Published:
Norcraft Holdings, L.P. and Norcraft Companies, L.P. Report First Quarter 2008 Results
Norcraft Holdings, L.P. and Norcraft Companies, L.P. Report First Quarter 2008 Results
EAGAN, Minn., May 9 /PRNewswire/ -- Norcraft Holdings, L.P. (Holdings) and
Norcraft Companies, L.P. (Norcraft) today reported financial results for the
first quarter ended March 31, 2008. The financial results for Holdings include
the accounts of its wholly-owned subsidiary, Norcraft. Holdings reflects the
obligations under its $118.0 million 9 3/4% senior discount notes and
$3.9 million of unsecured notes payable to former employees. Other than these
debt obligations, related deferred issuance costs, debt issuance amortization,
and related interest expense, all other assets, liabilities, income, expenses,
and cash flows presented for all periods represent those of Norcraft.
FINANCIAL RESULTS
First Quarter of Fiscal 2008 Compared with First Quarter of Fiscal 2007
Net sales decreased $6.3 million, or 6.7%, from $93.9 million for the
first quarter of 2007 compared to $87.6 million for the same quarter of 2008.
Income from operations decreased by $5.3 million, or 42.0%, from $12.6 million
for the first quarter of 2007 compared to $7.3 million for the same quarter of
2008. Net income for Holdings decreased $5.4 million, from $6.3 million for
the first quarter of 2007 to $0.9 million in the same quarter of 2008. Net
income for Norcraft decreased $5.2 million, from $8.9 million for the first
quarter of 2007 to $3.7 million for the same quarter of 2008.
EBITDA (as defined in the attached table) was $16.4 million for the first
quarter of 2007 compared to $11.7 million for the same quarter of 2008.
"Our sales continue to be negatively impacted by the slow-down in the
housing industry. Additionally, our overall performance and profitability have
been affected by general economic conditions and our efforts to aggressively
compete in the marketplace. We expect these conditions to persist and affect
future periods as well. We are actively introducing new products and programs
to stimulate sales and are working to adjust cost structures to improve
profitability," commented President and CEO, Mark Buller.
CONFERENCE CALL
Norcraft has scheduled a conference call on Tuesday, May 13, 2008 at
10:00 a.m. Eastern Time. To participate, dial 877-718-5108 and use the pass
code 3598470. A telephonic replay will be available by calling 888-203-1112
and using pass code 3598470.
GENERAL
Norcraft Companies is a leader in manufacturing, assembling and finishing
kitchen and bathroom cabinetry inthe United States. We provide our customers
with a single source for a broad range of high-quality cabinetry, including
stock, semi-custom and custom cabinets. Our cabinets are manufactured in both
framed and full access construction. We market our products through five
brands: Mid Continent Cabinetry, UltraCraft, StarMark, Fieldstone and
Brookwood.
Contact: Leigh E. Ginter
Chief Financial Officer
leigh.ginter@norcraftcompanies.com
(651) 234-3315
-Selected Financial Data Tables Follow-
Consolidated Balance Sheets
(dollar amounts in thousands)
(unaudited)
Norcraft Norcraft
Holdings, L.P. Companies, L.P.
March 31, December 31, March 31, December 31,
ASSETS 2008 2007 2008 2007
Current assets:
Cash $35,526 $28,409 $35,526 $28,409
Trade accounts
receivable, net 30,130 26,822 30,130 26,822
Inventories 24,565 24,088 24,565 24,088
Prepaid expenses 2,113 2,139 2,113 2,139
Total current assets 92,334 81,458 92,334 81,458
Property, plant and
equipment, net 38,494 39,478 38,494 39,478
Other assets:
Goodwill 148,459 148,459 148,459 148,459
Customer relationships,
net 47,148 48,265 47,148 48,265
Brand names 49,000 49,000 49,000 49,000
Deferred financing
costs, net 5,736 6,116 3,617 3,883
Display cabinets, net 9,695 10,074 9,695 10,074
Other 79 227 79 227
Total other assets 260,117 262,141 257,998 259,908
Total assets $390,945 $383,077 $388,826 $380,844
LIABILITIES AND
MEMBERS' EQUITY
Current liabilities:
Current portion of
long-term debt $1,959 $1,959 $- $-
Accounts payable 11,354 9,786 11,354 9,786
Accrued expenses 22,805 20,279 22,805 20,279
Total current
liabilities 36,118 32,024 34,159 30,065
Long-term debt 263,388 260,731 148,000 148,000
Other liabilities 470 453 470 453
Commitments and
contingencies - - - -
Members' equity subject
to put request 37,462 42,331 - -
Members' equity 53,507 47,538 206,197 202,326
Total liabilities and
members' equity $390,945 $383,077 $388,826 $380,844
Consolidated Statements of Income
(dollar amounts in thousands)
(unaudited)
Norcraft Holdings, L.P. Norcraft Companies, L.P.
Three Months Ended Three Months Ended
March 31, March 31,
2008 2007 2008 2007
Net sales $87,631 $93,907 $87,631 $93,907
Cost of sales 62,985 63,656 62,985 63,656
Gross profit 24,646 30,251 24,646 30,251
Selling, general
and administrative
expenses 17,347 17,668 17,347 17,668
Income from operations 7,299 12,583 7,299 12,583
Other expense (income):
Interest expense,
net 6,015 5,920 3,275 3,382
Amortization of
deferred financing
costs 380 373 266 269
Other, net 30 32 30 32
Total other expense
(income) 6,425 6,325 3,571 3,683
Net income $874 $6,258 $3,728 $8,900
Consolidated Statements of Cash Flows
(dollar amounts in thousands)
(unaudited)
Norcraft Holdings, L.P. Norcraft Companies, L.P.
Three Months Ended Three Months Ended
March 31, March 31,
2008 2007 2008 2007
Cash flows from
operating activities:
Net income $874 $6,258 $3,728 $8,900
Adjustments to
reconcile net income
to net cash provided
by operating
activities:
Depreciation and
amortization of
property, plant
and equipment: 1,551 1,243 1,551 1,243
Amortization:
Customer
relationships 1,117 1,116 1,117 1,116
Deferred financing
costs 380 373 266 269
Display cabinets 1,717 1,472 1,717 1,472
Provision for
uncollectible
accounts receivable 1,101 1,043 1,101 1,043
Provision for obsolete
and excess inventory 152 106 152 106
Provision for warranty
claims 900 807 900 807
Accreted interest on
senior notes 2,657 2,416 - -
Stock compensation
expense 298 187 298 187
Loss (gain) on
disposal of assets - 10 - 10
Change in operating
assets and
liabilities:
Trade accounts
receivable (4,417) 1,496 (4,417) 1,496
Inventories (630) (1,121) (630) (1,121)
Prepaid expenses 25 676 25 676
Other assets 148 30 148 30
Accounts payable
and accrued
liabilities 3,870 3,913 3,870 3,913
Net cash provided
by operating
activities 9,743 20,025 9,826 20,147
Cash flows from
investing activities:
Purchase of property,
plant and equipment (1,219) (1,970) (1,219) (1,970)
Additions to display
cabinets (1,338) (1,448) (1,338) (1,448)
Net cash used in
investing
activities (2,557) (3,418) (2,557) (3,418)
Cash flows from
financing
activities:
Repurchase of
members'
interests (68) (312) (68) (312)
Distributions to
members - - (83) (232)
Net cash used in
financing
activities (68) (312) (151) (544)
Effect of exchange
rates on cash (1) 23 (1) 23
Net increase in cash 7,117 16,318 7,117 16,208
Cash, beginning of
the period 28,409 3,928 28,409 4,038
Cash, end of period $35,526 $20,246 $35,526 $20,246
Reconciliation of Net Income to EBITDA
(dollar amounts in thousands)
EBITDA is net income before income tax expense, interest expense,
depreciation and amortization. We believe EBITDA is useful to investors
in evaluating our operating performance compared to that of other
companies in our industry, as the calculation of EBITDA eliminates the
effects of financing, income taxes and the accounting effects of capital
spending, which items may vary for different companies for reasons
unrelated to overall operating performance. We also believe EBITDA
provides information relevant to investors regarding our ability to
service and/or incur debt. EBITDA is not a presentation made in
accordance with U.S. generally accepted accounting principles ("U.S.
GAAP"). Accordingly, when analyzing our operating performance, investors
should not consider EBITDA in isolation or as a substitute for net income,
cash flows from operating activities or other income statement or cash
flow statement data prepared in accordance with U.S. GAAP. Our
calculations of EBITDA are not necessarily comparable to those of other
similarly titled measures reported by other companies. The calculations
of EBITDA are shown below:
Norcraft Holdings, L.P.
(unaudited)
Three Months Ended Twelve Months Ended
March 31, March 31,
2008 2007 2008
Net income $874 $6,258 $23,788(1)
Interest expense, net 6,015 5,920 23,713
Depreciation 1,551 1,243 5,769
Amortization of deferred
financing costs 380 373 1,547
Amortization of customer
relationships 1,117 1,116 4,467
Display cabinet
amortization 1,717 1,472 6,948
State Taxes 30 30 153
EBITDA $11,684 $16,412 $66,385
Norcraft Companies, L.P.
(unaudited)
Three Months Ended Twelve Months Ended
March 31, March 31,
2008 2007 2008
Net income $3,728 $8,900 $34,943(1)
Interest expense, net 3,275 3,382 12,997
Depreciation 1,551 1,243 5,769
Amortization of deferred
financing costs 266 269 1,108
Amortization of customer
relationships 1,117 1,116 4,467
Display cabinet
amortization 1,717 1,472 6,948
State Taxes 30 30 153
EBITDA $11,684 $16,412 $66,385
(1) Net income during the twelve months ended March 31, 2008 includes
$0.4 million from insurance proceeds due to a fire in the Newton,
Kansas facility which increased net income and correspondingly
increased EBITDA.
SOURCE Norcraft Holdings, L.P.
Copyright © 2008, PRNewswire
Copyright © 2008, NewsBlaze,
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