Central Garden and Pet (NASDAQ:CENT)
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Central Garden & Pet Company (NASDAQ:CENT) today
announced that the litigation between Central and Herbert and Evelyn
Axelrod has been settled. Under the settlement, Central received a
cash payment from the Axelrods of $26 million.
In September 2005, a jury found for Central on its claim against
the Axelrods for collection of a promissory note that the Axelrods
signed in 1997 and for breach of warranty and fraud.
The Company is in the process of completing the accounting for the
settlement. Central's preliminary estimate is that the settlement will
result in a one-time contribution to operating income of approximately
$10 million after consideration of a receivable balance due from the
Axelrods of $16 million comprised of note principal and interest and
related expenses previously accrued on its financial statements. The
Company's previously issued guidance of $2.80-$2.90 earnings per fully
diluted share for fiscal 2006 does not include the benefit of this
settlement.
"We are pleased to have favorably finalized this litigation," said
Glenn Novotny, President and CEO. "We look forward to dedicating all
of our energy and resources toward building the Company and increasing
shareholder value."
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, SuperPet, All-Glass
Aquarium, Oceanic, Kent Marine, Energy Savers Unlimited, Zodiac,
Pre-Strike, Altosid, Nylabone, TFH, Four Paws, Interpet, Breeder's
Choice and Farnam. Our lawn and garden products include grass seed,
wild bird food, weed and insect control products, and decorative
outdoor patio 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,
Cedar Works, AMDRO, Grant's, Ironite, Sevin and Over'n Out. For
additional information on Central Garden & Pet, including access to
the Company's SEC filings, please visit the Company's 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 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.