-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GnDEaFt1DVQRTgYirW86QJqjjvPmjgMuUbodEn9xYZmkiu8JMazg+KA0TWMUv7TO gydJqSxwUWS8xvOjASIz9Q== 0000891092-04-003685.txt : 20040729 0000891092-04-003685.hdr.sgml : 20040729 20040728194633 ACCESSION NUMBER: 0000891092-04-003685 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040728 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20040729 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AARON RENTS INC CENTRAL INDEX KEY: 0000706688 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EQUIPMENT RENTAL & LEASING, NEC [7359] IRS NUMBER: 580687630 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13941 FILM NUMBER: 04937143 BUSINESS ADDRESS: STREET 1: 309 E. PACES FERRY ROAD, N.E. STREET 2: (NONE) CITY: ATLANTA STATE: GA ZIP: 30305-2377 BUSINESS PHONE: 404-231-0011 MAIL ADDRESS: STREET 1: 309 E. PACES FERRY ROAD, N.E. STREET 2: (NONE) CITY: ATLANTA STATE: GA ZIP: 30305-2377 8-K 1 e18607_8k.txt FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of Earliest Event Reported): July 28, 2004 AARON RENTS, INC. ------------------------------------------------------ (Exact name of Registrant as Specified in its Charter) Georgia 1-13941 58-0687630 - ------------------------------- ---------------- ------------- (State or other Jurisdiction of (Commission File (IRS Employer Incorporation or Organization) Number) Identification No.) 309 E. Paces Ferry Road, N.E. Atlanta, Georgia 30305-2377 - ---------------------------------------- ---------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (404) 231-0011 Not Applicable ------------------------------------------------------------- (Former name or former address, if changed since last report) ITEM 7. FINANCIAL STATEMENTS, PRO FORMA INFORMATION AND EXHIBITS (a) Financial Statements of Businesses Acquired: None. (b) Pro Forma Financial Information: None. (c) Exhibits: Exhibit No. Description - ----------- ----------- 99.1 Aaron Rents, Inc. press release dated July 28, 2004, announcing the Company's financial results for the second quarter of 2004 (furnished pursuant to Item 12 of Form 8-K). ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION On July 28, 2004, Aaron Rents, Inc. (the "Company") issued a press release to announce its financial results for the second quarter of 2004. A copy of the press release is attached as Exhibit 99.1. The information in this Report, including the Exhibit attached hereto, is furnished solely pursuant to Item 12 of this Form 8-K. Consequently, it is not deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liabilities of that section. It may only be incorporated by reference in another filing under the Exchange Act or Securities Act of 1933 if such subsequent filing specifically references this Form 8-K. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AARON RENTS, INC. By: /s/ Gilbert L. Danielson ----------------------------- Gilbert L. Danielson Executive Vice President, Date: July 28, 2004 Chief Financial Officer EX-99.1 2 e18607ex991.txt PRESS RELEASE Exhibit 99.1 Aaron Rents, Inc. Reports Record Second Quarter; Same Store Revenues up 14.7%; Raises Outlook for Year ATLANTA, July 28 /PRNewswire-FirstCall/ -- Aaron Rents, Inc. (NYSE: RNT), the nation's leader in the sales and lease ownership, specialty retailing and rental of residential and office furniture, consumer electronics, home appliances and accessories, today announced record revenues and earnings for the second quarter of 2004. The Company's fast-growing Aaron's Sales & Lease Ownership division increased revenues 32% for both the second quarter and first six months of 2004 compared to the same periods a year ago, including a 14.7% increase in same store revenues during this year's second quarter. "Once again we are quite pleased with the Company's results," said R. Charles Loudermilk, Sr., Chairman and Chief Executive Officer of Aaron Rents. "Our Aaron's Sales & Lease Ownership division continues its rapid growth, adding 60 Company-operated stores and 37 franchise stores during the first six months of 2004, and we are well on our way to accomplishing our goals for the year." For the three months ended June 30, 2004 revenues advanced 30% to $230.3 million compared to $177.7 million for the second quarter of 2003. Net earnings for the second quarter increased 76% to $15.4 million, or $.46 per diluted share, compared to $8.8 million, or $.26 per diluted share, for the same period last year. The Company's other revenues include a pre-tax gain of $5.5 million, or $.10 per diluted share, realized in the second quarter resulting from the disposition of its Rainbow Rentals, Inc. stock when Rainbow merged with Rent- A-Center, Inc. in May. For the first six months of this year, revenues advanced 28% to a record $472.8 million compared to $369.0 million for the first half of 2003. Net earnings for the six months were $28.2 million versus $17.5 million for the corresponding period last year, up 61%. Diluted earnings per share for the first half were $.84 for 2004 and $.53 for 2003. Included in the Company's other revenues is royalty income from franchisees, which in 2004 increased to $4.1 million for the second quarter from $3.4 million for the quarter a year ago and to $8.3 million for the first six months compared to $7.0 million for the same period last year. In addition, non-retail sales, which are primarily sales of rental merchandise to franchisees, increased to $35.3 million for the second quarter from $24.9 million for the quarter a year ago and to $81.8 million for the first six months compared to $56.4 million for the same period last year. The increases in royalty income and non-retail sales are attributable to an increase in revenues of the Company's franchisees, who collectively had revenues of $88.7 million during the second quarter and $172.0 million for the first six months of 2004, a 29% and 22% increase from the comparable prior year periods, respectively. Revenues of franchisees, however, are not revenues of Aaron Rents, Inc. Revenues of the Aaron's Sales & Lease Ownership division increased 32% for the quarter to $198.3 million versus $150.3 million in the second quarter of last year. First half sales and lease ownership revenues also increased 32% to $412.9 million compared to $312.2 million a year ago. Same store revenues (revenues earned in Company-operated stores open for the entirety of both periods) in the Aaron's Sales & Lease Ownership division increased 14.7% during the second quarter of 2004 compared to second quarter of 2003. Same store revenues increased 12.0% for stores open over two years at the end of June 2004. During the second quarter the Company awarded area development agreements to various independent operators to open 31 new Aaron's Sales & Lease Ownership franchise stores. Through the first six months of 2004, agreements have been signed for 84 additional new franchise stores. At the end of June there were 281 franchise stores awarded that are scheduled to open over the next several years. The Company acquired 26 stores during the second quarter, including two franchise stores, and contracts and related merchandise of four additional stores. Also, during the second quarter, the Company converted ten of its 11 remaining Sight & Sound stores to Aaron's Sales & Lease Ownership stores. Including these acquisitions and one Sight & Sound store closure, the Aaron's Sales & Lease Ownership division increased its store count during the second quarter by 54 stores, comprising of 42 Company-operated stores and 12 franchised stores, bringing the total number of stores open at June 30 to 884. At the end of June the Company also had 60 rent-to-rent stores open. A 3-for-2 stock split effected in the form of a 50% stock dividend on both Common Stock (RNT) and Class A Common Stock (RNT.A) was announced by the Company on July 12. New shares will be distributed on August 16, 2004 to shareholders of record as of the close of business on August 2, 2004. The accompanying table presents the second quarter results as if the split occurred prior to this date. "For the third quarter of 2004 we expect revenues to be over $225 million and diluted earnings per share, on a pre-split basis, to be in the range of $.32 to $.34 per share," Mr. Loudermilk continued. "We are increasing our guidance for the full year of 2004, again expecting Company revenues to exceed $950 million (excluding revenues of franchisees), more than a 24% increase over 2003, with diluted earnings per share, on a pre-split basis, in the range of $1.50 to $1.54, compared to the $1.10 diluted per share recorded in 2003. Our previous earnings guidance for the 2004 year was between $1.48 and $1.53 per diluted share. Our new store opening plans for 2004 are to open approximately 140 new stores, a combination of Company-operated and franchised stores, in addition to adding between 40 and 50 Company-operated stores during the year through acquisition. Our initial outlook for 2005 is to continue to increase our Company-operated and franchise store base in excess of 15% annually and achieve diluted earnings per share, on a pre-split basis, in the range of $1.70 to $1.80." Aaron Rents will hold a conference call to discuss its quarterly financial results on Thursday, July 29, 2004, at 10:30 am Eastern Time. The public is invited to listen in to the call by webcast accessible through the Company's website, www.aaronrents.com , in the "Investor Relations" section. The webcast will be archived for playback at that same site. Aaron Rents, Inc., based in Atlanta, currently has over 945 Company- operated and franchised stores in the United States, Puerto Rico, and Canada for the rental and sale of residential and office furniture, accessories, consumer electronics and household appliances. The Company also manufactures furniture, bedding and accessories at 10 facilities in four states. "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this news release regarding Aaron Rents, Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties which could cause actual results to differ materially from those contained in the forward-looking statements. These risks and uncertainties include factors such as changes in general economic conditions, competition, pricing, customer demand and other issues, and the risks and uncertainties discussed under "Certain Factors Affecting Forward Looking Statements" in the Company's Annual Report on Form 10-K for fiscal 2003, which discussion is incorporated herein by this reference. Statements in this release that are "forward-looking" include without limitation Aaron Rents' projected revenues, earnings, and store openings for 2004 and 2005. Aaron Rents, Inc. and Subsidiaries Consolidated Statements of Earnings (In thousands, except per share amounts) (Unaudited) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2004 2003 2004 2003 Revenues: Rentals and Fees $170,225 $131,419 $342,597 $262,456 Retail Sales 12,578 15,608 29,049 38,646 Non-Retail Sales 35,272 24,870 81,771 56,427 Other 12,211 5,844 19,362 11,472 Total 230,286 177,741 472,779 369,001 Costs and Expenses: Retail Cost of Sales 8,663 11,391 20,373 28,246 Non-Retail Cost of Sales 32,709 23,077 76,015 52,479 Operating Expenses 100,658 81,377 202,751 164,496 Depreciation of Rental Merchandise 62,062 46,517 125,532 92,906 Interest 1,266 1,473 2,474 3,061 Total 205,358 163,835 427,145 341,188 Earnings Before Taxes 24,928 13,906 45,634 27,813 Income Taxes 9,543 5,145 17,432 10,304 Net Earnings $15,385 $8,761 $28,202 $17,509 Common Stock and Class A Common Stock: Earnings Per Share $.46 $.27 $.85 $.54 Earnings Per Share Assuming Dilution $.46 $.26 $.84 $.53 Weighted Average Shares Outstanding 33,088 32,562 32,985 32,545 Weighted Average Shares Outstanding Assuming Dilution 33,683 33,085 33,595 33,000 Aaron Rents, Inc. and Subsidiaries Selected Balance Sheet Data (In thousands) (Unaudited) June 30, December 31, 2004 2003 Cash $95 $95 Accounts Receivable 29,132 30,878 Rental Merchandise, Net 386,091 343,013 Property, Plant and Equipment, Net 101,136 99,584 Total Assets 606,882 555,292 Bank Debt 23,932 13,870 Senior Notes 50,000 50,000 Total Liabilities 256,316 235,106 Shareholders' Equity $350,566 $320,186 Aaron Rents, Inc. and Subsidiaries Earnings Per Share Pro Forma Presentation (In thousands, except per share amounts) (Unaudited) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2004 2003 2004 2003 Net Earnings $15,385 $8,761 $28,202 $17,509 Common Stock and Class A Common Stock: Earnings Per Share $.31 $.18 $.57 $.36 Earnings Per Share Assuming Dilution $.30 $.18 $.56 $.35 Weighted Average Shares Outstanding 49,632 48,843 49,478 48,818 Weighted Average Shares Outstanding Assuming Dilution 50,525 49,628 50,393 49,500 (1) Pro forma presentation gives prior-period effect to the 3-for-2 partial stock split effective August 16, 2004. SOURCE Aaron Rents, Inc. -0- 07/28/2004 /CONTACT: Gilbert L. Danielson, Executive Vice President, Chief Financial Officer of Aaron Rents, Inc., +1-678-402-3314/ /Web site: http://www.aaronrents.com / (RNT) CO: Aaron Rents, Inc. ST: Georgia IN: REA RLT SU: ERN ERP CCA MAV -----END PRIVACY-ENHANCED MESSAGE-----