EX-99.1 3 d57960_ex99-1.txt PRESS RELEASE DATED JANUARY 20, 2004 Exhibit 99.1 [LOGO] bluegreen(R) CONTACT: -OR- INVESTOR RELATIONS COUNSEL: Bluegreen Corporation The Equity Group Inc. John Chiste Devin Sullivan Chief Financial Officer (212) 836-9608 (561) 912-8010 dsullivan@equityny.com john.chiste@bxgcorp.com Adam Prior (212) 836-9606 aprior@equityny.com FOR IMMEDIATE RELEASE BLUEGREEN CORPORATION REPORTS RECORD FOURTH QUARTER AND YEAR-END FINANCIAL RESULTS 2003 Highlights Compared to 2002 o Resorts sales in Q4 rise 38% to record $62.9 million o Annual Resort sales increase 43% to record $253.9 million o Q4 Communities sales up 71% to record $38.7 million o Net income in Q4 rises 18% to record $7.3 million, or $.26 per diluted share o Annual net income increases 138% to record $25.8 million, or $.94 per diluted share Boca Raton, FL - January 20, 2004 - Bluegreen Corporation (NYSE: BXG), a leading U.S. developer and marketer of drive-to vacation ownership resorts ("Bluegreen(R) Resorts") and planned residential and golf communities ("Bluegreen Communities"), today announced record sales and net income for the fourth quarter and year ended December 31, 2003 (see attached tables). George F. Donovan, President and Chief Executive Officer of Bluegreen, commented, "We believe that 2003 was the most successful year in Bluegreen's history. Higher sales, improved operating efficiencies, an expanded portfolio of properties and a deep respect for the customer produced record profits for the 2003 fourth quarter and year. We continue to focus on pursuing growth opportunities in each of our businesses and providing high-quality leisure and lifestyle experiences." Bluegreen Corporation Page 2 January 20, 2004 RECORD NET INCOME Net income for the fourth quarter of 2003 rose 18% to a fourth quarter record $7.3 million, or $.26 per diluted share on approximately 29.7 million weighted average common and common equivalent shares outstanding ("shares outstanding"), versus net income of $6.1 million, or $.23 per diluted share on approximately 28.8 million shares outstanding, for the same period last year. Net income for the 2002 fourth quarter included an after-tax gain of $3.3 million, or $.10 per diluted share, directly related to the completion of a $170.2 million private offering of timeshare loan-backed securities in December 2002. Bluegreen did not complete a similar transaction in 2003. Net income for 2003 rose 138% to a record $25.8 million, or $.94 per diluted share on approximately 29.3 million shares outstanding, versus net income of $10.8 million, or $.44 per diluted share on approximately 28.8 million shares outstanding, last year. Net income for the 2002 twelve-month period included the cumulative effect of a change in accounting principle relating to a previously disclosed, one-time write off of deferred telemarketing costs, effective April 1, 2002, that reduced net income in 2002 by approximately $5.9 million, net of tax, or $.19 per diluted share. RECORD RESORTS AND COMMUNITIES SALES Resorts sales in the fourth quarter of 2003 increased 38% to a record $62.9 million from $45.5 million in the same period last year. Resorts sales for 2003 rose 43% to a record $253.9 million from $177.4 million last year. Higher sales in these periods were due primarily to continued same-resort sales increases at a majority of Bluegreen's properties. Bluegreen also experienced continued strong sales of the Bluegreen Vacation Club(R) product through the three new resort sales offices and one new off-site sales office added in 2003. During the fourth quarter of 2003, Bluegreen commenced sales at The Fountains Resort (formerly known as Oasis Lakes) in Orlando, FL and Grande Villas at World Golf Village in St. Augustine, FL. Communities sales in the fourth quarter of 2003 increased 71% to a record $38.7 million from $22.7 million in the same period last year. This increase was due primarily to strong sales at: Traditions of Braselton(TM), a Bluegreen golf community located near Atlanta, GA that commenced sales in April 2003; Sanctuary Cove at St. Andrews Sound, a Bluegreen Golf Community located among Georgia's Golden Isles that opened for sales in December 2003; and new properties in Texas and North Carolina that opened during 2003 including Silver Lakes Ranch (Sunset, TX), Quail Springs Ranch (Peaster, TX) and Catawba Falls Preserve (Black Mountain, NC). Sales of Communities in 2003 reached $104.4 million and increased 3% from 2002 Communities sales. Recognition of Communities sales in 2003 Bluegreen Corporation Page 3 January 20, 2004 was impacted by the effect of percentage-of-completion accounting. As of December 31, 2003, approximately $18.9 million and $8.1 million of communities sales and profits, respectively, were deferred under the percentage-of-completion method of accounting. We expect these amounts will be recognized in future periods ratably with the development of the projects. Other resort and communities operations revenue for 2003 increased 66% to $55.4 million from $33.3 million last year due primarily to the operations of a mini-vacation package sales and marketing business which the Company obtained as a result of the September 2002 acquisition of substantially all of the assets of TakeMeOnVacation LLC and affiliates. INCREASED EFFICIENCY OF OPERATIONS In addition, the Company believes that its sales and marketing strategies, and customer focus, contributed to increased operating efficiency. In this regard, while total sales for the fourth quarter of 2003 increased 49%, selling, general and administrative expenses as a percentage of total sales declined to 55% from 60% in the same period last year. For all of 2003, selling, general and administrative expenses as a percentage of total sales declined to 57% from 58%, despite an annual sales increase of 29%. Total positive net interest spread (interest income less interest expense) was $3.5 million in 2003 as compared to $3.1 million in 2002. FINANCIAL POSITION Bluegreen's balance sheet at December 31, 2003 reflected a book value of $7.50 per share and a debt-to-equity ratio of 1.37:1. In December 2003, Bluegreen increased its revolving vacation ownership receivables purchase facility with Resort Finance LLC to $150.0 million, from $100.0 million, and extended the facility through September 30, 2004, from March 31, 2004. Bluegreen also increased its unsecured line of credit with Wachovia Bank, NA to $15.0 million, from $12.5 million, and extended the maturity of the line until December 31, 2004, from December 31, 2003. Bluegreen Corporation Page 4 January 20, 2004 A PORTFOLIO OF LEISURE AND LIFESTYLE CHOICES Mr. Donovan commented, "During 2003, we continued to provide attractive, amenity-rich lifestyle choices to our customers while expanding our portfolio of resorts, entering new markets, and strengthening our operating and management infrastructure. Our resort properties allow our customers to vacation when they want to, wherever they want to at any Bluegreen Vacation Club resort for a lifetime. On the Communities side, we continue to sell homesites directly to consumers, thus allowing them, not builders or developers, to make such important decisions as location, style and size of their home. Thousands of owners in Bluegreen Golf communities have chosen this value-enhanced way to create the custom home of their dreams. We continue to be supported in our efforts by a dedicated management team and Board of Directors. We look forward to 2004 with confidence." Bluegreen is one of the leading companies engaged in the acquisition, development, marketing and sale of vacation ownership resorts and residential homesites. Bluegreen Resorts are located in a variety of popular vacation destinations, including: Orlando, Florida; St. Augustine, Florida; Surfside, Florida; the Smoky Mountains of Tennessee; Myrtle Beach, South Carolina; Charleston, South Carolina; Wisconsin Dells, Wisconsin; Gordonsville, Virginia; Branson, Missouri; Ridgedale, Missouri; Boyne Mountain, Michigan; and Aruba, while its Bluegreen Communities operations are predominantly located in the Southeastern and Southwestern United States. This press release contains forward-looking statements and the Company desires to take advantage of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 in connection with these statements. Statements contained herein are not statements of historical fact may be deemed forward-looking statements. The words "believe," "expect," "intend," "anticipate," "project," "may," "should," "designed to," "estimate," "hope," "plan" and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. The Company does not undertake and specifically disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Forward-looking statements are based on current expectations and assumptions and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and many of which are beyond the Company's control. Future events could differ materially from those set forth in, contemplated by, or underlying such forward-looking statements. The risks and uncertainties to which forward-looking statements are subject to include, but are not limited to, the following: that sales and marketing strategies will not be as successful as anticipated, new properties may not be successful, that Company estimates of the total anticipated cost of its real estate projects increase and therefore adversely impact profits recognized under the percentage-of-completion method of accounting, that the Company's sources of financing may not be available or prove to be sufficient, that the Company may not be able to consummate future sales of receivables or may not realize a gain on sales of these receivables, that the Company's estimates of the key assumptions that are related to its valuation of the fair value of its retained interests in notes receivable sold may adversely change, that the efficiency of the Company's operations may decrease and net income may decrease and the other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission, including its most recent Transition Report on Form 10-KT filed on March 31, 2003, its Quarterly Report on Form 10-Q filed on November 14, 2003 and its Form 10-K to be filed on or before March 30, 2004. ### #### ### Bluegreen Corporation Page 5 January 20, 2004 BLUEGREEN CORPORATION Condensed Consolidated Income Statements (In 000's, Except Per Share Data)
Three Months Ended Year Ended ------------------ ---------- December 31, December 31, December 31, December 31, 2003 2002 2003 2002 ---- ---- ---- ---- REVENUES: Bluegreen Resorts sales $ 62,879 $ 45,494 $ 253,939 $ 177,406 Bluegreen Communities sales 38,684 22,662 104,373 101,174 --------- --------- --------- --------- Total sales 101,563 68,156 358,312 278,580 Other resort and communities operations revenue 12,802 12,773 55,394 33,334 Interest income 5,228 4,454 17,536 15,827 Gain on sale of notes receivable 3,203 6,767 6,563 12,101 Other income 41 -- 649 -- --------- --------- --------- --------- Total operating revenues 122,837 92,150 438,454 339,842 --------- --------- --------- --------- EXPENSES: Cost of sales: Bluegreen Resorts cost of sales 12,368 10,513 51,695 43,422 Bluegreen Communities cost of sales 20,276 13,434 57,315 56,893 --------- --------- --------- --------- Total cost of sales 32,644 23,947 109,010 100,315 Cost of other resort and communities operations 16,629 14,344 59,825 32,596 Selling, general and administrative expense 55,305 40,751 204,164 162,206 Interest expense 4,410 3,280 14,036 12,712 Provision for loan losses 569 190 6,094 4,000 Other expense -- 385 -- 1,405 --------- --------- --------- --------- Total operating expenses 109,557 82,897 393,129 313,234 --------- --------- --------- --------- Income before minority interest and provision for income taxes 13,280 9,253 45,325 26,608 Minority interest in income of consolidated subsidiary 1,455 402 3,330 1,047 --------- --------- --------- --------- Income before provision for income taxes 11,825 8,851 41,995 25,561 Provision for income taxes 4,553 2,703 16,168 9,136 --------- --------- --------- --------- Income before cumulative effect of change in accounting principle 7,272 6,148 25,827 16,425 Cumulative effect of change in accounting principle, net of tax -- -- -- (5,929) Minority interest in cumulative effect of change in accounting principle, net of tax -- -- -- (350) --------- --------- --------- --------- Net income $ 7,272 $ 6,148 $ 25,827 $ 10,846 ========= ========= ========= ========= Net income per share: Basic: Income before cumulative effect of change in accounting principle $ 0.29 $ 0.25 $ 1.05 $ 0.67 Cumulative effect of change in accounting principle, net of tax -- -- -- (0.23) --------- --------- --------- --------- Net income $ 0.29 $ 0.25 $ 1.05 $ 0.44 ========= ========= ========= ========= Diluted: Income before cumulative effect of change in accounting principle $ 0.26 $ 0.23 $ 0.94 $ 0.63 Cumulative effect of change in accounting principle, net of tax -- -- -- (0.19) --------- --------- --------- --------- Net income $ 0.26 $ 0.23 $ 0.94 $ 0.44 ========= ========= ========= ========= Weighted average number of common and common equivalent shares: Basic 24,871 24,543 24,671 24,472 ========= ========= ========= ========= Diluted 29,688 28,825 29,263 28,783 ========= ========= ========= =========
Bluegreen Corporation Page 6 January 20, 2004 BLUEGREEN CORPORATION Condensed Consolidated Balance Sheets (in 000's)
December 31, December 31, 2003 2002 ---- ---- ASSETS Cash and cash equivalents (unrestricted) $ 39,491 $ 26,354 Cash and cash equivalents (restricted) 33,540 20,551 Contracts receivable, net 25,522 16,230 Notes receivable, net 94,194 61,795 Inventory, net 219,890 173,131 Retained interests in notes receivable sold 60,975 44,228 Property and equipment, net 63,430 51,787 Other assets 33,364 39,916 ---------- ---------- Total assets $ 570,406 $ 433,992 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Accounts payable, accrued liabilities and other $ 54,683 $ 37,415 Deferred income 18,646 19,704 Deferred income taxes 48,225 31,200 Lines-of-credit and notes payable 112,779 39,769 10.50% senior secured notes payable 110,000 110,000 8.25% convertible subordinated debentures 34,371 34,371 ---------- ---------- Total liabilities 378,704 272,459 Minority interest 4,648 3,250 Total shareholders' equity 187,054 158,283 ---------- ---------- Total liabilities and shareholders' equity $ 570,406 $ 433,992 ========== ==========