Bestway (NASDAQ:BSTW)
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Bestway, Inc. Reports Results for Fiscal 2004 Second Quarter and Six Months;
Same Store Sales Increase 7.5%; Net Earnings Increase 273.6%
DALLAS, March 11 /PRNewswire-FirstCall/ -- Bestway, Inc. , today reported
financial results for its fiscal second quarter and six-months ended January 31,
2004.
Revenue for the quarter was $9,564,193, a $669,933 increase from $8,894,260 for
the comparable period in the prior year. We achieved this 7.5% year-over-year
revenue increase from same stores. Of the increase in revenue from same stores,
rental and fee income increased $868,207, or 10.2%. The increase in rental and
fee income is directly attributable to the success of our efforts on improving
store operations through increasing our customer base and increasing the average
price per unit on rent by upgrading our rental merchandise. Sales of
merchandise decreased $198,274, or 50.6%, as the Company discontinued and
liquidated lower-margin product offerings in December 2002.
Net earnings for the quarter increased to $159,208, or $.09 per share on a
diluted basis, compared to net earnings of $42,619, or $.02 per diluted share,
for the comparable period in the prior year. The year-over-year increase in net
earnings is primarily the result of eliminating lower-cost, lower-margin
merchandise from our product mix, focusing on higher revenue-generating
merchandise, driving top line revenues through training and developing our
people and implementing a more aggressive and targeted marketing campaign.
For the six months ended January 31, 2004 revenue was $18,623,221, a $1,455,999
increase from $17,167,222 for the comparable period in the prior year. We
achieved this 8.5% year-over-year revenue increase from same stores. Net
earnings for the six month period ended January 31, 2004 was $223,713, or $.12
per share on a diluted basis, compared to net loss of $194,072, or $.12 per
diluted share for the comparable period last year.
"We continue to be pleased with our initiatives in training and development.
The pay offs we've seen are tighter inventory controls, a reduction in
delinquent accounts, increased customer counts, as well as a reduction in
employee turnover," said David A. Kraemer, President and Chief Executive
Officer. "As we look forward to the remainder of the year, we expect same store
revenues to continue to be strong and remain confident in the fundamentals of
our business."
Bestway, Inc. owns and operates a total of sixty-nine rent-to-own stores located
in the southeastern United States. These stores generally offer high quality
brand name merchandise such as home entertainment equipment, appliances,
furniture and computers under flexible rental purchase agreements that generally
allow the customer to obtain ownership of the merchandise at the conclusion of
an agreed upon rental period.
This press release and the guidance above contain various "forward-looking
statements" that involve risks and uncertainties. Forward-looking statements
represent the Company's expectations or beliefs concerning future events. Any
forward-looking statements made by or on behalf of the Company are subject to
uncertainties and other factors that could cause actual results to differ
materially from such statements. These uncertainties and other factors include,
but are not limited to, (i) the ability of the Company to open or acquire
additional rental-purchase stores on favorable terms, (ii) the ability of the
Company to improve the performance of such acquired stores and to integrate such
opened or acquired stores into the Company's operations, (iii) the impact of
state and federal laws regulating or otherwise affecting rental- purchase
transactions, (iv) the impact of general economic conditions in the United
States and (v) the impact of terrorist activity, threats of terrorist activity
and responses thereto on the economy in general and the rental- purchase
industry in particular. Undo reliance should not be placed on any
forward-looking statements made by or on behalf of the Company as such
statements speak only as of the date made. The Company undertakes no obligation
to publicly update or revise any forward-looking statement, whether as a result
of new information, the occurrence of future events or otherwise.
BESTWAY, INC.
SELECTED BALANCE SHEET DATA
(Unaudited)
January 31, July 31,
2004 2003
Cashand cash equivalents $ 823,058 $ 305,869
Prepaid expenses and other assets 208,630 234,908
Rental merchandise, net 13,755,615 13,858,064
Property and equipment, net 2,406,290 2,732,798
Total assets 19,643,353 20,002,168
Accounts payable 1,073,947 751,328
Debt 8,742,797 9,451,299
Total liabilities 11,078,250 11,683,375
Stockholders' Equity 8,565,103 8,318,793
BESTWAY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
January 31, January 31,
2004 2003 2004 2003
Revenues:
Rental and fee income $9,370,876 $8,502,669 $18,265,815 $16,496,860
Sales of merchandise 193,317 391,591 357,406 670,362
9,564,193 8,894,260 18,623,221 17,167,222
Cost and operating
expenses:
Depreciation and
amortization:
Rental merchandise 1,862,648 1,728,322 3,621,819 3,348,869
Other 308,540 379,407 636,981 751,944
Cost of merchandise sold 180,512 427,584 336,871 779,824
Salaries and wages 2,772,879 2,662,915 5,414,204 5,107,388
Advertising 454,715 427,932 918,604 812,923
Occupancy 632,683 593,122 1,250,953 1,182,182
Other operating
expenses 2,946,454 2,499,317 5,784,411 5,153,395
Interest expense 136,396 175,103 289,210 350,268
Loss (gain) on sale
of property and
equipment 14,225 (9,347) 11,653 (8,561)
9,309,052 8,884,355 18,264,706 17,478,232
Income (loss) before
income taxes 255,141 9,905 358,515 (311,010)
Income tax expense
(benefit) 95,933 (32,714) 134,802 (116,938)
Net income (loss) $ 159,208 $ 42,619 $ 223,713 $ (194,072)
Basic net income (loss)
per share $ 0.09 $ 0.03 $ 0.13 $ (0.12)
Diluted net income
(loss) per share $ 0.09 $ 0.02 $ 0.12 $ (0.12)
Weighted average common
shares outstanding 1,681,089 1,671,705 1,679,880 1,662,139
Diluted weighted average
common shares
outstanding 1,825,787 1,752,091 1,831,179 1,662,139
DATASOURCE: Bestway, Inc.
CONTACT: Beth A. Durrett, Chief Financial Officer, or
, or David A. Kraemer, President and Chief Executive
Officer, or , both of Bestway, Inc., +1-214-630-6655