Calloway's Nursery Announces Preliminary Results For Fourth Quarter And Year Ended December 31, 2015

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Jan 14, 2016, 02:56 ET

FORT WORTH, Texas, Jan. 14, 2016 /PRNewswire/ -- Calloway's Nursery, Inc. (PK:CLWY) today reported preliminary revenues and operating results for the fourth quarter and year ended December 31, 2015.

Results for the Fourth Quarter

Revenue was $10.0 million for 2015, compared to revenue of $11.1 million for 2014. Same-store revenue (17 stores) was $10.0 million for 2015, compared to same-store revenue of $9.1 million for 2014. The company closed two stores in 2015. Neither of these two stores has been included in the calculation of same-store revenue.

Net loss was $0.1 million for 2015, compared to net income of $5.6 million for 2014. The 2014 results included a $5.9 million (net of income tax) gain consisting of disposal gains and impairment losses on properties.

Diluted net loss per common share was $.01 for 2015, compared to diluted net income per common share of $.67 for 2014. The 2014 results included a $0.70 per share (net of income tax) gain consisting of disposal gains and impairment losses on properties.

Earnings before income taxes, depreciation and amortization and net interest expense, a non-GAAP measure ("EBITDA"), was $0.1 million for 2015 compared to EBITDA of $8.9 million for 2014.

"Adjusted EBITDA", a non-GAAP measure, is EBITDA adjusted for the effects of disposal gains and impairment losses on properties.

Adjusted EBITDA was $0.1 million for 2015 compared to Adjusted EBITDA of $0 (break-even) for 2014.

Results for the Year

Revenue was $50.0 million for 2015, compared to revenue of $53.5 million for 2014. Same-store revenue (17 stores) was $49.2 million for 2015, compared to same-store revenue of $46.6 million for 2014.

Net income was $1.8 million for 2015, compared to net income of $8.3 million for 2014. The 2014 results included a $5.9 million (net of income tax) gain consisting of disposal gains and impairment losses on properties.

Diluted net income per common share was $.22 for 2015, compared to diluted net income per common share of $1.00 for 2014. The 2014 results included a $0.70 per share (net of income tax) gain consisting of disposal gains and impairment losses on properties.

EBITDA was $3.8 million for 2015 compared to EBITDA of $13.8 million for 2014.

Adjusted EBITDA was $3.8 million for 2015 compared to Adjusted EBITDA of $4.9 million for 2014.

Founded in 1986, Calloway's Nursery, Inc. is a 17-store garden center chain serving the Dallas - Fort Worth and Houston markets as Calloway's Nursery in D/FW and Cornelius Nursery in Houston. The company strives to make gardening fun, easy and successful for customers by offering expert advice from Texas Certified Nursery Professionals; store environments that are educational and easy to shop; gardening clinics that serve both novice and expert gardeners; displays and instructions to aid gardeners with design and color development in their yards; and a product selection of the best plant varieties available.

Calloway's has not completed its normal reporting procedures for its year-end results, and there can be no assurance that Calloway's final results will not differ from these preliminary results. Any such changes could be material. In addition, during the course of the preparation of Calloway's audited consolidated financial statements and related notes as of and for the year ended December 31, 2015, Calloway's may identify items that would require it to make material adjustments to this preliminary financial information.

The preliminary financial information included herein has been prepared by, and is the responsibility of the management of Calloway's. Calloway's independent public accounting firm has not audited, reviewed, compiled or performed any procedures with respect to the accompanying unaudited financial information for the purpose of its inclusion herein, and accordingly, Calloway's independent public accounting firm does not express an opinion or provide any form of assurance with respect thereto.

CALLOWAY'S NURSERY, INC. CONDENSED CONSOLIDATED INCOME STATEMENTS (UNAUDITED) (Amounts in thousands, except per share amounts)

	Three-Months Ended		Year Ended
	December 31,		December 31,
	2015	2014	2015	2014

Net revenue	$10,043	$11,107	$49,960	$53,515
Cost of goods sold	5,338	5,993	25,630	27,055
Gross profit	4,705	5,114	24,330	26,460

Operating expense	3,578	3,755	15,950	16,378
Advertising expense	340	436	1,401	1,549
Occupancy expense	724	923	3,169	3,599
Depreciation and amortization	143	128	549	518
Net interest expense	81	148	388	566
Total expenses	4,866	5,390	21,457	22,610
(Gain) on disposals and impairments of properties	--	(8,874)	--	(8,874)
Income (loss) before provision for income taxes	(161)	8,598	2,873	12,724
Income tax expense (benefit)	(44)	2,980	1,025	4,384
Net income (loss)	($117)	$5,618	$1,848	$8,340

Weighted average number of common shares outstanding – basic and diluted	8,378	8,378	8,378	8,378

Net income (loss) per common share - basic and diluted	($0.01)	$0.67	$0.22	$1.00

CALLOWAY'S NURSERY, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Amounts in thousands)

ASSETS

	December 31,	December 31,
	2015	2014
Cash and cash equivalents	$ 6,481	$ 6,121
Accounts receivable	38	48
Inventories	2,462	2,069
Prepaids and other assets	72	74
Property held for sale	--	1,240
Total current assets	9,053	9,552
Property and equipment, net	21,688	13,337
Restricted cash	--	9,143
Other assets	117	194
Total assets	$30,858	$32,226

LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued expenses	$ 5,303	$ 5,322
Current portion of long-term debt	935	942
Total current liabilities	6,238	6,264
Long-term debt, net of current portion	4,285	6,850
Deferred rent payable	44	74
Deferred income taxes	2,005	2,600
Total liabilities	12,572	15,788
Shareholders' equity:
Common stock	86	86
Additional paid-in capital	11,082	11,082
Retained earnings	8,526	6,678
	19,694	17,846
Less: Treasury stock, at cost	(1,408)	(1,408)
Total shareholders' equity	18,286	16,438
Total liabilities and shareholders' equity	$30,858	$32,226

CALLOWAY'S NURSERY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Amounts in thousands)

	Year Ended
	December 31,
	2015	2014
Cash flows from operating activities:
Net income	$ 1,848	$ 8,340
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	549	518
Deferred income tax	(595)	2,825
Net gain on disposals and impairments of properties	(66)	(8,874)
Net change in operating assets and liabilities	(353)	461
Net cash provided by operating activities	1,383	3,270
Cash flows from investing activities:
Additions to property and equipment	(8,900)	(117)
Restricted cash	9,143	(9,143)
Proceeds from sale of assets	1,306	9,143
Net cash provided by (used for) investing activities	1,549	(117)
Cash flows from financing activities:
Repayments of debt	(2,572)	(919)
Proceeds from issuance of common stock	--	--
Net cash (used for) financing activities	(2,572)	(919)
Net increase in cash and cash equivalents	360	2,234
Cash and cash equivalents at beginning of period	6,121	3,887
Cash and cash equivalents at end of period	$ 6,481	$ 6,121