G&K Services, Inc. (Nasdaq:GKSRA), today reported revenue for
the fiscal fourth quarter ended July 2, 2005 of $207.4 million, up
7.3 percent over the $193.3 million reported in the prior-year
period, which included an extra week of operations. Excluding the
extra week, fourth quarter revenue increased 15.1 percent. Revenue
exceeded expectations on continued improvement in the company's
rental organic growth rate and strong direct sales volume. Earnings
per diluted share totaled $0.46 for the quarter, compared to $0.45
during the prior-year period. While the prior-year included the
benefit of an extra week of operations, it was largely offset by
costs associated with the transfer of production within the
company's manufacturing facilities and the settlement of a legal
dispute. Current year fourth quarter earnings were in-line with the
company's previous guidance and reflect the impact of investments
in the company's growth initiatives, costs associated with
acquisition integration and high energy costs. Revenue for fiscal
2005 reached a record $788.8 million versus $733.4 million last
year, up 7.5 percent. Excluding the extra week in fiscal 2004,
full-year revenues were up 9.5 percent. Fiscal 2005 earnings per
diluted share totaled $1.88 compared to $1.69 last year, an
increase of 11.2 percent. Fiscal 2004 earnings were positively
impacted by the extra week of operations in the fourth quarter
largely offset by the costs and legal settlement described above.
"In fiscal 2005, we continued to focus on the fundamentals of our
business in addition to driving our new vision to enhance our
customers' image and safety through innovation," said Richard
Marcantonio, G&K's president and chief executive officer.
"We've begun to successfully execute our long-term vision through a
number of strategies to enhance the value proposition we provide
our customers. We will continue to capitalize on market growth
opportunities by delivering innovative solutions that meet the
needs of our customers." Income Statement Review Fourth quarter
revenue from G&K's rental business increased to $193.2 million,
up 10.7 percent over the prior-year period, when excluding the
extra week of operations. The company's organic industrial rental
growth rate was approximately 2.5 percent in the fourth quarter
compared to the year-ago period. Direct sale revenue more than
doubled to $14.2 million during the quarter from $5.6 million a
year-earlier, when excluding the extra week of operations. The
increase in direct sale revenue was driven primarily by the
acquisition of the Lion Uniform Group. On an organic basis, direct
sales increased 26.1 percent during the quarter. The organic growth
rates are calculated using industrial rental and direct sale
revenue, respectively, adjusted for foreign currency exchange rate
differences, revenue from newly acquired locations and the extra
week recorded in the prior-period results. "During fiscal 2005, we
continued to focus on delivering earnings momentum in addition to
putting increasing emphasis on driving revenue growth," Marcantonio
said. "The result of our efforts improved our organic rental growth
rate 500 basis points, more than doubled our direct sale business
and expanded our market presence through acquisitions. The
combination of these accomplishments has increased our current
annual revenue run-rate to well over $800 million, and more
importantly, has better positioned the company for future growth."
Gross margin from rental operations for the quarter was 36.1
percent compared to 37.6 percent in the prior-year quarter. Gross
margin for the quarter declined due to higher energy and
acquisition integration costs. The fourth quarter of the previous
year also benefited from the fixed cost leverage from an extra week
of revenue. Gross margin from direct sales was 25.9 percent
compared to 20.8 percent in the prior-year period. This increase
resulted primarily from the increased level of sales attributed to
the Lion Uniform Group and strong organic growth. Selling, general
and administrative expenses were 21.0 percent of consolidated
revenue, down from 22.4 percent in the same period last year. The
decrease was attributed to a pre-tax charge in the prior-year
period of approximately $1.25 million for a legal settlement and
leverage from additional revenue, partially offset by investments
in sales and marketing initiatives. Strong Balance Sheet and Cash
Flow The company's balance sheet remains strong. Total debt to
total capitalization was 33.3 percent compared to 32.9 percent last
year. Total stockholders' equity was $475.4 million. The company
also reported strong cash flow for the year. Cash flow from
operations totaled $63.0 million driven by stronger earnings offset
by working capital investments to support revenue growth and the
transition of manufacturing to the company's Dominican Republic
facility. Free cash flow, defined as cash provided by operating
activities less capital expenditures, was $43.6 million. Capital
expenditures for the year were $19.4 million. Outlook The company
anticipates fiscal 2006 first quarter revenue to be in the range of
$204.0 million to $207.0 million and earnings per diluted share to
be between $0.45 and $0.48. The revenue guidance represents a
modest improvement in the company's rental organic growth rate and
reduced benefit from the Canadian dollar exchange rate. The
earnings guidance reflects the company's ongoing efforts to improve
operational efficiency offset by investments geared to drive
increased revenue growth and continued record energy costs. First
quarter earnings guidance also incorporates the anticipated impact
associated with expensing stock options of $0.02 per diluted share.
"During fiscal 2005, we achieved record revenues and earnings even
while continuing the investments we're making to stimulate top-line
growth and despite significantly higher energy costs," Marcantonio
said. "In fiscal 2006, we will continue to balance the need to
generate increased earnings with on-going investments in our sales
team, marketing programs and operational initiatives. We will also
continue to pursue strategic acquisitions that enhance our market
position and further leverage our existing infrastructure. In the
end, we expect to improve our financial performance, enhance our
customer relationships and continue to differentiate our services
through innovation." Conference Call Information The company will
conduct a conference call today beginning at 10:00 a.m. Central
Time. The call will be web cast and can be accessed through the web
site www.gkservices.com (on the Investor Relations page, click on
the webcast icon and follow the instructions). A replay of the call
will be available through September 16, 2005. Safe Harbor for
Forward-Looking Statements The Private Securities Litigation Reform
Act of 1995 (the "Act") provides companies with a "safe harbor"
when making forward-looking statements as a way of encouraging them
to furnish their shareholders with information regarding expected
trends in their operating results, anticipated business
developments and other prospective information. Statements made in
this press release concerning our intentions, expectations or
predictions about future results or events are "forward-looking
statements" within the meaning of the Act. These statements reflect
our current expectations or beliefs, and are subject to risks and
uncertainties that could cause actual results or events to vary
from stated expectations, which could be material and adverse.
Given that circumstances may change, and new risks to the business
may emerge from time to time, having the potential to negatively
impact our business in ways we could not anticipate at the time of
making a forward-looking statement, you are cautioned not to place
undue reliance on these statements, and we undertake no obligation
to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
Some of the factors that could cause actual results or events to
vary from stated expectations include, but are not limited to, the
following: unforeseen operating risks; the effects of overall
economic conditions and employment; fluctuations in costs of
insurance and energy; acquisition integration costs; the
performance of acquired businesses; preservation of positive labor
relationships; competition, including pricing, within the corporate
identity apparel and facility services industry; and the
availability of capital to finance planned growth. Additional
information concerning potential factors that could affect future
financial results is included in our Annual Report on Form 10-K for
the fiscal year ended July 3, 2004. About G&K Services, Inc.
Headquartered in Minneapolis, Minnesota, G&K Services, Inc. is
a market leader in branded identity apparel programs and facility
services in the United States, and is the largest such provider in
Canada. G&K operates over 140 processing facilities and branch
offices, serving more than 160,000 customers. -0- *T CONSOLIDATED
STATEMENTS OF OPERATIONS G&K Services, Inc. and Subsidiaries
For the Three For the Twelve Months Ended Months Ended
------------------------------------------- July 2, July 3, July 2,
July 3, 2005 2004 2005 2004 (U.S. dollars, in (13 weeks) (14 weeks)
(52 weeks) (53 weeks) thousands, except per share data)
----------------------------------------------------------------------
Revenues Rental operations $193,243 $187,277 $740,708 $708,708
Direct sales 14,155 6,003 48,067 24,739
----------------------------------------------------------------------
Total revenues 207,398 193,280 788,775 733,447
----------------------------------------------------------------------
Operating Expenses Cost of rental operations 123,553 116,842
470,116 448,131 Cost of direct sales 10,482 4,754 35,830 18,899
Selling and administrative 43,451 43,357 165,814 158,034
Depreciation and amortization 10,817 10,018 41,543 39,346
----------------------------------------------------------------------
Total operating expenses 188,303 174,971 713,303 664,410
----------------------------------------------------------------------
Income from Operations 19,095 18,309 75,472 69,037 Interest expense
3,258 3,052 11,338 11,966
----------------------------------------------------------------------
Income before Income Taxes 15,837 15,257 64,134 57,071 Provision
for income taxes 6,033 5,798 24,207 21,687
----------------------------------------------------------------------
Net Income $9,804 $9,459 $39,927 $35,384
----------------------------------------------------------------------
Basic weighted average number of shares outstanding 21,037 20,793
20,942 20,710 Basic Earnings Per Common Share $0.47 $0.45 $1.91
$1.71
----------------------------------------------------------------------
Diluted weighted average number of shares outstanding 21,240 21,042
21,199 20,900 Diluted Earnings Per Common Share $0.46 $0.45 $1.88
$1.69
----------------------------------------------------------------------
Dividends per share $0.0175 $0.0175 $0.0700 $0.0700 CONSOLIDATED
CONDENSED BALANCE SHEETS G&K Services, Inc. and Subsidiaries
July 2, July 3, (U.S. dollars, in thousands) 2005 2004
----------------------------------------------------------------------
ASSETS Current Assets Cash and cash equivalents $15,345 $26,931
Accounts receivable, net 83,459 71,058 Inventories 121,120 94,476
Prepaid expenses 16,587 14,902
----------------------------------------------------------------------
Total current assets 236,511 207,367
----------------------------------------------------------------------
Property, Plant and Equipment, net 243,307 240,609 Other Assets
423,351 354,771
----------------------------------------------------------------------
$903,169 $802,747
----------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts
payable $25,695 $20,511 Accrued expenses 81,523 76,470 Deferred
income taxes 8,971 7,395 Current maturities of long-term debt
26,537 24,018
----------------------------------------------------------------------
Total current liabilities 142,726 128,394
----------------------------------------------------------------------
Long-Term Debt, net of current maturities 210,462 184,305 Deferred
Income Taxes 36,900 38,256 Other Noncurrent Liabilities 37,651
26,369 Stockholders' Equity 475,430 425,423
----------------------------------------------------------------------
$903,169 $802,747
----------------------------------------------------------------------
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS G&K Services,
Inc. and Subsidiaries For the Twelve Months Ended
--------------------- July 2, July 3, 2005 2004 (U.S. dollars, in
thousands) (52 weeks) (53 weeks)
----------------------------------------------------------------------
Operating Activities: Net income $39,927 $35,384 Adjustments to
reconcile net income to net cash provided by operating activities -
Depreciation and amortization 41,543 39,346 Deferred income taxes
76 1,300 Tax benefit of employee stock options 767 492 Amortization
of deferred compensation - restricted stock 852 937 Changes in
current operating items, exclusive of acquisitions (21,817) 14,243
Other assets and liabilities 1,637 4,565
----------------------------------------------------------------------
Net cash provided by operating activities 62,985 96,267
----------------------------------------------------------------------
Investing Activities: Property, plant and equipment additions, net
(19,408) (17,349) Acquisition of business assets and other (75,917)
(26,527)
----------------------------------------------------------------------
Net cash used for investing activities (95,325) (43,876)
----------------------------------------------------------------------
Financing Activities: Proceeds from issuance of long-term debt -
1,345 Repayments of long-term debt (25,729) (12,874) Proceeds from
(repayments of) short-term borrowings, net 40,400 (29,500) Cash
dividends paid (1,468) (1,459) Sale of common stock 5,953 5,218
----------------------------------------------------------------------
Net cash provided by (used for) financing activities 19,156
(37,270)
----------------------------------------------------------------------
(Decrease) / Increase in Cash and Cash Equivalents (13,184) 15,121
Effect of Exchange Rates on Cash 1,598 306 Cash and Cash
Equivalents: Beginning of period 26,931 11,504
----------------------------------------------------------------------
End of period $15,345 $26,931
----------------------------------------------------------------------
Supplemental Cash Flow Information: Non-Cash Transactions - Debt
issued in connection with business acquisitions $11,890 $ -
----------------------------------------------------------------------
*T
G & K (NASDAQ:GKSRA)
과거 데이터 주식 차트
부터 5월(5) 2024 으로 6월(6) 2024
G & K (NASDAQ:GKSRA)
과거 데이터 주식 차트
부터 6월(6) 2023 으로 6월(6) 2024