-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BQD0xRDqLJyFlo1Sest0kui7YBU1pdNTkqHj11buYfjywKTMPfTWYcTQ6Q64ioJ3 ey2k10C18/WSVk/sAPQ53A== 0000914384-03-000011.txt : 20030425 0000914384-03-000011.hdr.sgml : 20030425 20030425153952 ACCESSION NUMBER: 0000914384-03-000011 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030425 ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030425 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DAN RIVER INC /GA/ CENTRAL INDEX KEY: 0000914384 STANDARD INDUSTRIAL CLASSIFICATION: TEXTILE MILL PRODUCTS [2200] IRS NUMBER: 581854637 STATE OF INCORPORATION: GA FISCAL YEAR END: 0129 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13421 FILM NUMBER: 03664716 BUSINESS ADDRESS: STREET 1: 261 MEMORIAL DRIVE CITY: DANVILLE STATE: VA ZIP: 24543 BUSINESS PHONE: 4347997000 8-K 1 f8k42503.txt 1 - --------------------------------------------------------------------------- - --------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 _________________________ Form 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 25, 2003 DAN RIVER INC. (Exact name of registrant as specified in its charter) Commission file number 1-13421 GEORGIA 58-1854637 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2291 Memorial Drive 24541 Danville, Virginia (Zip Code) (Address of principal executive offices) Registrant's telephone number, including area code: (434) 799-7000 - --------------------------------------------------------------------------- - --------------------------------------------------------------------------- 2 Item 12. Results of Operations and Financial Conditions. ----------------------------------------------- On April 25, 2003, we filed a news release reporting earnings and other financial information with respect to the first quarter of fiscal 2003. The text of our news release is attached as an exhibit to this Report on Form 8-K. 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. DAN RIVER INC. (Registrant) Date: April 25, 2003 /s/ Harry L. Goodrich --------------------------------- Harry L. Goodrich Vice President 4 INDEX Exhibit No. Description of Exhibit - ----------- ---------------------- 99 Text of Press of Dan River Inc., dated April 25, 2003 EX-99 3 e9942503.txt 1 EXHIBIT 99 Danville, Virginia, April 25, 2003. Dan River Inc. (NYSE: DRF) today reported results for the first fiscal quarter ended March 29, 2003. Net sales for the quarter were $147.4 million, down $11.0 million or 7% from $158.4 million for the first quarter of fiscal 2002. Net income for the first quarter of fiscal 2003 was $2.8 million, or $0.12 per diluted share. Included in these results is a $0.4 million pre-tax gain related to the sale of surplus equipment. These results compare to a net loss of $5.1 million, or $0.24 per diluted share for the first quarter of fiscal 2002 before the effect of an accounting change related to the writedown of goodwill under SFAS No. 142, "Impairment of Goodwill and Intangible Assets". The results for the first quarter of fiscal 2002 include a one- time increase in income tax expense of $2.8 million, or $0.13 per diluted share attributable to the tax law changes associated with the Job Creation and Worker Assistance Act of 2002, and a $1.4 million pre-tax charge ($0.8 million after tax or $0.04 per diluted share) for bad debt expense related to the January 2002 Chapter 11 filing of Kmart Corporation. After the effect of the accounting change, the net loss for the first quarter of fiscal 2002 was $25.8 million, or $1.19 per diluted share. "The weak retail environment was apparent in our home fashions division for the first quarter," said Joseph L. Lanier, Chairman and Chief Executive Officer, "as sales for the division were $108.4 million, down $7.6 million or 6.5% from the first quarter of 2002. Despite this decrease in sales, operating income for the division was $11.5 million, up significantly from $5.3 million reported for the first quarter of fiscal 2002. The better operating results were due to the sales of a better product mix, lower raw material prices, and the benefits of the plant consolidation efforts that were put into place last year. "The overall economic weakness was also evident in our apparel fabrics division," Mr. Lanier continued. "For the first quarter of 2003, sales were $29.1 million, down $2.9 million or 9.0% from the first quarter of fiscal 2002. However, operating performance improved compared to the same quarter a year ago, from a loss of $1.6 million to a loss of $0.6 million, reflecting lower raw material prices and better manufacturing performance due to the plant consolidation. This was offset somewhat by consulting expenses related to an initiative to increase manufacturing efficiencies and to reduce manufacturing lead times. "Our engineered products division is also experiencing the impact of the slowing economy," Mr. Lanier stated, "as sales of $9.9 million for the first quarter of fiscal 2003 were down $0.6 million, or 5.5%, from the first quarter of 2002. The combination of lower sales volume, a less profitable sales mix and poor manufacturing performance led to a $0.9 million operating loss for the quarter, compared to a $0.3 million loss in the same period last year. Manufacturing performance was hampered during the quarter by start up issues related to the installation of a new shop floor, cost and inventory control system." In the second quarter of fiscal 2003, the Company completed the refinancing of its $120 million senior subordinated notes and its credit facility, which were both due in 2003. This refinancing included the sale of $157 million aggregate principal amount of 12-3/4% senior notes due 2009, at 95.035% of par, in a private offering pursuant to Rule 144A and 2 Regulation S under the Securities Act of 1933. The Company also entered into a new senior secured credit facility, which consists of a five-year $160 million revolving credit facility and a five-year $40 million term loan. Availability under the revolving credit facility is based upon a borrowing base determined by reference to the Company's eligible accounts receivable and inventory. Amounts outstanding under the senior credit facility will bear interest at either prime rate or LIBOR plus, in each case, a spread based on the Company's leverage ratio. The net proceeds from the notes offering, together with borrowings under the new senior credit facility, were used (i) to repay all borrowings outstanding under the existing credit agreement; (ii) to provide for the redemption, on May 15, 2003, of all of the outstanding 10-1/8% senior subordinated notes due 2003 for an aggregate redemption price of $120 million (100% of the principal amount thereof) plus accrued interest of approximately $5.1 million; and (iii) to pay related fees and expenses. "While the Company's earnings for the first quarter came in better than expected," Mr. Lanier stated, "the immediate outlook is very hazy. The uncertainties imposed by the soft economy, high unemployment, and the war in Iraq have depressed consumer spending. This is reflected in the negative same stores sales comparisons reported by most retailers. In reaction, our customers are very skittish about placing new business and are very conservative in their order quantities. We expect this difficult retail environment to have a negative impact on our second quarter operating results. Also, due to our recent refinancing, the second quarter will be burdened with the write off of deferred financing fees associated with our 1993 subordinated notes and our 1997 bank credit facility ($1.3 million pre-tax). There will also be a one month period in the second quarter during which our recently issued 12-3/4% senior notes and our 10-1/8% subordinated notes will both be outstanding, resulting in increased interest expense for the overlapping period ($1.0 million pre-tax). The combination of these items along with higher interest expense under the refinancing will cause us to report a loss in the range of $0.05 per share in the second quarter. "Looking beyond the second quarter," Mr. Lanier concluded, "due to many uncertainties we are not comfortable with our ability to predict our operating results for the back half of the year. Accordingly, we are not giving guidance for our full year results. Hopefully the recent victory in Iraq will bring an end to the current economic malaise. Under any circumstances, we believe we are maintaining our market share in our key product areas, and we remain well-positioned in those areas to take advantage of the upturn when it occurs." __________ Note: This news release contains forward-looking statements under applicable securities laws. We believe our forward-looking statements are reasonable; however, undue reliance should not be placed on such statements, which are based on current expectations. Our financial condition and results of operations could be materially and adversely affected by numerous market and industry factors outside of our control, including, for example, general economic conditions, including in particular continued weak demand at retail, and the effects of military 3 conflicts or terrorist activity on the U.S. economy generally, including any resultant adverse effects on retail demand and the cost of energy and raw materials used in our manufacturing processes. Additionally, risks associated with our business are detailed in our annual report on Form 10-K filed with the SEC on February 21, 2003. 4 The following are the financial highlights: UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (OOO's, EXCEPT PER SHARE DATA)
Three Months Ended ----------------------- March 29, March 30, 2003 2002 --------- -------- Net Sales $ 147,372 $ 158,418 Cost of Sales 119,653 136,664 --------- --------- Gross Profit 27,719 21,754 S,G and A 17,968 17,815 Other Operating Costs, Net (440) -- --------- --------- Operating Income 10,191 3,939 Other Income 137 59 Interest Expense 5,547 7,383 --------- --------- Income (Loss) Before Income Taxes and Cumulative Effect of Accounting Change 4,781 (3,385) Provision for Income Taxes 2,031 1,750 --------- --------- Income (Loss) Before Cumulative Effect of Accounting Change 2,750 (5,135) Cumulative Effect of Accounting Change, Net of Tax -- (20,701) --------- --------- Net Income (Loss) $ 2,750 $ 25,836 ========= =========
5 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (000's, EXCEPT PER SHARE DATA)
Three Months Ended ----------------------- March 29, March 30, 2003 2002 --------- --------- Earnings (Loss) Per Share--Basic: Income (Loss) Before Cumulative Effect of Accounting Change $ 0.13 $ (0.24) Cumulative Effect of Accounting Change, Net of Tax -- (0.95) --------- -------- Net Income (Loss) $ 0.13 $ (1.19) ========= ======== Earnings (Loss) Per Share--Diluted: Income (Loss) Before Cumulative Effect of Accounting Change $ 0.12 $ (0.24) Cumulative Effect of Accounting Change, Net of Tax -- (0.95) --------- -------- Net Income (Loss) $ 0.12 $ (1.19) ========= ======== Wtd. Avg. No. Shares: Basic 21,909 21,790 Diluted 22,291 21,790
6 UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (000's)
March 29, December 28, 2003 2002 ----------- ----------- ASSETS: - ------ Cash $ 2,206 $ 2,832 Accounts Receivable 75,738 71,292 Inventories 159,394 151,586 Other Current Assets 19,936 19,667 ----------- ----------- Total Current Assets 257,274 245,377 Property, Plant & Equipment, Net 241,193 248,175 Goodwill, Net 91,701 91,701 Other Assets 10,825 10,269 ----------- ----------- Total Assets $ 600,993 $ 595,522 =========== =========== Liabilities and Shareholders' Equity: - ------------------------------------ Current Maturities of Long-Term Debt $ 7,017 $ 241,231 Accounts Payable & Accrued Expenses 63,042 58,439 ----------- ----------- Total Current Liabilities 70,059 299,670 Long-Term Debt 241,216 10,792 Deferred Income Taxes and Other Liabilities 57,776 56,023 Shareholders' Equity 231,942 229,037 ----------- ----------- Total Liabilities & Shareholders' Equity $ 600,993 $ 595,522 =========== ===========
7 UNAUDITED SEGMENT INFORMATION (000's)
Three Months Ended ----------------------- March 29, March 30, 2003 2002 --------- -------- Net Sales: Home Fashions $ 108,414 $ 116,009 Apparel Fabrics 29,059 31,930 Engineered Products 9,899 10,479 --------- --------- Consolidated Net Sales $ 147,372 $ 158,418 ========= ========= Operating Income (Loss): Home Fashions $ 11,525 $ 5,314 Apparel Fabrics (636) (1,576) Engineered Products (852) (303) Corporate Items Not Allocated to Segments: Other Operating Costs, Net 440 -- Other (286) 504 --------- --------- Consolidated Operating Income $ 10,191 $ 3,939 ========= =========
8 UNAUDITED OTHER FINANCIAL DATA (000's)
Three Months Ended ----------------------- March 29, March 30, 2003 2002 --------- -------- Depreciation & Amortization of Property, Plant & Equipment $ 9,439 $ 9,306 Capital Expenditures in Cash $ 3,748 $ 2,623
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