Organic sales declined 1% for the year.
With 2007 behind us, we are looking to fiscal 2008 to reset and create a stronger and more agile company, noted William Brown, Chairman and Chief Executive Officer of Central Garden & Pet Company. Some of our operations are not performing well. We have significant work to do.
The Company will discuss its fourth quarter and full year fiscal 2007 results on a conference call today at 4:30 p.m. EST. The earnings conference call will be broadcast over the Internet through Centrals website, www.central.com, or you may link directly to the webcast at http://phx.corporate-ir.net/phoenix.zhtml?c=93879&p=irol-calendar. To listen to the call by telephone, please dial 1-8886800879 and passcode 3227 3384 (domestic) or 6172134856 and passcode 3227 3384 (international). You may bypass the operator and go directly to the teleconference by pre-registering, at any time before the call, through the link below which will provide you with a unique PIN number. At the time of the call, after dialing the number and passcode mentioned above, enter your PIN for immediate access to the teleconference.
https://www.theconferencingservice.com/prereg/key.process?key=PAXD9GGKY
Central Garden & Pet Company is a leading innovator, marketer and producer of quality branded products for the lawn & garden and pet supplies markets. Committed to new product innovation, our products are sold to specialty independent and mass retailers in the following categories: Lawn & Garden: Grass seed including the brands PENNINGTON® and THE REBELS; wild bird feed and the brands PENNINGTON® and KAYTEE®; weed and insect control and the brands AMDRO®, SEVIN®, IRONITE® and OVER N OUT and; decorative outdoor patio products and the brands NORCAL®, NEW ENGLAND POTTERY®, GKI/BETHLEHEM LIGHTING® and MATTHEWS FOUR SEASONS. We also provide a host of other regional and application-specific garden brands and supplies. Pet categories
include: Animal health and the brands ADAMS and ZODIAC®; aquatics and reptile and the brands OCEANIC®, AQUEON and ZILLA; bird & small animal and the brands KAYTEE®, SUPER PET® and CRITTER TRAIL®; dog & cat and the brands TFH / NYLABONE®, FOUR PAWS®, PINNACLE® and AVO-DERM® and; equine and the brands FARNAM®, BRONCO® and SUPER MASK®. We also provide a host of other application-specific pet brands and supplies. Central Garden & Pet Company is based in Walnut Creek, California, and has approximately 5,000 employees, primarily in North America and Europe. For additional information on Central Garden & Pet Company, including access to the Companys SEC filings, please visit the Companys website at http://www.central.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 Companys Annual Report on Form 10-K and other Securities and Exchange Commission filings. Central undertakes no obligation to publicly update these forward-looking statements to reflect new information, subsequent events or otherwise.
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(Tables Follow)
Central Garden & Pet Company
Consolidated Statements of Income
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended | Fiscal Year Ended | |||||||||||||||
September 29, 2007 |
September 30, 2006 |
September 29, 2007 |
September 30, 2006 |
|||||||||||||
Net Sales |
$ | 401,309 | $ | 420,774 | $ | 1,671,145 | $ | 1,621,531 | ||||||||
Cost of Goods Sold and Occupancy |
283,845 | 285,923 | 1,136,825 | 1,086,219 | ||||||||||||
Gross Profit |
117,464 | 134,851 | 534,320 | 535,312 | ||||||||||||
Selling, General and Administrative |
||||||||||||||||
Expenses |
107,394 | 113,427 | 434,903 | 398,510 | ||||||||||||
Income from Operations |
10,070 | 21,424 | 99,417 | 136,802 | ||||||||||||
Interest Expense |
(12,389 | ) | (11,893 | ) | (49,685 | ) | (40,677 | ) | ||||||||
Interest Income |
281 | 138 | 1,538 | 3,007 | ||||||||||||
Other Income (Expense) |
(477 | ) | (140 | ) | 2,402 | 3,083 | ||||||||||
Income (Loss) Before Income Taxes and Minority Interest |
(2,515 | ) | 9,529 | 53,672 | 102,215 | |||||||||||
Income Tax Expense (Benefit) |
(905 | ) | 3,429 | 19,999 | 35,791 | |||||||||||
Minority Interest |
85 | 81 | 1,369 | 890 | ||||||||||||
Net Income (Loss) |
$ | (1,695 | ) | $ | 6,019 | $ | 32,304 | $ | 65,534 | |||||||
Basic Earnings (Loss) Per Common Share |
$ | (0.02 | ) | $ | 0.09 | $ | 0.46 | $ | 0.97 | |||||||
Diluted Earnings (Loss) Per Common Share |
$ | (0.02 | ) | $ | 0.08 | $ | 0.45 | $ | 0.95 | |||||||
Weighted Average Shares Outstanding |
||||||||||||||||
Basic |
71,131 | 70,746 | 70,824 | 67,833 | ||||||||||||
Diluted |
71,131 | 71,733 | 72,050 | 69,054 |
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Central Garden & Pet Company
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
September 29, 2007 |
September 30, 2006 |
|||||
Assets |
||||||
Current Assets: |
||||||
Cash and Cash Equivalents |
$ | 21,055 | $ | 28,406 | ||
Accounts Receivable |
247,429 | 239,172 | ||||
Inventories |
378,365 | 332,214 | ||||
Other Current Assets |
38,659 | 34,910 | ||||
Total Current Assets |
685,508 | 634,702 | ||||
Property and Equipment - Net |
201,609 | 162,604 | ||||
Goodwill and Other Assets |
759,705 | 736,517 | ||||
Total |
$ | 1,646,822 | $ | 1,533,823 | ||
Liabilities and Shareholders Equity |
||||||
Current Liabilities: |
||||||
Accounts Payable |
$ | 135,972 | $ | 122,960 | ||
Accrued Expenses |
75,968 | 81,305 | ||||
Current Portion of Long-Term Debt |
3,352 | 3,039 | ||||
Total Current Liabilities |
215,292 | 207,304 | ||||
Long-Term Debt |
607,171 | 565,410 | ||||
Other Long-Term Obligations |
44,802 | 29,583 | ||||
Convertible Redeemable Preferred Stock |
750 | 3,000 | ||||
Minority Interest |
1,834 | 1,167 | ||||
Shareholders Equity |
776,973 | 727,359 | ||||
Total |
$ | 1,646,822 | $ | 1,533,823 | ||