-----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, GA/5JvnSQNUhaWqS3TcKK8DvxLUtOvR+LQiouTtvUikQ2q3girfct7DFMZVBeZUJ qT22bgEe1aYmisPXNGhQ7Q== 0000930413-06-008356.txt : 20061205 0000930413-06-008356.hdr.sgml : 20061205 20061205083005 ACCESSION NUMBER: 0000930413-06-008356 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20061205 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20061205 DATE AS OF CHANGE: 20061205 FILER: COMPANY DATA: COMPANY CONFORMED NAME: REX STORES CORP CENTRAL INDEX KEY: 0000744187 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-RADIO TV & CONSUMER ELECTRONICS STORES [5731] IRS NUMBER: 311095548 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09097 FILM NUMBER: 061255960 BUSINESS ADDRESS: STREET 1: 2875 NEEDMORE RD CITY: DAYTON STATE: OH ZIP: 45414 BUSINESS PHONE: 5132763931 FORMER COMPANY: FORMER CONFORMED NAME: AUDIO VIDEO AFFILIATES INC DATE OF NAME CHANGE: 19920703 8-K 1 c45564_8k.txt 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): December 5, 2006 REX STORES CORPORATION (Exact name of registrant as specified in its charter) Delaware 001-09097 31-1095548 (State or other jurisdiction (Commission File No.) (IRS Employer of incorporation) Identification No.) 2875 Needmore Road, Dayton, Ohio 45414 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (937) 276-3931 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02. Results of Operations and Financial Condition On December 5, 2006, REX Stores Corporation issued a press release announcing financial results and comparable store sales for the three month and nine month periods ended October 31, 2006 as well as an update on its Ethanol projects. The press release is furnished as Exhibit 99 to this report. Item 9.01. Financial Statements and Exhibits (c) Exhibits. The following exhibits are furnished with this report: 99 Press Release dated December 5, 2006 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. REX STORES CORPORATION Date: December 5, 2006 By: /s/ DOUGLAS L. BRUGGEMAN ------------------------ Name: Douglas L. Bruggeman Title: Vice President-Finance, Chief Financial Officer and Treasurer EX-99 2 c45564_ex99.txt Exhibit 99 [Rex Logo] NEWS ANNOUNCEMENT FOR IMMEDIATE RELEASE For further information contact: Douglas Bruggeman Joseph N. Jaffoni/David Collins Chief Financial Officer Jaffoni & Collins Incorporated 937/276-3931 212/835-8500 or rsc@jcir.com REX STORES REPORTS FISCAL THIRD QUARTER DILUTED EARNINGS PER SHARE OF $0.42 - REX PROVIDES UPDATE ON ETHANOL PROJECTS - Dayton, Ohio (December 5, 2006) -- REX Stores Corporation (NYSE:RSC) today announced financial results and comparable store sales for the three- and nine-month periods ended October 31, 2006 (the Company's 2006 fiscal year). Net sales in the fiscal 2006 third quarter were $85.2 million compared with $91.8 million in the fiscal 2005 third quarter. Comparable store sales for the three months ended October 31, 2006 declined 5.6%. The Company reports sales performance quarterly and considers a store to be comparable after it has been open six full fiscal quarters. Comparable store sales figures do not include sales of extended service contracts. For the quarter ended October 31, 2006, income from synthetic fuel limited partnership investments was $5.9 million compared with $8.4 million in the comparable year-ago period which included a $1.2 million gain related to the sale by the Company of its interest in a synthetic fuel limited partnership. Earlier in fiscal 2006 some of the synthetic fuel plants for which REX receives income had temporarily ceased production as higher oil prices increased the likelihood that Section 29/45K tax credits would be reduced or phased out. As of the end of the fiscal third quarter of 2006, all synthetic fuel plants for which REX receives income had returned to operation. Based upon recent oil price reductions, the Company has reduced its estimate of Section 29/45K phase out from 75% at the end of the second quarter to 40% at the end of the third quarter. During the fiscal 2006 third quarter, REX completed the sale of seven retail store locations for a total of $6.8 million and recorded a $2.2 million pre-tax gain related to the real estate sale of which $0.5 million was related to continuing operations and $1.7 million ($1.1 million after-tax) was classified as discontinued operations. Net income in the three months ended October 31, 2006 was $4.8 million, or $0.42 per diluted share, compared to net income of $6.9 million, or $0.58 per diluted share, in the three months ended October 31, 2005. Per share results are based on 11,517,000 and 11,865,000 diluted weighted average shares outstanding for the three-month periods ended October 31, 2006 and 2005, respectively. -more- REX STORES REPORTS THIRD QUARTER RESULTS, 12/5/06 page 2 Net income in the nine-month period ended October 31, 2006 was $7.8 million, or $0.67 per diluted share, compared with net income of $21.7 million, or $1.76 per diluted share, in the nine-month period ended October 31, 2005. Per share results are based on 11,608,000 and 12,353,000 diluted weighted average shares outstanding for the nine-month periods ended October 31, 2006 and October 31, 2005, respectively. Net sales in the 2006 nine-month period were $251.5 million compared to $259.6 million in the nine months ended October 31, 2005. Comparable store sales in the first nine months of fiscal 2006 declined 0.7% compared to the same year-ago period. ETHANOL UPDATE REX recently received notification that all conditions had been met for the Company to fund its $16.0 million equity interest in Patriot Renewable Fuels LLC ("Patriot"). REX provided its funding on December 4, 2006. With funding obtained Patriot has commenced construction of a 100 million gallon per year ethanol production facility in Illinois. As previously announced, during the third fiscal quarter REX funded $11.5 million for Levelland/Hockley County Ethanol, LLC ("Levelland/Hockley"), a 40 million gallon per year ethanol production facility in Texas. The $11.5 million funding, along with REX's previously announced $5 million convertible secured promissory note commitment (expected to be funded by December 31, 2006), enables REX to secure a majority equity interest in the LLC that controls the facility. REX has an agreement, subject to certain conditions, to fund up to an additional $6.5 million in Levelland/Hockley to further increase its ownership. Effective in the fiscal 2006 third quarter REX has consolidated Levelland/Hockley with its financial statements. REX also funded $5 million during the fiscal third quarter in Big River Resources, LLC ("Big River") and has entered into an agreement to fund an additional $15 million in exchange for a minority equity interest in the entity. Through a holding company structure, Big River presently operates a 52 million gallon dry-mill ethanol manufacturing facility in Iowa. Big River intends to expand the plant to produce 80 million gallons per year and, through interests in other entities, intends to develop additional ethanol production plants. REX intends to fund $14 million in Millennium Ethanol, LLC ("Millennium") on or before April 1, 2007, for a convertible note that provides the Company rights to convert the note, with additional funds, into a minority ownership interest. Millennium has commenced construction of a 100 million gallon per year ethanol production facility in South Dakota. In addition to the four ethanol commitments described above, REX has entered into a contingent agreement to fund $24.9 million for One Earth Energy LLC, that intends to construct a 100 million gallon per year ethanol production facility in Illinois. The Company will host a conference call and webcast today at 11:00 a.m. EST, which are open to the general public. The conference call dial-in number is 212/346-6584; please call ten minutes in advance to ensure that you are connected prior to the presentation. Interested parties may also access the call live via the Investor Relations page of the Company's website, www.rextv.com, or at www.earnings.com; please allow 15 minutes to register, download and install any necessary software. -more- REX STORES REPORTS THIRD QUARTER RESULTS, 12/5/06 page 3 Following its completion, a telephonic replay of the call can be accessed through 12:30 p.m. EST on December 12, 2006 by dialing 800/633-8284 or 402/977-9140 (international callers). The access code for the audio replay is 21310853. Alternatively, a replay will be available on the Internet for 30 days at WWW.REXTV.COM or WWW.EARNINGS.COM. REX Stores Corporation is a leading specialty retailer of consumer electronic products and appliances. As of October 31, 2006, the Company operated 207 retail stores in 36 states under the trade name "REX." Over the past eight years, REX has also been active in several synthetic fuel investments and the Company currently has plans to participate in five proposed ethanol producing plants. This news announcement contains or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by use of forward-looking terminology such as "may," "expect," "believe," "estimate," "anticipate" or "continue" or the negative thereof or other variations thereon or comparable terminology. Readers are cautioned that there are risks and uncertainties that could cause actual events or results to differ materially from those referred to in such forward-looking statements. These risks and uncertainties include the risk factors set forth from time to time in the Company's filings with the Securities and Exchange Commission and among other things: the highly competitive nature of the consumer electronics retailing industry, changes in the national or regional economies, weather, the effects of terrorism or acts of war on consumer spending patterns, the availability of certain products, technological changes, changes in real estate market conditions, new regulatory restrictions or tax law changes relating to the Company's synthetic fuel investments, the fluctuating amount of quarterly payments received by the Company with respect to sales of its partnership interest in a synthetic fuel investment, the potential for Section 29/45K tax credits to phase out based on the price of crude oil adjusted for inflation, and the uncertain amount of synthetic fuel production and resulting income received from time to time from the Company's synthetic fuel investments. As it relates to ethanol investments, risks and uncertainties include among other things: the uncertainty of constructing plants on time and on budget and the price volatility of corn, dried distiller grains, ethanol, gasoline and natural gas. -tables follow- REX STORES REPORTS THIRD QUARTER RESULTS, 12/5/06 page 4 REX STORES CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED)
Three Months Ended Nine Months Ended October 31 October 31 ---------- ---------- 2006 2005 2006 2005 ---- ---- ---- ---- NET SALES AND REVENUE $ 85,215 $ 91,759 $ 251,495 $ 259,553 Cost of sales 62,702 66,380 182,722 186,132 ------ ------ ------- ------- Gross profit 22,513 25,379 68,773 73,421 Selling, general and administrative expenses 23,284 24,102 68,485 69,578 ------ ------ ------ ------ OPERATING (LOSS) INCOME (771) 1,277 288 3,843 INVESTMENT INCOME 341 23 920 155 INTEREST EXPENSE (562) (664) (1,549) (1,946) GAIN ON SALE OF REAL ESTATE 462 253 2,197 253 INCOME FROM SYNTHETIC FUEL INVESTMENTS 5,865 8,433 8,650 24,813 ------ ------ ------ ------ Income from continuing operations before provision for income taxes and discontinued operations 5,335 9,322 10,506 27,118 PROVISION FOR INCOME TAXES 1,713 2,251 3,627 4,992 ----- ----- ----- ----- Income from continuing operations 3,622 7,071 6,879 22,126 Income (loss) from discontinued operations, net of tax 103 (189) (168) (548) Gain on disposal of discontinued operations, net of tax 1,090 -- 1,090 125 ------ ------ ------ ------ NET INCOME $4,815 $6,882 $7,801 $21,703 ====== ====== ====== ======= WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC 10,333 10,532 10,268 10,850 ====== ====== ====== ====== Basic income per share from continuing operations $0.35 $0.67 $0.67 $2.04 Basic income (loss) per share from discontinued operations 0.01 (0.02) (0.02) (0.05) Basic income per share on disposal of discontinued operations 0.11 -- 0.11 0.01 ------ ------ ------ ------ BASIC NET INCOME PER SHARE $0.47 $0.65 $0.76 $2.00 ===== ===== ===== ===== WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED 11,517 11,865 11,608 12,353 ====== ====== ====== ====== Diluted income per share from continuing operations $0.31 $0.60 $0.59 $1.79 Diluted income (loss) per share from discontinued operations 0.01 (0.02) (0.01) (0.04) Diluted income per share on disposal of discontinued operations 0.10 -- 0.09 0.01 ------ ------ ------ ------ DILUTED NET INCOME PER SHARE $0.42 $0.58 $0.67 $1.76 ====== ====== ====== ======
-more- REX STORES REPORTS THIRD QUARTER RESULTS, 12/5/06 page 5 REX STORES CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS) (UNAUDITED)
October 31 January 31 October 31 2006 2006 2005 ---- ---- ---- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 15,923 $ 21,363 $ 1,254 Accounts receivable, net 3,757 3,457 4,460 Synthetic fuel receivable 7,592 1,680 2,930 Merchandise inventory 116,065 97,371 135,220 Prepaid expenses and other 1,655 2,052 1,555 Future income tax benefits 9,588 9,361 10,929 --------- --------- -------- Total current assets 154,580 135,284 156,348 PROPERTY AND EQUIPMENT, NET 121,846 125,245 127,626 ASSETS HELD FOR SALE 1,497 1,497 1,669 OTHER ASSETS 7,919 760 823 FUTURE INCOME TAX BENEFITS 28,397 30,031 27,978 INVESTMENTS 5,000 -- -- RESTRICTED INVESTMENTS 2,384 2,318 2,300 --------- --------- -------- Total assets $ 321,623 $ 295,135 $316,744 ========= ========= ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term debt $2,354 $2,389 $2,958 Current portion of deferred income and deferred gain on sale and leaseback 11,176 10,883 10,609 Accounts payable, trade 23,153 20,396 38,919 Accrued income taxes 1,587 541 418 Accrued payroll and related items 4,302 7,183 5,777 Other current liabilities 6,300 5,863 6,596 --------- --------- -------- Total current liabilities 48,872 47,255 65,277 --------- --------- -------- LONG-TERM LIABILITIES: Long-term mortgage debt 21,454 21,462 27,774 Deferred income and deferred gain on sale and leaseback 13,106 12,213 11,349 --------- --------- -------- Total long-term liabilities 34,560 33,675 39,123 --------- --------- -------- MINORITY INTEREST 12,119 -- -- --------- --------- -------- SHAREHOLDERS' EQUITY: Common stock 295 294 293 Paid-in capital 138,700 135,775 134,985 Retained earnings 248,699 240,898 234,332 Treasury stock (161,622) (162,762) (157,266) --------- --------- -------- Total shareholders' equity 226,072 214,205 212,344 --------- --------- -------- Total liabilities and shareholders' equity $ 321,623 $ 295,135 $316,744 ========= ========= ========
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