SOURCE: U.S. Dry Cleaning Corporation

September 06, 2007 07:00 ET

U.S. Dry Cleaning Reports Record Revenue for the Quarter Ending June 30, 2007

PALM SPRINGS, CA--(Marketwire - September 6, 2007) - U.S. Dry Cleaning Corporation (OTCBB: UDRY) ("U.S. Dry Cleaning"), a first mover in consolidating the nation's dry cleaning industry, announced today its financial results for the quarter ended June 30, 2007. Revenue for the quarter was over $2.4 million, a 50% (YOY) increase over the same period in the previous fiscal year when the company had $1.6 million in revenue.

Contributing to the revenue increase was the company's acquisition in February 2007 of Cleaners Club Inc. (doing business as "Boston Cleaners") in Riverside, California. This was U.S. Dry Cleaning's latest acquisition in its move to create the first national premier chain in the dry cleaning industry. Boston Cleaners added 12 retail outlets to the business and increased the company's annualized run rate to nearly $10 million. In July 2007, U.S. Dry Cleaning completed an initial public offering of $6.1 million to advance its strategy of consolidating market-leading businesses at accretive valuations.

Robert Y. Lee, CEO, Director and co-founder of U.S. Dry Cleaning, said, "We have entered a very exciting time at U.S. Dry Cleaning. We have completed our IPO. We have money in the bank to be used to acquire some of the leading dry cleaning companies in America. Our revenue increase of 50% from a year ago is just what we expected. It signals the beginning of the rapid growth through acquisition that we have planned. We also exceeded our other major goal: same store sales were up 6% over a year ago, which was higher than our 5% goal."

About U.S. Dry Cleaning Corporation

U.S. Dry Cleaning Corporation's mission is to create the premier national chain in the dry cleaning industry. Over the last year and half, U.S. Dry Cleaning has completed acquisitions with combined annualized revenues of over $9 million. U.S. Dry Cleaning combines a management team with extensive experience in retail consolidations and premier dry cleaning operations, with a proven operating model.

U.S. Dry Cleaning intends to rapidly acquire profitable, positive cash flow operations at accretive valuations. Each acquisition target is expected to be self-sufficient and senior management is expected to remain in place to ease the assimilation. U.S. Dry Cleaning is focused on acquiring profitable businesses that hold a leading share in their individual markets.

U.S. Dry Cleaning management believes that the current absence of extensive competition to acquire the larger dominant operators will change as the industry consolidates. Management believes that the greatest value achieved in any consolidation occurs during the earliest phases and intends to grow as rapidly as possible to deliver shareholder value.

This release is provided for informational purposes only and should not be construed as a solicitation to invest. U.S. Dry Cleaning Corporation's future operation results are dependent upon many factors, including but not limited to: (i) U.S. Dry Cleaning's ability to obtain sufficient capital or a strategic business arrangement to fund its expansion plans; (ii) U.S. Dry Cleaning's ability to build the management and human resources and infrastructure necessary to support the growth of its business; (iii) competitive factors and developments beyond U.S. Dry Cleaning's control; and (iv) other risk factors discussed in U.S. Dry Cleaning's periodic filings with the Securities and Exchange Commission, which are available for review at http://www.sec.gov under "Search for Company Filings."

In accordance with a December 5, 2006 agreement, Consulting For Strategic Growth 1, Ltd. ("CFSG1") provides U.S. Dry Cleaning Corporation with consulting, business advisory, investor relations, public relations and corporate development services. CFSG1 receives only restricted stock as compensation from U.S. Dry Cleaning. CFSG1 may also choose to purchase U.S. Dry Cleaning's common stock and thereafter liquidate those securities at any time it deems appropriate to do so. For more information please visit www.cfsg1.com.



                      U.S. DRY CLEANING CORPORATION
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
        FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 2007 AND 2006
                                (UNAUDITED)


                              THREE MONTHS              NINE MONTHS
                                        2006                      2006
                            2007     As Restated       2007    As Restated
                        ------------ ------------ ------------ ------------
Net Sales               $ 2,427,466  $ 1,617,711  $ 6,054,794  $ 4,554,918

Cost of Sales
  Supplies                 (138,556)     (63,488)    (303,835)    (223,550)
  Other direct costs     (1,113,705)    (742,365)  (2,811,066)  (2,205,009)
                        ------------ ------------ ------------ ------------
    Total cost of sales  (1,252,261)    (805,853)  (3,114,901)  (2,428,559)
                        ------------ ------------ ------------ ------------

Gross Profit              1,175,205      811,858    2,939,893    2,126,359

Operating Expenses
  Delivery expenses         205,744      132,883      538,089      387,059
  Store expenses            720,423      360,322    1,623,176    1,047,310
  Selling expenses          153,532      178,609      464,869      489,682
  Administrative
   expenses                 680,770      347,456    2,001,022    1,105,268
  Professional fees and
   other expenses           526,727      156,925    2,129,696      978,229
  Depreciation and
   amortization expense      96,112       77,125      245,968      204,589
                        ------------ ------------ ------------ ------------
    Total operating
     expenses             2,383,308    1,253,320    7,002,820    4,212,137
                        ------------ ------------ ------------ ------------

Operating Loss           (1,208,103)    (441,462)  (4,062,927)  (2,085,778)

Loss on extinguishment
 of debt                           -  (1,751,000)            -  (1,751,000)
Other expense              (606,847)  (1,880,463)  (1,541,060)  (2,861,270)
                        ------------ ------------ ------------ ------------

Net Loss                $(1,814,950) $(4,072,925) $(5,603,987) $(6,698,048)
                        ============ ============ ============ ============

Basic and diluted loss
 per common share       $     (0.10) $     (0.32) $     (0.31) $     (0.63)
                        ============ ============ ============ ============

Basic and diluted
 weighted average
 number of common
 shares outstanding       17,313,060   12,803,334   17,972,608   10,612,735
                        ============ ============ ============ ============


Contact Information

  • Company Contact
    Rick Johnston,
    Director of Shareholder Communications
    Tel: 760-668-1274
    Email: Email Contact
    www.usdrycleaning.com

    Investor Relations:
    Stanley Wunderlich, CEO
    Consulting For Strategic Growth 1
    Tel: 800-625-2236
    Fax: 212-337-8089
    Email: Email Contact
    Web site: www.cfsg1.com

    Media Relations:
    Daniel Stepanek
    Consulting For Strategic Growth 1
    Tel: 212-896-1202
    Fax: 212-697-0910
    Email: Email Contact