BONITA SPRINGS, Fla., Feb. 12, 2007 (PRIME NEWSWIRE) -- WCI Communities, Inc. (NYSE:WCI), a leading builder of traditional and tower residences in highly amenitized lifestyle communities, today announced that it has retained Goldman Sachs & Co. to assist the Board and senior management in a thorough review of the Company's business plans, capital structure, and growth prospects, with the objective of enhancing the company's value for all of its shareholders.
"Our Board of Directors is committed to maximizing value for all WCI shareholders," said Don E. Ackerman, Chairman of the Board. "Consistent with that commitment, we have asked our financial advisors to help us identify financial, strategic, and operational alternatives through a systematic and comprehensive review process. The Board will evaluate the options that result from this process and determine whether to pursue any of those options based on their potential to deliver shareholder value."
Jerry Starkey, President and CEO commented, "During 2007, we expect our company to generate about $1 billion of free cash flow, in large part from the collection of our tower receivables, which will enable us to dramatically reduce our debt. We also are exploring the disposition of certain assets, which would further increase liquidity and reduce leverage. Once our receivables are collected and our debt is reduced, we believe our ability to enhance shareholder value through a variety of strategic alternatives, including additional stock repurchases and potentially the sale of our company, will be greatly improved."
Starkey continued, "We hope that over the months required to implement the above measures that overall demand for housing in our markets and across the country will begin to firm and display signs of improvement. Our finished lot and tower site inventory positions us well when the demand does materialize. In the meantime, we will continue implementing our strategic plan to maximize cash flow, reduce overhead expenses, lower direct construction costs and operate more efficiently through this period of lower consumer demand. The strength of the national economy and the powerful boomer demographics of WCI's typical consumer point to an eventual rebound in demand and excellent long term prospects for the business, notwithstanding today's cyclical trough."
There can be no assurance regarding the timing of or whether the company will elect to pursue any of the strategic alternatives it may consider or that any such alternatives will be consummated. The company does not intend to provide updates or make any further comment until the outcome of the process is determined.
About WCI
WCI Communities, Inc., named America's Best Builder in 2004 by the National Association of Home Builders and Builder Magazine, has been creating amenity-rich, master-planned lifestyle communities since 1946. Florida-based WCI caters to primary, retirement, and second-home buyers in Florida, New York, New Jersey, Connecticut, Maryland and Virginia. The company offers traditional and tower home choices with prices from the high-$100,000s to more than $10 million and features a wide array of recreational amenities in its communities. In addition to homebuilding, WCI generates revenues from its Prudential Florida WCI Realty Division, its mortgage and title businesses, and its recreational amenities, as well as through land sales and joint ventures. The company currently owns and controls developable land on which the company plans to build about 20,000 traditional and tower homes.
For more information about WCI and its residential communities visit www.wcicommunities.com
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Forward-Looking Statement
Certain information included herein and in other company reports, Securities and Exchange Commission filings, statements and presentations is forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements about the company's anticipated operating results, financial resources, ability to acquire land, ability to sell homes and properties, ability to deliver homes from backlog, and ability to secure materials and subcontractors. Such forward-looking information involves important risks and uncertainties that could significantly affect actual results and cause them to differ materially from expectations expressed herein and in other company reports, filings, statements and presentations. These risks and uncertainties include WCI's ability to compete in real estate markets where we conduct business; the availability and cost of land in desirable areas in its geographic markets and elsewhere and our ability to expand successfully into those areas; WCI's ability to obtain necessary permits and approvals for the development of its lands; the availability of capital to WCI and our ability to effect growth strategies successfully; WCI's ability to pay principal and interest on its current and future debts; WCI's ability to comply with outstanding debt agreements/covenants; S&P and/or Moody's downgrades; WCI's ability to maintain or increase historical revenues and profit margins; availability of labor and materials and material increases in labor and material costs; increases in interest rates and availability of mortgage financing; the level of consumer confidence; increased customer cancellations or defaults; adverse legislation or regulations; unanticipated litigation or legal proceedings; changes in accounting rules, including changes in percentage of completion accounting; natural disasters; lack of visibility in the marketplace and inability to gage timing of market turnarounds; and changes in general economic, real estate and business conditions. If one or more of the assumptions underlying our forward-looking statements proves incorrect, then the company's actual results, performance or achievements could differ materially from those expressed in, or implied by the forward-looking statements contained in this report. Therefore, we caution you not to place undue reliance on our forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This statement is provided as permitted by the Private Securities Litigation Reform Act of 1995.