Rock of Ages Corporation (NASDAQ:ROAC) announced today that the net loss for the first quarter of 2010 narrowed to $2,092,000, or $.28 per share, compared to a net loss of $2,774,000, or $.37 per share, for the first quarter of 2009. Revenue increased 26% to $7,511,000 from $5,938,000 for the first quarter of last year. "We have always reported a loss in the first quarter due to the seasonal nature of our business. This year's sharply reduced first quarter loss was primarily the result of the substantially improved performance of our manufacturing operations, as well as continued reductions in overhead costs," said Chief Executive Officer Donald Labonte.
Rock of Ages announced earlier this week that it had received an unsolicited offer from Swenson Granite of New Hampshire to purchase the company and take it private. Kurt Swenson is chairman of both companies.
Manufacturing revenue for the first quarter of 2010 was up 38% to $3,889,000 compared to $2,814,000 for the first quarter of 2009, as sales of monuments and industrial products both increased. The operating loss in the manufacturing segment decreased to $484,000 from $864,000 a year ago, reflecting the higher revenue and cost saving steps initiated last year. "Based on current trends, we are optimistic regarding the performance of our manufacturing operations for 2010 as a whole," Labonte said.
Quarry revenue for the three months ended April 3, 2010 increased 16% to $3,622,000 compared to $3,124,000 for the first quarter of 2009, primarily the result of higher shipments from the Company's export quarries. The operating loss in the quarry segment increased to $944,000 compared to an operating loss of $772,000 last year as the Company employed significantly more manpower in its Barre, Bethel, Gardenia White and Salisbury quarries during the quarter compared to the prior year to prepare more areas for quarrying and build inventory levels. "Demand for our export granite in particular remains strong, and we expect it to remain strong throughout the year," Labonte said. "The development program in our quarries we launched last year is on schedule, and we expect to produce and deliver increased quantities of saleable granite throughout the rest of the year."
Unallocated corporate overhead decreased 34% to $687,000 for the first quarter of 2010 versus $1,041,000 for the first quarter of 2009. This decrease is a result of lower salary, pension, audit and franchise tax expenses. "We are confident that our unallocated corporate overhead for 2010 will be approximately 10% below 2009," said Labonte.
Total debt at April 3, 2010 was $16 million. This compares to total debt at April 4, 2009 of $19.3 million and $14.4 million at December 31, 2009. "We continue to focus on reducing our debt and are in discussions with various lenders regarding options that may be available to us to reduce our interest costs," Labonte said.
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 including possible expenses we may incur in connection with responding to the recently disclosed acquisition proposal from Swenson Granite Company LLC and related matters; 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, 2009. 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
April 3,
April 4,
2010
2009
Net revenues:
Quarry
$
3,622
$
3,124
Manufacturing
3,889
2,814
Total net revenues
7,511
5,938
Cost of goods sold:
Quarry
3,973
3,349
Manufacturing
3,444
2,710
Total cost of goods sold
7,417
6,059
Gross profit (loss):
Quarry
(351
)
(225
)
Manufacturing
445
104
Total gross profit (loss):
94
(121
)
Selling, general and administrative expenses:
Quarry
593
547
Manufacturing
929
968
Total SG&A expenses
1,522
1,515
Divisional operating loss:
Quarry
(944
)
(772
)
Manufacturing
(484
)
(864
)
Divisional operating loss
(1,428
)
(1,636
)
Unallocated corporate overhead
687
1,041
Effect of pension curtailment
--
95
Other income, net
(178
)
(88
)
Loss before interest and taxes
(1,937
)
(2,684
)
Interest expense
294
206
Loss before taxes
(2,231
)
(2,890
)
Income tax benefit
(139
)
(116
)
Net loss
$
(2,092
)
$
(2,774
)
Per share information:
Net loss per share - basic and diluted
$
(0.28
)
$
(0.37
)
Weighted average number of common shares outstanding - basic and diluted
7,416
7,416
ROCK OF AGES CORPORATION
Consolidated Balance Sheets
( in thousands, except per share amounts) (Unaudited)
Apr. 3,
Dec. 31,
Assets
2010
2009
Current assets:
Cash and cash equivalents
$
1,124
$
1,713
Trade receivables, net
7,062
7,241
Inventories
14,827
15,077
Other current assets
1,907
1,620
Assets held for sale
758
758
Total current assets
25,678
26,409
Property, plant and equipment, net
31,067
30,559
Identified intangible assets, net
548
582
Goodwill
387
387
Other long-term assets
553
515
Total assets
$
58,233
$
58,452
Liabilities and Stockholders' Equity
Current liabilities:
Borrowings under line of credit
$
--
$
214
Current installments of long-term debt
1,463
801
Current installments of retirement benefits
702
691
Trade payables
1,244
1,285
Accrued expenses
1,419
1,264
Customer deposits
897
774
Deferred tax liabilities
59
236
Total current liabilities
5,784
5,265
Long-term debt, excluding current installments
14,546
13,361
Salary continuation
5,277
5,386
Accrued pension cost
4,723
4,810
Deferred salary
1,504
1,504
Accrued post retirement benefits
1,623
1,622
Total liabilities
33,457
31,948
Stockholders' equity:
Preferred stock $0.01 par value. Authorized
2,500,000 shares; none issued
--
--
Common stock Class A, $0.01 par value.
Authorized 30,000,000 shares; 4,812,342 issued and
outstanding at April 3, 2010 and December 31, 2009
48
48
Common stock Class B, $0.01 par value.
Authorized 15,000,000 shares; 2,603,721 issued and
outstanding at April 3, 2010 and December 31, 2009
26
26
Additional paid-in capital
65,764
65,751
Accumulated deficit
(36,838
)
(34,746
)
Accumulated other comprehensive loss
(4,224
)
(4,575
)
Total stockholders' equity
24,776
26,504
Total liabilities and stockholders' equity
$
58,233
$
58,452
Source: BARRE, Vt.--(BUSINESS WIRE)--Rock of Ages Corporation. 5.12.2010