EVANSVILLE, IN--(Marketwire - October 26, 2007) - Escalade, Incorporated (
NASDAQ:
ESCA)
announced that net income for the third quarter of 2007 increased 4.6%
compared to the same period last year while revenues for the third quarter
declined 7.5%. The Company reported earnings per share for the third
quarter of $.24 per share compared to $.23 per share for the same period
last year. Net income for the nine months ended October 6, 2007 increased
12.9% compared to the same period last year while revenues declined 1.8%.
Earnings per share for the first nine months of 2007 were $0.51 compared to
$0.45 per share for the same period last year.
Revenues from the Sporting Goods business segment declined 8.8% in the
third quarter of 2007 compared to the same period last year, principally
due to continued industry-wide erosion in consumer demand for soccer and
hockey game tables sold through the mass retail channel. Sales for the
nine months ended October 6, 2007 were down 2.9% compared to the same
period last year. Sales to mass-market retail customers were down 11.2% and
11.6% for the quarter and nine months ended October 6, 2007, respectively.
The Company continues to maintain strong relationships with its mass retail
customers. However, declining demand for game tables is expected to
continue, resulting in lower sales to the Company's mass retail customers.
The Company continues to execute its strategy of diversifying product
offerings and expanding its presence in sporting goods specialty retailers
and dealers. Sales to the specialty/dealer channel increased 10.2% and
20.7% for the quarter and nine months ended October 6, 2007, respectively,
compared to last year. As of October 6, 2007, sales to the specialty/dealer
channel comprise 38.2% of year-to-date sales compared to 31.2% for the same
period last year. Increased sales to the specialty/dealer channel is the
primary factor for increased profitability in the Sporting Goods business
segment. Management expects the Sporting Goods business to have flat
revenues with increased profitability for fiscal 2007 compared to last
year.
Revenues from the Office Products business segment were down 2.4% for the
quarter and up 1.0% for the nine months ended October 6, 2007. Excluding
the impact of foreign currency fluctuations, revenues from the Office
Products business were down 5.5% for the quarter and 2.7% for the nine
months ended October 6, 2007. Soft demand for office machines in North
America is being offset in part by higher demand for professional and heavy
duty paper shredders in Europe. Profitability in the Office Products
business continues to be strong with operating income up 16.2% and 11.5%
for the quarter and nine months ended October 6, 2007, respectively.
Operating income is defined as Revenues less Cost of Goods Sold and
Selling, General and Administrative costs and is deemed by management to be
an important measure of the business segments overall performance.
Management anticipates Office Product revenues for 2007 to be relatively
unchanged from the prior year.
Robert J. Keller, President and Chief Executive Office of Escalade, Inc.
stated: "With a stable of strong brands, including Stiga, Goalrilla, Bear
Archery, and Intimus, we have the opportunity to invest in marketing and
innovation to sustain profitable growth. In the future we will increase
our investments in market research, along with training and development of
people, to capitalize on the emerging needs of our consumers. We will also
continue to consider acquisitions which complement our consumer brand
strategy. While these changes will not happen overnight, we believe we
have taken the right initial steps to shape the strategy, organization, and
business processes required for long-term success."
Escalade is a leading manufacturer and marketer of sporting goods and
office/graphic arts products sold worldwide. To obtain more information on
the Company and its products, visit our website at:
www.EscaladeInc.com or
contact Terry Frandsen Vice President and CFO at 812/467-1334.
FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements relating to present or
future trends or factors that are subject to risks and uncertainties. These
risks, include, but are not limited to, the impact of competitive products
and pricing, product demand and market acceptance, Escalade's ability to
successfully integrate the operations of acquired assets and businesses,
new product development, the continuation and development of key customer
and supplier relationships, Escalade's ability to control costs, general
economic conditions, fluctuations in operating results, changes in the
securities markets and other risks detailed from time to time in Escalade's
filings with the Securities and Exchange Commission. Escalade's future
financial performance could differ materially from the expectations of
management contained herein. Escalade undertakes no obligation to update
these forward-looking statements after the date of this report.
ESCALADE, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited, In Thousands Except Per Share Amounts)
Three Months Ended Nine Months Ended Twelve Months Ended
---------------- ------------------ ------------------
06 07 06 07 06 07
October October October October October October
2007 2006 2007 2006 2007 2006
------- ------- -------- -------- -------- --------
NET SALES $60,687 $65,583 $144,684 $147,332 $188,817 $189,757
OPERATING
EXPENSES
Cost of goods
sold 45,086 49,023 100,997 104,684 134,135 133,048
Selling and
administrative 9,509 10,650 30,047 31,434 38,531 40,421
Restructuring -- -- -- -- -- (631)
------- ------- -------- -------- -------- --------
OPERATING INCOME 6,092 5,910 13,640 11,214 16,151 16,919
OTHER INCOME
(EXPENSE)
Interest expense (714) (862) (2,183) (1,926) (2,893) (2,283)
Other income
(expense) 595 (310) (472) (565) 465 (283)
------- ------- -------- -------- -------- --------
INCOME BEFORE
INCOME TAXES 5,973 4,738 10,985 8,723 13,723 14,353
PROVISION FOR
INCOME TAXES (2,842) (1,746) (4,322) (2,819) (4,469) (5,065)
------- ------- -------- -------- -------- --------
NET INCOME $ 3,131 $ 2,992 $ 6,663 $ 5,904 $ 9,254 $ 9,288
======= ======= ======== ======== ======== ========
PER SHARE DATA
Basic earnings
per share $ 0.24 $ 0.23 $ 0.51 $ 0.45 $ 0.71 $ 0.71
======= ======= ======== ======== ======== ========
Diluted earnings
per share $ 0.24 $ 0.23 $ 0.51 $ 0.45 $ 0.71 $ 0.70
======= ======= ======== ======== ======== ========
Average shares
outstanding 12,889 13,026 12,938 13,007 12,983 13,003
CONSOLIDATED CONDENSED BALANCE SHEET
(Unaudited, In Thousands)
06 October 07 October 30 December
2007 2006 2006
------------ ------------ ------------
ASSETS
Current assets $ 99,195 $ 94,662 $ 74,470
Property, Plant & Equipment - net 20,206 20,290 20,657
Other assets 32,408 30,987 30,561
Goodwill 25,485 24,708 25,027
------------ ------------ ------------
Total $ 177,294 $ 170,647 $ 150,715
============ ============ ============
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities $ 60,623 $ 59,545 $ 41,345
Other liabilities 28,755 29,045 23,655
Stockholders’ equity 87,916 82,057 85,715
------------ ------------ ------------
Total $ 177,294 $ 170,647 $ 150,715
============ ============ ============
Contact Information: Contact:
Terry Frandsen
Vice President and CFO
812/467-1334