EX-99.1 2 d67633exv99w1.htm EX-99.1 exv99w1
Ex 99.1
SILVERLEAF RESORTS, INC. REPORTS
FIRST QUARTER 2009 RESULTS
DALLAS—(BUSINESS WIRE) — May 7, 2009 — Silverleaf Resorts, Inc. (NASDAQ: SVLF) today reported the following results for its first quarter ended March 31, 2009.
Financial highlights for the first quarter of 2009:
  •   Net income of $4.6 million and diluted earnings per share of $0.12
 
  •   Gross Vacation Interval sales of $58.7 million
2009 First Quarter Results
Overall, total revenues for the first quarter of 2009 were $63.2 million compared to $67.0 million for the first quarter of 2008. Total revenues consist of net sales, interest income, management fees, and other income.
Vacation Interval sales were $58.7 million in the first quarter of 2009 compared to $65.1 million in the comparable prior-year period. The decrease in Vacation Interval sales is primarily attributable to a 6.6% decrease in tours and a 1.2% decrease in the closing ratio, partially offset by a favorable sales mix of higher-end products on additional interval sales to existing customers. Vacation Interval sales to existing customers decreased 5.8% to $35.8 million while Vacation Interval sales to new customers decreased 15.6% to $22.8 million. Vacation Interval sales to existing customers comprised 61.1% and 58.5% of total Vacation Interval sales in the first quarters of 2009 and 2008, respectively, which maintains the Company’s favorable sales-mix trend toward upgrades and second-week sales to existing customers as such sales have relatively lower associated sales and marketing costs.
The provision for estimated uncollectible revenue was 24.9% of Vacation Interval sales during the first quarter of 2009 versus 22.0% for the same period of 2008. This increase was necessary to maintain the allowance for uncollectible notes at a level management considers adequate to provide for anticipated losses resulting from customer defaults.
Cost of Vacation Interval sales increased to 10.2% of Vacation Interval sales for the first quarter of 2009 compared to 7.5% in the 2008 comparable period. This increase resulted from sales of higher cost-basis inventory during the first quarter of 2009 compared to the first quarter of 2008.
Sales and marketing expense as a percentage of Vacation Interval sales was 52.4% for the first quarter of 2009 versus 51.5% for the comparable prior year period. The increase in sales and marketing expense as a percentage of Vacation Interval sales is primarily attributable to higher commissions. As previously mentioned, the sales-mix trend of existing customers to new customers was favorable for the first quarter of 2009 compared to the same period of 2008.
While total positive net interest spread (interest income less interest expense and lender fees) remained constant at $8.4 million for the first quarters of 2009 and 2008, interest expense and lender fees as a percentage of interest income increased to 45.9% in the first quarter of 2009 compared to 42.1% in the first quarter of 2008. This increase is attributable to a larger average debt balance outstanding for the first quarter of 2009 versus the same period of 2008 and an increase in lender fees related to the Company’s Silverleaf Finance VI (“SF-VI”) securitization which closed in the second quarter of 2008. The increase was partially offset by a higher average notes receivable balance during the first quarter of 2009 versus the same period of 2008 coupled with an overall increase in the weighted average yield on customer notes receivable to 16.8% at March 31, 2009 from 16.6% at March 31, 2008. The weighted average cost of borrowings was 6.4% for each of the three-month periods ended March 31, 2009 and 2008.

 

 

Net income for the quarter ended March 31, 2009 was $4.6 million, or $0.12 per diluted share, compared to net income of $7.4 million, or $0.19 per diluted share, for the quarter ended March 31, 2008.
Balance Sheet
At March 31, 2009, notes receivable and revolving debt balances increased over comparative balances at December 31, 2008. However, there was a decrease in the growth of the Company’s notes receivable and debt portfolios for the first quarter of 2009 versus the first quarter of 2008. These decreases are consistent with the decrease in the Company’s Vacation Interval sales.
At March 31, 2009, senior credit facilities provided for loans of up to $535.9 million, of which $172.0 million was unused. Considering forecasted sales and expansion plans, these senior credit facilities provide adequate liquidity into 2010. At March 31, 2009, the Company’s senior debt consisted of 34% fixed-rate debt and 66% variable-rate debt. However, the majority of the Company’s variable-rate debt is subject to interest-rate floors between 5.25% and 8.00%.
Expansion at existing resorts, primarily construction of lodging units, was $7.5 million for each of the three-month periods ended March 31, 2009 and 2008.
About Silverleaf Resorts
Based in Dallas, Texas, Silverleaf Resorts, Inc. currently owns and operates timeshare resorts with a wide array of country club-like amenities, such as golf, clubhouses, swimming, tennis, boating, and many organized activities for children and adults. For additional information, please visit www.silverleafresorts.com.
Forward-Looking Statements
This release contains certain forward-looking statements that involve risks and uncertainties and actual results may differ materially from those anticipated. The Company is subject to specific risks associated with the timeshare industry, the regulatory environment, and various economic factors. These risks and others are more fully discussed under the heading “Risk Factors” in the Company’s reports filed with the Securities and Exchange Commission, including the Company’s 2008 Annual Report on Form 10-K filed on March 10, 2009.
For more information or to visit the Company’s website, click here:
http://www.b2i.us/irpass.asp?BzID=1358&Nav=0&S=0&L=1
Contact:
Silverleaf Resorts, Inc., Dallas, Texas
Thomas J. Morris, 214-631-1166 x2218

 

 

SILVERLEAF RESORTS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(Unaudited)
                 
    Three Months Ended  
    March 31,  
    2009     2008  
Revenues:
                
Vacation Interval sales
   $ 58,658     $ 65,081  
Estimated uncollectible revenue
     (14,606 )     (14,318 )
 
            
Net sales
     44,052       50,763  
 
                
Interest income
     15,502       14,507  
Management fee income
     930       780  
Other income
     2,679       976  
 
            
Total revenues
     63,163       67,026  
 
            
 
                
Costs and Operating Expenses:
                
Cost of Vacation Interval sales
     5,980       4,874  
Sales and marketing
     30,758       33,537  
Operating, general and administrative
     10,435       9,292  
Depreciation
     1,356       1,114  
Interest expense and lender fees:
                
Related to receivables-based credit facilities
     5,595       4,602  
Related to other indebtedness
     1,519       1,500  
 
            
Total costs and operating expenses
     55,643       54,919  
 
            
 
                
Income before provision for income taxes
     7,520       12,107  
Provision for income taxes
     (2,933 )     (4,661 )
 
            
 
                
Net income
   $ 4,587     $ 7,446  
 
            
 
                
Basic net income per share
   $ 0.12     $ 0.20  
 
            
 
                
Diluted net income per share
   $ 0.12     $ 0.19  
 
            
 
                
Weighted average basic common shares issued and outstanding
     38,146,943       37,926,835  
 
            
 
                
Weighted average diluted common shares issued and outstanding
     38,823,170       39,377,595  
 
            

 

 

SILVERLEAF RESORTS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
                 
    March 31,     December 31,  
    2009     2008  
    (Unaudited)          
ASSETS
               
Cash and cash equivalents
   $ 7,284     $ 11,431  
Restricted cash
     22,691       22,623  
Notes receivable, net of allowance for uncollectible notes of $74,529 and $76,696, respectively
     330,133       320,306  
Accrued interest receivable
     4,081       4,154  
Investment in special purpose entity
     4,878       4,908  
Amounts due from affiliates
     1,642       1,738  
Inventories
     192,979       190,318  
Land, equipment, buildings, and leasehold improvements, net
     55,650       55,393  
Prepaid and other assets
     33,436       33,951  
 
            
TOTAL ASSETS
   $ 652,774     $ 644,822  
 
            
 
                
LIABILITIES AND SHAREHOLDERS’ EQUITY
                
 
                
LIABILITIES
                
Accounts payable and accrued expenses
   $ 13,062     $ 12,701  
Accrued interest payable
     2,519       2,380  
Unearned samplers
     6,343       6,247  
Income taxes payable
     1,688       1,942  
Deferred income taxes
     37,225       35,114  
Notes payable and capital lease obligations
     370,166       369,071  
Senior subordinated notes
     22,814       23,121  
 
            
Total Liabilities
     453,817       450,576  
 
            
 
                
COMMITMENTS AND CONTINGENCIES
                
 
                
SHAREHOLDERS’ EQUITY
                
Preferred stock, 10,000,000 shares authorized, none issued and outstanding
     —       —  
Common stock, par value $0.01 per share, 100,000,000 shares authorized, 38,146,943 shares issued and outstanding at March 31, 2009 and December 31, 2008
     381       381  
Additional paid-in capital
     113,100       112,976  
Retained earnings
     85,476       80,889  
 
            
Total Shareholders’ Equity
     198,957       194,246  
 
            
 
                
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
   $ 652,774     $ 644,822