ST. PETERSBURG, Fla., May 18 /PRNewswire-FirstCall/ -- Catalina Marketing
Corporation (NYSE: POS) today reported financial results for its fourth
quarter and fiscal year ended March 31, 2005.
For the three months ended March 31, 2005, consolidated revenues were
$112.0 million, compared with revenues of $119.6 million in the comparable
period last year. Consolidated net income for the fourth quarter was
$15.3 million, or $0.29 per diluted share, compared with a net loss of
$8.8 million, or $0.17 per diluted share, in the fourth quarter of fiscal year
2004. Fourth quarter results in fiscal year 2005 included $0.7 million in
losses from discontinued operations due principally to losses from the
disposal of non-core businesses, compared with $32.5 million of losses from
discontinued operations, due principally from goodwill impairment charges,
recognized in the fourth quarter of fiscal year 2004.
The company reported consolidated income from continuing operations for
the quarter ended March 31, 2005 of $16.0 million, or $0.30 per diluted share,
compared with $23.7 million, or $0.44 per diluted share, for the quarter ended
March 31, 2004.
"The results in the fourth quarter were consistent with our expectations,"
said Dick Buell, chief executive officer of Catalina Marketing. "The company
incurred costs in the fourth quarter of fiscal 2005 that were not experienced
in fiscal 2004 including costs related to growth initiatives, incentive
compensation and compliance with Sarbanes-Oxley. As discussed on our last
earnings call, the company's investment in growth initiatives reflects a
commitment to drive future earnings growth."
Revenue in the fourth quarter of fiscal year 2005 was negatively
influenced by the sale of the loyalty card business, which occurred in March
2004, and the pull back of a large manufacturer client. The combined revenue
impact of these two issues exceeded $8 million in the quarter which, in turn,
negatively impacted gross profit.
Full Year Consolidated Results
For the twelve months ended March 31, 2005, consolidated revenues were
$410.1 million, compared with revenues of $408.6 million last year.
Consolidated net income for the fiscal year was $65.5 million, or $1.25 per
diluted share, compared with a net loss of $19.3 million, or $0.37 per diluted
share, in fiscal year 2004. Results in fiscal year 2005 included $3.1 million
in losses from discontinued operations due principally to losses from the
operations of non-core businesses, compared with $78.9 million of losses from
discontinued operations, due principally from goodwill impairment charges,
recognized in fiscal year 2004.
The company reported consolidated income from continuing operations for
the year ended March 31, 2005 of $68.6 million, or $1.31 per diluted share,
compared with $60.4 million, or $1.15 per diluted share, for the year ended
March 31, 2004.
"We are pleased with our financial, strategic and organizational results
for fiscal 2005. In addition to the financial outcome, our focus for 2005 was
to establish a solid foundation for the future," stated Dick Buell, Catalina's
chief executive officer. "We repurchased a record $44 million of Catalina
stock during the fourth quarter. In the second quarter, for the first time in
the history of the company, we declared an annual dividend to shareholders.
The company renewed the focus on its core businesses, achieved its goal of
divesting the four non-strategic businesses, and strengthened the management
team with the hiring and promotion of key individuals. Catalina Marketing's
financial, strategic and organizational achievements in fiscal 2005 have
created a solid foundation for future innovation and growth."
During the third fiscal quarter ended December 31, 2004, the company
received a favorable ruling related to a state sales tax assessment, and as a
result, reversed into income a $4.4 million accrued liability, which had been
recognized as expense in prior periods. The reversal of this liability
resulted in a favorable impact, net of related income taxes, of approximately
$0.05 per diluted share, in both the third quarter and the full fiscal year
2005.
Pro Forma Non-GAAP Adjustments
The pro forma non-GAAP basis results presented in this news release and
attached tables exclude the effect of Catalina Health Resource revenues
recognized in fiscal year 2004 that had been deferred from prior fiscal years
due to revenue recognition adjustments.
Fourth quarter fiscal 2005 consolidated revenues of $112.0 million reflect
a decrease of 4.6% compared with non-GAAP pro forma revenues of $117.4 million
for the same period last year. For the three months ended March 31, 2005,
consolidated income from continuing operations was $16.0 million, or $0.30 per
diluted share, compared with pro forma non-GAAP income from continuing
operations of $22.4 million, or $0.43 per diluted share, for the same period
last year.
Consolidated revenues of $410.1 million for the twelve months ended March
31, 2005 reflect an increase of 3.3% compared with pro forma non-GAAP revenues
of $397.1 million for the same period last year. Consolidated income from
continuing operations was $68.6 million, or $1.31 per diluted share, for the
twelve months ended March 31, 2005, compared with pro forma non-GAAP income
from continuing operations of $53.5 million, or $1.02 per diluted share, for
the same period last year.
Summary of Segment Results
Three Months Ended Three Months Ended
March 31, 2005 March 31, 2004
(In thousands) Revenues Income/ Revenues Income/
(Loss) (Loss)
Catalina Marketing Services $74,641 $20,660 $82,101 $22,820
Catalina Health Resource (1) 19,324 1,801 20,392 1,677
International 17,974 2,911 15,360 1,177
Corp / Eliminations 30 (9,395) (430) (3,263)
Total Pro Forma (1) $111,969 $15,977 $117,423 $22,411
Catalina Health Resource
Adj.(1) -- -- 2,137 1,327
From Continuing
Operations - GAAP $111,969 $15,977 $119,560 $23,738
Discontinued Operations $-- $(701) $-- $(32,514)
Consolidated GAAP $111,969 $15,276 $119,560 $(8,776)
Twelve Months Ended Twelve Months Ended
March 31, 2005 March 31, 2004
(In thousands) Revenues Income/ Revenues Income/
(Loss) (Loss)
Catalina Marketing Services $269,612 $73,879 $282,128 $72,724
Catalina Health Resource (1) 76,167 9,356 66,207 396
International 64,116 7,395 49,580 462
Corp / Eliminations 167 (22,034) (841) (20,062)
Total Pro Forma (1) $410,062 $68,596 $397,074 $53,520
Catalina Health Resource
Adj.(1) -- -- 11,558 6,877
From Continuing
Operations - GAAP $410,062 $68,596 $408,632 $60,397
Discontinued Operations $-- $(3,144) $-- $(78,900)
Cumulative Effect of Acctg
Change $-- $-- $-- $(770)
Consolidated GAAP $410,062 $65,452 $408,632 $(19,273)
(1) The non-GAAP pro forma revenue and net income results are a supplement
to the financial data that is based on generally accepted accounting
principles (GAAP). The non-GAAP pro forma results reflect adjustments to
exclude non-recurring revenue resulting from the one-time deferral of CHR
revenues in prior periods (and the related tax effect) resulting from revenue
recognition adjustments in such prior years. The company believes this
presentation provides useful information to investors because it assists
investors in better understanding the company's operations for comparability
with recurring results for the future. It should be emphasized, however, that
these measurements are not a substitution for GAAP-based financial statements.
Discontinued Operations
During the fiscal year ended March 31, 2005, the company completed the
divestiture of its remaining non-strategic business units. Research Solutions
was divested during the third quarter and Direct Marketing Services and Japan
Billboard were both sold in the second quarter of fiscal year 2005. The
aggregated results of these dispositions are reported in the income statement
as "Discontinued Operations."
Stock Repurchases
During the fourth quarter, the company repurchased 1,652,100 shares of its
common stock for a total of $44.2 million, at an average price of $26.74 per
share. The company currently has authorization to repurchase an additional
$55.8 million of common stock under the September 2004 Board of Directors'
authorization.
Catalina Marketing expects to file its Annual Report on Form 10-K for the
fiscal year ended March 31, 2005, with the Securities and Exchange Commission
on or before June 14, 2005. Investors are urged to review the Form 10-K for a
detailed discussion of the company's financial results and business
descriptions.
Webcast and Investor Conferences Scheduled
The company will host a webcast on Wednesday, May 18, 2005, at 10:00 a.m.
EDT to discuss its financial results. The webcast may be accessed at
http://www.corporate-ir.net/ireye/ir_site.zhtml?ticker=POS&script=1010&item_id
=1056457 , and will be available for replay from Wednesday, May 18, 2005
through Thursday, June 16, 2005.
The Catalina 2005 investor conference will be held in Tampa, Florida on
May 25 and May 26, 2005 and will address key accomplishments for fiscal year
2005 as well as the company's future growth initiatives. The audio portion of
the investor conference, and the graphics presented, will be webcast live over
the Internet. The webcast will be accessible at
http://www.wsw.com/webcast/catalina .
Dick Buell, chief executive officer, will also present at Deutsche Bank's
Media/Telecom Conference at The Pierre Hotel in New York City on June 6, 2005.
The presentation will be webcast and will be accessible through the Investor
Relations Calendar of Events section of the company's web site at
http://www.catalinamarketing.com .
Catalina Marketing Corporation
Selected Financial Data
(in thousands, except per share amounts)
Periods Ended March 31 Three Months Twelve Months
2005 2004 2005 2004
Revenues $111,969 $119,560 $410,062 $408,632
Direct Operating Expenses 37,446 40,676 129,449 140,401
Selling, General and
Administrative 40,660 32,377 129,365 124,856
Depreciation and Amortization 10,086 11,739 42,446 45,243
Income from Operations 23,777 34,768 108,802 98,132
Other Income (Expense) 1,462 (8) 1,450 (536)
Provision for Income Taxes 9,262 11,022 41,656 37,199
Income from Continuing Operations 15,977 23,738 68,596 60,397
Gain (Loss) from Discontinued
Operations (270) (32,514) (4,272) (78,900)
Gain (Loss) from Disposition (431) -- 1,128 --
Income (Loss) from Discontinued
Operations (701) (32,514) (3,144) (78,900)
Cumulative Effect of Change in
Accounting -- -- -- (770)
Net Income (Loss) $15,276 $(8,776) $65,452 $(19,273)
Earnings Per Share, Basic:
Earnings Per Share from Continuing
Operations $0.30 $0.44 $1.31 $1.15
Income (Loss) from Discontinued
Operations $(0.01) $(0.61) $(0.06) $(1.50)
Cumulative Effect of Change in
Accounting $-- $-- $-- $(0.02)
Net Income (Loss) Per Common Share $0.29 $(0.17) $1.25 $(0.37)
Weighted Average Shares
Outstanding 51,740 52,229 52,167 52,304
Earnings Per Share, Diluted:
Earnings Per Share from Continuing
Operations $0.30 $0.44 $1.31 $1.15
Income (Loss) from Discontinued
Operations $(0.01) $(0.61) $(0.06) $(1.50)
Cumulative Effect of Change in
Accounting $-- $-- $-- $(0.02)
Net Income (Loss) Per Common Share $0.29 $(0.17) $1.25 $(0.37)
Weighted Average Shares
Outstanding 52,180 52,264 52,356 52,324
Catalina Marketing Corporation
Selected Other Data
(in thousands, except store data)
March 31 March 31
2005 2004
Balance Sheet and Cash Flow (in thousands):
Cash $116,191 $72,704
Debt $64,623 $66,924
Stockholders' Equity $196,374 $184,662
Cash Flows from Operating
Activities Quarter / YTD $46,230 / $117,991 $51,838 / $138,133
Capital Expenditures
Quarter / YTD $9,594 / $22,527 $4,827 / $26,427
Catalina Marketing Services:
Number of Stores at Quarter End 17,609 17,604
Net Stores (Deinstalled)
Installed During Quarter / YTD (103) / 5 22 / 106
Promotions Printed During
Quarter / YTD (in millions) 881 / 3,279 878 / 3,118
Weekly Shopper Reach at
Quarter End (in millions) 218 209
Catalina Health Resource:
Number of Stores at Quarter End 12,423 11,929
Net Stores Installed
(Deinstalled) During Quarter / YTD 43 / 494 (3,884) / (5,898)
Catalina Marketing International:
Number of Stores at Quarter End 5,907 5,545
Net Stores Installed During
Quarter / YTD 166 / 362 287 / 1028
Promotions Printed During
Quarter / YTD (in millions) 248 / 851 230 / 757
Weekly Shopper Reach at
Quarter End (in millions) 66 65
Based in St. Petersburg, FL, Catalina Marketing Corporation
( http://www.catalinamarketing.com ) was founded 20 years ago based on the
premise that targeting communications based on actual purchase behavior would
generate more effective consumer response. Today, Catalina Marketing combines
unparalleled insight into consumer behavior with dynamic consumer access. This
combination of insight and access provides marketers with the ability to
execute behavior-based marketing programs, ensuring that the right consumer
receives the right message at exactly the right time. Catalina Marketing
offers an array of behavior-based promotional messaging, loyalty programs and
direct-to-patient information. Personally identifiable data that may be
collected from the company's targeted marketing programs, as well as its
research programs, are never sold or given to any outside party without the
express permission of the consumer.
Certain statements in the preceding paragraphs are forward looking, and
actual results may differ materially. Statements not based on historic facts
involve risks and uncertainties, including, but not limited to, the changing
market for promotional activities, especially as it relates to policies and
programs of packaged goods and pharmaceutical manufacturers and retailers,
government and regulatory statutes, rules, regulations and policies, the
effect of economic and competitive conditions and seasonal variations, actual
promotional activities and programs with the company's customers, the pace of
installation of the company's store network, the success of new services and
businesses and the pace of their implementation, the company's ability to
maintain favorable client relationships, the outcome and impact of an ongoing
SEC investigation into certain of the company's prior fiscal years, and the
outcome and impact of the pending shareholder class action and derivative
lawsuits.
SOURCE Catalina Marketing Corporation
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Related links:
http://www.catalinamarketing.com
CONTACT:
Investors, Rick Frier, Executive Vice
President, Finance, +1-727-579-5147, or Joanne Freiberger, Vice
President, Finance, +1-727-579-5116; or Media, Michelle Bauer,
Executive Director, Marketing Communications, +1-727-579-5129,
all of Catalina Marketing Corporation
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