Improved fourth quarter results reported.
Highlights include increased operating income,
stronger factory backlogs and growth in modular sales.
AUBURN HILLS, Mich., Feb. 15 /PRNewswire-FirstCall/ -- Champion
Enterprises, Inc. (NYSE: CHB), a leader in the factory-built housing industry,
today reported results for its year and fourth quarter ended January 1, 2005.
The company reported its first profitable year since 1999 and 2004 net income
improved $120 million over 2003. For the year, the company reported revenues
of $1.15 billion and net income of $17 million, or $0.21 per diluted share,
compared to revenues of $1.14 billion and a net loss of $103 million, or $1.86
per diluted share, in 2003. For the quarter, the company reported revenues of
$291 million and a net loss of $2.1 million, or $0.03 per diluted share,
compared to slightly lower revenues and a net loss of $3.6 million, or $0.06
per diluted share, in the fourth quarter of 2003.
Champion's improved results reflect continuing progress in its core
manufacturing operations, which reported strong year-over-year margin
improvement. Comparisons of net sales, income (loss) from continuing
operations, and net income (loss) for the periods reported are shown below:
(Unaudited)
Three months ended Twelve months ended
(In millions, Jan. 1, Jan. 3, Jan. 1, Jan. 3,
except per share) 2005 2004 2005 2004
Net sales $291.4 $291.3 $1,150.2 $1,140.7
Income (loss)-
cont. operations ($2.2) (1) ($3.5) (2) $15.8 (3) ($83.3) (4)
Per diluted share ($0.03) ($0.06) $0.19 ($1.52)
Net income (loss) ($2.1) (1) ($3.6) (2) $17.0 (3) ($103.1) (4)
Per diluted share ($0.03) ($0.06) $0.21 ($1.86)
(1) Included a $2.0 million warrant valuation charge and $6.5 million of
restructuring charges.
(2) Included a $0.8 million warrant valuation charge, $1.0 million of
restructuring charges, and a $3.2 million loss on debt retirement. Net loss
also included a $3.7 million favorable tax adjustment.
(3) Included a $5.5 million warrant valuation charge, $5.5 million of
restructuring charges, and a $2.8 million loss on debt retirement. Net income
also included a $12.0 million favorable tax adjustment.
(4) Included a $3.3 million warrant valuation charge, $30.0 million of
restructuring charges, $34.2 million of goodwill impairment charges, and a
$10.6 million gain on debt retirement. Net loss also included a $7.0 million
favorable tax adjustment.
2004 Fourth Quarter and Full Year Highlights
* Pretax internal operating results (see the table below) improved year-
over-year by $8.7 million for the quarter and $51.5 million for the year;
* In the fourth quarter, manufacturing operations reported a 6.1% margin,
or $15.4 million of segment income despite including $3.8 million of
restructuring charges. Before these charges, manufacturing segment margin was
7.6% of net sales, the best fourth quarter margin since 1998;
* Manufacturing backlogs at year end totaled $90 million, more than
double the year earlier level;
* Modular homes sold continued to increase, up 5% year-over-year for the
quarter and 25% for the year, now representing 15% of manufacturing home
shipments and 19% of manufacturing revenues;
* For the quarter, cash flows from continuing operating activities
totaled $4.5 million, while cash and cash equivalents increased to $142.3
million.
Management Comments and Outlook
William Griffiths, President and Chief Executive Officer, commented, "Our
fourth quarter results, which showed year-over-year improvement on only
slightly higher sales, are due to our increased focus on margin improvements
through productivity gains. Strong segment earnings continued to be reported
by our core manufacturing operations despite restructuring charges and the
manufactured housing industry continuing for the second successive year at a
shipment level of approximately 131,000 homes, the lowest level since 1962.
During 2004 industry shipments of multi-section manufactured homes, where we
enjoy our strongest market share, continued to decline and were down 8% versus
2003. However, the modular housing market grew an estimated 15% in the latest
twelve months and our share of that market continued to improve.
"This is now our seventh consecutive quarter with year-over-year
manufacturing margin improvement and at least double-digit growth in segment
income," Griffiths continued. "We expect to continue to report productivity
gains as we move forward in 2005. With restructuring at our homebuilding
facilities largely behind us, we will continue to focus on margin growth at
all locations. We will also work to leverage our strong cash balances and
improved financial position to capitalize on growth opportunities, including
the re-investment of capital in our factories to support productivity
initiatives.
"During the quarter we sold nine retail locations, generating $6.8 million
in cash. We are now in active, but preliminary discussions with several
interested parties for the sale of various other retail centers. If
successful, we would exit most of our traditional retail business within six
months, while generating cash and with no material effect on earnings. We
have no plans to divest of our successful, non-traditional retail operations,
Advantage Homes, which specialize in the re-development of California
communities through 18 profitable sales centers," Griffiths concluded.
Operating Results
Below is a summary of Champion's pretax internal operating results, which
management regards as a useful measure in evaluating its core operations of
producing and selling factory-built housing. Management regards pretax
internal operating results as useful because restructuring charges, non-cash
capital structure related items, goodwill impairment charges, income taxes and
discontinued operations are excluded.
(Unaudited)
Three months ended Twelve months ended
(In millions) Jan. 1, Jan. 3, Better/ Jan. 1, Jan. 3, Better/
2005 2004 (worse) 2005 2004 (worse)
Manufacturing
segment inc. * $19.2 $11.3 $7.9 $62.5 $30.1 $32.4
Retail segment
inc. (loss) * (1.0) (1.2) 0.2 2.4 (5.6) 8.0
General corporate
expenses (8.3) (6.6) (1.7) (27.7) (30.7) 3.0
Intercompany
eliminations * 0.8 0.6 0.2 0.3 1.1 (0.8)
Interest
expense, net (4.1) (6.2) 2.1 (17.9) (26.8) 8.9
Pretax internal
operating results 6.6 (2.1) 8.7 19.6 (31.9) 51.5
Restructuring
charges, net (6.5) (1.0) (5.5) (5.5) (30.0) 24.5
Mark-to-market
charge for common
stock warrant (2.0) (0.8) (1.2) (5.5) (3.3) (2.2)
Debt retirement
(loss) gain - (3.2) 3.2 (2.8) 10.6 (13.4)
Goodwill impairment
charges - - - - (34.2) 34.2
Income tax
(expense) benefit (0.3) 3.6 (3.9) 10.0 5.5 4.5
Income (loss)-
cont. operations (2.2) (3.5) 1.3 15.8 (83.3) 99.1
Income (loss)-
discont. operations 0.1 (0.1) 0.2 1.2 (19.8) 21.0
Net income (loss) ($2.1) ($3.6) $1.5 $17.0 ($103.1) $120.1
* Before restructuring charges.
Manufacturing - In the fourth quarter of 2004, manufacturing net sales
increased to $254 million from $248 million in the prior year. Segment income
rose 38% to $15.4 million, or 6.1% of net sales, from $11.2 million, or 4.5%
of net sales, a year earlier. Results in the fourth quarter of 2004 included
$3.8 million of restructuring charges related to the closure and consolidation
of a manufacturing facility in Alabama.
Retail - For the quarter ended January 1, 2005, Champion's retail
operations reported a loss as a result of the closure and divestiture of
traditional retail locations. Closed locations had a loss of $4.6 million,
including $3.5 million of restructuring charges for the closure of 12 sales
centers, while ongoing retail operations reported income of $0.2 million. Net
sales for the quarter decreased 10% from a year earlier due to a decline in
the average number of sales lots in operation, partially offset by an increase
in the average new home selling price.
Other - Results in the fourth quarter of 2004 included a mark-to-market
charge of $2.0 million related to the company's outstanding common stock
warrant for 2.2 million shares as a result of the increase in Champion's
common stock price during the period. General corporate expenses rose during
the quarter and are expected to continue into 2005 at this higher level as a
result of a variety of margin improvement initiatives, including an ERP system
implementation that was piloted in 2004, as well as higher costs generally to
operate as a public company. Net interest expense decreased 33% versus the
year earlier quarter as a result of debt reduction completed over the last two
years.
Results in the 2004 year-to-date period included $5.5 million of charges
for the company's common stock warrant, a $2.8 million loss on debt retirement
and a $12 million income tax benefit as a result of decreasing the allowance
for tax adjustments. Also, $1.1 million of income from discontinued
operations resulted from the settlement of contractual obligations.
Financial Position
During the quarter $4.5 million of cash was generated from continuing
operating activities primarily driven by cash earnings. The company ended
2004 with cash and cash equivalents totaling $142 million and net debt (total
debt less cash and cash equivalents) at 42% of total net capital (net debt
divided by shareholders' equity, redeemable convertible preferred stock, and
net debt), our lowest level since 1998. Champion has an estimated $120
million of federal tax loss carry forward available to offset certain future
taxable income.
Conference Call
Mr. Griffiths and Ms. Knight will review results in a conference call for
investors and analysts beginning at 11:00 a.m. eastern time tomorrow. To
participate in the conference call, please call the number below:
Dial-in #: (866) 800-8648
Pass code #: 88252003
A replay of the conference call will be available after 1:00 p.m. eastern
time tomorrow through midnight on Wednesday, February 23, 2005. The recording
may be heard by dialing the number below:
Dial-in #: (888) 286-8010
Pass code #: 61880346
The live call and the replay can also be accessed using the company's
website, http://www.championhomes.net .
About Champion
Champion Enterprises, Inc., headquartered in Auburn Hills, Michigan, is
one of the industry's leading manufacturers and has produced over 1.6 million
homes since the company was founded. The company operates 29 homebuilding
facilities in 14 states and two Canadian provinces and 59 retail locations in
15 states. Over 2,400 independent retailers, including 845 Champion Home
Center locations, and approximately 500 builders and developers also sell
Champion-built homes. Further information can be found at the company's
website.
Forward Looking Statements
This news release contains certain statements, including statements
regarding the company's financial position, growth opportunities, improving
productivity and margins, that could be construed to be forward looking
statements within the meaning of the Securities and Exchange Act of 1934.
These statements reflect the company's views with respect to future plans,
events and financial performance. The company does not undertake any
obligation to update the information contained herein, which speaks only as of
the date of this press release. The company has identified certain risk
factors which could cause actual results and plans to differ substantially
from those included in the forward looking statements. These factors are
discussed in the company's most recently filed Form 10-K and other SEC
filings, in each case under the section entitled "Forward Looking Statements,"
and those discussions regarding risk factors are incorporated herein by
reference.
CHAMPION ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL SUMMARY
(Dollars and weighted shares in thousands, except per share amounts)
(Unaudited)
Three Months Ended (1)
Jan. 1, Jan. 3, %
2005 2004 Change
Net sales:
Manufacturing $253,727 $247,993 2%
Retail 59,250 66,037 (10%)
Less: intercompany (21,600) (22,700)
Total net sales 291,377 291,330
Cost of sales (2) 241,469 246,251 (2%)
Gross margin 49,908 45,079 11%
Selling, general and administrative
expenses 40,744 40,964 (1%)
Mark-to-market charge for
common stock warrant (3) 2,000 800
Loss (gain) on debt retirement (4) - 3,194
Goodwill impairment charges (2) - -
Restructuring charges (2) 4,900 1,000
Operating income (loss) 2,264 (879) 358%
Interest expense, net 4,130 6,203 (33%)
Income (loss) from continuing operations
before income taxes (5) (1,866) (7,082) 74%
Income tax expense (benefit) (6) 300 (3,550)
Income (loss) from continuing operations (2,166) (3,532) 39%
Income (loss) from discontinued operations
net of taxes (7) 79 (58)
Net income (loss) $(2,087) $(3,590) 42%
Income (loss) from continuing operations $(2,166) $(3,532)
Less: preferred stock dividends (258) (109)
Less: amount allocated to
participating securities (8) - -
Less: charge to retained earnings for
induced preferred stock conversion (3) - -
Income (loss) from continuing operations
available to common shareholders $(2,424) $(3,641) 33%
Basic income (loss) per share (8):
Income (loss) from continuing
operations $(0.03) $(0.06) 50%
Income (loss) from discontinued
operations - -
Net income (loss) $(0.03) $(0.06) 50%
Weighted shares for basic EPS 71,916 61,970
Diluted income (loss) per share (8):
Income (loss) from continuing
operations $(0.03) $(0.06) 50%
Income (loss) from discontinued
operations - -
Net income (loss) $(0.03) $(0.06) 50%
Weighted shares for diluted EPS 71,916 61,970
Twelve Months Ended (1)
Jan. 1, Jan. 3, %
2005 2004 Change
Net sales:
Manufacturing $1,002,164 $981,254 2%
Retail 245,978 269,146 (9%)
Less: intercompany (97,900) (109,686)
Total net sales 1,150,242 1,140,714 1%
Cost of sales (2) 953,854 974,295 (2%)
Gross margin 196,388 166,419 18%
Selling, general and administrative
expenses 159,414 180,398 (12%)
Mark-to-market charge for
common stock warrant (3) 5,500 3,300
Loss (gain) on debt retirement (4) 2,776 (10,639)
Goodwill impairment charges (2) - 34,183
Restructuring charges (2) 4,900 21,100
Operating income (loss) 23,798 (61,923) 138%
Interest expense, net 17,984 26,847 (33%)
Income (loss) from continuing operations
before income taxes (5) 5,814 (88,770) 107%
Income tax expense (benefit) (6) (10,000) (5,500)
Income (loss) from continuing operations 15,814 (83,270) 119%
Income (loss) from discontinued operations
net of taxes (7) 1,197 (19,814)
Net income (loss) $17,011 $(103,084) 117%
Income (loss) from continuing
operations $15,814 $(83,270)
Less: preferred stock dividends (936) (728)
Less: amount allocated to
participating securities (8) (995) -
Less: charge to retained earnings for
induced preferred stock conversion (3) - (3,488)
Income (loss) from continuing operations
available to common shareholders $13,883 $(87,486) 116%
Basic income (loss) per share (8):
Income (loss) from continuing
operations $0.20 $(1.52) 113%
Income (loss) from discontinued
operations 0.01 (0.34)
Net income (loss) $0.21 $(1.86) 111%
Weighted shares for basic EPS 70,494 57,688
Diluted income (loss) per share (8):
Income (loss) from continuing
operations $0.19 $(1.52) 113%
Income (loss) from discontinued
operations 0.02 (0.34)
Net income (loss) $0.21 $(1.86) 111%
Weighted shares for diluted EPS 71,982 57,688
See accompanying Notes to Financial Information.
CHAMPION ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
Jan. 1, Oct. 2, Jan. 3,
Assets 2005 2004 2004
Cash and cash equivalents $142,266 $132,707 $145,868
Restricted cash 529 529 8,341
Accounts receivable, trade 22,717 40,173 13,773
Inventories 105,580 124,012 98,824
Other current assets 14,415 13,484 18,325
Total current assets 285,507 310,905 285,131
Property, plant and equipment, net 86,021 90,874 95,821
Goodwill 126,591 126,553 126,537
Non-current assets of discontinued
operations (7) 5 9 68
Other non-current assets 18,897 18,817 20,743
$517,021 $547,158 $528,300
Liabilities, Redeemable Convertible
Preferred Stock and Shareholders' Equity
Floor plan payable $11,835 $13,861 $14,123
Accounts payable 15,862 36,200 26,724
Current liabilities of discontinued
operations (7) 81 108 3,173
Other accrued liabilities 148,559 160,842 167,624
Total current liabilities 176,337 211,011 211,644
Long-term debt (4) 201,190 201,323 245,468
Other long-term liabilities 41,444 39,117 47,510
Redeemable convertible preferred
stock (3) 20,750 20,750 8,689
Shareholders' equity 77,300 74,957 14,989
$517,021 $547,158 $528,300
See accompanying Notes to Financial Information.
CHAMPION ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED CASH FLOW STATEMENTS
(In thousands)
(Unaudited)
Three Months Ended(1) Twelve Months Ended(1)
Jan. 1, Jan. 3, Jan. 1, Jan. 3,
2005 2004 2005 2004
Income (loss) from continuing
operations $(2,166) $(3,532) $15,814 $(83,270)
Adjustments:
Depreciation 2,729 2,988 11,395 15,203
Mark-to-market charge for
common stock warrant (3) 2,000 800 5,500 3,300
Loss (gain) on debt retirement (4) - 3,194 2,776 (10,639)
Goodwill impairment charges (2) - - - 34,183
Fixed asset impairment charges,
net (2) 3,854 (2,958) 3,014 12,389
Changes in cash collateral
deposits (9) - - - 9,600
Refundable income taxes - (2,523) 3,123 58,397
Decrease in allow. for tax
adjustments (6) - - (12,000) -
Changes in working capital 8,551 24,127 (33,561) 17,037
Changes in accrued liabilities (10,058) (13,494) (10,183) (486)
Other (436) (2,890) 2,680 5,698
Cash provided by (used for)
continuing operations 4,474 5,712 (11,442) 61,412
Income (loss) from discontinued
operations 79 (58) 1,197 (19,814)
(Increase) decrease in net assets
of discontinued operations (2) 778 (3,008) 25,854
Cash provided by (used for)
discontinued operations (7) 77 720 (1,811) 6,040
Additions to property, plant and
equipment (2,207) (1,777) (8,672) (6,145)
Acquisition related deferred
purchase price payments - - - (3,882)
Proceeds on sale of retail
businesses 6,813 - 6,813 -
Proceeds on disposal of fixed
assets 76 4,999 3,721 10,192
Other (45) (55) (208) (501)
Cash provided by (used for)
investing activities 4,637 3,167 1,654 (336)
Decrease in floor plan payable, net (2,026) (719) (2,288) (3,024)
Repayment of industrial revenue
bond and other debt 33 (286) (6,307) (766)
Purchase of Senior Notes (4) - - (10,395) (35,830)
(Increase) decrease in restricted
cash (9) - (7,829) 7,888 42,542
Preferred stock issued, net (3) - - 12,000 -
Common stock issued, net 2,623 326 7,777 1,390
Dividends paid on preferred stock (259) (164) (678) (1,101)
Deferred financing costs - 145 - (1,840)
Cash provided by (used for)
financing activities 371 (8,527) 7,997 1,371
Increase (decrease) in cash and
cash equivalents 9,559 1,072 (3,602) 68,487
Cash and cash equivalents
at beginning of period 132,707 144,796 145,868 77,381
Cash and cash equivalents
at end of period $142,266 $145,868 $142,266 $145,868
See accompanying Notes to Financial Information.
CHAMPION ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL INFORMATION (UNAUDITED)
(1) The three and twelve months ended January 1, 2005 include 13 and 52
weeks, respectively, compared to 14 and 53 weeks, respectively, for the three
and twelve months ended January 3, 2004.
(2) A reconciliation of closing-related expenses, including fixed asset
impairment charges, follows (in thousands):
Three Months Ended Twelve Months Ended
Jan. 1, Jan. 3, Jan. 1, Jan. 3,
2005 2004 2005 2004
Closing-related expenses:
Cost of sales $1,600 $- $600 $8,900
Restructuring charges 4,900 1,000 4,900 21,100
$6,500 $1,000 $5,500 $30,000
By segment:
Manufacturing $3,800 $100 $2,800 $22,800
Retail 3,500 900 3,500 9,300
Intercompany (800) - (800) (2,100)
$6,500 $1,000 $5,500 $30,000
The year-to-date period in 2003 also included $34 million of retail
goodwill impairment charges.
(3) As a result of increases in the company's common stock price, during
the three and twelve months ended January 1, 2005 Champion recorded charges of
$2.0 million and $5.5 million, respectively, for the change in estimated fair
value of an outstanding common stock warrant for 2.2 million shares issued in
connection with the Series C preferred stock. Charges of $0.8 million and
$3.3 million, respectively, related to this warrant were recorded during the
quarter and year ended January 3, 2004. During the first quarter of 2004, the
preferred shareholder exercised its right to purchase $12 million of Series B-
2 preferred stock. During the first quarter of 2003, the company agreed to
accelerate the reduction in the conversion price for its Series C preferred
stock. This amendment to the preferred stock terms was accounted for as an
induced conversion, resulting in a charge directly to retained earnings of
$3.5 million and an increase in the loss per share of $0.06 per diluted share.
(4) During the year-to-date period of 2004, the company recorded a net
pretax loss of $2.8 million from the purchase and retirement of $37.9 million
of Senior Notes due 2007 and 2009 for $10.4 million of cash and 3.9 million
shares of common stock. During the fourth quarter of 2003, the company issued
6.7 million shares of its common stock in exchange for $44.7 million of its
Senior Notes due 2007 and 2009, resulting in a pretax loss of $3.2 million.
In the year-to-date period of 2003, the company recorded net pretax gains of
$10.6 million resulting from the purchase and retirement of $95.3 million of
Senior Notes for cash payments totaling $35.8 million and the 6.7 million
shares of common stock. As of the dates below, long-term debt consisted of
the following (in thousands):
Jan. 1, Oct. 2, Jan. 3, Debt Reduction
2005 2004 2004 3 Months 12 Months
Senior Notes due 2007 $97,510 $97,510 $111,010 $- $(13,500)
Senior Notes due 2009 89,273 89,273 113,715 - (24,442)
Industrial revenue bonds 12,430 12,430 18,145 - (5,715)
Other 1,977 2,110 2,598 (133) (621)
$201,190 $201,323 $245,468 $(133) $(44,278)
CHAMPION ENTERPRISES, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL INFORMATION (UNAUDITED)
(5) The company evaluates the performance of its manufacturing and retail
segments based on earnings (loss) before interest, income taxes and general
corporate expenses. A reconciliation of income (loss) from continuing
operations before income taxes for the periods presented follows (dollars in
thousands):
Three months ended: Jan. 1, Related Jan. 3, Related %
2005 Sales 2004 Sales Change
Manufacturing segment income 15,418 6.1% $11,207 4.5% 38%
Retail segment loss (4,422) (7.5%) (2,051) (3.1%) (116%)
General corporate expenses (8,332) (6,641) (25%)
Mark-to-market charge for stock
warrant (2,000) (800)
Loss on debt retirement - (3,194)
Intercompany eliminations 1,600 600
Interest expense, net (4,130) (6,203) 33%
Loss from continuing operations
before income taxes $(1,866) (0.6%) $(7,082) (2.4%) 74%
Twelve months ended: Jan. 1, Related Jan. 3, Related %
2005 Sales 2004 Sales Change
Manufacturing segment income $59,731 6.0% $7,253 0.7% 724%
Retail segment loss (1,051) (0.4%) (14,831) (5.5%) 93%
General corporate expenses (27,706) (30,717) 10%
Mark-to-market charge for stock
warrant (5,500) (3,300)
(Loss) gain on debt retirement (2,776) 10,639
Intercompany eliminations 1,100 3,216
Goodwill impairment charges - (34,183)
Interest expense, net (17,984) (26,847) 33%
Income (loss) from continuing
operations before income taxes $5,814 0.5% $(88,770) (7.8%) 107%
For the quarter ended January 1, 2005, restructuring charges were $3.8
million in manufacturing, $3.5 million in retail and $0.8 million of income
for intercompany profit eliminations. For the year then ended, manufacturing
segment results also included $1.0 million of income for the reversal of
restructuring reserves recorded in prior periods. In 2003 the quarter
included restructuring charges of $0.1 million in manufacturing and $0.9
million in retail and the year included restructuring charges of $22.8 million
in manufacturing, $9.3 million in retail and $2.1 million of income for
intercompany profit eliminations.
(6) The effective tax rates for the periods presented differ from the 35%
federal statutory rate because the company has a 100% deferred tax asset
valuation allowance. In addition, the company currently has an estimated $120
million federal tax loss carry forward, the benefits of which can only be
recorded to the extent of future taxable income. The income tax benefit in
the year-to-date period of 2004 included a $12 million decrease in the
allowance for tax adjustments, partially offset by state and foreign income
taxes. The quarter ended January 3, 2004 included a tax benefit of $3.7
million related to tax audits completed in 2003. The year-to-date tax benefit
for the period then ended also included $3.0 million recorded to reduce the
deferred tax asset valuation allowance following the completion of the
company's 2002 federal income tax return, which resulted in a larger refund
than previously estimated, partially offset by state and foreign income taxes.
(7) In 2003 the company exited its consumer finance business, HomePride
Finance Corp. Related amounts are presented as discontinued operations. In
the year-to-date period of 2004, the company recorded income from discontinued
operations due to the settlement of contractual obligations.
(8) EPS for periods reported reflect the adoption of EITF 03-6, which
requires the use of the two-class method for enterprises with participating
securities. The company's participating securities consist of its convertible
preferred stock and common stock warrant, which may participate in dividends
paid on common stock pursuant to the terms of the securities. The company has
no plans to pay dividends on its common stock in the near term.
(9) During the first quarter of 2003, the company finalized a $75 million
revolving credit facility, which was used to issue letters of credit to
replace cash collateral and resulted in the release of $49.8 million of
restricted cash and $9.6 million of cash deposits. At the end of December
2004, the company had $60.3 million of letters of credit issued and no
borrowings outstanding under this facility.
CHAMPION ENTERPRISES, INC. AND SUBSIDIARIES
OTHER STATISTICAL INFORMATION (UNAUDITED)
Three Months Ended
Jan. 1, Jan. 3, %
2005 2004 Change
MANUFACTURING
Homes sold
HUD Code
Multi-section 3,855 4,382 (12%)
Single-section 650 704 (8%)
Total HUD Code 4,505 5,086 (11%)
Modular 849 811 5%
Canadian 226 203 11%
Total homes sold 5,580 6,100 (9%)
Less: intercompany 382 464 (18%)
Homes sold to independent
retailers/builders 5,198 5,636 (8%)
Total floors sold 10,693 11,820 (10%)
Floors sold per average plant 369 369
Multi-section mix 85% 86%
Average home prices
Total $43,700 $39,200 11%
HUD Code $40,900
Modular $55,900
Manufacturing facilities at period end 29 30 (3%)
RETAIL
Homes sold
New homes 546 820 (33%)
Pre-owned homes 339 306 11%
Total homes sold 885 1,126 (21%)
% Champion-produced new homes sold 88% 94%
New multi-section mix 92% 91%
Average number of new homes
in inventory per sales center
at period end 13.1 13.1
Average new home retail price $109,300 $89,100 23%
Average number of new homes retail
sold per sales center per month 2.3 2.7 (15%)
Average number of total homes retail
sold per sales center per month 3.6 4.0 (10%)
Sales centers at period end 60 78 (23%)
CONSOLIDATED AT PERIOD END (in thousands)
Contingent repurchase obligations (est.) $250,000 $245,000
Shares issued and outstanding 72,358 65,470 11%
Twelve Months Ended
Jan. 1, Jan. 3, %
2005 2004 Change
MANUFACTURING
Homes sold
HUD Code
Multi-section 15,981 18,753 (15%)
Single-section 2,801 3,215 (13%)
Total HUD Code 18,782 21,968 (15%)
Modular 3,274 2,619 25%
Canadian 922 896 3%
Total homes sold 22,978 25,483 (10%)
Less: intercompany 1,877 2,629 (29%)
Homes sold to independent
retailers/builders 21,101 22,854 (8%)
Total floors sold 44,036 48,506 (9%)
Floors sold per average plant 1,499 1,411 6%
Multi-section mix 85% 84%
Average home prices
Total $42,000 $37,100 13%
HUD Code $39,400
Modular $54,000
Manufacturing facilities at period end 29 30 (3%)
RETAIL
Homes sold
New homes 2,290 3,432 (33%)
Pre-owned homes 1,239 1,233 0%
Total homes sold 3,529 4,665 (24%)
% Champion-produced new homes sold 89% 95%
New multi-section mix 92% 87%
Average number of new homes
in inventory per sales center
at period end 13.1 13.1
Average new home retail price $101,100 $78,300 29%
Average number of new homes retail
sold per sales center per month 2.4 2.5 (4%)
Average number of total homes retail
sold per sales center per month 3.7 3.5 6%
Sales centers at period end 60 78 (23%)
CONSOLIDATED AT PERIOD END (in thousands)
Contingent repurchase obligations (est.) $250,000 $245,000
Shares issued and outstanding 72,358 65,470 11%
SOURCE Champion Enterprises, Inc.
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Related links:
http://www.championhomes.net
Company News On-Call:
http://www.prnewswire.com/comp/110861.html
CONTACT:
Investor and Media Contacts: Phyllis A.
Knight, Chief Financial Officer, +1-248-340-9090, or Colleen T.
Bauman, Investor Relations, +1-248-340-7731, both of Champion
Enterprises, Inc.
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