From: ASAP
Russell Corporation (NYSE: RML) today announced fiscal 2002 second quarter earnings of $.20 per share before extraordinary charges for debt refinancing, which exceeded the First Call consensus estimate of $.15 per share for the quarter.
"We are pleased to have exceeded analysts' EPS expectations, especially in this challenging economic environment," said Jack Ward, chairman and chief executive officer. "Our second quarter results exceeded last year's EPS, before restructuring in the 2001 second quarter, by 33% reflecting the success of our Six-Point Profit Growth Plan."
Sales for the 2002 second quarter were $253.1 million, which was basically flat with prior year's second quarter sales of $253.8 million, which included sales from businesses that were discontinued over the last 12 months. On an ongoing basis, sales for the 2002 second quarter increased 2% to $253.1 million from last year's second quarter sales of $248.6 million.
During the quarter, Russell successfully completed its refinancing and incurred an extraordinary after-tax charge associated with the early retirement of debt of $12.6 million, or ($.39) per share. Before this extraordinary charge, net income for the 2002 second quarter was $6.5 million, or $.20 per share. Excluding restructuring charges, net income in the 2001 second quarter was $4.9 million, or $.15 per share. After the extraordinary charge, the Company had a net loss of $6.1 million, or ($.19) per share, for the 2002 second quarter as compared to a net loss of $11.6 million, or ($.36) per share, in the 2001 second quarter.
EBITDA, defined as net income before interest, taxes, extraordinary charges, depreciation and amortization, for the 2002 second quarter was $29.6 million versus $2.5 million in the comparable period last year. Excluding the restructuring charges, EBITDA in the 2001 second quarter was $29.1 million.
Outlook
"We continue to forecast a strong second half in 2002," added Ward. "We expect sales for the second half of the year to be up 7% to 12% based on new and expanded programs such as a national expansion of men's and boys' fleece at JCPenney and a national men's fleece program at Sam's Club. Other new and expanded programs include Vintage Varsity(TM) by Russell Athletic, the rollout of no-show socks, a broadened product offering for Mossy Oak(R), the introduction of Discus(R) at Sears, and women's fleece at Kohl's."
"Given the strong forecasted sales growth for second half of 2002 plus the benefits from our cost saving initiatives, we expect earnings per share for the second half of the year to be up over 25% versus last year's second half EPS before restructuring," said Ward. As previously announced, for 2002 the Company anticipates sales to be in the range of $1.18 billion to $1.22 billion as compared to $1.16 billion in 2001. Excluding the extraordinary charge for the early retirement of debt, the Company continues to anticipate EBITDA to be in the range of $150 million to $160 million and earnings of $1.50 to $1.60 per share for the full year."
Management plans an open conference call today (July 25, 2002) at 8:30 a.m. ET to discuss second quarter results. The call may be accessed at 800-374-0196 and will be simultaneously webcast via the Company's Investor Relations section of its website, http://www.russellcorp.com/. Replay will be available through the website for 30 days. Register through the referenced website if you would like to receive press releases, conference call reminders and other notices
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