EX-99.1 2 ex99p1.txt Exhibit 99.1 [CENVEO logo] For Immediate Release August 1, 2005 CENVEO ANNOUNCES SECOND QUARTER RESULTS AND ADDITIONAL MAJOR COSTS SAVINGS, BRINGING TOTAL REDUCTIONS TO $55 MILLION ENGLEWOOD, COLO. (AUGUST 1, 2005) -- Cenveo, Inc., (NYSE: CVO) announced its results for the quarter and six months ended June 30, 2005. The net loss was $10.6 million for the quarter and $33.2 million for the six months, or $0.22 per share and $0.69 per share, respectively. Sales for the quarter were $422 million and $871 million for the six months ended June 30, 2005. Last year, the net loss for the corresponding quarter was $2.1 million or $0.04 per share, on $409 million of sales and for the six months ended June 30, 2004, the net loss was $18.6 million, or $0.39 per share, on $833 million of sales. Cenveo's net loss for the six months ended June 30, 2005, included restructuring, impairment and other charges of $13.0 million and losses on sales of non-strategic businesses of $1.3 million. EBITDA of ongoing operations for the second quarter of 2005 was $30 million compared to EBITDA of $28 million achieved by the ongoing operations for the same period last year, a 7.3% improvement on 3% better sales. The guidance given previously had been for results to be flat to last year. For the six months ended June 30, 2005, EBITDA was $56.2 million compared to $59.4 million for the corresponding period of the prior year. This decline was primarily due to the costs of transitioning to a new CEO, lower margins on our envelope products, lower net pricing in our office products channel and higher incentive accruals. 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 June 30, 2005 was $16.9 million compared to $9.8 million provided during the same period last year. It is still expected that operations will generate approximately $35 million of free cash flow for the full year. Jim Malone, President and CEO, stated, "The second quarter has been a turning point for Cenveo. Building on the previously announced plan to reduce SG&A expenses by $20 million on an annual basis, we have identified another $35 million of cost reductions that will be in place no later than January 1, 2006. On this basis, and even before factoring in continued strong market successes, we expect Cenveo to be at an annual EBITDA run rate of $190 million going into 2006. This significant change in the expected EBITDA of the company has been made possible by flattening the organization, reducing the size and changing the role of head office and making Cenveo much more customer and operations oriented. We have discontinued all programs and activities that are not designed to serve our customers or support the high level of corporate governance that we are committed to maintain. We are confident that what we are doing is clearly the best option for our shareholders and we will continue to aggressively pursue shareholder value creation for all of our shareholders". - more - Cenveo will hold a conference call today, Tuesday August 2nd at 2:00 p.m. Eastern Time (1:00 pm Central, 12:00 noon Mountain, 11:00 a.m. Pacific Time). To participate in the Cenveo conference call, please dial in to 1-800-819-9193 and provide conference ID 1024706. 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 303-790-8023 or email: bea.rodriguez@cenveo.com no later than 1 hour prior to the call with your telephone information. If you are unable to join the Cenveo conference call, you may access a replay of the call starting Tuesday, August 2, 2004 at 5:00 pm Eastern Time until Midnight Eastern Time, August 9, 2004. To access the replay, please dial 1-888-203-1112 and reference the conference ID 1024706. 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 and clearly demonstrates our method of calculating EBITDA. 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 9,400 employees and more than 80 production locations plus five advanced fulfillment and distribution centers throughout North America. In 2004 and 2005, Cenveo was voted among Fortune Magazine's Most Admired Companies in the printing and publishing category and has consistently earned one of the highest Corporate Governance Quotients by Institutional Shareholder Services. The company is headquartered in Englewood, Colorado. - more - Forward-Looking Statements -------------------------- Statements made in this release, other than those concerning historical financial information, may be considered forward-looking statements, which are subject to risks and uncertainties, including without limitation: (1) general economic, business and labor conditions, (2) the ability to implement the Company's strategic initiatives, (3) the ability to regain profitability after substantial losses in 2004 and the first six months of 2005, (4) the majority of Company's sales are not subject to long-term contracts, (5) the impact of a new CEO and changes in management and strategic direction that may be made, (6) the impact of a special shareholders' meeting to be held September 14, 2005 called by a dissident shareholder group to replace the current board of directors, (7) the ability to effectively execute cost reduction programs and management reorganizations, (8) the industry is extremely competitive due to over capacity, (9) the impact of the Internet and other electronic media on the demand for envelopes and printed material, (10) postage rates and other changes in the direct mail industry, (11) environmental laws may affect the Company's business, (12) the ability to retain key management personnel, (13) compliance with recently enacted and proposed changes in laws and regulations affecting public companies could be burdensome and expensive, (14) the ability to successfully identify, manage and integrate possible future acquisitions, (15) dependence on suppliers and the costs of paper and other raw materials and the ability to pass paper price increases onto customers, (16) the ability to meet customer demand for additional value-added products and services, (17) changes in interest rates and currency exchange rates of the Canadian dollar, (18) the ability to manage operating expenses, (19) the risk that a decline in business volume or profitability could result in a further impairment of goodwill, and (20) the ability to timely or adequately respond to technological changes in the Company's industry. These risks and uncertainties are also set forth under Management's Discussion and Analysis of Results of Operations and Financial Condition in the Cenveo, Inc. Annual Report for the fiscal year ended December 31, 2004, and in the Company's other SEC filings. A copy of the annual report is available on the Company's website at http://www.cenveo.com. 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 # # # FINANCIAL HIGHLIGHTS Cenveo, Inc. and Subsidiaries (dollars in thousands, except per share data) (unaudited)
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30, 2005 2004 2005 2004 CONSOLIDATED RESULTS -------------------- Net sales $ 421,736 $ 409,396 $ 871,338 $ 833,138 Gross profit 83,308 83,634 170,063 172,054 Operating income 12,012 14,805 15,983 33,719 Loss from continuing operations (10,609) (3,296) (33,167) (19,831) Gain on disposal of discontinued operations - 1,230 - 1,230 ----------------------------------------------------------------------------------------------------------------------------------- Net loss $ (10,609) $ (2,066) $ (33,167) $ (18,601) Net loss per share $ (0.22) $ (0.04) $ (0.69) $ (0.39) ----------------------------------------------------------------------------------------------------------------------------------- SEGMENT INFORMATION NET SALES: Commercial $ 320,195 $ 307,583 $ 666,603 $ 631,432 Resale 101,541 101,813 204,735 201,706 ----------------------------------------------------------------------------------------------------------------------------------- Total $ 421,736 $ 409,396 $ 871,338 $ 833,138 OPERATING INCOME (EXPENSE): Commercial $ 7,918 $ 9,920 $ 10,181 $ 21,914 Resale 9,321 12,359 18,059 23,822 Corporate services (5,227) (7,474) (12,257) (12,017) ----------------------------------------------------------------------------------------------------------------------------------- Total $ 12,012 $ 14,805 $ 15,983 $ 33,719 OPERATING INCOME MARGINS: Commercial 2.5% 3.2% 1.5% 3.5% Resale 9.2% 12.1% 8.8% 11.8% EBITDA (1): Commercial $ 21,436 $ 21,419 $ 43,513 $ 43,545 Resale 13,496 14,409 24,618 28,303 Corporate services (4,887) (7,827) (11,934) (12,428) ----------------------------------------------------------------------------------------------------------------------------------- Total $ 30,045 $ 28,001 $ 56,197 $ 59,420 ----------------------------------------------------------------------------------------------------------------------------------- FINANCIAL POSITION JUNE 30, 2005 DECEMBER 31, 2004 Working capital $ 118,501 $ 113,391 Total assets 1,128,219 1,174,747 Total debt 783,575 769,769 Shareholders' equity $ 28,081 $ 57,354 ----------------------------------------------------------------------------------------------------------------------------------- (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 JUNE 30, 2005 RELEASED AUGUST 2, 2005 [CENVEO logo] ------------------------------------------------------------------------------- Three and six months ended June 30, 2005 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 ------------------------------------------------------------------------------- Three and six months ended June 30, 2005 Financial and Operational Summary --------------------------------- CONSOLIDATED RESULTS: Consolidated net sales increased $12.3 million, or 3%, in the second quarter of 2005 compared to the second quarter of 2004. On a year-to-date basis, consolidated net sales are $38.2 million, or 4.6%, higher than the corresponding period of 2004. This strong growth in sales is primarily the result of our strategy of offering the full range of products and services to our customers. Operating income declined $2.8 million in the second quarter of 2004 and on a year-to-date basis has declined $17.7 million compared to the corresponding period of 2004. These declines are primarily the result of restructuring expenses related to our program to reduce SG&A expenses by $20 million, impairment charges on equipment that will be taken out of service, expenses related to the evaluation of our strategic alternatives and losses incurred on the dispositions of non-strategic businesses. COMMERCIAL: Net sales increased $12.6 million, or 4%, in the second quarter compared to the second quarter of 2004 and are $35.2 million higher on a year-to-date basis than the prior year. Sales to our strategic accounts have increased $24.0 million in the first six months of 2005. RESALE: Net sales were down slightly in the second quarter but are $3.0 million higher than 2004 on a year-to-date basis. This growth is occurring in our sales of office products to retail superstores. DEBT: Total debt was reduced by $18.2 million in the second quarter. CAPITAL EXPENDITURES: Capital expenditures were $6.2 million in the second quarter. 1 Financial and Operational Summary and Recent Developments ------------------------------------------------------------------------------- Second Quarter ended June 30, 2005 Recent Developments ------------------- - The Company announced on June 22, 2005 the appointment of James R. Malone as Chief Executive Officer, effective Monday, June 27, 2005. Mr. Malone was founding and managing partner of Qorval, LLC, a financial and business restructuring firm based in Naples, Florida. In this capacity, he assumed the role of Chief Executive Officer of several companies including Mail Contractors of America, Inc., Avborne, Inc. and Brown Jordan International. - On June 1, 2005, the Company announced a comprehensive program initiated to streamline certain management functions, increase flexibility and efficiency, and reduce operating expense. This program, when completed before the end of 2005, will provide an annual savings in excess of $20 million and eliminate approximately 125 positions. 2 CONSOLIDATED BALANCE SHEETS Cenveo, Inc. and Subsidiaries (in thousands) (unaudited)
JUNE 30, DECEMBER 31, 2005 2004 ASSETS Current assets: Cash and cash equivalents $ 1,844 $ 796 Accounts receivable, net 226,951 252,711 Inventories, net 113,585 112,219 Other current assets 46,881 46,019 ---------------------------------------------------------------------------------------------------------------------------- Total current assets 389,261 411,745 ---------------------------------------------------------------------------------------------------------------------------- Property, plant and equipment, net 345,061 367,260 Goodwill 307,627 308,938 Other intangible assets, net 29,853 28,788 Other assets, net 56,417 58,016 ---------------------------------------------------------------------------------------------------------------------------- TOTAL ASSETS $ 1,128,219 $ 1,174,747 ---------------------------------------------------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 150,600 $ 172,731 Accrued compensation and related liabilities 60,249 58,639 Other current liabilities 57,070 64,714 Current maturities of long-term debt 2,841 2,270 ---------------------------------------------------------------------------------------------------------------------------- Total current liabilities 270,760 298,354 ---------------------------------------------------------------------------------------------------------------------------- Long-term debt, less current maturities 780,734 767,499 Other liabilities 48,644 51,540 ---------------------------------------------------------------------------------------------------------------------------- Total liabilities 1,100,138 1,117,393 ---------------------------------------------------------------------------------------------------------------------------- Shareholders' equity: Common stock 505 487 Paid-in capital 224,100 214,902 Retained deficit (203,205) (170,039) Deferred compensation (2,885) (2,003) Accumulated other comprehensive income 9,566 14,007 ---------------------------------------------------------------------------------------------------------------------------- Total shareholders' equity 28,081 57,354 ---------------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 1,128,219 $ 1,174,747 ----------------------------------------------------------------------------------------------------------------------------
3 CONSOLIDATED STATEMENTS OF OPERATIONS Cenveo, Inc. and Subsidiaries (in thousands, except per share data) (unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, 2005 2004 2005 2004 Net sales $ 421,736 $ 409,396 $ 871,338 $ 833,138 Cost of sales 338,428 325,762 701,275 661,084 --------------------------------------------------------------------------------------------------------------------------------- Gross profit 83,308 83,634 170,063 172,054 --------------------------------------------------------------------------------------------------------------------------------- Operating expenses: Selling, general and administrative expenses 64,559 66,415 137,224 134,413 Amortization of intangibles 1,276 1,396 2,606 2,801 Loss on sale of non-strategic businesses 539 - 1,260 - Restructuring, impairment and other charges 4,922 1,018 12,990 1,121 --------------------------------------------------------------------------------------------------------------------------------- Operating income 12,012 14,805 15,983 33,719 --------------------------------------------------------------------------------------------------------------------------------- Other expense: Interest expense 18,802 17,513 36,995 35,912 Loss on early extinguishment of debt - - - 17,748 Other 445 527 434 968 --------------------------------------------------------------------------------------------------------------------------------- Loss before income taxes (7,235) (3,235) (21,446) (20,909) Income tax expense (benefit) 3,374 61 11,721 (1,078) --------------------------------------------------------------------------------------------------------------------------------- Loss from continuing operations (10,609) (3,296) (33,167) (19,831) Gain on disposal of discontinued operations, net of taxes of $770 - 1,230 - 1,230 --------------------------------------------------------------------------------------------------------------------------------- Net loss $ (10,609) $ (2,066) $ (33,167) $ (18,601) --------------------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------------------- Loss per share - basic and diluted $ (0.22) $ (0.04) $ (0.69) $ (0.39) --------------------------------------------------------------------------------------------------------------------------------- Weighted averages shares - basic and diluted 48,804 47,740 48,292 47,737
4 CONSOLIDATED CASH FLOW STATEMENTS Cenveo, Inc. and Subsidiaries (in thousands) (unaudited)
SIX MONTHS ENDED JUNE 30, 2005 2004 Cash flows from operating activities: Net loss from continuing operations $ (33,167) $ (19,831) Adjustments to reconcile net loss from continuing operations to net cash used in operating activities: Depreciation 23,289 22,841 Amortization 4,896 5,093 Asset impairment charges 7,689 - Loss on sale of non-strategic businesses 1,260 - Write-off of deferred financing fees - 4,220 Deferred income tax expense (benefit) 456 (7,949) Loss on disposal of assets 77 240 Other non-cash charges, net (703) (366) Changes in operating assets and liabilities, excluding effects of acquisitions and operations sold: Accounts receivable 25,723 4,210 Inventories (2,247) (20,011) Accounts payable and accrued compensation (20,077) 7,686 Income taxes payable (476) (991) Other working capital changes (9,415) 211 Other, net (6,877) (76) ------------------------------------------------------------------------------------------------------------------------------- Net cash used in operating activities (9,572) (4,723) Cash flows from investing activities: Acquisitions, net of cash acquired (3,995) - Capital expenditures (12,652) (12,460) Proceeds from divestitures, net 4,158 2,000 Proceeds from sales of property, plant and equipment 284 346 ------------------------------------------------------------------------------------------------------------------------------- Net cash used in investing activities (12,205) (10,114) Cash flows from financing activities: Increase in borrowings under credit facility 14,824 6,806 Proceeds from issuance of long-term debt - 320,000 Repayments of long-term debt (1,018) (302,809) Proceeds from the issuance of common stock 9,082 46 Capitalized loan fees - (8,936) ------------------------------------------------------------------------------------------------------------------------------- Net cash provided by financing activities 22,888 15,107 Effect of exchange rate changes on cash and cash equivalents (63) (412) ------------------------------------------------------------------------------------------------------------------------------- Net increase (decrease) in cash and cash equivalents 1,048 (142) Cash and cash equivalents at beginning of year 796 307 ------------------------------------------------------------------------------------------------------------------------------- Cash and cash equivalents at end of quarter $ 1,844 $ 165 -------------------------------------------------------------------------------------------------------------------------------
5 SEGMENT RESULTS Cenveo, Inc. and Subsidiaries (in thousands) (unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, 2005 2004 2005 2004 Net sales: Commercial $ 320,195 $ 307,583 $ 666,603 $ 631,432 Resale 101,541 101,813 204,735 201,706 ---------------------------------------------------------------------------------------------------------------------------------- Total net sales $ 421,736 $ 409,396 $ 871,338 $ 833,138 ---------------------------------------------------------------------------------------------------------------------------------- Operating income (expense): Commercial $ 7,918 $ 9,920 $ 10,181 $ 21,914 Resale 9,321 12,359 18,059 23,822 Corporate services (5,227) (7,474) (12,257) (12,017) ---------------------------------------------------------------------------------------------------------------------------------- Total operating income $ 12,012 $ 14,805 $ 15,983 $ 33,719 ---------------------------------------------------------------------------------------------------------------------------------- EBITDA (1): Commercial $ 21,436 $ 21,419 $ 43,513 $ 43,545 Resale 13,496 14,409 24,618 28,303 Corporate services (4,887) (7,827) (11,934) (12,428) ---------------------------------------------------------------------------------------------------------------------------------- Total EBITDA $ 30,045 $ 28,001 $ 56,197 $ 59,420 ---------------------------------------------------------------------------------------------------------------------------------- Net sales by product line: Commercial printing $ 188,748 $ 186,873 $ 399,125 $ 385,073 Envelopes 183,322 172,077 373,093 346,180 Business forms and labels 49,666 50,446 99,120 101,885 ---------------------------------------------------------------------------------------------------------------------------------- Total net sales $ 421,736 $ 409,396 $ 871,338 $ 833,138 ---------------------------------------------------------------------------------------------------------------------------------- (1) See Appendix 1 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.
6 APPENDIX 1 - RECONCILIATION OF NET INCOME TO EBITDA FOR THE THREE MONTHS ENDED JUNE 30, 2005 AND 2004 Cenveo, Inc. and Subsidiaries (in thousands) (unaudited)
FOR THE THREE MONTHS ENDED JUNE 30, 2005 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ 5,500 $ 9,332 $ (25,441) $ (10,609) Interest 58 7 18,737 18,802 Taxes 2,514 - 860 3,374 Depreciation 9,457 2,050 133 11,640 Amortization 1,172 134 - 1,306 Restructuring, impairment and other charges 2,422 1,676 824 4,922 Loss on sale of non-strategic businesses 313 226 - 539 Divested operations - 71 - 71 ------------------------------------------------------------------------------------------------------------------------------- EBITDA $ 21,436 $ 13,496 $ (4,887) $ 30,045 FOR THE THREE MONTHS ENDED JUNE 30, 2004 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ (4,184) $ 10,020 $ (7,902) $ (2,066) Interest 11,291 2,324 3,898 17,513 Taxes 2,939 - (2,878) 61 Depreciation 8,984 2,205 186 11,375 Amortization 1,182 135 99 1,416 Restructuring, impairment and other charges 1,018 - - 1,018 Divested operations 189 (275) - (86) Gain on discontinued operations - - (1,230) (1,230) ------------------------------------------------------------------------------------------------------------------------------- EBITDA $ 21,419 $ 14,409 $ (7,827) $ 28,001 Note: This schedule is a reconciliation of net income to EBITDA which we define as earnings before interest, taxes, depreciation, amortization, non-cash charges from asset impairments and gains and losses recognized on divestitures. Additionally, we exclude the impacts of restructuring and related charges and the EBITDA of divested operations. 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
7 APPENDIX 1 - RECONCILIATION OF NET INCOME TO EBITDA FOR THE SIX MONTHS ENDED JUNE 30, 2005 AND 2004 Cenveo, Inc. and Subsidiaries (in thousands) (unaudited)
FOR THE SIX MONTHS ENDED JUNE 30, 2005 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ 4,537 $ 18,057 $ (55,761) $(33,167) Interest 97 12 36,886 36,995 Taxes 5,864 - 5,857 11,721 Depreciation 18,869 4,160 260 23,289 Amortization 2,399 268 - 2,667 Restructuring, impairment and other charges 10,503 1,663 824 12,990 Loss on sale of non-strategic businesses 1,034 226 - 1,260 Divested operations 210 232 - 442 ----------------------------------------------------------------------------------------------------------------------------------- EBITDA $ 43,513 $ 24,618 $ (11,934) $ 56,197 FOR THE SIX MONTHS ENDED JUNE 30, 2004 COMMERCIAL RESALE CORPORATE TOTAL Net income (loss) $ (6,685) $ 19,106 $ (31,022) $ (18,601) Interest 22,597 4,647 8,668 35,912 Taxes 6,066 - (7,144) (1,078) Depreciation 18,009 4,478 354 22,841 Amortization 2,433 270 198 2,901 Restructuring, impairment and other charges 1,121 - - 1,121 Divested operations 4 (198) - (194) Loss from the early extinguishment of debt - - 17,748 17,748 Gain on discontinued operations - - (1,230) (1,230) ----------------------------------------------------------------------------------------------------------------------------------- EBITDA $ 43,545 $ 28,303 $ (12,428) $ 59,420 Note: This schedule is a reconciliation of net income to EBITDA which we define as earnings before interest, taxes, depreciation, amortization, non-cash charges from asset impairments and gains and losses recognized on divestitures. Additionally, we exclude the impacts of restructuring and related charges and the EBITDA of divested operations. In 2004, we excluded the loss on the early extinguishment of debt. 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 comp
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