Calloway's Nursery Announces Results For Fourth Quarter And Year Ended December 31, 2014

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Mar 18, 2015, 02:49 ET

FORT WORTH, Texas, March 18, 2015 /PRNewswire/ -- Calloway's Nursery, Inc. (PK: CLWY) today reported revenues and operating results for the fourth quarter and year ended December 31, 2014.

Results for the Fourth Quarter

Revenue was $11.1 million for 2014, compared to revenue of $9.6 million for 2013. Same-store revenue (17 stores) was $8.9 million for 2014, compared to same-store revenue of $7.8 million for 2013. The company had opened one new store in August 2013, and has closed one store in early January 2015. Neither of these two stores has been included in the calculation of same-store revenue.

Net income was $5.6 million for 2014, compared to net loss of $0.6 million for 2013. 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 $.67 for 2014, compared to diluted net loss per common share of $.07 for 2013. 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 $8.9 million for 2014 compared to EBITDA of negative $0.6 million for 2013.

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

Adjusted EBITDA was $0 (break-even) for 2014 compared to Adjusted EBITDA of negative $0.6 million for 2013.

Results for the Year

Revenue was $53.5 million for 2014, compared to revenue of $46.6 million for 2013. Same-store revenue (17 stores) was $45.6 million for 2014, compared to same-store revenue of $41.3 million for 2013.

Net income was $8.3 million for 2014, compared to net income of $0.8 million for 2013. The 2014 results included a $5.9 million (net of income tax) gain consisting of disposal gains and impairment losses on properties, and the 2013 results included $0.2 million (net of income tax) proxy contest expenses.

Diluted net income per common share was $1.00 for 2014, compared to diluted net income per common share of $.10 for 2013. The 2014 results included a $0.70 per share (net of income tax) gain consisting of disposal gains and impairment losses on properties, and the 2013 results included $0.03 per share (net of income tax) proxy contest expenses.

EBITDA was $13.8 million for 2014 compared to EBITDA of $2.4 million for 2013.

Adjusted EBITDA was $4.9 million for 2014 compared to Adjusted EBITDA of $2.8 million for 2013.

Founded in 1986, Calloway's Nursery, Inc. is an 18-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 NURSERY, INC. CONDENSED CONSOLIDATED INCOME STATEMENTS (UNAUDITED) (Amounts in thousands, except per share amounts)

	Three-Months Ended		Year Ended
	December 31,		December 31,
	2014	2013	2014	2013

Net revenue	$11,107	$9,637	$53,515	$46,644
Cost of goods sold	5,993	5,574	27,055	24,104
Gross profit	5,114	4,063	26,460	22,540

Operating expense	3,755	3,328	16,378	14,835
Advertising expense	436	405	1,549	1,524
Occupancy expense	923	916	3,599	3,372
Depreciation and amortization	128	138	518	518
Net interest expense	148	144	566	593
Proxy contest expense	--	--	--	373
Total expenses	5,390	4,931	22,610	21,215
(Gain) on disposals and impairments of properties	(8,874)	--	(8,874)	--
Income (loss) before provision for income taxes	8,598	(868)	12,724	1,325
Income tax expense (benefit)	2,980	(285)	4,384	498
Net income (loss)	$5,618	($ 583)	$8,340	$ 827

Weighted average number of common shares outstanding – basic and diluted	8,378	8,378	8,378	8,358

Net income (loss) per common share - basic and diluted	$0.67	($0.07)	$1.00	$0.10

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

ASSETS
	December 31,	December 31,
	2014	2013
Cash and cash equivalents	$ 6,121	$ 3,887
Accounts receivable	48	50
Inventories	2,069	2,403
Prepaids and other assets	74	55
Deferred income taxes	217	90
Property held for sale	1,240	1,508
Total current assets	9,769	7,993
Property and equipment, net	13,337	15,299
Restricted cash	9,143	--
Deferred income taxes	--	135
Other assets	194	166
Total assets	$32,443	$23,593

LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued expenses	$5,322	$5,169
Current portion of long-term debt	942	896
Total current liabilities	6,264	6,065
Long-term debt, net of current portion	6,850	9,375
Deferred rent payable	74	55
Deferred income taxes	2,817	--
Total liabilities	16,005	15,495
Shareholders' equity:
Common stock	86	86
Additional paid-in capital	11,082	11,082
Retained earnings (accumulated deficit)	6,678	(1,662)
	17,846	9,506
Less: Treasury stock, at cost	(1,408)	(1,408)
Total shareholders' equity	16,438	8,098
Total liabilities and shareholders' equity	$32,443	$23,593

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

	Year Ended
	December 31,
	2014	2013
Cash flows from operating activities:
Net income	$8,340	$ 827
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	518	518
Deferred income tax	2,825	84
Net gain on disposals and impairments of properties	(8,874)	--
Net change in operating assets and liabilities	461	179
Net cash provided by operating activities	3,270	1,608
Cash flows from investing activities:
Additions to property and equipment	(117)	(2,126)
Proceeds from sale/leaseback of property and equipment	--	1,000
Net cash (used for) investing activities	(117)	(1,126)
Cash flows from financing activities:
Repayments of debt	(919)	(845)
Proceeds from issuance of common stock	--	82
Net cash (used for) financing activities	(919)	(763)
Net increase (decrease) in cash and cash equivalents	2,234	(281)
Cash and cash equivalents at beginning of period	3,887	4,168
Cash and cash equivalents at end of period	$ 6,121	$ 3,887