-----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, Lmj/NUQOVtfw8mF44VmLD4piksIvCFqzUM6Y4IFZQQ4sqfO9voPBriEoGKCZ2dOk JSHA2Dc5o8UBauIznwhSJQ== 0001068800-05-000095.txt : 20050214 0001068800-05-000095.hdr.sgml : 20050214 20050214143103 ACCESSION NUMBER: 0001068800-05-000095 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050214 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20050214 DATE AS OF CHANGE: 20050214 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENVEO, INC CENTRAL INDEX KEY: 0000920321 STANDARD INDUSTRIAL CLASSIFICATION: CONVERTED PAPER & PAPERBOARD PRODS (NO CONTAINERS/BOXES) [2670] IRS NUMBER: 841250533 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12551 FILM NUMBER: 05607823 BUSINESS ADDRESS: STREET 1: 8310 S VALLEY HWY #400 CITY: ENGLEWOOD STATE: CO ZIP: 80112 BUSINESS PHONE: 3037908023 MAIL ADDRESS: STREET 1: 8310 S VALLEY HWY #400 CITY: ENGLEWOOD STATE: CO ZIP: 80112 FORMER COMPANY: FORMER CONFORMED NAME: MAIL WELL INC DATE OF NAME CHANGE: 19950817 FORMER COMPANY: FORMER CONFORMED NAME: MAIL WELL HOLDINGS INC DATE OF NAME CHANGE: 19940328 8-K 1 pr8k.txt UNITED STATES 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): February 14, 2005 ------------------------ CENVEO, INC. (Exact name of registrant as specified in its charter) COLORADO 1-12551 4-1250533 (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) ------------------------ 8310 S. VALLEY HWY. #400 ENGLEWOOD, CO (Address of principal executive offices) 80112 (Zip Code) ------------------------ Registrant's telephone number, including area code: (303) 790-8023 ------------------------ NOT APPLICABLE (Former name or former address, if changed since last report) 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. Please see the company's press release dated February 14, 2005 attached hereto as Exhibit 99.1. The foregoing information is intended to be furnished under Item 2.02 "Results of Operations and Financial Condition" in accordance with Securities and Exchange Commission Release No. 33-8400. Such information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933. 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 Cenveo, Inc. ------------ (Registrant) By: /s/ Michel P. Salbaing -------------------------------- Michel P. Salbaing Sr. Vice President and CFO Date: February 14, 2005 EX-99.1 2 ex99p1.txt Exhibit 99.1 [CENVEO logo] For Immediate Release February 14, 2005 CENVEO ANNOUNCES FOURTH QUARTER RESULTS WHICH MEET REVISED GUIDANCE ENGLEWOOD, COLO. (FEBRUARY 14, 2005) -- Cenveo, Inc., (NYSE: CVO) announced its results for the quarter and the year ended December 31, 2004. Net loss in the quarter was $3.6 million, or $0.08 per share, and for the year the net loss was $19.7 million, or $0.41 per share. Sales were $482 million in the quarter and $1,743 million for the year ended December 31, 2004. Last year in the fourth quarter, the net income was $2.5 million or $0.05 per share, on $424 million of sales and for the twelve months ended December 31, 2003, net income was $5.2 million, or $0.11 per share, on $1,672 million of sales. Sales in the quarter increased 13.5% as compared to the same period last year and on a full year basis, the company had growth of 4.3% in sales. Cenveo's net loss for the year ended December 31, 2004, included a first quarter charge for early extinguishment of debt of $17.7 million. EBITDA for the fourth quarter of 2004 was $34.3 million compared to EBITDA of $34.2 million achieved for the same period last year. For the year ended December 31, 2004, EBITDA was $128.6 million compared to $126.2 million for the same period last year, a 1.9% improvement. The revised guidance provided in December 2004 was a range of $126 million to $129 million of EBITDA. An explanation of the Company's use of EBITDA for comparative purposes is provided below. Net cash provided by operating activities in the quarter ended December 31, 2004 was $10 million compared to $26 million provided during the comparable period of 2003. Net cash provided by operating activities in 2004 was $24 million compared to $59 million provided during 2003. Paul Reilly, President and CEO, stated, "In the fourth quarter we continued to see increases in volumes of work. However, margins continued to be tight. We are taking measures to mitigate this situation. We will discuss guidance for 2005 during the conference call to be held later today." Cenveo will hold a conference call today, Monday February 14, 2005 at 1:00 p.m. Eastern Time (12 noon Central, 11:00 a.m. Mountain, 10:00 a.m. Pacific Time). To participate in the Cenveo conference call, please dial in to 1-888-639-6218 and provide conference ID 640016. Please call 5-7 minutes before the call is to begin. The conference call will also be available via webcast. To listen to the webcast, go to www.cenveo.com, www.streetevents.com, or www.fulldisclosure.com. INTERNATIONAL DIAL-IN: An operator will dial out to you. Contact Cenveo Investor Relations at 303-730-8023 or email: bea.rodriguez@cenveo.com no later than 1 hour prior to the call with your telephone information. - more - If you are unable to join the Cenveo conference call, you may access a replay of the call starting Monday, February 14, 2005 at 3:00 pm Eastern Time until Midnight Eastern Time, February 21, 2005. To access the replay, please dial 888-211-2648 and reference the conference ID 640016. EBITDA (earnings before interest, taxes, depreciation and amortization) should not be considered as an alternative to any measure of operating results as promulgated under accounting principles generally accepted (GAAP) in the United States (such as operating income or net income), nor should it be considered as an indicator of our overall financial performance. EBITDA does not fully consider the impact of investing or financing transactions as it specifically excludes depreciation and interest charges, which should also be considered in the overall evaluation of results. Additionally, our method of calculating EBITDA may be different from the method used by other companies and therefore comparability may be limited. EBITDA has not been provided as a measure of liquidity. The Supplemental Information to the press release includes the Company's Statement of Cash Flows. We use EBITDA as a supplemental measure of performance because we believe it gives the reader a more complete understanding of our operating results before the impact of investing and financing transactions. A reconciliation of net income (loss) under U.S. GAAP to EBITDA is presented in the Supplemental Information to this press release. ABOUT CENVEO Cenveo, Inc. (NYSE: CVO), www.cenveo.com, is one of North America's leading providers of visual communications with one-stop services from design through fulfillment. The company is uniquely positioned to serve both direct customers through its commercial segment, and distributors and resellers of printed office products through its Quality Park resale segment. The company's broad portfolio of services and products include e-services, envelopes, offset and digital printing, labels and business documents. Cenveo currently has approximately 10,000 employees and more than 80 production locations plus five advanced fulfillment and distribution centers throughout North America. In early 2004, Cenveo was voted second place in the printing and publishing category as Fortune Magazine's Most Admired Companies and ranked number five of the Russell 3000 companies on Corporate Governance Quotients by Institutional Shareholder Services. The company is headquartered in Englewood, Colorado. This press release may contain certain forward-looking statements of management. It should be understood that all such statements are subject to various uncertainties and risks that could affect their outcome. Factors which could cause or contribute to such differences include, but are not limited to, the ability to execute strategic initiatives, economic conditions, product demand and sales, ability to obtain assumed productivity and cost savings, interest rates, foreign currency exchange rates, paper and raw material costs and the ability to pass them through to customers, waste paper prices, postage rates, union relations, competition and competitors' actions, availability of financing, and changes in the direct mail industry. Please refer to the company's 10-K, 10-Q and other SEC filings for a more detailed discussion of the risks. None of management's statements in this release should be considered an offer to sell or a solicitation of an offer to buy Cenveo securities. CONTACT: Mr. Michel P. Salbaing Senior Vice President and Chief Financial Officer Cenveo, Inc. (303) 790-8023 # # # [CENVEO logo] FINANCIAL HIGHLIGHTS (in thousands, except per share data) (unaudited)
THREE MONTHS ENDED YEAR ENDED DECEMBER 31 DECEMBER 31 ----------- ----------- 2004 2003 2004 2003 CONSOLIDATED RESULTS - -------------------- Net sales $ 481,677 $ 424,300 $ 1,742,914 $ 1,671,664 Gross profit 92,838 89,624 349,393 334,546 Operating income 17,872 23,288 72,735 80,215 Income (loss) from continuing operations (3,598) 2,903 (20,938) 3,924 Loss (gain) on disposal of discontinued operations - 372 (1,230) (1,548) Cumulative effect of change in accounting principle - - - 322 - --------------------------------------------------------------------------------------------------------------------------- Net income (loss) $ (3,598) $ 2,531 $ (19,708) $ 5,150 Net income (loss) per share - assuming dilution $ (0.08) $ 0.05 $ (0.41) $ 0.11 - --------------------------------------------------------------------------------------------------------------------------- SEGMENT INFORMATION NET SALES: Commercial $ 370,982 $ 326,826 $ 1,329,778 $ 1,272,525 Resale 110,695 97,474 413,136 399,139 - --------------------------------------------------------------------------------------------------------------------------- Total $ 481,677 $ 424,300 $ 1,742,914 $ 1,671,664 OPERATING INCOME (EXPENSE): Commercial $ 12,257 $ 19,063 $ 50,538 $ 58,704 Resale 9,811 12,445 43,102 44,703 Corporate services and other charges (4,196) (8,220) (20,905) (23,192) - --------------------------------------------------------------------------------------------------------------------------- Total $ 17,872 $ 23,288 $ 72,735 $ 80,215 OPERATING INCOME MARGINS: Commercial 3.3% 5.8% 3.8% 4.6% Resale 8.9% 12.8% 10.4% 11.2% EBITDA (1): Commercial $ 26,209 $ 27,844 $ 95,844 $ 94,921 Resale 12,327 14,822 52,604 54,498 Corporate (4,257) (8,498) (19,801) (23,173) - --------------------------------------------------------------------------------------------------------------------------- Total $ 34,279 $ 34,168 $ 128,647 $ 126,246 - --------------------------------------------------------------------------------------------------------------------------- FINANCIAL POSITION DECEMBER 31, 2004 DECEMBER 31, 2003 Working capital $ 113,391 $ 102,773 Total assets 1,163,776 1,107,393 Total debt 769,769 748,961 Shareholders' equity 57,354 68,019 - --------------------------------------------------------------------------------------------------------------------------- (1) See Appendix 1 in the Supplemental Information to the Press Release for the definition of EBITDA, the reconciliation of net income to EBITDA and the reason why EBITDA is a relevant non-GAAP financial measure for Cenveo.
[CENVEO logo] Supplemental Information to the Press Release For the Quarter Ended December 31, 2004 Released February 14, 2005 [CENVEO logo] - ------------------------------------------------------------------------------------ Fourth Quarter Ended December 31, 2004
Page Financial and Operational Summary and Recent Developments 1, 2 - ------------------------------------------------------------------------------------ Consolidated Balance Sheets 3 - ------------------------------------------------------------------------------------ Consolidated Statements of Operations 4 - ------------------------------------------------------------------------------------ Consolidated Cash Flow Statements 5 - ------------------------------------------------------------------------------------ Segment Results 6 - ------------------------------------------------------------------------------------ Appendix 1 - Reconciliation of Net Income to EBITDA 7, 8 - ------------------------------------------------------------------------------------
Financial and Operational Summary and Recent Developments - ---------------------------------------------------------------------------- Three months ended December 31, 2004 Financial and Operational Summary - --------------------------------- CONSOLIDATED RESULTS: Net sales increased $57.4 million in the fourth quarter 2004 compared to net sales for the same period in 2003. Sales from acquisitions contributed $11.4 million in the period. Operating income decreased by $5.4 million in the fourth quarter as compared to operating income in fourth quarter of 2003. COMMERCIAL: Net sales in the fourth quarter of 2004 increased $44.2 million to $371.0 million compared to net sales of $326.8 million in the fourth quarter of 2003. RESALE: Net sales in the fourth quarter of 2004 increased by $13.2 million to $110.7 million compared to net sales of $97.5 million in the fourth quarter of 2003. DEBT: Net cash provided by operating activities was $10.5 million for the quarter and total debt increased by $0.2 million in the quarter. CAPITAL EXPENDITURES: During the quarter ended December 31, 2004, capital expenditures were $7.2 million compared to $11.9 million in the same period last year. AVAILABILITY: Credit available under our credit facility was $110.8 million based on the certificate filed on January 21,2005. Financial and Operational Summary and Recent Developments - ---------------------------------------------------------------------------- Three months ended December 31, 2004 Recent Developments - ------------------- o The Company announced on January 7, 2005 that Paul Reilly intends to resign as the Chairman, President and Chief Executive Officer of Cenveo. Mr. Reilly has agreed to remain as President and Chief Executive Officer to assist in the transition to his successor. o The Company announced on December 20, 2004 the launch of eCENergy, a web portal providing access to a suite of eSolutions designed to automate and streamline transactions with customers. Cenveo customers can securely login to their custom branded web portal, then choose from a menu of time-and cost-saving applications that currently includes an online print ordering and fulfillment system called eCatalog; soft and remote proofing; and digital asset management. o The Company announced on December 3, 2004 that its Los Angeles facility, Cenveo Anderson Lithograph, was awarded the Sappi 2004 International Printer of the Year Award. The winning entry was the Cadillac XLR 2004 brochure for General Motors. The Sappi International Printer award is one of the printing industry's most prestigious honors, and in April, Cenveo Anderson Lithograph was also named the North American Printer of the Year. CENVEO, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (unaudited)
DECEMBER 31 DECEMBER 31 (IN THOUSANDS) 2004 2003 ASSETS Current assets: Cash and cash equivalents $ 796 $ 307 Accounts receivable, net 252,711 223,541 Inventories, net 112,219 91,402 Other current assets 46,019 48,135 - ---------------------------------------------------------------------------------------------------------------------------- Total current assets 411,745 363,385 - ---------------------------------------------------------------------------------------------------------------------------- Property, plant and equipment, net 367,260 388,240 Goodwill 308,938 299,392 Other intangible assets, net 28,788 19,687 Other assets, net 47,045 36,689 - ---------------------------------------------------------------------------------------------------------------------------- TOTAL ASSETS $ 1,163,776 $ 1,107,393 - ---------------------------------------------------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 172,731 $ 140,468 Accrued compensation and related liabilities 58,639 53,209 Other current liabilities 64,714 64,360 Current maturities of long-term debt 2,270 2,575 - ---------------------------------------------------------------------------------------------------------------------------- Total current liabilities 298,354 260,612 - ---------------------------------------------------------------------------------------------------------------------------- Long-term debt, less current maturities 767,499 746,386 Deferred income taxes - 6,717 Other liabilities 40,569 25,659 - ---------------------------------------------------------------------------------------------------------------------------- Total liabilities 1,106,422 1,039,374 - ---------------------------------------------------------------------------------------------------------------------------- Shareholders' equity: Common stock 487 484 Paid-in capital 214,902 213,850 Retained deficit (170,039) (150,331) Deferred compensation (2,003) (1,714) Accumulated other comprehensive income 14,007 5,730 - ---------------------------------------------------------------------------------------------------------------------------- Total shareholders' equity 57,354 68,019 - ---------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,163,776 $ 1,107,393 - ----------------------------------------------------------------------------------------------------------------------------
CENVEO, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
THREE MONTHS ENDED YEAR ENDED DECEMBER 31 DECEMBER 31 (in thousands, except per share data) 2004 2003 2004 2003 Net sales $ 481,677 $ 424,300 $ 1,742,914 $ 1,671,664 Cost of sales 388,839 334,676 1,393,521 1,337,118 - ------------------------------------------------------------------------------------------------------------------------------ Gross profit 92,838 89,624 349,393 334,546 - ------------------------------------------------------------------------------------------------------------------------------ Operating expenses: Selling, general and administrative expenses 69,143 60,258 265,870 245,689 Amortization of intangibles 1,267 536 5,381 1,899 Settlement of litigation - 5,330 - 5,330 Restructuring, impairment charges and other 4,556 212 5,407 1,413 - ------------------------------------------------------------------------------------------------------------------------------ Operating income 17,872 23,288 72,735 80,215 - ------------------------------------------------------------------------------------------------------------------------------ Other expense: Interest expense 19,353 17,728 73,125 71,891 Loss on early extinguishment of debt - - 17,748 - Other 706 755 2,459 1,819 - ------------------------------------------------------------------------------------------------------------------------------ Income (loss) from continuing operations before income taxes and cumulative effect of a change in accounting principle (2,187) 4,805 (20,597) 6,505 Income tax expense 1,411 1,902 341 2,581 - ------------------------------------------------------------------------------------------------------------------------------ Income (loss) from continuing operations before cumulative effect of a change in accounting principle (3,598) 2,903 (20,938) 3,924 Loss (gain) on disposal of discontinued operations, net of taxes of $770 in 2004 - 372 (1,230) (1,548) Cumulative effect of a change in accounting principle - - - 322 - ------------------------------------------------------------------------------------------------------------------------------ Net income (loss) $ (3,598) $ 2,531 $ (19,708) $ 5,150 - ------------------------------------------------------------------------------------------------------------------------------ Earnings (loss) per share - basic and diluted: Continuing operations $ (0.08) $ 0.06 $ (0.44) $ 0.08 Discontinued operations - (0.01) 0.03 0.04 Cumulative effect of a change in accounting principle - - - (0.01) - ------------------------------------------------------------------------------------------------------------------------------ Earnings (loss) per share - diluted $ (0.08) $ 0.05 $ (0.41) $ 0.11 - ------------------------------------------------------------------------------------------------------------------------------ Weighted averages shares - basic 47,764 47,719 47,750 47,687 Weighted averages shares - diluted 47,764 48,540 47,750 48,315
CENVEO, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) YEAR ENDED DECEMBER 31 (in thousands) 2004 2003 Cash flows from operating activities: Income (loss) from continuing operations $ (20,938) $ 3,924 Adjustments to reconcile income (loss) from continuing operations to net cash provided by (used in) operating activities: Depreciation 47,602 46,069 Amortization 9,959 5,883 Asset impairments 3,228 - Write-off of deferred financing fees 4,220 - Deferred income tax benefit (12,536) (10,854) Loss on disposal of assets 686 1,221 Other noncash charges, net 198 435 Changes in operating assets and liabilities, excluding effects of acquired businesses: Accounts receivable (23,283) 3,414 Inventories (18,122) 14,647 Accounts payable and accrued compensation 32,784 (15,417) Income taxes payable (1,663) 12,212 Other working capital changes (711) (1,952) Other, net 3,039 (123) - ------------------------------------------------------------------------------------------------------------------------------- Net cash provided by operating activities 24,463 59,459 Cash flows from investing activities: Acquisitions, less cash acquired (13,174) (2,800) Capital expenditures (27,435) (31,602) Proceeds from divestitures, net 2,000 3,864 Proceeds from sales of property, plant and equipment 3,012 682 - ------------------------------------------------------------------------------------------------------------------------------- Net cash used in investing activities (35,597) (29,856) Cash flows from financing activities: Proceeds from long-term debt 2,724,655 1,915,452 Repayment of long-term debt (2,703,847) (1,948,299) Proceeds from the issuance of common stock 48 75 Capitalized loan fees (9,077) (484) - ------------------------------------------------------------------------------------------------------------------------------- Net cash provided by (used in) financing activities 11,779 (33,256) Effect of exchange rate changes on cash and cash equivalents (156) 1,310 - ------------------------------------------------------------------------------------------------------------------------------- Net increase (decrease) in cash and cash equivalents 489 (2,343) Cash and cash equivalents at beginning of year 307 2,650 - ------------------------------------------------------------------------------------------------------------------------------- Cash and cash equivalents at end of year $ 796 $ 307 - -------------------------------------------------------------------------------------------------------------------------------
CENVEO, INC. AND SUBSIDIARIES SEGMENT RESULTS (unaudited)
THREE MONTHS ENDED YEAR ENDED DECEMBER 31 DECEMBER 31 (in thousands) 2004 2003 2004 2003 Net sales: Commercial $ 370,982 $ 326,826 $ 1,329,778 $ 1,272,525 Resale 110,695 97,474 413,136 399,139 - ---------------------------------------------------------------------------------------------------------------------------- Total net sales $ 481,677 $ 424,300 $ 1,742,914 $ 1,671,664 - ---------------------------------------------------------------------------------------------------------------------------- Operating income (expense): Commercial $ 12,257 $ 19,063 $ 50,538 $ 58,704 Resale 9,811 12,445 43,102 44,703 Corporate services (4,196) (8,220) (20,905) (23,192) - ---------------------------------------------------------------------------------------------------------------------------- Total operating income $ 17,872 $ 23,288 $ 72,735 $ 80,215 - ---------------------------------------------------------------------------------------------------------------------------- EBITDA (1): Commercial $ 26,209 $ 27,844 $ 95,844 $ 94,921 Resale 12,327 14,822 52,604 54,498 Corporate services (4,257) (8,498) (19,801) (23,173) - ---------------------------------------------------------------------------------------------------------------------------- Total EBITDA $ 34,279 $ 34,168 $ 128,647 $ 126,246 - ---------------------------------------------------------------------------------------------------------------------------- Net sales by product line: Commercial printing $ 227,031 $ 197,219 $ 821,332 $ 777,638 Envelopes 203,523 178,189 719,465 693,929 Business forms and labels 51,123 48,892 202,117 200,096 - ---------------------------------------------------------------------------------------------------------------------------- Total net sales $ 481,677 $ 424,300 $ 1,742,914 $ 1,671,663 - ---------------------------------------------------------------------------------------------------------------------------- (1) See Appendix 1 in the Supplemental Information to the Press Release for the definition of EBITDA, the reconciliation of net income to EBITDA and the reason why EBITDA is a relevant non-GAAP financial measure for Cenveo.
APPENDIX 1 - RECONCILIATION OF NET INCOME TO EBITDA FOR THE THREE MONTHS ENDED DECEMBER 31, 2004 AND 2003 Cenveo, Inc. and Subsidiaries (in thousands) (unaudited)
FOR THE THREE MONTHS ENDED DECEMBER 31, 2004 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ 12,131 $ 9,836 $ (25,565) $ (3,598) Interest - - 19,353 19,353 Taxes - - 1,411 1,411 Depreciation 9,992 2,349 247 12,588 Amortization (excluding amortization included in interest) 1,155 142 - 1,297 Asset impairments recorded in the fourth quarter 2,931 - 297 3,228 - ----------------------------------------------------------------------------------------------------------------------------------- EBITDA $ 26,209 $ 12,327 $ (4,257) $ 34,279 FOR THE THREE MONTHS ENDED DECEMBER 31, 2003 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ 18,676 $ 12,365 $ (28,510) $ 2,531 Interest - - 17,728 17,728 Taxes - - 1,902 1,902 Depreciation 8,866 2,224 127 11,217 Amortization (excluding amortization included in interest) 302 233 - 535 Tax adjustment included in discontinued operations - - 372 372 Gain on asset held for sale - - (117) (117) - ----------------------------------------------------------------------------------------------------------------------------------- EBITDA $ 27,844 $ 14,822 $ (8,498) $ 34,168 Note: This schedule is a reconciliation of net income to EBITDA which we define as earnings before interest, taxes, depreciation and amortization and excluding asset impairments in 2004 and the tax adjustment included in discontinued operations and gain on assets held for sale in 2003. EBITDA should not be considered as an alternative to any measure of operating results as promulgated under accounting principles generally accepted in the United States (such as operating income or net income), nor should it be considered as an indicator of our overall financial performance. EBITDA does not fully consider the impact of investing or financing transactions as it specifically excludes depreciation and interest charges, which should also be considered in the overall evaluation of results. Additionally, our method of calculating EBITDA may be different from the method used by other companies, and therefore, comparability may be limited. EBITDA has not been provided as a measure of liquidity. EBITDA provides useful supplemental information to investors since it excludes the impact of investing or financing transactions on our operating results.
APPENDIX 1 - RECONCILIATION OF NET INCOME TO EBITDA FOR THE YEAR ENDED DECEMBER 31, 2004 AND 2003 CENVEO, INC. AND SUBSIDIARIES (in thousands) (unaudited)
FOR THE YEAR ENDED DECEMBER 31, 2004 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ 50,397 $ 43,030 $ (113,135) $ (19,708) Interest - - 73,125 73,125 Taxes, including taxes included in discontinued operations - - 1,111 1,111 Depreciation 37,753 9,027 822 47,602 Amortization (excluding amortization included in interest) 4,762 547 232 5,541 Loss on early extinguishment of debt - - 17,748 17,748 Asset impairments recorded in the fourth quarter 2,932 - 296 3,228 - ------------------------------------------------------------------------------------------------------------------------------------ EBITDA $ 95,844 $ 52,604 $ (19,801) $ 128,647 FOR THE YEAR ENDED DECEMBER 31,2003 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ 57,528 $ 44,456 $ (96,834) $ 5,150 Interest - - 71,891 71,891 Taxes - - 2,581 2,581 Depreciation 36,430 9,106 532 46,068 Amortization (excluding amortization included in interest) 963 936 - 1,899 Gain on asset held for sale - - (117) (117) Tax adjustment included in discontinued operations - - (1,548) (1,548) Cumulative effect of a change in accounting principle - - 322 322 - ------------------------------------------------------------------------------------------------------------------------------------ EBITDA $ 94,921 $ 54,498 $ (23,173) $ 126,246 Note: This schedule is a reconciliation of net income to EBITDA which we define as earnings before interest, taxes, depreciation and amortization and excluding asset impairments, the loss from the early extinguishment of debt and the income tax impact included in the gain on the disposal of discontinued operations recorded in 2004, and the tax adjustment reported as a gain on disposal of discontinued operations, gain on assets held for sale and the cumulative effect of a change in accounting principle in 2003. EBITDA should not be considered as an alternative to any measure of operating results as promulgated under accounting principles generally accepted in the United States (such as operating income or net income), nor should it be considered as an indicator of our overall financial performance. EBITDA does not fully consider the impact of investing or financing transactions as it specifically excludes depreciation and interest charges, which should also be considered in the overall evaluation of results. Additionally, our method of calculating EBITDA may be different from the method used by other companies, and therefore, comparability may be limited. EBITDA has not been provided as a measure of liquidity. We believe EBITDA provides useful supplemental information to investors since it excludes the impact of investing or financing transactions on our operating results.
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