Rock of Ages Corporation (NASDAQ:ROAC) today announced net income for the third quarter of 2009 of $1.5 million, or $0.21 per diluted share, on revenue of $12.9 million. This compares to net income for the third quarter of 2008 of $3.1 million, or $0.41 per diluted share, on revenue of $16.6 million.
"The decrease in revenue and net income for the third quarter primarily reflected lower recovery rates in both our Bethel quarry, our most important export quarry, and our Barre quarry, our most important quarry for U.S. sales. As a result, the cost of saleable granite increased and we had less granite to sell. The good news is that recovery rates have improved in these quarries, and demand for our granites remains strong both domestically and internationally. Assuming no unusual weather-related disruptions between now and Thanksgiving, we expect quarry revenue and operating income to improve in the fourth quarter relative to the third quarter, which should also drive an increase in net income for the fourth quarter relative to the third," said Chief Executive Officer Donald Labonte.
Manufacturing revenue and operating income for the third quarter of 2009 compared to the third quarter of 2008 were affected by lower mausoleum sales and continued weakness in precision products sales.
Unallocated corporate overhead decreased 20% to $660,000 for the third quarter of 2009 versus $822,000 for the third quarter of 2008. "We remain confident that unallocated corporate overhead for 2009 will be about 15% below last year," Labonte said.
Nine Month Results
For the nine months ended September 30, 2009, net income was $193,000, or $0.03 per diluted share, on revenue of $33.2 million. This compares to income from continuing operations for the first nine months of 2008 of $623,000, or $0.08 per diluted share, on revenue of $39.3 million. Net income for the first nine months of 2008 was $481,000, or $0.06 per share, which included a loss from discontinued operations of $142,000, or $0.02 per share. There were no discontinued operations in 2009.
Balance Sheet Highlights
Total debt at October 3, 2009 was $16.7 million, 31% below total debt of $24.2 million at September 27, 2008, and 23% below the $21.8 million reported at December 31, 2008. "Based on forecasted cash flow, we plan to reduce debt to approximately $14 million by the end of 2009," Labonte said.
Stockholders' equity at October 3, 2009 was $25,986,000, or $3.50 per share. This compares to stockholders' equity at December 31, 2008 of $20,431,000, or $2.75 per share.
About Rock of Ages
Rock of Ages (www.RockofAges.com) is the largest integrated granite quarrier and manufacturer of finished granite memorials and granite blocks for memorial use in North America.
Forward-Looking Statements
This press release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about our business or expected events based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual events, results or outcomes may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including the challenge of successfully implementing our strategic plan intended to enhance our overall profitability; unanticipated overhead or other expenses; and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports including, but not limited to, the risks discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2008. Such forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
ROCK OF AGES CORPORATION
Consolidated Statements of Operations
(In thousands, except per share amounts) (Unaudited)
Three Months Ended
Nine Months Ended
Oct. 3,
Sep. 27,
Oct. 3,
Sep. 27,
2009
2008
2009
2008
Net revenue
Quarry
$
5,914
$
8,537
$
15,949
$
18,766
Manufacturing
6,967
8,056
17,293
20,543
Total net revenue
12,881
16,593
33,242
39,309
Gross profit
Quarry
1,911
3,411
3,433
4,076
Manufacturing
2,022
2,523
4,556
5,498
Total gross profit
3,933
5,934
7,989
9,574
Selling, general and administrative expenses
Quarry
503
523
1,633
1,747
Manufacturing
938
1,026
2,964
3,059
Total SG&A expenses
1,441
1,549
4,597
4,806
Divisional operating income
Quarry
1,408
2,888
1,800
2,329
Manufacturing
1,084
1,497
1,592
2,439
Total divisional operating income
2,492
4,385
3,392
4,768
Unallocated corporate overhead
660
822
2,393
2,998
Effect of pension curtailment
--
--
95
--
Other income, net
(76
)
(56
)
(219
)
(179
)
Income from continuing
operations before interest and income taxes
1,908
3,619
1,123
1,949
Interest expense, net
334
337
871
1,046
Income from continuing operations before income taxes
1,574
3,282
252
903
Income tax expense
40
223
59
280
Income from continuing operations
1,534
3,059
193
623
Loss from discontinued operations
--
--
--
(142
)
Net income
$
1,534
$
3,059
$
193
$
481
Net income (loss) per share - basic and diluted:
Income from continuing operations
$
0.21
$
0.41
$
0.03
$
0.08
Loss from discontinued operations
--
--
--
(0.02
)
Net income (loss) per share - basic and diluted
$
0.21
$
0.41
$
0.03
$
0.06
Weighted average common shares
outstanding - basic and diluted
7,416
7,416
7,416
7,416
ROCK OF AGES CORPORATION
Consolidated Balance Sheets
( in thousands, except per share amounts) (Unaudited)
Oct. 3,
Dec. 31,
Assets
2009
2008
Current assets:
Cash and cash equivalents
$
842
$
888
Trade receivables, net
9,215
13,314
Inventories
15,597
16,840
Other current assets
1,417
1,561
Assets held for sale
759
477
Total current assets
27,830
33,080
Property, plant and equipment, net
30,701
29,998
Cash surrender value of life insurance
132
132
Intangibles, net
503
571
Goodwill
387
387
Long term investments
129
25
Other
481
249
Total assets
$
60,163
$
64,442
Liabilities and Stockholders' Equity
Current liabilities:
Borrowings under line of credit
$
2,565
$
7,428
Current maturities of long-term debt
800
517
Salary continuation and other post-employment benefits
690
567
Trade payables
1,214
1,334
Accrued expenses
1,721
2,226
Customer deposits
801
454
Total current liabilities
7,791
12,526
Long-term debt, excluding current installments
13,372
13,904
Salary continuation liability, net of current portion
5,151
5,382
Accrued pension cost
4,705
9,026
Deferred salary liability
1,504
1,523
Other post-employment benefits, net of current portion
1,623
1,623
Deferred tax liability
31
27
Total liabilities
34,177
44,011
Stockholders' equity:
Preferred stock 0.01 par value. Authorized 2,500,000 shares; issued and outstanding no shares
--
--
Common stock Class A, $0.01 par value. Authorized 30,000,000 shares; 4,812,342 issued and outstanding at October 3, 2009 and December 31, 2008
48
48
Common stock Class B, $0.01 par value. Authorized 15,000,000 shares; 2,603,721 issued and outstanding at October 3, 2009 and December 31, 2008
26
26
Additional paid-in capital
65,735
65,688
Accumulated deficit
(35,355
)
(35,548
)
Accumulated other comprehensive loss
(4,468
)
(9,783
)
Total stockholders' equity
25,986
20,431
Total liabilities and stockholders' equity
$
60,163
$
64,442
Source: ROCK OF AGES CORPORATION. 11.11.2009. BARRE, Vt.--(BUSINESS WIRE)--