EX-99.1 2 g91779exv99w1.htm EX-99.1 NOVEMBER 4, 2004 PRESS RELEASE Ex-99.1 November 4, 2004 Press Release
 

Exhibit 99.1

     
(CATALINA MARKETING LOGO)
  NEWS

INVESTOR CONTACT:
Christopher W. Wolf
Chief Financial Officer
(727) 579-5218

Joanne Freiberger
Vice President, Finance
(727) 579-5116

MEDIA CONTACT:
Rachel Keener
Corporate Communications Manager
(727) 579-5224

Catalina Marketing Reports Financial Results
For Second Quarter of Fiscal 2005

ST. PETERSBURG, Fla., November 4, 2004 — Catalina Marketing Corporation (NYSE: POS) today reported financial results for its second fiscal quarter and first six months ended September 30, 2004.

For the three months ended September 30, 2004, consolidated revenues were $103.7 million, compared with revenues of $107.7 million in the comparable period last year. The company reported consolidated net income of $20.3 million, or $0.39 per diluted share, for the second quarter of fiscal 2005, compared with a net loss of $11.1 million, or a loss of $0.21 per diluted share, for the second quarter of fiscal 2004.

On a pro forma non-GAAP basis (which excludes the results of businesses that have either been disposed of or the disposition of which is planned, as well as the removal of the one-time deferral of revenues resulting from the prior years’ revenue recognition adjustments to Catalina Health Resource (CHR), as described further below), consolidated revenues were $102.4 million for the three months ended September 30, 2004, compared with $100.3 million of revenues for the same period last year. Pro forma non-GAAP consolidated net income was $18.9 million, or $0.36 per diluted share, for the three months ended September 30, 2004, compared with $14.2 million of net income, or $0.27 per diluted share, for the same period last year.

For the six months ended September 30, 2004, consolidated revenues were $200.5 million, compared with revenues of $194.3 million in the comparable period last year. The company

 


 

reported consolidated net income of $31.2 million, or $0.60 per diluted share, for the first half of fiscal 2005, compared with a net loss of $6.8 million, or a loss of $0.13 per diluted share, for the first half of fiscal 2004.

On a pro forma non-GAAP basis, consolidated revenues were $197.8 million for the six months ended September 30, 2004, compared with $182.1 million of revenues for the same period last year. Pro forma non-GAAP consolidated net income was $32.2 million, or $0.62 per diluted share, for the six months ended September 30, 2004, compared with $18.7 million of net income, or $0.36 per diluted share, for the same period last year.

Dick Buell, Catalina president and chief executive officer stated, “The results achieved in the second quarter were encouraging, and they reinforce our belief that our strategy to focus on proprietary applications at the point of sale is key to our long-term growth and vitality. Our plans have been formulated and as reflected in the accomplishments achieved to date, we believe these results demonstrate that the company has taken the necessary steps to develop a foundation for the future.”

Pro Forma Non-GAAP Adjustments

This pro forma non-GAAP financial information includes the results of the company’s ongoing business operations and, accordingly, excludes (i) the effect of CHR revenues recognized in fiscal 2004 that had been deferred from prior fiscal years, (ii) the financial results of the business units that have been divested, and (iii) the financial results of the remaining business unit targeted for divestiture by the company. In the second quarter of fiscal 2005, Catalina Marketing sold its Japan Billboard business and its Direct Marketing Services unit and has reported their aggregated results as ‘Discontinued Operations’ on the income statement. The company has also previously announced its intention to divest Catalina Marketing Research Solutions (CMRS). Investors are urged to review the Form 10-Q for a detailed discussion of the financial results and business descriptions.

 


 

Summary of Segment Results

                                 
    Three Months Ended   Three Months Ended
    September 30, 2004   September 30, 2003
(In thousands)   Revenues   Income/Loss   Revenues   Income/Loss
Catalina Marketing Services
  $ 66,070     $ 18,896     $ 71,427     $ 18,870  
Catalina Health Resource
    19,181       2,774       15,153       (146 )
International
    16,891       2,073       13,633       1,083  
Corp / Eliminations
    230       (4,890 )     114       (5,641 )
 
   
 
     
 
     
 
     
 
 
Total Pro Forma Non-GAAP
  $ 102,372     $ 18,853     $ 100,327     $ 14,166  
 
   
 
     
 
     
 
     
 
 
Discontinued Operations
  $     $ 3,543     $     $ (27,648 )
CMRS
    1,345       (2,117 )     3,354       92  
Catalina Health Resource Adj.
                3,995       2,279  
 
   
 
     
 
     
 
     
 
 
Total Pro Forma Adjustment
  $ 1,345     $ 1,426     $ 7,349     $ (25,277 )
 
   
 
     
 
     
 
     
 
 
Consolidated GAAP
  $ 103,717     $ 20,279     $ 107,676     $ (11,111 )
 
   
 
     
 
     
 
     
 
 
                                 
    Six Months Ended   Six Months Ended
    September 30, 2004   September 30, 2003
(In thousands)   Revenues   Income/Loss   Revenues   Income/Loss
Catalina Marketing Services
  $ 129,468     $ 35,029     $ 131,026     $ 31,706  
Catalina Health Resource
    37,046       3,848       28,572       (2,810 )
International
    31,138       2,874       22,744       (63 )
Corp / Eliminations
    122       (9,535 )     (197 )     (10,093 )
 
   
 
     
 
     
 
     
 
 
Total Pro Forma Non-GAAP
  $ 197,774     $ 32,216     $ 182,145     $ 18,740  
 
   
 
     
 
     
 
     
 
 
Discontinued Operations
  $     $ 1,543     $     $ (28,131 )
Cumulative Effect of Accounting Change
                            (770 )
CMRS
    2,727       (2,554 )     7,121       367  
Catalina Health Resource Adj.
                5,042       2,946  
 
   
 
     
 
     
 
     
 
 
Total Pro Forma Adjustment
  $ 2,727     $ (1,011 )   $ 12,163     $ (25,588 )
 
   
 
     
 
     
 
     
 
 
Consolidated GAAP
  $ 200,501     $ 31,205     $ 194,308     $ (6,848 )
 
   
 
     
 
     
 
     
 
 

Review of Operations

The company provided the following review and highlights of the performance of Catalina Marketing’s continuing business segments:

  Catalina Marketing Services – CMS revenues were $66.1 million in the quarter ended September 30, 2004, compared with $71.4 million in the same period last year. Net income for the second fiscal quarter was $18.9 million, or $0.36 per diluted share, in both fiscal 2005 and fiscal 2004. For the first six months of fiscal 2005, CMS revenues were $129.5 million and net income was $35.0 million, compared with revenues and net income of $131.0 million and $31.7 million, respectively, in the first six months of fiscal 2004. Earnings were $0.67 and $0.61 per diluted share in the six months ended September 30, 2004 and 2003, respectively.

 


 

  Catalina Health Resources – CHR revenues were $19.2 million and net income was $2.8 million, or $0.05 per diluted share, for the quarter ended September 30, 2004, compared with revenues of $19.1 million and net income of $2.1 million, or $0.04 per diluted share, for the same period last year. On a pro forma non-GAAP basis, CHR revenues grew 26.6% to $19.2 million in the second quarter of the current fiscal year, compared with $15.2 million in the same period last year and pro forma non-GAAP net income was $2.8 million, or $0.05 per diluted share, compared with a loss of $0.1 million for the comparable prior year period. For the first six months of fiscal 2005, CHR revenues were $37.0 million resulting in net income of $3.8 million, or $0.07 per diluted share, compared with $33.6 million in revenues and $0.1 million in net income for the first six months of fiscal 2004. On a pro forma non-GAAP basis, fiscal year 2004 year-to-date revenues were $28.6 million with a net loss of $2.8 million, or a net loss of $0.05 per diluted share.
 
  Catalina Marketing International – CMI revenues increased 23.9% to $16.9 million in the quarter ended September 30, 2004, compared with $13.6 million in the same period last year. Net income for the quarter ended September 30, 2004 was $2.1 million, or $0.04 per diluted share, compared with $1.1 million, or $0.02 per diluted share, for the comparable prior year period. For the first six months of fiscal 2005, CMI revenues were $31.1 million resulting in net income of $2.9 million, or $0.05 per diluted share, compared with revenues of $22.7 million and a net loss of $0.1 million for the six months ended September 30, 2003.
 
  Catalina Marketing Research Solutions – CMRS second quarter revenues were $1.3 million compared with $3.4 million in the second quarter of fiscal 2004. During the second quarter of fiscal 2005, the company recorded an additional impairment expense related to goodwill and other tangible assets of $3.0 million. CMRS incurred a second quarter net loss of $2.1 million, or $0.04 per diluted share, compared with net income of $0.1 million in the comparable prior year period. For the six months ended September 30, 2004, CMRS revenues were $2.7 million compared with $7.1 million in fiscal 2004. The six-month net loss for CMRS totaled $2.6 million, or $0.05 per diluted share, compared with net income of $0.4 million, or $0.01 per diluted share, in the first six months of fiscal 2004.

The company’s disposition of its Direct Marketing Services unit and its Japan Billboard business during the second quarter of fiscal 2005 resulted in a net gain of $3.5 million from the operations and disposition of these assets. The aggregated results of these business units are reported in ‘Discontinued Operations’ on the income statement.

During the second quarter of fiscal year 2005, Catalina’s board of directors authorized $100 million

 


 

of funds to be available for the repurchase of the company’s common stock. This authorization replaced the $44 million unused portion of the $100 million repurchase program authorized by the board in July 2002. As of September 30, 2004, the company had not yet repurchased any of its stock during the current fiscal year.

Mr. Buell said, “We are pleased with the progress made in the second quarter. Several key steps were taken toward our objectives, and we are now focusing on the Catalina businesses in which we hold strategic advantages that will serve to generate long-term growth and profitability.”

Catalina Marketing said it plans to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, with the Securities and Exchange Commission next week. Investors are urged to review the Form 10-Q for a detailed discussion of the company’s financial results and business descriptions.

Webcast Scheduled

The company also announced that it will host a webcast on Thursday, November 4, 2004; at 10:00 a.m. EST to discuss its financial results. The webcast may be accessed at www.corporate-ir.net/ireye/ir_site.zhtml?ticker=POS&script=1010&item_id=946944, and will be available for replay from November 4, 2004 through Monday, December 6, 2004.

 


 

Catalina Marketing Corporation
Selected Financial Data
(in thousands, except per share amounts)

                                 
    GAAP
    Three Months   Six Months
Periods Ended September 30   2004   2003   2004   2003
Revenues
  $ 103,717     $ 107,676     $ 200,501     $ 194,308  
Direct Operating Expenses
    32,713       35,991       67,600       70,692  
Selling, General and Administrative
    29,331       31,298       59,086       63,374  
Impairment Charge
    3,298             3,298        
Depreciation and Amortization
    10,698       11,174       22,337       22,533  
 
   
 
     
 
     
 
     
 
 
Income from Operations
    27,677       29,213       48,180       37,709  
Other (Income) Expense
    (126 )     211       267       (38 )
Provision for Income Taxes
    11,067       12,465       18,251       15,694  
 
   
 
     
 
     
 
     
 
 
Income from Continuing Operations
    16,736       16,537       29,662       22,053  
Gain (Loss) from Discontinued Operations
    260       (27,648 )     (1,740 )     (28,131 )
Gain (Loss) from Disposition
    3,283             3,283        
 
   
 
     
 
     
 
     
 
 
Income (Loss) from Discontinued Operations
    3,543       (27,648 )     1,543       (28,131 )
Cumulative effect of acctg change
                      (770 )
 
   
 
     
 
     
 
     
 
 
Net Income (Loss)
  $ 20,279     $ (11,111 )   $ 31,205     $ (6,848 )
 
   
 
     
 
     
 
     
 
 
Earnings Per Share, Basic:
                               
Earnings Per Share from Continuing Operations
  $ 0.32     $ 0.32     $ 0.57     $ 0.43  
Income (Loss) from Discontinued Operations
  $ 0.07     $ (0.53 )   $ 0.03     $ (0.54 )
Cumulative Effect of Accounting Change
  $     $     $     $ (0.02 )
 
   
 
     
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.39     $ (0.21 )   $ 0.60     $ (0.13 )
Weighted Average Shares Outstanding
    52,231       52,217       52,233       52,375  
Earnings Per Share, Diluted:
                               
Earnings Per Share from Continuing Operations
  $ 0.32     $ 0.32     $ 0.57     $ 0.43  
Income (Loss) from Discontinued Operations
  $ 0.07     $ (0.53 )   $ 0.03     $ (0.54 )
Cumulative Effect of Accounting Change
  $     $     $     $ (0.02 )
 
   
 
     
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.39     $ (0.21 )   $ 0.60     $ (0.13 )
Weighted Average Shares Outstanding
    52,311       52,217       52,269       52,375  

 


 

Catalina Marketing Corporation
Selected Financial Data
(in thousands, except per share amounts)

                                 
    Pro Forma Non-GAAP
    Three Months   Six Months
Periods Ended September 30   2004   2003   2004   2003
Revenues
  $ 102,372     $ 100,327     $ 197,774     $ 182,145  
Direct Operating Expenses
    31,727       34,270       65,515       67,201  
Selling, General and Administrative
    28,516       29,931       57,339       60,576  
Impairment Charge
    288             288        
Depreciation and Amortization
    10,606       11,066       22,158       22,321  
 
   
 
     
 
     
 
     
 
 
Income from Operations
    31,235       25,060       52,474       32,047  
Other (Income) Expense
    (126 )     211       268       (38 )
Provision for Income Taxes
    12,508       10,683       19,990       13,345  
 
   
 
     
 
     
 
     
 
 
Income from Continuing Operations
    18,853       14,166       32,216       18,740  
Gain (Loss) from Discontinued Operations
                       
Gain (Loss) from Disposition
                       
 
   
 
     
 
     
 
     
 
 
Income (Loss) from Discontinued Operations
                       
 
   
 
     
 
     
 
     
 
 
Net Income (Loss)
  $ 18,853     $ 14,166     $ 32,216     $ 18,740  
 
   
 
     
 
     
 
     
 
 
Earnings Per Share, Basic:
                               
Earnings Per Share from Continuing Operations
  $ 0.36     $ 0.27     $ 0.62     $ 0.36  
Income (Loss) from Discontinued Operations
  $     $     $     $  
 
   
 
     
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.36     $ 0.27     $ 0.62     $ 0.36  
Weighted Average Shares Outstanding
    52,231       52,217       52,233       52,375  
Earnings Per Share, Diluted:
                               
Earnings Per Share from Continuing Operations
  $ 0.36     $ 0.27     $ 0.62     $ 0.36  
Income (Loss) from Discontinued Operations
  $     $     $     $  
 
   
 
     
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.36     $ 0.27     $ 0.62     $ 0.36  
Weighted Average Shares Outstanding
    52,311       52,217       52,269       52,375  

 


 

Catalina Marketing Corporation
Selected Other Data
(in thousands, except store data)

                 
    September 30   September 30
    2004   2003
    GAAP   GAAP
Balance Sheet and Cash Flow (in thousands):
               
Cash
  $ 97,345     $ 9,165  
Stockholders’ Equity
  $ 200,126     $ 197,113  
Cash Flows from Operating Activities Qtr / YTD
  $ 40,603 / $42,469     $ 37,162 / $54,441  
Catalina Marketing Services:
               
Number of Stores at Quarter End
    17,644       17,581  
Net Stores Installed During Quarter / YTD
    37 / 40       12 / 83  
Promotions Printed During Quarter / YTD (in millions)
    846 / 1,584       813 / 1,457  
Weekly Shopper Reach at Quarter End (in millions)
    216       209  
Catalina Health Resource:
               
Number of Stores at Quarter End
    12,081       15,338  
Net Stores Installed During Quarter / YTD
    72 / 152       76 / (2,489 )
Catalina Marketing International:
               
Number of Stores at Quarter End
    5,598       4,517  
Net Stores Installed During Quarter / YTD
    101 / 154       1,066 / 1,514  
Promotions Printed During Quarter / YTD (in millions)
    220 / 411       212 / 349  
Weekly Shopper Reach at Quarter End (in millions)
    63       59  

 


 

Catalina Marketing Corporation
Reconciliation of GAAP to Pro Forma Non-GAAP Net Income (1)
(in thousands, except per share amounts)

                         
            Non-GAAP Pro    
            Forma   Non-GAAP
Three Months Ended September 30, 2004   GAAP
  Adjustments
  Pro Forma
Revenues
  $ 103,717     $ (1,345 )   $ 102,372  
Direct Operating Expenses
    32,713       (986 )     31,727  
Selling, General and Administrative
    29,331       (815 )     28,516  
Impairment Charge
    3,298       (3,010 )     288  
Depreciation and Amortization
    10,698       (92 )     10,606  
 
   
 
     
 
     
 
 
Income from Operations
    27,677       3,558       31,235  
Other (Income) Expense
    (126 )           (126 )
Provision for Income Taxes
    11,067       1,441       12,508  
 
   
 
     
 
     
 
 
Income from Continuing Operations
    16,736       2,117       18,853  
Gain (Loss) from Discontinued Operations
    260       (260 )      
Gain (Loss) from Disposition
    3,283       (3,283 )      
 
   
 
     
 
     
 
 
Income (Loss) from Discontinued Operations
    3,543       (3,543 )      
 
   
 
     
 
     
 
 
Net Income (Loss)
  $ 20,279     $ (1,426 )   $ 18,853  
 
   
 
     
 
     
 
 
Earnings Per Share, Basic:
                       
Earnings Per Share from Continuing Operations
  $ 0.32     $ 0.04     $ 0.36  
Income (Loss) from Discontinued Operations
  $ 0.07     $ (0.07 )   $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.39     $ (0.03 )   $ 0.36  
Weighted Average Shares Outstanding
    52,231               52,231  
Earnings Per Share, Diluted:
                       
Earnings Per Share from Continuing Operations
  $ 0.32     $ 0.04     $ 0.36  
Income (Loss) from Discontinued Operations
  $ 0.07     $ (0.07 )   $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.39     $ (0.03 )   $ 0.36  
Weighted Average Shares Outstanding
    52,311               52,311  

(1) The non-GAAP pro forma net income results are a supplement to the financial data provided that is based on generally accepted accounting principles (GAAP). These non-GAAP pro forma results reflect adjustments primarily to exclude from operating results the financial statement information for business units that have been identified for divestiture or disposal and as such are not viewed by the company as part of the ongoing business. The company believes this presentation provides useful information to investors because it assists investors in better understanding the company’s operations for the period. It should be emphasized, however, that these measurements are not a substitution for GAAP-based financial statements.

 


 

Catalina Marketing Corporation
Reconciliation of GAAP to Pro Forma Non-GAAP Net Income (1)
(in thousands, except per share amounts)

                         
            Non-GAAP Pro    
            Forma   Non-GAAP
Six Months Ended September 30, 2004   GAAP
  Adjustments
  Pro Forma
Revenues
  $ 200,501     $ (2,727 )   $ 197,774  
Direct Operating Expenses
    67,600       (2,085 )     65,515  
Selling, General and Administrative
    59,086       (1,747 )     57,339  
Impairment Charge
    3,298       (3,010 )     288  
Depreciation and Amortization
    22,337       (179 )     22,158  
 
   
 
     
 
     
 
 
Income from Operations
    48,180       4,294       52,474  
Other (Income) Expense
    267       1       268  
Provision for Income Taxes
    18,251       1,739       19,990  
 
   
 
     
 
     
 
 
Income from Continuing Operations
    29,662       2,554       32,216  
Gain (Loss) from Discontinued Operations
    (1,740 )     1,740        
Gain (Loss) from Disposition
    3,283       (3,283 )      
 
   
 
     
 
     
 
 
Income (Loss) from Discontinued Operations
    1,543       (1,543 )      
 
   
 
     
 
     
 
 
Net Income (Loss)
  $ 31,205     $ 1,011     $ 32,216  
 
   
 
     
 
     
 
 
Earnings Per Share, Basic:
                       
Earnings Per Share from Continuing Operations
  $ 0.57     $ 0.05     $ 0.62  
Income (Loss) from Discontinued Operations
  $ 0.03     $ (0.03 )   $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.60     $ 0.02     $ 0.62  
Weighted Average Shares Outstanding
    52,233               52,233  
Earnings Per Share, Diluted:
                       
Earnings Per Share from Continuing Operations
  $ 0.57     $ 0.05     $ 0.62  
Income (Loss) from Discontinued Operations
  $ 0.03     $ (0.03 )   $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ 0.60     $ 0.02     $ 0.62  
Weighted Average Shares Outstanding
    52,269               52,269  

(1) The non-GAAP pro forma net income results are a supplement to the financial data provided that is based on generally accepted accounting principles (GAAP). These non-GAAP pro forma results reflect adjustments primarily to exclude from operating results the financial statement information for business units that have been identified for divestiture or disposal and as such are not viewed by the company as part of the ongoing business. The company believes this presentation provides useful information to investors because it assists investors in better understanding the company’s operations for the period. It should be emphasized, however, that these measurements are not a substitution for GAAP-based financial statements.

 


 

Catalina Marketing Corporation
Reconciliation of GAAP to Pro Forma Non-GAAP Net Income (1)
(in thousands, except per share amounts)

                         
            Non-GAAP Pro    
            Forma   Non-GAAP
Three Months Ended September 30, 2003   GAAP
  Adjustments
  Pro Forma
Revenues
  $ 107,676     $ (7,349 )   $ 100,327  
Direct Operating Expenses
    35,991       (1,721 )     34,270  
Selling, General and Administrative
    31,298       (1,367 )     29,931  
Depreciation and Amortization
    11,174       (108 )     11,066  
 
   
 
     
 
     
 
 
Income from Operations
    29,213       (4,153 )     25,060  
Other (Income) Expense
    211             211  
Provision for Income Taxes
    12,465       (1,782 )     10,683  
 
   
 
     
 
     
 
 
Income from Continuing Operations
    16,537       (2,371 )     14,166  
Gain (Loss) from Discontinued Operations
    (27,648 )     27,648        
Gain (Loss) from Disposition
                 
 
   
 
     
 
     
 
 
Income (Loss) from Discontinued Operations
    (27,648 )     27,648        
 
   
 
     
 
     
 
 
Net Income (Loss)
  $ (11,111 )   $ 25,277     $ 14,166  
 
   
 
     
 
     
 
 
Earnings Per Share, Basic:
                       
Earnings Per Share from Continuing Operations
  $ 0.32     $ (0.05 )   $ 0.27  
Income (Loss) from Discontinued Operations
  $ (0.53 )   $ 0.53     $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ (0.21 )   $ 0.48     $ 0.27  
Weighted Average Shares Outstanding
    52,217               52,217  
Earnings Per Share, Diluted:
                       
Earnings Per Share from Continuing Operations
  $ 0.32     $ (0.05 )   $ 0.27  
Income (Loss) from Discontinued Operations
  $ (0.53 )   $ 0.53     $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ (0.21 )   $ 0.48     $ 0.27  
Weighted Average Shares Outstanding
    52,217               52,217  

(1) The non-GAAP pro forma net income results are a supplement to the financial data provided that is based on generally accepted accounting principles (GAAP). These non-GAAP pro forma results reflect adjustments primarily to exclude from operating results the financial statement information for business units that have been identified for divestiture or disposal and as such are not viewed by the company as part of the ongoing business and the removal of the 2003 one-time deferral of revenues resulting from the prior year’s revenue recognition adjustments to Catalina Health Resource. The company believes this presentation provides useful information to investors because it assists investors in better understanding the company’s operations for the period. It should be emphasized, however, that these measurements are not a substitution for GAAP-based financial statements.

 


 

Catalina Marketing Corporation
Reconciliation of GAAP to Pro Forma Non-GAAP Net Income (1)
(in thousands, except per share amounts)

                         
            Non-GAAP Pro    
            Forma   Non-GAAP
Six Months Ended September 30, 2003   GAAP
  Adjustments
  Pro Forma
Revenues
  $ 194,308     $ (12,163 )   $ 182,145  
Direct Operating Expenses
    70,692       (3,491 )     67,201  
Selling, General and Administrative
    63,374       (2,798 )     60,576  
Depreciation and Amortization
    22,533       (212 )     22,321  
 
   
 
     
 
     
 
 
Income from Operations
    37,709       (5,662 )     32,047  
Other (Income) Expense
    (38 )           (38 )
Provision for Income Taxes
    15,694       (2,349 )     13,345  
 
   
 
     
 
     
 
 
Income from Continuing Operations
    22,053       (3,314 )     18,740  
Gain (Loss) from Discontinued Operations
    (28,131 )     28,131        
Gain (Loss) from Disposition
                 
 
   
 
     
 
     
 
 
Income (Loss) from Discontinued Operations
    (28,131 )     28,131        
Cumulative effect of acctg change
    (770 )     770        
 
   
 
     
 
     
 
 
Net Income (Loss)
  $ (6,848 )   $ 25,588     $ 18,740  
 
   
 
     
 
     
 
 
Earnings Per Share, Basic:
                       
Earnings Per Share from Continuing Operations
  $ 0.43     $ (0.07 )   $ 0.36  
Income (Loss) from Discontinued Operations
  $ (0.54 )   $ 0.54     $  
Cumulative effect of acctg change
  $ (0.02 )   $ 0.02     $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ (0.13 )   $ 0.49     $ 0.36  
Weighted Average Shares Outstanding
    52,375               52,375  
Earnings Per Share, Diluted:
                       
Earnings Per Share from Continuing Operations
  $ 0.43     $ (0.07 )   $ 0.36  
Income (Loss) from Discontinued Operations
  $ (0.54 )   $ 0.54     $  
Cumulative effect of acctg change
  $ (0.02 )   $ 0.02     $  
 
   
 
     
 
     
 
 
Net Income (Loss) Per Common Share
  $ (0.13 )   $ 0.49     $ 0.36  
Weighted Average Shares Outstanding
    52,375               52,375  

(1) The non-GAAP pro forma net income results are a supplement to the financial data provided that is based on generally accepted accounting principles (GAAP). These non-GAAP pro forma results reflect adjustments primarily to exclude from operating results the financial statement information for business units that have been identified for divestiture or disposal and as such are not viewed by the company as part of the ongoing business and the removal of the 2003 one-time deferral of revenues resulting from the prior year’s revenue recognition adjustments to Catalina Health Resource. The company believes this presentation provides useful information to investors because it assists investors in better understanding the company’s operations for the period. It should be emphasized, however, that these measurements are not a substitution for GAAP-based financial statements.

 


 

Based in St. Petersburg, FL, Catalina Marketing Corporation (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.

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