POMONA, Calif., Jan. 30, 2007 (PRIME NEWSWIRE) -- Keystone Automotive Industries, Inc. (Nasdaq:KEYS) today reported record earnings and sales for its fiscal 2007 third quarter ended December 29, 2006, supported by strong demand for generic replacement parts and the benefits of its strategies to enhance in-stock availability of parts across the company's network.
Net income for the fiscal third quarter climbed 32.1 percent to $9.4 million, or $0.57 per diluted share, from $7.1 million, or $0.44 per diluted share, a year ago. Operating income increased 30.8 percent to $15.0 million from $11.5 million a year ago. Net sales for the fiscal third quarter climbed 12.7 percent to $185.3 million from $164.4 million last year. Same store sales growth for the third quarter was 11.4 percent.
Net income for the nine months of fiscal 2007 climbed 28.6 percent to $18.9 million, or $1.15 per diluted share, from $14.7 million, or $0.91 per diluted share, a year ago. Operating income for the same period increased 34.1 percent to $30.5 million from $22.8 million a year ago. Net sales for the nine months climbed 14.6 percent to $513.8 million from $448.4 million last year. Same store sales growth for the nine-month period was 11.1 percent.
Gross margin for the fiscal third quarter was 45.3 percent compared with 45.2 percent last year. As previously noted, the company began the process of implementing a cross-dock strategy to enhance the delivery of product to its distribution centers and customers, which results in the elimination of certain expenses previously included in selling and distribution costs and replaced with costs included in cost of sales. As a result, gross margin for the quarter was reduced by approximately $1.6 million, while selling and distribution costs were positively impacted by approximately $1.3 million. The company emphasized that its ongoing cross-dock implementation strategy is designed to enhance availability of parts and increase top-line sales growth.
"The company's strategic focus on parts availability throughout the network continues to be an important catalyst to our success. Specific organizational initiatives designed to enhance efficiency and foster relationships with automotive body shops have been fundamental to Keystone's growth, and results for the quarter clearly highlight that our strategy is working," said Richard L. Keister, president and chief executive officer.
Commenting on the continuing International Trade Commission investigation with respect to the importation and sale of certain aftermarket collision replacement parts for the Ford Motor Company's F-150 truck, Keister reiterated his previously stated position that this legal initiative represents an ongoing campaign by original equipment manufacturers to deny consumers an alternative product for automotive collision repair. "This case could have far reaching consequences beyond just the automotive industry and we intend to vigorously defend our right to distribute aftermarket parts, and continue to build coalitions to counter the power of the original equipment manufacturers and provide alternatives to consumers," Keister said.
He noted that fiscal third quarter results were not significantly impacted by higher legal fees associated with the ongoing legal dispute discussed above. However, nine-month results include approximately $1.4 million in additional legal fees. Third quarter results also reflect a net income impact of approximately $300,000 associated with the company's start-up bumper remanufacturing facility in Mexico. For the nine-months, the Mexico remanufacturing facility impacted net income by approximately $700,000.
Keister indicated that results for the company's fiscal third quarter were supported by a 15.9 percent increase in the sale of automotive body parts, which includes fenders, hoods, headlights, cooling, grills and crash parts.
Teleconference
Richard L. Keister, president and chief executive officer, and Jeff Gray, chief financial officer, will host an investor conference call today at 9:00 a.m. Pacific Time to discuss the company's financial results and operations for the fiscal third quarter. The call will be open to all interested investors through a live audio broadcast by calling (877) 440-9648 (domestic) or (706) 679-0668 (international) with call ID number 6978322. For those who are not available to listen to the live broadcast, the call will be archived for two weeks on Keystone's website. A telephone playback of the conference call will also be available from 10:00 a.m. Pacific time Tuesday, January 30 through 9:00 p.m. Sunday, February 4 by calling (800) 642-1687 (domestic) or (706) 645-9291 (international) and using access code: 6978322.
About Keystone
Keystone Automotive Industries, Inc. distributes its products primarily to collision repair shops through its 136 distribution facilities, of which 22 serve as regional hubs, located in 38 states and Canada. Its product lines consist of automotive body parts, bumpers, and remanufactured alloy wheels, as well as paint and other materials used in repairing a damaged vehicle. These products are sold to more than 25,000 repair shops throughout the United States and Canada.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained in this press release that are not historical facts are forward-looking statements based on the company's current expectations and beliefs concerning future developments and their potential effects on the company. There can be no assurance that future developments affecting the company will be those anticipated by the company. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the company) and are subject to change based upon various factors, including but not limited to the ultimate disposition of the International Trade Commission investigation and its impact on the company; the ability to achieve the initiatives in place for fiscal 2007; the impact of increased competition and the aggressive actions being taken by certain car manufacturers to negatively impact the aftermarket collision replacement parts industry, including patenting vehicle parts sold by the aftermarket, instituting litigation relating to alleged trademark violations and lobbying state legislature to adopt legislation favoring the OEM's; the impact on the company as a result of actions which have been, or in the future may be, taken by insurance companies with respect to the use of aftermarket products in the repair of vehicles; the impact of moving the company's chief executive offices to Nashville; the effect of policies adopted by CAPA; and the costs of litigation. Reference is also specifically made to the "Risk Factors" section set forth in the company's Form 10-K Annual Report filed with the Securities and Exchange Commission (SEC) for the fiscal year ended March 31, 2006 and in Part II, Item 1A of its Form 10-Qs filed with the SEC thereafter for additional information on the risks and uncertainties facing the company. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise.
KEYSTONE AUTOMOTIVE INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(In thousands, except per share amounts)
(Unaudited)
Thirteen Thirteen Thirty-nine Thirty-nine
Weeks Ended Weeks Ended Weeks Ended Weeks Ended
Dec. 29, Dec. 30, Dec. 29, Dec. 30,
2006 2005 2006 2005
--------- --------- --------- ---------
Net Sales 185,263 164,387 513,769 448,389
Cost of Sales 101,419 90,143 285,731 248,448
--------- --------- --------- ---------
Gross Profit 83,844 74,244 228,038 199,941
Operating Expenses:
Selling &
Distribution 50,680 47,897 146,933 135,494
General &
Administrative 18,116 14,840 50,569 41,676
--------- --------- --------- ---------
Operating Income 15,048 11,507 30,536 22,771
Other Income 344 607 1,029 1,988
Interest Expense (35) (334) (281) (466)
--------- --------- --------- ---------
Income Before
Income Taxes 15,357 11,780 31,284 24,293
Income Taxes 5,965 4,672 12,389 9,598
--------- --------- --------- ---------
Net Income $ 9,392 $ 7,108 $ 18,895 $ 14,695
========= ========= ========= =========
Per Common Share
Income
Basic: $ 0.58 $ 0.44 $ 1.16 $ 0.92
========= ========= ========= =========
Diluted: $ 0.57 $ 0.44 $ 1.15 $ 0.91
========= ========= ========= =========
Weighted average
common shares
outstanding:
Basic: 16,315 16,008 16,256 15,956
========= ========= ========= =========
Diluted: 16,488 16,183 16,441 16,094
========= ========= ========= =========
Note: The preliminary condensed consolidated statements of income have
been prepared on a basis consistent with the company's previously
prepared statements of income filed with the Securities and Exchange
Commission for its prior quarter and annual reports, but do not include
the footnotes required by generally accepted accounting principles for
complete financial statements.
KEYSTONE AUTOMOTIVE INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
December 29, March 31,
2006 2006
------------ ----------
(Unaudited) (Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 6,503 $ 4,733
Accounts receivable, net of allowance
of $1,072 at December 2006 and $935
at March 2006 61,440 56,774
Inventories, primarily finished goods 135,661 128,458
Other current assets 13,789 17,137
-------- --------
Total current assets 217,393 207,102
Plant, property and equipment, net 35,957 33,713
Goodwill 39,446 39,369
Other intangibles, net of accumulated
amortization of $1,855 at December 2006
and $1,544 at March 2006 1,091 1,402
Other assets 8,186 7,107
-------- --------
Total assets $302,073 $288,693
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Credit facility $ -- $ 9,544
Accounts payable 25,880 35,310
Accrued liabilities 27,380 19,519
-------- --------
Total current liabilities 53,260 64,373
Other long-term liabilities 1,459 1,373
Commitments and contingencies -- --
Shareholders' Equity:
Preferred stock, no par value:
Authorized shares -- 3,000,000
None issued and outstanding -- --
Common stock, no par value:
Authorized shares -- 50,000,000
Issued and outstanding shares 16,332
at December 2006 and 16,269 at
March 2006, at stated value 101,196 97,956
Restricted Stock -- 1,154
Additional paid-in capital 13,786 10,470
Retained earnings 132,254 113,359
Accumulated other comprehensive income 118 8
-------- --------
Total shareholders' equity 247,354 222,947
-------- --------
Total liabilities and shareholders'
equity $302,073 $288,693
======== ========
Note: The preliminary condensed consolidated balance sheets have been
prepared on a basis consistent with the company's previously prepared
balance sheets filed with the Securities and Exchange Commission for
its prior quarter and annual reports, but do not include the
footnotes required by generally accepted accounting principles for
complete financial statements.