EX-99.1 3 j1407_ex99d1.htm EX-99.1

EXHIBIT 99.1

 

ANACOMPÒ REPORTS SECOND QUARTER FINANCIAL RESULTS

 

Company Posts Net Income

 

SAN DIEGO, CA – May 16, 2003 - Anacomp, Inc. (OTC BB: ANCPA), a global provider of information outsourcing, maintenance support and imaging and print solutions, today announced net income of $0.3 million for the three months ended March 31, 2003.

 

“We are very pleased to report net income for the second consecutive quarter, reflecting growth in our MVS and Web Presentment product lines and continued reduction of our operating expenses compared to the prior year,” said Jeff Cramer, president and chief executive officer of Anacomp.  “In addition, our income from continuing operations before income taxes for this quarter grew significantly over our first quarter of FY 2003.”

 

Anacomp’s financial results for the second quarter of fiscal 2003 reflect continued growth in the Company’s Multi-Vendor Services (MVS) and Web Presentment product lines against the decline in the Computer Output to Microfilm (COM) business.  MVS revenue has grown in 14 of the past 15 quarters.”

 

“ Focus on cash management remains a high priority at Anacomp, ” said executive vice president and chief financial officer,” Linster (Lin) Fox.  “During the quarter we reduced our borrowings under our credit facilities by over 50% or $12.8 million while increasing our cash position by $2.9 million. This was accomplished with proceeds from the sale of our Swiss subsidiaries and cash generated from operations. We ended the second quarter with our cash position now exceeding our bank debt by $3.3 million. ”

 

The Company also announced that it will host a conference call for the investment community on May 21, 2003 to discuss the results of its second quarter ended March 31, 2003. The conference call, which will begin at 8:30 a.m. PST, may be accessed at 1-877-716-4284, Leader: Jeff Cramer, Passcode: Q2 Analyst. The conference call replay number will be 1-800-945-7471, Passcode 52103. It will replay for one week until May 28, 2003.

 

Second Quarter Results

 

For the second quarter ended March 31, 2003, Anacomp’s income from continuing operations before income taxes was $1.0 million, compared to $1.5 million income from continuing operations before income taxes in the prior year second quarter.  The net income

 

 

in the second quarter of fiscal year 2003 was $0.3 million, compared with net income of $0.9 million in the second quarter of the prior year.  Revenues for the three months ended March 31, 2003 were $52.8 million, compared with $60.6 million in the same period last year.

 

Product Line Results

 

In the second quarter of fiscal year 2003, revenues for Multi-Vendor Services, one of Anacomp’s principal growth areas, were $8.2 million, reflecting a 28% growth rate over the prior year quarter.  This increase reflects new Original Equipment Manufacturer (OEM) agreements and resulting continued growth in the Company’s MVS offerings (services and hardware sales for products manufactured by other companies).  MVS represented 61% of total maintenance service revenues, which encompass both MVS and COM Professional Services, in the second quarter of fiscal year 2003.

 

Web Presentment Service revenues increased 21% over the prior year quarter, to $4.7 million, in the second quarter of fiscal year 2003.  This increase reflects growth from new customers, as well as additional revenue from established customers who have increased their use of the Company’s Web Presentment Service.

 

CD/Digital revenues declined $1.6 million, or 18% from prior year revenues.  The decrease reflects the negative impact of competition from large document services providers and numerous small, regional CD services companies, along with increased popularity of in-house, online viewing systems.

 

COM revenues — comprised of COM/Other Output Services, COM/Professional Services, and Equipment and Supplies — declined $8.8 million or 21% from the second quarter of the prior fiscal year.  COM-related product lines have been impacted negatively by the decrease in demand for COM as customers continue to opt for digital solutions such as Web and CD services.  As in prior periods, we continue to reduce our operating costs to address the COM revenue declines.

 

About Anacomp

 

Anacomp, Inc., provides comprehensive information outsourcing, maintenance support, and imaging and print solutions to more than 7,000 businesses and organizations. Founded in 1968 and headquartered in San Diego, Anacomp offers a full range of solutions for the secure capture, production, presentation, retrieval and archive of critical business documents, as

 

 

 

well as professional services for mass storage, computing and networking equipment.  For more information, visit Anacomp’s web site at www.anacomp.com.

 

Media and Analyst Contact:  Deb Troyer, Anacomp Investor Relations, (858) 716-3605 or dtroyer@anacomp.com

 

#  #  #

 

This news release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995, including statements relating the Company’s plans regarding managing revenue generation and costs in changing environments. These forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that may cause actual results to be different materially from those contemplated by the forward-looking statements. Such risks, uncertainties and other important factors include: general economic and business conditions; the declining trend in the micrographics market and other industry trends; competition; raw material costs and availability; currency fluctuations; the loss of any significant customers; and changes in business strategy or development plans.  These and other factors are discussed in greater detail in Anacomp’s Annual Report on Form 10-K and other filings with the SEC.

 

Anacomp’s news releases are distributed through PRNewswire and can be accessed via the Internet (www.anacomp.com or www.prnewswire.com).

 

Anacomp is a registered trademark of Anacomp, Inc.

 

 

 

ANACOMP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

Reorganized Company

 

(in thousands)

 

March 31,
2003

 

September 30,
2002

 

 

 

(Unaudited)

 

 

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

14,655

 

$

15,561

 

Receivable on sale of Swiss subsidiaries – current portion

 

1,277

 

—

 

Accounts receivable, net

 

31,562

 

33,990

 

Inventories, net

 

2,815

 

3,474

 

Prepaid expenses and other

 

4,884

 

6,442

 

Assets of discontinued operations

 

—

 

12,027

 

Total current assets

 

55,193

 

71,494

 

 

 

 

 

 

 

Property and equipment, net

 

19,621

 

21,448

 

Reorganization value in excess of identifiable net assets

 

73,093

 

73,227

 

Intangible assets, net

 

9,821

 

10,813

 

Receivable on sale of Swiss subsidiaries – long-term portion

 

1,248

 

—

 

Other assets

 

2,442

 

3,101

 

 

 

$

161,418

 

$

180,083

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Current portion of senior secured revolving credit facility

 

$

11,365

 

$

29,975

 

Accounts payable

 

6,909

 

9,797

 

Accrued compensation, benefits and withholdings

 

14,182

 

16,294

 

Deferred revenue

 

8,321

 

7,117

 

Accrued income taxes

 

1,461

 

1,264

 

Other accrued liabilities

 

8,284

 

9,305

 

Liabilities of discontinued operations

 

—

 

4,241

 

Total current liabilities

 

50,522

 

77,993

 

 

 

 

 

 

 

Long-term liabilities:

 

 

 

 

 

Unfunded accumulated benefit obligation

 

6,233

 

6,233

 

Other long-term liabilities

 

4,108

 

4,023

 

Total long-term liabilities

 

10,341

 

10,256

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Preferred stock

 

—

 

—

 

Common stock

 

40

 

40

 

Additional paid-in capital

 

97,000

 

96,942

 

Accumulated other comprehensive loss

 

(2,542

)

(2,836

)

Retained earnings (deficit)

 

6,057

 

(2,312

)

Total stockholders’ equity

 

100,555

 

91,834

 

 

 

$

161,418

 

$

180,083

 

 

 

 

ANACOMP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

 

Reorganized Company

 

(in thousands, except per share amounts)

 

Three months ended
March 31, 2003

 

Three months ended
March 31, 2002

 

Revenues:

 

 

 

 

 

Services

 

$

43,038

 

$

48,717

 

Equipment and supply sales

 

9,743

 

11,890

 

 

 

52,781

 

60,607

 

Cost of revenues:

 

 

 

 

 

Services

 

28,914

 

32,121

 

Equipment and supply sales

 

6,689

 

8,334

 

 

 

35,603

 

40,455

 

 

 

 

 

 

 

Gross profit

 

17,178

 

20,152

 

Costs and expenses:

 

 

 

 

 

Engineering, research and development

 

1,581

 

1,604

 

Selling, general and administrative

 

13,634

 

15,256

 

Amortization of intangible assets

 

496

 

496

 

 

 

 

 

 

 

Operating income from continuing operations

 

1,467

 

2,796

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Interest income

 

78

 

71

 

Interest expense and fee amortization

 

(631

)

(1,205

)

Other

 

90

 

(124

)

 

 

(463

)

(1,258

)

Income from continuing operations before income taxes

 

1,004

 

1,538

 

Provision for income taxes

 

547

 

1,253

 

Income from continuing operations

 

457

 

285

 

Income from discontinued operations, net of taxes

 

—

 

618

 

Loss on sale of discontinued operations, net of taxes

 

(200

)

—

 

Net income

 

$

257

 

$

903

 

 

 

 

 

 

 

Basic and diluted per share data:

 

 

 

 

 

Basic and diluted income from continuing operations

 

$

0.11

 

$

0.07

 

Basic and diluted income from discontinued operations

 

0.00

 

0.15

 

Loss on sale of discontinued operations

 

(0.05

)

0.00

 

Basic and diluted net income

 

$

0.06

 

$

0.22

 

 

 

 

 

 

 

Shares used in computing basic and diluted net income per share

 

4,039

 

4,034

 

 

 

 

ANACOMP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

Reorganized Company

 

Predecessor
Company

 

(in thousands)

 

Six months ended
March 31, 2003

 

Three months ended
March 31, 2002

 

Three months ended
December 31, 2001

 

 

 

(Unaudited)

 

(Unaudited)

 

 

 

Cash flows from operating  activities:

 

 

 

 

 

 

 

Net income

 

$

8,369

 

$

903

 

$

277,360

 

Adjustments to reconcile net income to net  cash provided by operating activities:

 

 

 

 

 

 

 

Other income due to extinguishment of debt

 

—

 

—

 

(265,329

)

Adjustments of assets and liabilities to fair value

 

—

 

—

 

(16,916

)

Write off of deferred debt issuance costs and unamortized premiums and discounts

 

—

 

—

 

2,216

 

Gain on sale of discontinued operations

 

(8,184

)

—

 

—

 

Income from discontinued operations

 

—

 

(618

)

—

 

Depreciation and amortization

 

7,627

 

4,434

 

7,194

 

Non-cash settlement of facility lease contract

 

—

 

—

 

349

 

Amortization of debt fees, premiums, and discounts

 

344

 

172

 

92

 

Non-cash compensation

 

58

 

—

 

—

 

Change in assets and liabilities:

 

 

 

 

 

 

 

Accounts and other receivables

 

2,428

 

(1,972

)

3,092

 

Inventories

 

659

 

(246

)

739

 

Prepaid expenses and other assets

 

1,791

 

1,583

 

332

 

Accounts payable, accrued expenses and other liabilities

 

(7,851

)

(622

)

(3,733

)

Accrued interest

 

—

 

250

 

(387

)

Net cash provided by continuing operations

 

5,241

 

3,884

 

5,009

 

Net cash provided by discontinued operations

 

—

 

1,495

 

—

 

Net cash provided by operating activities

 

5,241

 

5,379

 

5,009

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Purchases of property and equipment

 

(1,518

)

(1,110

)

(1,075

)

Proceeds from sale of discontinued operations, net

 

13,398

 

—

 

—

 

Net cash provided by (used in) investing activities

 

11,880

 

(1,110

)

(1,075

)

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Principal payments on revolving line of credit, net

 

(18,610

)

(11,700

)

(2,000

)

Net cash used in financing activities

 

(18,610

)

(11,700

)

(2,000

)

Effect of exchange rate changes on cash and cash equivalents

 

583

 

(84

)

637

 

(Decrease) increase in cash and cash equivalents

 

(906

)

(7,515

)

2,571

 

Less increase in cash from discontinued operations

 

—

 

(1,495

)

—

 

Cash and cash equivalents at beginning of period

 

15,561

 

26,879

 

24,308

 

Cash and cash equivalents at end of period

 

$

14,655

 

$

17,869

 

$

26,879

 

 

 

 

ANACOMP, INC.

QUARTERLY REVENUES AND EBITDA

(in thousands)

 

 

 

FY 2002
REPORTED

 

FY 2002
EXCLUDING DISCONTINUED OPERATIONS (ALL
PERIODS)

 

FY 2003

 

FY 2003

 

 

 

Q1

 

Q1 (A)

 

Q2

 

Q3

 

Q4

 

Q1

 

Q2

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MVS

 

$

6,513

 

$

6,459

 

$

6,421

 

$

6,871

 

$

7,263

 

$

8,117

 

$

8,238

 

Web Presentment

 

3,176

 

3,048

 

3,891

 

4,038

 

4,611

 

4,783

 

4,713

 

CD / Digital

 

14,573

 

8,513

 

8,981

 

8,016

 

8,069

 

7,329

 

7,336

 

Subtotal

 

24,262

 

18,020

 

19,293

 

18,925

 

19,943

 

20,229

 

20,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COM / Other Output Services

 

25,521

 

24,954

 

24,244

 

21,966

 

20,885

 

19,158

 

18,777

 

COM Professional Services

 

7,165

 

6,886

 

6,228

 

6,114

 

5,895

 

5,538

 

5,268

 

Equipment / Supplies

 

11,076

 

10,659

 

10,842

 

9,529

 

9,943

 

8,046

 

8,449

 

Total revenues

 

$

68,024

 

$

60,519

 

$

60,607

 

$

56,534

 

$

56,666

 

$

52,971

 

$

52,781

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of EBITDA to Operating Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA (B)

 

$

8,495

 

$

7,444

 

$

7,242

 

$

6,272

 

$

4,876

 

$

5,096

 

$

5,194

 

Depreciation and amortization

 

(7,194

)

(7,044

)

(4,445

)

(4,295

)

(4,293

)

(3,973

)

(3,654

)

Other income (expense), net

 

262,149

 

262,182

 

(1,258

)

(426

)

(736

)

(756

)

(463

)

Non-cash compensation

 

—

 

—

 

—

 

—

 

(57

)

(33

)

(25

)

Reorganization items

 

13,328

 

13,328

 

—

 

—

 

—

 

—

 

—

 

Restructuring credits (charges)

 

1,032

 

1,032

 

—

 

(2,081

)

—

 

—

 

—

 

Other

 

—

 

(1

)

(1

)

1

 

—

 

(48

)

(48

)

Income from operations before income taxes and gain on sale of discontinued operations

 

$

277,810

 

$

276,941

 

$

1,538

 

$

(529

)

$

(210

)

$

286

 

$

1,004

 

 

(A)       Results excluding Switzerland and two smaller operating units sold in fiscal year 2002.  The discontinued operations generated the following revenues in the three months ended December 31, 2001:  MVS $54, Web Presentment $128, CD/Digital $6,060, COM/Other Output Services $567, COM Professional Services $279, and Equipment/Supplies $417 for total revenue of $7,505.  These operating units generated EBITDA of $1,051 and had depreciation expense of $150 and other income/expense of $33.

(B)       Anacomp reports its financial results in accordance with GAAP, and additionally on a non-GAAP basis using EBITDA.  EBITDA is not in accordance with, nor a substitute for, GAAP measures to evaluate and manage the Company’s operations.  Anacomp is providing this information to investors to allow for the performance of additional financial analysis and because it is consistent with the financial models and estimates historically used by investors who follow the Company.