Wolohan Lumber Reports Improvement in First Quarter Results

Apr 18, 2001, 01:00 ET from Wolohan Lumber Co.

    SAGINAW, Mich., April 18 /PRNewswire/ -- Wolohan Lumber Co. (Nasdaq: WLHN)
 today reported a net loss of $615,000 (18 cents per share) for the first
 quarter ended March 31, 2001.  This compares with a net loss of $1,206,000
 (24 cents per share) in the same period of 2000.  The Company's business is
 subject to seasonal influences with lower sales historically recorded in the
 first quarter, often resulting in a net loss.
     The Company had sales of $44.4 million for the first quarter of 2001,
 compared with $66.8 million in the first quarter of 2000.  Same-store sales
 declined 21 percent.
     "Sales in the first quarter were negatively affected by significant price
 deflation in lumber and structural panel products combined with slower
 construction activity and strategic product changes," said James L. Wolohan,
 President and Chief Executive Officer.  "As the Company moves its strategic
 focus to professional builders and large-project-oriented consumers, it will
 continue to eliminate or reduce certain products previously sold to the do-it-
 yourself home improvement market, which in turn, will have a negative impact
 on sales comparisons," noted Mr. Wolohan.
     The decline in the net loss for the quarter ended March 31, 2001, compared
 with the first quarter of the prior year reflects:
 
     1) $441,000 of operating losses associated with four discontinued stores
 in 2001 (in the fourth quarter 2000, the Company also accrued and expensed
 $492,000 of projected operating losses and store closing costs associated with
 these four stores), compared with $574,000 of operating losses (inclusive of
 store closing costs of $445,000) incurred from two discontinued stores in
 first quarter 2000.
     2) $1,073,000 of gains from the sale of real estate properties recorded in
 2001 compared with $300,000 of gains in 2000.
     3) $22,000 of net interest expense recorded in 2001, compared with
 $199,000 of net interest expense in 2000.
 
     "The Company's strategic direction continues to be: (1) revenue growth and
 operating improvement at existing stores through the advancement of services
 to our target customers and development of operating efficiencies, and (2)
 strengthening our balance sheet by improving management of working capital at
 existing operations and redeploying investments which do not meet our
 strategic profit model.  The Company has consistently utilized its strategic
 profit model to evaluate overall performance of its assets and will continue
 to do so.  This may result in additional store closings or other asset
 redeployments," said Mr. Wolohan.
     At March 31, 2001, the Company had 36 stores compared with 47 at the end
 of the first quarter of 2000.
     Asset redeployments have improved the Company's already strong balance
 sheet.  The Company had a liquidity position (cash and short-term investments)
 of $9.1 million at March 31, 2001.  It has reduced long-term debt (including
 the portion due within one year) to $6.1 million, approximately 6 percent of
 total assets.  The Company has also repurchased 3.6 million shares of its
 common stock since January 1, 1998 at an average price of $11.99 per share.
 The book value per share was $22.85 at March 31, 2001, compared with $19.09 at
 the end of the first quarter of 2000.
 
     Safe Harbor for Forward-Looking Statements
     Statements contained herein which are not historical fact are forward-
 looking statements within the meaning of the Securities Act of 1933 and the
 Securities Exchange Act of 1934 which are intended to be covered by the safe
 harbors created thereby.  For a summary of important facts, which could cause
 the Company's actual results to differ materially from those included in, or
 inferred by, the forward-looking statements, refer to the Company's Form 10-K
 and other documents that are on file with the Securities and Exchange
 Commission.
                                                Quarter Ended  Quarter Ended
                                                    3/31/01        3/25/00
 
     Sales                                       $44,380,000    $66,834,000
     Pretax loss                                  (1,024,000)    (1,993,000)
     Net loss                                       (615,000)    (1,206,000)
     Per share, basic                                  ($.18)         ($.24)
 
 

SOURCE Wolohan Lumber Co.
    SAGINAW, Mich., April 18 /PRNewswire/ -- Wolohan Lumber Co. (Nasdaq: WLHN)
 today reported a net loss of $615,000 (18 cents per share) for the first
 quarter ended March 31, 2001.  This compares with a net loss of $1,206,000
 (24 cents per share) in the same period of 2000.  The Company's business is
 subject to seasonal influences with lower sales historically recorded in the
 first quarter, often resulting in a net loss.
     The Company had sales of $44.4 million for the first quarter of 2001,
 compared with $66.8 million in the first quarter of 2000.  Same-store sales
 declined 21 percent.
     "Sales in the first quarter were negatively affected by significant price
 deflation in lumber and structural panel products combined with slower
 construction activity and strategic product changes," said James L. Wolohan,
 President and Chief Executive Officer.  "As the Company moves its strategic
 focus to professional builders and large-project-oriented consumers, it will
 continue to eliminate or reduce certain products previously sold to the do-it-
 yourself home improvement market, which in turn, will have a negative impact
 on sales comparisons," noted Mr. Wolohan.
     The decline in the net loss for the quarter ended March 31, 2001, compared
 with the first quarter of the prior year reflects:
 
     1) $441,000 of operating losses associated with four discontinued stores
 in 2001 (in the fourth quarter 2000, the Company also accrued and expensed
 $492,000 of projected operating losses and store closing costs associated with
 these four stores), compared with $574,000 of operating losses (inclusive of
 store closing costs of $445,000) incurred from two discontinued stores in
 first quarter 2000.
     2) $1,073,000 of gains from the sale of real estate properties recorded in
 2001 compared with $300,000 of gains in 2000.
     3) $22,000 of net interest expense recorded in 2001, compared with
 $199,000 of net interest expense in 2000.
 
     "The Company's strategic direction continues to be: (1) revenue growth and
 operating improvement at existing stores through the advancement of services
 to our target customers and development of operating efficiencies, and (2)
 strengthening our balance sheet by improving management of working capital at
 existing operations and redeploying investments which do not meet our
 strategic profit model.  The Company has consistently utilized its strategic
 profit model to evaluate overall performance of its assets and will continue
 to do so.  This may result in additional store closings or other asset
 redeployments," said Mr. Wolohan.
     At March 31, 2001, the Company had 36 stores compared with 47 at the end
 of the first quarter of 2000.
     Asset redeployments have improved the Company's already strong balance
 sheet.  The Company had a liquidity position (cash and short-term investments)
 of $9.1 million at March 31, 2001.  It has reduced long-term debt (including
 the portion due within one year) to $6.1 million, approximately 6 percent of
 total assets.  The Company has also repurchased 3.6 million shares of its
 common stock since January 1, 1998 at an average price of $11.99 per share.
 The book value per share was $22.85 at March 31, 2001, compared with $19.09 at
 the end of the first quarter of 2000.
 
     Safe Harbor for Forward-Looking Statements
     Statements contained herein which are not historical fact are forward-
 looking statements within the meaning of the Securities Act of 1933 and the
 Securities Exchange Act of 1934 which are intended to be covered by the safe
 harbors created thereby.  For a summary of important facts, which could cause
 the Company's actual results to differ materially from those included in, or
 inferred by, the forward-looking statements, refer to the Company's Form 10-K
 and other documents that are on file with the Securities and Exchange
 Commission.
                                                Quarter Ended  Quarter Ended
                                                    3/31/01        3/25/00
 
     Sales                                       $44,380,000    $66,834,000
     Pretax loss                                  (1,024,000)    (1,993,000)
     Net loss                                       (615,000)    (1,206,000)
     Per share, basic                                  ($.18)         ($.24)
 
 SOURCE  Wolohan Lumber Co.