EX-99 4 ex9910507038k.txt EXHIBIT 99.1 FOR FORM 8-K DATED MAY 7, 2003 EXHIBIT 99.i NEWS RELEASE DATE: MAY 7, 2003 CONTACT: JOE L. POWERS EXECUTIVE VICE PRESIDENT P.O. BOX 141000, NASHVILLE, TN 37214-1000 WEBSITE: www.thomasnelson.com PHONE: (615) 902-1300 FAX: (615) 883-6353 THOMAS NELSON INCREASES REVENUES 20% AND CONTINUING OPERATIONS PROFITS 55% FOR THE QUARTER NEDED MARCH 31, 2003 Nashville, TN, May 7, 2003 - Thomas Nelson, Inc. (NYSE: TNM) today announced its results for the fourth quarter of fiscal 2003: For the three months ended March 31, 2003, the Company's net revenues were $60.2 million compared to $50.3 million in the prior year's comparable quarter, an increase of $9.9 million or 20%. Income from continuing operations was $3.3 million compared to $2.1 million in the previous year's quarter, an increase of $1.2 million, or 55%. Income per share from continuing operations was $0.23 (basic and diluted) versus $0.15 (basic) or $0.14 (diluted), increases of 53% and 64%, respectively. For the year ended March 31, 2003, net revenues were $217.2 million compared to $215.6 million in the previous year, up $1.6 million or 1%. Income from continuing operations was $10.2 million compared to $7.8 million in the previous year, a gain of $2.4 million or 30%. Income per share from continuing operations was $0.71 (basic) or $0.70 (diluted) versus $0.55 (basic) or $0.54 (diluted), increases of 29% and 30%, respectively. Financial Condition at March 31, 2003 is stronger than a year ago. Total debt has been reduced from $56.4 million as of March 31, 2002 to $26.0 million at March 31, 2003, a reduction of $30.4 million or 54%. Long-term is debt now 23% of total capital, compared to 42% at the end of fiscal year 2002. Total assets employed have been reduced by $22.4 million from fiscal 2002, primarily through reductions in inventories and the collection of accounts receivable and tax refunds. Shareholders' equity increased by $10.2 million or 13%. "Analysis of our recent results should take into consideration two unusual circumstances," said Sam Moore, chairman and chief executive officer. "In the year-ago fourth fiscal quarter our results reflect $1.3 million of income relating to the sale of our Kmart receivable, an asset that had previously been written down to zero. In the more recent quarter, our results include the write off of a $1.2 million receivable owed to us by a book distributor who recently received bankruptcy court protection. When combined, these two items impact our period-to-period performance by $2.5 million." "Despite that handicap, and the continuing economic softness, most of our operating units, as well as our general financial condition, scored improvements in the March quarter and for the fiscal year as a whole," Mr. Moore, continued. "It is gratifying to see that many of the plans and programs we've instituted to deal with the adverse economic conditions are working to good effect. This is important," Mr. Moore stated, "because even though we continue to find occasional signs that external conditions are starting to improve, we are wary about letting our optimism override our sense of prudent caution." Mr. Moore added: "Our products continue to enjoy market-leading positions, but retail sales at many of our important customers remain soft, as does store traffic. The good news in all this is that we continue to increase our share of most of our important markets, and dominate the best- seller lists in most of our product categories." "Even in this difficult operating environment, and given our generally conservative business stance, we continue to take initiatives to broaden our operating base" added Mr. Moore. "We are, for example, working very closely with retailers and distributors of gardening-oriented products in ways that will feature the State-specific gardening guides published by our Cool Springs Press imprint. I mention this because we are now in the peak season for this category of product, and initial sales reports are very encouraging. In addition, we have developed a strong relationship with WorldNetDaily (WND) and intend to develop additional book projects to appeal to this important constituency. The Savage Nation, which was #1 on the New York Times bestseller list for five weeks and, as of this date, remains in the top ten on the list after 17 weeks. It was our best-selling product in the fourth quarter and is now in our new WND division, which has several new product endeavors slated for release during the current fiscal year." "Shortly after the close of the year we received an income tax refund of $18.7 million," said Mr. Moore. "This arose from events surrounding the disposal of our C.R. Gibson operation in October 2001. The funds have been used to repay debt, and this refund is not reflected in the March 2003 financial statements." This news release includes certain forward-looking statements. Actual results could differ materially from those reflected by the forward-looking statements and a number of factors may affect future results, liquidity and capital resources. These factors include, but are not limited to, softness in the general retail environment, the timing and acceptance of products being introduced to the market, the level of product returns experienced, the level of margins achievable in the marketplace, the collectibility of accounts receivable, the recoupment of royalty advances, the effects of acquisitions or dispositions, the financial condition of our customers and suppliers, the realization of inventory values at carrying amounts, our access to capital and the realization of income tax (including the outcome of any future Internal Revenue Service audits) and intangible assets. Future revenue and margin trends cannot be reliably predicted and may cause the Company to adjust its business strategy during the remaining portion of the 2003 fiscal year. The Company disclaims any intent or obligation to update forward-looking statements. Thomas Nelson, Inc. will host a conference call related to this earnings release at 10:00 a.m. CST on Wednesday, May 7, 2003. Individuals may listen to the call by dialing (800) 946-0712. The confirmation number for the call is 301440. The live broadcast of Thomas Nelson's quarterly conference call will be available online by going to www.thomasnelson.com/news and at www.streetevents.com. The online replay will be available shortly after the call and continue through May 14, 2003. Thomas Nelson, Inc. is a leading publisher, producer and distributor of products emphasizing Christian, inspirational and family value themes and believes it is the largest publisher of Bibles and inspirational products in the English language. For more information, visit our website www.thomasnelson.com. Thomas Nelson's Common stock and Class B Common stock is listed on the New York Stock Exchange (TNM-NYSE). ### Thomas Nelson, Inc. & Subsidiaries Consolidated Statements of Operations (000's omitted except per share data, unaudited)
Three Months Ended Twelve Months Ended March 31, March 31, 2003 2002 2003 2002 ---------- ---------- --------- --------- Net revenues $60,198 $50,259 $217,217 $215,552 Costs and expenses: Cost of goods sold 34,139 30,466 129,378 129,691 Selling, general & administrative 19,820 15,060 66,852 66,649 Depreciation & amortization 552 556 2,061 2,649 ---------- ---------- --------- --------- Total expenses 54,511 46,082 198,291 198,989 ---------- ---------- --------- --------- Operating income 5,687 4,177 18,926 16,563 Other income 69 (76) 170 49 Interest expense 644 966 3,026 4,295 Equity in earnings of investee 35 - 35 - ---------- ---------- --------- --------- Income from continuing operations before income taxes 5,147 3,135 16,105 12,317 Provision for income taxes 1,879 1,144 5,878 4,496 Minority interest 6 119 (43) - ---------- ---------- --------- --------- Income from continuing operations 3,274 2,110 10,184 7,821 Discontinued operations: Operating loss, net of taxes - - - (766) Loss on disposal, net of taxes - (1,389) - (16,096) ---------- ---------- --------- --------- Total loss from discontinued operations - (1,389) - (16,862) ---------- ---------- --------- --------- Cumulative effect of change in accounting principle - - - (40,433) ---------- ---------- --------- --------- Net income (loss) $ 3,274 $ 721 $ 10,184 $(59,474) ========== ========== ========= ========= Weighted average number of shares Basic 14,369 14,361 14,368 14,348 ========== ========== ========= ========= Diluted 14,550 14,662 14,596 14,488 ========== ========== ========= ========= Net income (loss) per share, Basic: Income from continuing operations $ 0.23 $ 0.15 $ 0.71 $ 0.55 Loss from discontinued operations - (0.10) - (1.18) Cumulative effect of change in accounting principle - - - (2.82) ---------- ---------- --------- --------- Net income (loss) per share $ 0.23 $ 0.05 $ 0.71 $ (3.45) ========== ========== ========= ========= Net income (loss) per share, Diluted: Income from continuing operations $ 0.23 $ 0.14 $ 0.70 $ 0.54 Loss from discontinued operations - (0.09) - (1.16) Cumulative effect of change in accounting principle - - - (2.79) ---------- ---------- --------- --------- Net income (loss) per share $ 0.23 $ 0.05 $ 0.70 $ (3.41) ========== ========== ========= =========
Thomas Nelson, Inc. & Subsidiaries Consolidated Balance Sheets (000's omitted, unaudited)
March 31, 2003 2002 ---------- ---------- ASSETS Current assets: Cash & cash equivalents $ 1,707 $ 535 Accounts receivable, less allowances of $7,311 and $6,419, respectively 56,806 61,600 Inventories 33,637 39,195 Prepaid expenses 13,521 17,571 Assets held for sale 1,785 2,500 Refundable income taxes - 7,800 Deferred income tax benefits 5,085 7,966 ---------- ---------- Total current assets 112,541 137,167 Property, plant & equipment, net 11,630 9,242 Other assets 7,885 7,541 Deferred charges 1,695 2,135 Goodwill 29,304 29,304 ---------- ---------- Total Assets $163,055 $185,389 ========== ========== LIABILITIES & SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 20,218 $ 22,258 Accrued expenses 13,835 15,603 Deferred revenue 11,493 11,222 Income taxes currently payable 2,379 500 Current portion of long-term debt 3,322 3,322 ---------- ---------- Total current liabilities 51,247 52,905 Long term debt 22,630 53,052 Deferred tax liability and other liabilities 1,311 1,856 Minority interest 43 - Shareholders' equity 87,824 77,576 ---------- ---------- Total Liabilities & Shareholders' Equity $163,055 $185,389 ========== ==========