Mpw Industrial Services (NASDAQ:MPWG)
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MPW Reports Fiscal Third Quarter and Year-to-Date Results
HEBRON, Ohio, May 12 /PRNewswire-FirstCall/ -- MPW Industrial Services Group,
Inc. today announced total revenue of $22.8 million for the third fiscal
quarter ended March 31, 2004. The revenue was down $1.3 million from $24.1
million for the quarter ended March 31, 2003. The Company reported net income
of $455 thousand, or $0.04 per share, for the third fiscal quarter ended March
31, 2004, compared with net income of $600 thousand, or $0.05 per share, for
the same period last year.
Total revenue for the first nine months of fiscal 2004 was $64.8 million
compared with $72.2 million for the first nine months of fiscal 2003. The net
loss for the nine months ended March 31, 2004 was $(1.5) million, or ($0.14)
per share, compared with a net loss of $(2.2) million, or $(0.21) per share,
for the nine months ended March 31, 2003.
The net loss for the first nine months of fiscal 2003 included a $2.8 million,
net of tax of $1.9 million, non-cash goodwill impairment charge as a result of
the adoption of Statement of Financial Accounting Standards No. 142, "Goodwill
and Other Intangible Assets." This charge was recorded as a cumulative effect
of a change in accounting principle as of July 1, 2002.
CEO Comments
Monte Black, Chairman and Chief Executive Officer, commented, "We continue to
expand our sales and marketing efforts and are beginning to see some benefits
from these initiatives. In addition, we are committed to increasing our market
presence, to improve our operating efficiencies, and to provide excellent
service to our customers to support their operations."
Quarterly Discussion
Revenues decreased 5.4% to $22.8 million in the third quarter of fiscal 2004
from $24.1 million in the same prior year period. The decline in revenues was
primarily in the Chemical Cleaning business unit of the Industrial Water
Process Purification ("Industrial Water") segment as a result of aggressive
pricing by competitors, deferred customer spending and a one- time $0.5 million
project in the prior year.
Income from operations was $0.9 million for the three months ended March 31,
2004 compared to $2.0 million for the three months ended March 31, 2003. The
decline in operating income was driven by a high fixed labor base in the
Industrial Cleaning and Facility Maintenance and Industrial Water segments,
increased workers compensation costs and recoveries from two favorable contract
settlements in the prior year, slightly offset by decreased repair and
maintenance costs, decreased bad debt expense and improved efficiencies in
operating supply usage.
The net loss for the third quarter of fiscal 2003 included the Company's equity
loss in affiliate of $0.3 million. During the fourth quarter of fiscal 2003,
the Company wrote off its remaining investment in Pentagon Technologies, Inc.
("Pentagon") due to continued declines in Pentagon's operating results as well
as the slowdown and uncertainty in the semi-conductor industry. As a result of
the full write-off of the Company's investment in Pentagon at June 30, 2003,
the Company has not continued to recognize its equity investment in the losses
of Pentagon in fiscal 2004.
Corporate Profile
MPW Industrial Services Group, Inc. is a leading provider of integrated,
technically based industrial cleaning and related facilities support services
in North America. MPW offers three principal service lines that are integral
to a wide variety of manufacturing processes. These three service lines are
industrial cleaning and facility maintenance, industrial container cleaning and
industrial process water purification.
Forward-Looking Statements
The statements contained in this news release that are forward-looking are
based on current expectations that are subject to a number of uncertainties and
risks, and actual results may differ materially. The uncertainties and risks
include, but are not limited to, competitive and other market factors, customer
purchasing behavior, general economic conditions and other facets of the
Company's business operations. Additional information about these and other
risks and uncertainties can be found in "Investment Considerations" in the
Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2003;
and in other documents the Company files or has filed with the Securities and
Exchange Commission. Further information may also be obtained at the Company's
Internet site: http://www.mpwservices.com/ .
MPW INDUSTRIAL SERVICES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
March 31, June 30,
2004 2003
(unaudited)
ASSETS
Cash $358 $2,726
Accounts receivable, net 15,253 17,201
Inventories 2,296 2,294
Deferred income taxes 1,512 1,461
Prepaid expenses 798 1,197
Other current assets 2 16
Total current assets 20,219 24,895
Property and equipment, net 31,382 35,120
Goodwill 6,044 6,044
Other intangibles, net 6,427 6,889
Other assets 96 122
Total assets $64,168 $73,070
LIABILITIES
Accounts payable $3,383 $8,218
Accrued compensation and related
taxes 2,152 2,373
Current maturities of long-term
debt 1,281 1,322
Other accrued liabilities 4,265 6,153
Total current liabilities 11,081 18,066
Long-term debt 18,912 18,892
Deferred income taxes 3,643 3,400
Other long-term liabilities 321 469
Total liabilities 33,957 40,827
SHAREHOLDERS' EQUITY
Preferred stock, $0.01 par value;
5,000,000 shares authorized; no
shares issued and outstanding - -
Common stock, no par value;
30,000,000 shares authorized;
10,708,707 and 10,939,957 shares
issued and outstanding at
March 31, 2004 and June 30, 2003,
respectively 107 109
Additional paid-in capital 40,921 41,507
Accumulated deficit (10,575) (9,027)
Accumulated other comprehensive loss (242) (346)
Total shareholders' equity 30,211 32,243
Total liabilities and
shareholders' equity $64,168 $73,070
MPW INDUSTRIAL SERVICES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share data)
Three Months Ended Nine Months Ended
March 31, March 31,
2004 2003 2004 2003
(unaudited) (unaudited)
Revenues $22,833 $24,144 $64,808 $72,150
Cost of services (including
depreciation) 18,171 18,127 53,278 56,061
Gross profit 4,662 6,017 11,530 16,089
Selling, general and administrative
expenses 3,724 4,052 12,852 12,751
Income (loss) from operations 938 1,965 (1,322) 3,338
Interest expense, net 296 457 857 1,470
Income (loss) from continuing
operations before income taxes
(benefit) and equity in loss of
affiliate 642 1,508 (2,179) 1,868
Provision (benefit) for income
taxes 187 634 (631) 785
Income (loss) from continuing
operations before equity in
loss of affiliate 455 874 (1,548) 1,083
Equity in loss of affiliate - (315) - (499)
Income (loss) from continuing
operations 455 559 (1,548) 584
Income from discontinued
operations, net of tax - 41 - 84
Income (loss) before cumulative
effect of change in
accounting principle 455 600 (1,548) 668
Cumulative effect of change in
accounting principle - - - (2,845)
Net income (loss) $455 $600 $(1,548) $(2,177)
Net income (loss) per share, basic
and diluted:
Income (loss) from continuing
operations $0.04 $0.05 $(0.14) $0.05
Income from discontinued
operations, net of tax - - - -
Income (loss) before cumulative
effect of change in
accounting principle $0.04 $0.05 $(0.14) $0.05
Cumulative effect of change in
accounting principle - - - (0.26)
Net income (loss) per share $0.04 $0.05 $(0.14) $(0.21)
Weighted average shares outstanding 10,747 10,940 10,881 10,940
Weighted average shares outstanding,
assuming dilution 10,857 10,941 10,881 10,965
DATASOURCE: MPW Industrial Services Group, Inc.
CONTACT: Robert Valentine, Vice President and Chief Financial Officer of
MPW Industrial Services Group, Inc., +1-740-927-8790
Web site: http://www.mpwservices.com/
Company News On-Call: http://www.prnewswire.com/comp/126032.html