UniFirst Announces Record Financial Results for Fiscal 2004 Fourth Quarter and Full Year
WILMINGTON, Mass.--(BUSINESS WIRE)--Oct. 26, 2004--UniFirst Corporation (NYSE:UNF) today announced record revenues and earnings for its fiscal 2004 fourth quarter and full year, which ended August 28, 2004.
For fiscal 2004, revenues were a record $719.4 million, the highest in the Company's 68 year history and a 20.5 percent increase from $596.9 million in fiscal 2003. Acquisitions, primarily Textilease, accounted for 14.7 percent of this revenue growth. Income before cumulative effect of accounting change was $33.6 million, a 14.7 percent increase from last year's $29.3 million. In the first quarter of fiscal 2003 the Company recorded an expense of $2.2 million, net of tax, as a result of implementing SFAS 143 regarding long lived assets. Net income for fiscal 2004 was $33.6 million, a 24.3 percent increase from last year's $27.0 million.
Revenues for the fourth quarter of fiscal 2004 were $178.1 million, a 20.6 percent increase from $147.6 million in the same period a year ago. Acquisitions, again primarily Textilease, accounted for 14.5 percent of the revenue growth for the quarter. Fourth quarter net income was $7.5 million, a 4.2 percent increase from last year's $7.2 million.
Since the Company has two classes of common stock with a dividend differential, GAAP (in accordance with EITF 03-06) now requires the Company to report net income per share separately for each class of stock. Management believes that the historical method of reporting net income per share on the "if converted method", which is now a non GAAP financial measure, is more meaningful since the Class B Common Stock is freely convertible at any time into an equal number of shares of Common Stock. Under the "if converted method", the net income per basic share for fiscal 2004 would have been $1.75 which is consistent with the high end of the Company's guidance in our last conference call.
Under the new dual class reporting method the basic income per Common share before cumulative effect of accounting change was $1.95 for fiscal 2004 or 14.0% greater than the $1.71 computed on the same basis in the prior year. The basic income per share for the Class B Common stock was $1.56 as compared to $1.37 in the prior year.
Under the new dual class reporting method the basic net income per Common share was $0.44 for the fourth quarter of fiscal 2004 or 9.5% greater than the $0.42 computed on the same basis in the prior year. For the same period the basic net income per share for the Class B common stock was $0.35 as compared to $0.34 in the prior period.
"Fiscal 2004 was our 36th consecutive year of record revenues," said Ronald D. Croatti, UniFirst's President and Chief Executive Officer. "The Textilease integration is proceeding on schedule and the Company did an excellent job controlling operating expenses. Overall I was very pleased with our results in a difficult economy."
The Company will hold a conference call today at 4:00 PM (EST) to discuss its quarterly and annual financial results, business highlights and outlook. A simultaneous live webcast of the call will be available over the Internet, and replays of the webcast will be available until November 27, 2004. The webcast can be accessed at www.unifirst.com.
UniFirst is one of the largest providers of workplace uniforms, protective clothing and facility services products in North America. The Company employs 9,000 team partners who serve more than 175,000 customer locations in 46 states, Canada and Europe from 175 manufacturing, distribution and customer service facilities.
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward-looking statements. This public announcement may contain forward-looking statements that reflect the Company's current views with respect to future events and financial performance. These forward-looking statements are subject to certain risks and uncertainties. The words "anticipate" and "should," and other expressions that indicate future events and trends identify forward-looking statements. Actual future results may differ materially from those anticipated depending on a variety of factors, including, but not limited to, performance of acquisitions; economic and business changes; fluctuations in the cost of materials, fuel and labor; economic and other developments associated with the on-going war on terrorism; strikes and unemployment levels; demand and price for the Company's products and services; improvement in under performing rental operations; and the outcome of pending and future litigation and environmental matters.
UNIFIRST CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Fifty- Fifty- Thirteen Thirteen
two two
weeks weeks weeks weeks
ended ended ended ended
(In thousands, except per August August August August
share data) 28, 30, 28, 30,
2004 2003 2004 2003
----------------------------------------------------------------------
Revenues $719,356 $596,936 $178,066 $147,642
----------------------------------------------------------------------
Costs and expenses:
Operating costs 462,612 381,582 115,588 95,124
Selling and administrative
expenses 147,851 127,343 37,240 31,981
Depreciation and amortization 44,889 39,173 10,500 9,267
----------------------------------------------------------------------
655,352 548,098 163,328 136,372
----------------------------------------------------------------------
Income from operations 64,004 48,838 14,738 11,270
----------------------------------------------------------------------
----------------------------------------------------------------------
Other expense (income):
Interest expense 12,522 4,179 3,387 683
Interest income (1,135) (1,621) (350) (509)
Interest rate swap expense
(income) (1,981) (1,292) (527) (626)
----------------------------------------------------------------------
9,406 1,266 2,510 (452)
----------------------------------------------------------------------
Income before income taxes 54,598 47,572 12,228 11,722
Provision for income taxes 21,020 18,310 4,708 4,508
----------------------------------------------------------------------
Income before cumulative effect
of accounting change 33,578 29,262 7,520 7,214
----------------------------------------------------------------------
Cumulative effect of accounting change
(net of tax benefit of $1,404 in
2003) - (2,242) - -
----------------------------------------------------------------------
Net income $33,578 $27,020 $7,520 $7,214
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Weighted average number of shares
outstanding:
-------------
Shares outstanding
------------------
Common 9,103 8,992 9,253 8,997
Class B Common 10,091 10,190 9,950 10,175
----------------------------------------------------------------------
Total outstanding 19,194 19,182 19,203 19,172
Common stock equivalents 64 40 74 61
----------------------------------------------------------------------
Total with common stock
equivalents 19,258 19,222 19,277 19,233
----------------------------------------------------------------------
Income per Common share -- basic:
---------------------------------
Before cumulative effect of an
accounting change, net $1.95 $1.71 $0.44 $0.42
Cumulative effect of an
accounting change, net - (0.13) - -
------------------------------------
Net income per Common share
-- basic $1.95 $1.58 $0.44 $0.42
Income per Class B Common share
-- basic:
----------------------------------
Before cumulative effect of an
accounting change, net $1.56 $1.37 $0.35 $0.34
Cumulative effect of an
accounting change, net - (0.10) - -
------------------------------------
Net income per Class B Common
share -- basic $1.56 $1.27 $0.35 $0.34
Income per Common share
-- diluted:
----------------------------------
Before cumulative effect of an
accounting change, net $1.74 $1.52 $0.39 $0.37
Cumulative effect of an
accounting change, net - (0.12) - -
------------------------------------
Net income per Common share
-- diluted $1.74 $1.40 $0.39 $0.37
Income per Class B Common share
-- diluted:
----------------------------------
Before cumulative effect of an
accounting change, net $1.56 $1.36 $0.35 $0.34
Cumulative effect of an
accounting change, net - (0.10) - -
------------------------------------
Net income per Class B Common
share -- diluted $1.56 $1.26 $0.35 $0.34
UNIFIRST CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands) August 28, August 30,
2004 2003
----------------------------------------------------------------------
Assets
Current assets:
Cash $4,436 $6,053
Receivables 69,471 57,941
Inventories 31,060 25,355
Rental merchandise in service 60,544 60,490
Deferred tax assets - 5,591
Prepaid expenses 1,857 407
----------------------------------------------------------------------
Total current assets 167,368 155,837
----------------------------------------------------------------------
Property and equipment:
Land, buildings and leasehold improvements 240,018 221,487
Machinery and equipment 258,736 238,820
Motor vehicles 70,048 66,081
----------------------------------------------------------------------
568,802 526,388
Less - accumulated depreciation 280,012 251,806
----------------------------------------------------------------------
288,790 274,582
----------------------------------------------------------------------
Other assets 241,911 84,168
----------------------------------------------------------------------
$698,069 $514,587
======================================================================
Liabilities and Shareholders' Equity
Current liabilities:
Current maturities of long-term obligations $986 $2,493
Notes payable - 104
Accounts payable 33,754 30,678
Accrued liabilities 72,824 53,670
Accrued income taxes 9,020 -
----------------------------------------------------------------------
Total current liabilities 116,584 86,945
----------------------------------------------------------------------
Long-term obligations, net of current
maturities 177,855 67,319
Deferred income taxes 35,881 24,943
----------------------------------------------------------------------
Shareholders' equity:
Common stock 927 1,060
Class B common stock 993 1,018
Treasury stock - (26,005)
Capital surplus 13,138 12,693
Retained earnings 353,197 348,043
Accumulated other comprehensive loss (506) (1,429)
----------------------------------------------------------------------
Total shareholders' equity 367,749 335,380
----------------------------------------------------------------------
$698,069 $514,587
======================================================================
CONTACT: UniFirst Corporation
John B. Bartlett, 978-658-8888 Ext 520
jbartlett@unifirst.com
SOURCE: UniFirst Corporation