Mac-Gray Corporation Reports First Quarter 2001 Results

Apr 26, 2001, 01:00 ET from Mac-Gray Corporation

    CAMBRIDGE, Mass., April 26 /PRNewswire/ -- Mac-Gray Corporation
 (NYSE:   TUC), a leading provider of laundry services and other amenities to the
 multi-housing industry, and the largest provider of such services to the
 college and university market, today reported net income of $580,000, or $0.05
 per share, for the quarter ended March 31, 2001.  This compares with net
 income of $615,000, or $0.05 per share for the first quarter of 2000.
     First quarter revenue totaled $38.2 million, an increase of $1.0 million,
 or 2.7% over the same period last year.
     Commenting on the results, Stewart MacDonald, Chairman and Chief Executive
 Officer, said: "This quarter had mixed results.  The laundry and reprographics
 businesses enjoyed a combined revenue increase of 7%, but our MicroFridge
 division trailed last year's revenue for the same period by 19%, primarily due
 to timing issues.
     "The total cost of revenue for the first quarter was hurt by the mix of
 sales, and by the margin in the MicroFridge division being lower than in 2000.
 This decrease in the MicroFridge margin is due primarily to an increase in the
 sale of less profitable larger units, particularly to the government, and
 competitive pressures in the price sensitive hotel and motel markets.  As
 mentioned in my recent letter to shareholders, we are taking steps to remove
 these pressures and the effect of these steps will be visible as this year
 proceeds.
     "We continue to generate good cash flow through improved operating results
 and prudent management of the Balance Sheet and capital spending.  We expect
 this year to be another good one, although we say that with an eye on rising
 gasoline costs, which have a direct impact on our combined service and
 collection fleets.
     "The first quarter also saw exciting development of another new approach
 to our cashless laundry rooms of the future.  In cooperation with two
 manufacturers who provided product, we are nearing the conclusion of an
 experiment in laundry equipment that communicates with its users through an
 Internet-based design.  At a local university that we have served continuously
 for almost fifty years, our machines are now connected to us, to the students
 or residents, and to the school.  This connectivity enhances everyone's
 convenience.  The machines tell us when they are available, when they are in
 use, and when they need service.  This experiment was featured in The New York
 Times on March 15th."
     Mac-Gray, founded in 1927, is one of the nation's leading providers of
 card- and coin-operated laundry equipment, card- and coin-operated
 reprographics equipment, and MicroFridge(R) products.  Mac-Gray is the
 industry leader in card-operated laundry equipment, which enhances customer
 convenience by eliminating the need for coins.
 
     Safe Harbor Statement under the Private Securities Litigation Reform Act
 of 1995: The statements contained in this release which are not historical
 facts, such as those containing future financial performance and growth, are
 forward looking statements that are subject to change based on various factors
 which may be beyond the company's control.  Accordingly, the future
 performance and financial results of the company, including those of its
 MicroFridge and Copico divisions, may differ materially from those expressed
 or implied in any such forward looking statements.  Such factors include, but
 are not limited to, those described in the company's filings with the
 Securities and Exchange Commission.
 
                           (Financial Table Follows)
 
                              MAC-GRAY CORPORATION
                         CONSOLIDATED INCOME STATEMENTS
                    (In thousands, except per share amounts)
 
                                                   Three months  Three months
                                                       ended          ended
                                                     March 31,      March 31,
                                                       2001           2000
 
     Revenue                                          $38,220        $37,213
     Cost of revenue:
      Cost of route revenues                           19,463         18,643
      Depreciation and amortization                     4,920          4,729
      Cost of products sold                             5,893          5,522
       Total cost of revenue                           30,276         28,894
 
     Operating expenses:
      Selling, General and Administration Expenses      5,338          5,562
 
     Income from operations                             2,606          2,757
     Interest and other expenses, net                   1,506          1,581
     Income before provision for income taxes           1,100          1,176
     Provision for income taxes                           520            561
     Net income                                           580            615
 
     Net income per common share - basic               $ 0.05         $ 0.05
 
     Weighted average common shares
      outstanding - basic                              12,640         12,630
 
     Net income per common share - diluted             $ 0.05         $ 0.05
 
     Weighted average common shares
      outstanding - diluted                            12,644         12,630
 
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SOURCE Mac-Gray Corporation
    CAMBRIDGE, Mass., April 26 /PRNewswire/ -- Mac-Gray Corporation
 (NYSE:   TUC), a leading provider of laundry services and other amenities to the
 multi-housing industry, and the largest provider of such services to the
 college and university market, today reported net income of $580,000, or $0.05
 per share, for the quarter ended March 31, 2001.  This compares with net
 income of $615,000, or $0.05 per share for the first quarter of 2000.
     First quarter revenue totaled $38.2 million, an increase of $1.0 million,
 or 2.7% over the same period last year.
     Commenting on the results, Stewart MacDonald, Chairman and Chief Executive
 Officer, said: "This quarter had mixed results.  The laundry and reprographics
 businesses enjoyed a combined revenue increase of 7%, but our MicroFridge
 division trailed last year's revenue for the same period by 19%, primarily due
 to timing issues.
     "The total cost of revenue for the first quarter was hurt by the mix of
 sales, and by the margin in the MicroFridge division being lower than in 2000.
 This decrease in the MicroFridge margin is due primarily to an increase in the
 sale of less profitable larger units, particularly to the government, and
 competitive pressures in the price sensitive hotel and motel markets.  As
 mentioned in my recent letter to shareholders, we are taking steps to remove
 these pressures and the effect of these steps will be visible as this year
 proceeds.
     "We continue to generate good cash flow through improved operating results
 and prudent management of the Balance Sheet and capital spending.  We expect
 this year to be another good one, although we say that with an eye on rising
 gasoline costs, which have a direct impact on our combined service and
 collection fleets.
     "The first quarter also saw exciting development of another new approach
 to our cashless laundry rooms of the future.  In cooperation with two
 manufacturers who provided product, we are nearing the conclusion of an
 experiment in laundry equipment that communicates with its users through an
 Internet-based design.  At a local university that we have served continuously
 for almost fifty years, our machines are now connected to us, to the students
 or residents, and to the school.  This connectivity enhances everyone's
 convenience.  The machines tell us when they are available, when they are in
 use, and when they need service.  This experiment was featured in The New York
 Times on March 15th."
     Mac-Gray, founded in 1927, is one of the nation's leading providers of
 card- and coin-operated laundry equipment, card- and coin-operated
 reprographics equipment, and MicroFridge(R) products.  Mac-Gray is the
 industry leader in card-operated laundry equipment, which enhances customer
 convenience by eliminating the need for coins.
 
     Safe Harbor Statement under the Private Securities Litigation Reform Act
 of 1995: The statements contained in this release which are not historical
 facts, such as those containing future financial performance and growth, are
 forward looking statements that are subject to change based on various factors
 which may be beyond the company's control.  Accordingly, the future
 performance and financial results of the company, including those of its
 MicroFridge and Copico divisions, may differ materially from those expressed
 or implied in any such forward looking statements.  Such factors include, but
 are not limited to, those described in the company's filings with the
 Securities and Exchange Commission.
 
                           (Financial Table Follows)
 
                              MAC-GRAY CORPORATION
                         CONSOLIDATED INCOME STATEMENTS
                    (In thousands, except per share amounts)
 
                                                   Three months  Three months
                                                       ended          ended
                                                     March 31,      March 31,
                                                       2001           2000
 
     Revenue                                          $38,220        $37,213
     Cost of revenue:
      Cost of route revenues                           19,463         18,643
      Depreciation and amortization                     4,920          4,729
      Cost of products sold                             5,893          5,522
       Total cost of revenue                           30,276         28,894
 
     Operating expenses:
      Selling, General and Administration Expenses      5,338          5,562
 
     Income from operations                             2,606          2,757
     Interest and other expenses, net                   1,506          1,581
     Income before provision for income taxes           1,100          1,176
     Provision for income taxes                           520            561
     Net income                                           580            615
 
     Net income per common share - basic               $ 0.05         $ 0.05
 
     Weighted average common shares
      outstanding - basic                              12,640         12,630
 
     Net income per common share - diluted             $ 0.05         $ 0.05
 
     Weighted average common shares
      outstanding - diluted                            12,644         12,630
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X59944835
 
 SOURCE  Mac-Gray Corporation