CFC International, Inc. Reports Preliminary Fourth Quarter and Record Year End 2004 Results and Intention to Restate Prior Perio
15 Febbraio 2005 - 11:23PM
PR Newswire (US)
CFC International, Inc. Reports Preliminary Fourth Quarter and
Record Year End 2004 Results and Intention to Restate Prior Periods
-- Record year end sales of $82.6 million, up 32% over $62.8
million in 2003. CHICAGO HEIGHTS, Ill., Feb. 15
/PRNewswire-FirstCall/ -- Worldwide holographic and specialty
coated film manufacturer, CFC International, Inc. (NASDAQ:CFCI)
today reports preliminary net income for the year ended December
31, 2004, of approximately $3.5 million or $0.79 per diluted share.
These preliminary results do not give effect to the correction of
mathematical errors recently identified by the Company in its
accounting for the foreign currency translation of its overseas
operations into U.S. dollars. As a result of the discovery of these
mathematical errors, the Company is reviewing the calculations for
past reporting periods. As a result of the correction of these
errors, the Company preliminarily expects net income for 2004 and
2003 to be revised upward by $300,000 to $500,000, or $0.07 to
$0.10 per diluted share in each year for 2004 and 2003, or in
aggregate $0.14 to $0.20 per diluted share increase. These changes
are not expected to have any impact on cash flows in any of the
periods restated. The Company intends to file its Form 10-K,
including its fiscal 2004 results and the restated results for 2003
and 2002, and amend Forms 10-Q for the first three quarters of
fiscal 2004, including comparable periods for 2003, as soon as it
has completed its investigation. The Company does not expect a
delay in the timely filing of its Form 10-K. The Company expects to
complete its review, revise and release its final upward fourth
quarter and year-end 2004 earnings and its restated upward earnings
for 2003 on March 1, 2005, and has rescheduled its investor call to
March 2, 2005. Further details on the conference call will go out
under a separate announcement. The review of the Company's
preliminary results for the 2004 fourth quarter and year end has
not been completed; therefore, the results discussed in this press
release may differ from what the Company files in its Form 10-K for
the year ended December 31, 2004. Sales in the fourth quarter of
2004 increased 35 percent to $20.7 million compared to $15.3
million in the fourth quarter of 2003. The fourth quarter 2004
increase in sales was primarily due to an increase in printed
pattern products sales, solid holographic sales and a favorable
currency translation of $370,000, based on preliminary results.
Fourth quarter 2004 preliminary net income increased to $562,000,
or $0.13 cents per share on a fully diluted basis, compared to a
net loss for the fourth quarter of 2003 of ($202,000) or ($0.05)
cents per share on a fully diluted basis. This increase in
preliminary net income was primarily due to higher sales and
improved productivity. "I am pleased to report that our preliminary
results indicate that CFC has delivered solid quarter-to-quarter
financial results with fourth quarter sales in 2004 capping a year
of delivering positive sales and earnings per share results," said
Greg Jehlik, CFC's President and Chief Executive Officer. "Our
preliminary financial results for the quarter, and for the year,
are a direct reflection of the steadfastness of our employees
around the world, who through their dedication and hard work made
these achievements possible." Jehlik further stated that, "The
strategies implemented in 2003 and 2004 allowed us to make
significant strides in growing our bottom line in 2004. As a
result, we enter 2005 with a continued focus and commitment to
continue to grow the business and executing our annual operating
plan." Operating income before depreciation and amortization of
intangibles was $2.0 million in the fourth quarter of 2004, an
increase of 206 percent compared with $0.6 million in the fourth
quarter of 2003, based on preliminary results. This increase was
primarily due to the benefits of improved operating results during
the fourth quarter of 2004. Sales for the year of 2004 totaled
$82.6 million, an increase of 32 percent from $62.8 million for the
same period last year. The 2004 sales increase was a result of
higher sales volume in all of the Company's product groups. In
particular, the Company had strong sales in its printed patterned
products, security products and holographics, in packaging,
security and authenticity. The Company also benefited from a strong
Euro which positively affected sales by $2.0 million for the full
year of 2004, based on preliminary results. Preliminary net income
for the year increased to $3.5 million, or $0.79 per share on a
fully diluted basis in 2004, from a preliminary net loss of
($202,000) or ($0.05) per share on a fully diluted basis for the
same period last year. Preliminary net income for the year was
favorably affected by higher sales, and the company leveraged its
manufacturing infrastructure. Operating income before depreciation
and amortization of intangibles for the year increased 116 percent
to $10.5 million in 2004, from $4.9 million in 2003, based on
preliminary results, for the reasons described above. "2004 has
been a year of significant achievements for CFC," said Roger Hruby,
CFC's Chairman. "Our performance in 2004 is by far the best in
CFC's history. Based on preliminary results, CFC not only had
record sales, but we also produced exceptional earnings growth. We
increased our market share in a number of our core product
categories, and we exceeded our previously reported fully diluted
earnings guidance of $0.72 to $0.76, coming in preliminarily at
$0.79 per share on a fully diluted basis. In addition, we also
significantly reduced the current portion of our long-term debt by
$4.0 million in 2004." Hruby further added, "In calendar year 2004,
we committed substantial manpower and financial resources in order
to increase our capacity and improve on our production
efficiencies, and also made investments in our sales and marketing
resources. We expect to continue to benefit from these increased
commitments and investments in 2005, as well as from the
initiatives that we have already put into action including the
initiating of a Six Sigma program at CFC. We will continue to
manage and reduce our lead times and increasing our market share
with the commercialization of new products." Based upon the
company's preliminary results and factoring in the current economic
outlook, the company anticipates earning net income of $1.10 to
$1.15 cents per share on a fully diluted basis for 2005 utilizing a
35.4% tax rate. Recent Developments The company reports that it has
secured three additional embossers, two of which will be located at
the Chicago Heights, Illinois facility, and one at the Goppingen,
Germany location. This additional capacity in the U.S. and in
Goppingen is expected to be fully operational by the end of the
second quarter in 2005. The Company expects to have one embosser on
line by the end of the first quarter in Chicago Heights, with the
other two embossers on line by the end of the second quarter in
2005. This capital investment will allow the company to further
increase its manufacturing capacity both domestically and
internationally. The company will be exhibiting at the upcoming
CardTech/SecurTech (CTST) 2005 show at the Mandalay Bay Convention
Center in Las Vegas, Nevada, April 11-14, 2005 in Booth #333, where
it will feature its card products, such as HoloLam Plus, magnetic
stripe, signature panel, security holograms, scratch- off foils and
tipping foils for transaction cards. The company will be exhibiting
at the upcoming Interpack 2005 show at Messe Dusseldorf GmbH in
Dusseldorf, Germany, April 21-27, 2005 in the North American
Pavilion, Hall 12, Booth #12C09-3. CFC will feature its holographic
solutions for packaging, security and authentication, as well as
its specialty films and foils. Headquartered in Chicago Heights,
Illinois, CFC International is a market leader in the design,
manufacture and marketing of holographics and specialty functional
coatings that add value to a wide variety of industrial and
consumer products. The Company operates facilities in Chicago
Heights and Countryside, Illinois; London, England; and Goppingen,
Germany. Statements made in this press release, including those
relating to expectations of future sales, net income and operating
costs reductions, estimated availability of additional equipment,
estimations of the market size for certain of the company's
products or the company's share of those markets and expectations
of increased sales attributable to various product lines, are
forward looking and are made pursuant to the safe harbor provisions
of the Securities Reform Act of 1995. Such statements involve risks
and uncertainties which may cause results to differ materially from
those set forth in those statements. Among other things, continued
unfavorable economic conditions may impact market growth trends or
otherwise impact the demand for the company's products and
services; competition from existing and new competitors and
producers of alternative products will impact the company's ability
to penetrate or expand its presence in new or growing markets;
uncertainties relating to the company's ability to develop and
distribute new proprietary products to respond to market needs in a
timely manner may impact the company's ability to exploit new or
growing markets; the company's ability to successfully identify and
implement productivity improvements and cost reduction initiatives
may impact profitability; and risks inherent in international
operations, including possible economic, political or monetary
instability, may impact the level and profitability of the
company's foreign sales. In addition to the factors set forth in
this release, the economic, competitive, governmental,
technological and other factors identified in the company's filings
with the Securities and Exchange Commission, could affect the
forward looking statements contained in this press release. We have
no obligation to revise or update these forward-looking statements
to reflect events or circumstances that arise after the date of
this press release or to reflect the occurrence of anticipated
events. You may access additional information, including our
filings with the Securities and Exchange Commission and previous
press releases by visiting CFC International's Internet homepage at
http://www.cfcintl.com/ . DATASOURCE: CFC International, Inc.
CONTACT: Dennis Lakomy, Chief Financial Officer of CFC
International, Inc., +1-708-757-2803 Web site:
http://www.cfcintl.com/ Company News On-Call:
http://www.prnewswire.com/comp/110663.html
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