DALLAS--Jan. 3, 1996--I.C.H.
Corporation
(ICHD--OTC) announced today that Susan A. Brown and Rodney D. Moore
have been elected directors of the Company, replacing Glenn H.
Gettier, Jr. and Keith A. Tucker, who have resigned.
The Company also announced that Brown has been elected chairman
of the board, co-chief executive officer, chief financial officer
and treasurer of ICH and that Moore has been elected president, co-
chief executive officer and corporate secretary of ICH. They
replace all of the previously elected executive officers of the
Company, all of whom, including Gettier, became officers of
Southwestern Financial Corporation, a privately held insurance
holding company, upon its purchase of ICH's principal insurance
subsidies under a bankruptcy court supervised process that was
completed in December.
Previously Brown served as chief executive officer of the
reorganized First RepublicBank Corporation and was its chairman and
chief executive officer when the company was a debtor in possession
under Chapter 11 of the bankruptcy code. Moore has been serving the
Company as a special consultant in connection with, among other
things, the sale to Southwestern Financial. ICH has been operating
as a debtor in possession since its voluntary Chapter 11 bankruptcy
filing on October 10, 1995.
CONTACT: I.C.H. Corporation, Dallas,
Gerald J. Kohout, 214/954-7414
NEW YORK, Jan. 3, 1996 -- Stuart Held,
President/C.E.O. of
TUT Services, Inc., (the company who purchased the assets of href="chap11.47st.html">47st.
Photo in Bankruptcy court) announced today the "joining of two
financially supportive companies to TUT Services, Inc. The first,
the TUTTNAUER COMPANY, an Israeli Stock Market listed company doing
business in the medical field and the second, TRACT FINANCIAL, LTD.,
is an offshore Investment Company based in Hong Kong."
Mr. Held continued, "The TUTTNAUER COMPANY was an investor of
inventory in 47st. Photo and took over its operation. The company
had the consent of the Bankruptcy court, when a series of losses of
inventory could not be found or explained. TUT Services, Inc., a
wholly owned subsidiary, was then directed to run 47st. Photo under
a license with the Chapter-11 trustee.
TUT Services Inc. (TUTTNAUER COMPANY) exercised its option to
purchase the assets of 47st. Photo and won the company in Bankruptcy
court, December 14, 1995.
Since then, the TUTTNAUER COMPANY joined forces with TRACT
FINANCIAL, LTD., and for financial consideration, has given control
of TUT Services to TRACK FINANCIAL. TRACT has already assisted in
funding TUT Services holiday seasonal purchasing."
Mr. Held added, "the financial support we have already received
from TRACT is only the beginning. We anticipate a store expansion
and acquisition program in addition to a stock market offering in
the very near future. 47st. Photo will once again rise and take its
position as one of the leading innovators of the consumer discount
revolution."
47st. Photo is a New York City landmark, located in its original
"super store" at 115 West 45 Street, New York, NY 10036, between
Broadway and Sixth Avenues. The thirty year old retailer has a
dynamic level of name recognition throughout the world. The
company's yearly sales in the last three years range from
$80,000,000 to $100,000,000 per annum.
NOTE: "The World Shops 47st. Photo - So Should You!" is 47st.
Photo's trademark.
/CONTACT: Stuart Held, President and CEO of TUT Service, Inc.,
212-398-1530, or Fax: 212-302-6460/
NEW YORK, Jan. 4, 1996 -- Fitch assigns a
preliminary 'BB'
rating to El Paso Electric Co.'s
(EPE) proposed new first mortgage
bonds to be issued under the company's pending bankruptcy
reorganization plan. An anticipated $100 million new preferred stock
issue is rated 'B+'. Once the reorganization is complete, EPE's
credit trend will be stable. The Fitch Competitive Indicator (FCI)
is 3.58, versus an industry average of 2.71, placing the utility at
the lower end of the Fitch scale.
EPE is currently in bankruptcy. The bankruptcy court will begin
confirmation hearings on the company's Plan of Reorganization on
January 9, 1996. Fitch's new ratings are predicated on approval of
the plan essentially in its present form.
The ratings reflect the following company strengths: a 10-year
rate freeze covering EPE's Texas service area, growing retail power
demands, and sufficient cash flow over the next five years to cover
debt and preferred service, fund capital expenditures internally,
and reduce outstanding long-term debt. EPE has also arranged a
committed working capital credit facility to back up any
extraordinary cash requirements after reorganization.
Offsetting credit risks include extremely high initial debt
leverage, high nuclear operating exposure, and the threat of
municipalization of EPE's Las Cruces, New Mexico, distribution
facilities, which represent approximately 8% of the business.
Fitch will provide additional information and rating updates as
the reorganization process proceeds.
/CONTACT: Ellen Lapson, 212-908-0504, or John Watt, 212-908-0523,
both of Fitch/
-12.19% Senior Notes to be Redeemed; $550 Million
Bank Financing Underway
TAMPA, Fla., Jan. 4, 1996 -- Walter
Industries, Inc.
(Nasdaq: WLTR) today reported results for its fiscal second quarter
and first half ended November 30, 1995.
Net sales and revenues for the quarter totaled $378.1 million, a
four percent increase over revenues of $363.3 million a year
earlier. Earnings Before Interest, Taxes, Depreciation and
Amortization (EBITDA) increased three percent to $87.3 million
versus $84.7 million in the prior period. Earnings are reported on
the basis of EBITDA to reflect the company's operating performance
before interest costs associated with its post-Chapter 11
reorganization capital structure and ongoing goodwill amortization
expenses.
First half sales and revenues totaled $758.3 million, eight
percent higher than prior year revenues of $704.0 million. EBITDA
was 11 percent higher at $176.9 million versus $159.5 million in the
prior year first half.
EBITDA for the second quarter was higher in each of the
company's four operating groups, and revenues were higher in the
Water and Waste Water Transmission Products Group and the Natural
Resources Group.
The company's Homebuilding and Related Financing Group generated
two percent higher EBITDA despite fractionally lower revenues. The
income gain reflected margin improvement from higher home sales
prices and lower lumber costs, while the decrease in revenues
resulted from lower unit completions versus the prior year.
The Water and Waste Water Transmission Products Group provided
two percent higher EBITDA on modestly higher revenues, reflecting
gains in selling prices for the company's ductile iron pressure pipe
and fittings, which were partially offset by lower sales volumes and
higher raw material costs.
Results of the Industrial and Other Products Group were mixed.
EBITDA increased 27 percent, benefiting from improved margins at the
company's aluminum operations. Revenues declined three percent,
principally due to lower sales volume of aluminum products and
window components.
The Natural Resources Group reported four percent higher EBITDA
on 23 percent higher revenues. The Group benefitted from higher
coal and methane gas shipments, greater outside gas and timber
royalties, and proceeds from the sale of gas royalty interests in
certain mineral properties. Income was constrained by higher
production costs stemming from various geological problems at the
company's coal mines during the quarter.
In the final days of the second quarter, the company also
experienced an unexpected recurrence of spontaneous "hot spot"
conditions at the Jim Walter Resources' No. 5 Mine, the smallest of
the company's four deep underground mines in Alabama. Hot spots
have occurred periodically at the No. 5 Mine in past years and have
all been successfully contained. They occur when iron pyrite, a
mineral encountered during the mining process, is exposed to oxygen
and spontaneously combusts. The latest hot spot occurrence caused
no injuries and had no material impact on results in the second
quarter. Efforts throughout December to contain and extinguish the
fire appear to have been successful; however, the mine has been shut
down while company and mine safety officials assess the timing for
resuming production. Although the company's three other mines remain
in full production, results of the Natural Resources Group are now
expected to be adversely impacted in the fiscal third quarter which
ends February 29 as a result of the higher costs associated with the
problems at Mine No. 5.
Capital expenditures were $19.9 million in the second quarter
and $33.9 million for the six months, compared with $15.0 million
and $29.7 million, respectively, for the comparable 1994 periods,
reflecting the company's ongoing investment in its businesses.
Interest expense in the second quarter increased $18.6 million,
or 51 percent over the same year ago period, stemming from the
company's new capital structure following its emergence from Chapter
11 reorganization in March 1995. Largely due to this higher
expense, the company incurred a net loss of $1.1 million, or two
cents per share, for the current quarter, compared with net income
of $4.9 million a year earlier. (Prior year per share amounts are
not meaningful in light of the recapitalization.)
In addition, net results were after goodwill amortization of
$9.7 million, equal to 19 cents per share, in the current quarter,
and $10.3 million in the prior year period.
In a move to substantially lower its interest costs, the company
in December launched a $550 million bank financing led by
NationsBank. Proceeds from the financing will be used to redeem $490
million of 12.19% Senior Notes Due 2000 and replace an existing $150
million bank credit facility - both incurred in conjunction with the
company's emergence from Chapter 11 reorganization last March.
Redemption notices were sent to holders of the Senior Notes on
December 22 with a January 22, 1996 redemption date. The call price
is 101% of principal plus accrued and unpaid interest to that date.
The refinancing consists of a $375 million revolving credit
facility, a six-year $125 million term loan and a $50 million seven-
year term loan. Interest savings from the refinancing are expected
to exceed $20 million annually.
Note to Editor: Walter Industries, Inc., based in Tampa,
Florida, is a diversified, multi-subsidiary corporation with major
interests in two business areas: homebuilding and financing and
industrial operations. Walter Industries and its subsidiaries employ
more than 7,800 at manufacturing facilities and sales offices
throughout the United States, generating sales and revenues in
excess of $1.4 billion annually.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Quarter Ended November 30,
($ in thousands, except
per share amount) 1995 1994
Net sales and revenues (a) $ 378,136 $ 361,654
Cost of sales 249,794 237,737
Depreciation 18,925 17,930
Selling, general
and administrative 34,214 32,790
Postretirement health benefits 6,843 6,435
Amortization of goodwill 9,744 10,316
Earnings before interest and taxes58,616 56,446
Chapter 11 costs, net (a) --- 6,127
Interest 54,912 36,290
Pretax income 3,704 14,029
Income tax expense ( 4,798) ( 9,109)
Net income (loss) $( 1,094) $ 4,920
Net income (loss)
per share $( .02) NM (b)
Number of shares of common stock
used in calculation
of net loss per share 50,988,626 NM (b)
(a) -- Interest income from Chapter 11 proceedings ($1,676 in
1994) is excluded from sales and revenues and included in net
Chapter 11 costs for purposes of determining earnings before
interest and taxes.
(b) - Not meaningful due to change in capital structure which
occurred as a result of the company's reorganization.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Six Months Ended November 30,
($ in thousands, except
per share amount) 1995 1994
Net sales and revenues (a) $ 758,284 $ 700,876
Cost of sales 499,627 461,856
Depreciation 37,442 34,687
Selling, general
and administrative 68,256 66,437
Postretirement health benefits 13,522 13,082
Amortization of goodwill 19,969 20,884
Earnings before interest
and taxes 119,468 103,930
Chapter 11 costs, net (a) --- 8,858
Interest 109,493 72,753
Pretax income 9,975 22,319
Income tax expense ( 10,828) ( 15,966)
Net income (loss) $( 853) $ 6,353
Net income (loss)
per share $( .02) NM (b)
Number of shares of common stock
used in calculation
of net loss per share 50,988,626 NM (b)
(a) -- Interest income from Chapter 11 proceedings ($3,094 in
1994) is excluded from sales and revenues and included in net
Chapter 11 costs for purposes of determining earnings before
interest and taxes.
(b) - Not meaningful due to change in capital structure which
occurred as a result of the company's reorganization.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
RESULTS BY OPERATING GROUP
($ in thousands)
SALES AND REVENUES: Quarter Ended November 30,
1995 1994
Homebuilding and
Related Financing $ 102,702 $ 103,206
Water and Waste
Water Transmission Products 110,108 109,689
Natural Resources 97,998 79,613
Industrial and Other Products 66,827 68,953
Corporate 501 1,869
$ 378,136 $ 363,330
EBITDA: (a)
Homebuilding and
Related Financing (b) $ 54,723 $ 53,857
Water and Waste
Water Transmission Products 14,926 14,596
Natural Resources 15,912 15,341
Industrial and Other Products 6,532 5,158
Corporate ( 4,808) ( 4,260)
$ 87,285 $ 84,692
(a) -- Reflects addback of depreciation and amortization of
goodwill, as follows:
1995 1994
Homebuilding and
Related Financing $ 8,483 $ 9,081
Water and Waste
Water Transmission Products 7,559 7,452
Natural Resources 9,959 9,294
Industrial and Other Products 3,470 3,238
Corporate ( 802) ( 819)
Total $ 28,669 $ 28,246
(b) -- Before deducting interest expense of $32,596 in 1995 and
$31,197 in 1994.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
RESULTS BY OPERATING GROUP
($ in thousands)
SALES AND REVENUES: Six Months Ended November 30,
1995 1994
Homebuilding and
Related Financing $ 203,466 $ 206,288
Water and Waste
Water Transmission Products 229,556 215,023
Natural Resources 187,513 148,225
Industrial and Other Products 136,386 130,904
Corporate 1,363 3,530
$ 758,284 $ 703,970
EBITDA: (a)
Homebuilding and
Related Financing (b) $ 109,196 $ 105,702
Water and Waste
Water Transmission Products 30,690 28,759
Natural Resources 33,077 22,008
Industrial and Other Products 12,029 10,154
Corporate ( 8,113) ( 7,122)
$ 176,879 $ 159,501
(a) -- Reflects addback of depreciation and amortization of
goodwill, as follows:
1995 1994
Homebuilding and
Related Financing $17,419 $18,387
Water and Waste
Water Transmission Products 14,506 14,254
Natural Resources 20,000 18,085
Industrial and Other Products 7,100 6,497
Corporate ( 1,614) ( 1,652)
Total $57,411 $55,571
(b) -- Before deducting interest expense of $64,249 in 1995 and
$62,317 in 1994.
WALTER INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
($ in thousands) November 30,
1995 1994
Cash and short-term
investments $ 78,841 $ 190,844
Short-term investments,
restricted 150,126 95,260
Instalment notes
receivable 4,238,155 4,205,652
Less - Provision for
possible losses ( 26,388) ( 26,372)
Unearned time
charges (2, 864,560) (2,822,412)
Trade and other receivables 166,677 158,273
Federal income tax receivable 99,875 ---
Inventories 196,982 171,032
Prepaid expenses 12,524 15,803
Property, plant
and equipment, net 655,795 648,842
Excess of purchase
price over net assets
acquired (goodwill) 352,927 392,039
Deferred income taxes 7,216 ---
Other assets 80,222 70,842
$ 3,148,392 $ 3,099,803
Bank overdrafts,
accounts payable
and accrued expenses $ 202,882 $ 200,050
Income taxes payable 53,712 20,323
Deferred income taxes --- 61,544
Long-term senior debt 2,205,152 812,547
Accrued interest 36,976 284,329
Accumulated postretirement
health benefits obligation 238,618 221,049
Other long-term liabilities 51,133 48,682
Liabilities subject to
Chapter 11 proceedings --- 1,727,279
Stockholders' equity (deficit) 359,919 (276,000)
$3,148,392 $3,099,803
NEW YORK--Jan. 4, 1996--The Orange
County
bankruptcy relief package approved by the California Legislature on
September 15, 1995 and signed into law by Governor Wilson on October
9, 1995 included three bills stipulating the diversion of
Transportation Development Act (TDA) funds normally earmarked for
public transit services provided by the Orange County Transportation
Authority (OCTA).
The Consensus Recovery Plan intercepts and redirects $38 million
a year of OCTA's TDA funds to county bankruptcy relief beginning on
July 1, 1996 for a 15-year period. In exchange, $23 million a year
in county gas taxes will be transferred from the county to OCTA
beginning one year later, on July 1, 1997. This results in a net
loss of $15 million per year in public transit funding beginning in
fiscal year 1998.
On October 20, 1995, Moody's placed under review related ratings
of OCTA, which is the consolidated agency responsible for all
transportation planning and services in Orange County. OCTA is the
oversight authority for the Orange County Local Transportation
Authority (OCLTA), the Orange County Transit District (OCTD), the
agency responsible for mass transit services, and the Orange County
Service Authority for Freeway Emergencies (OCSAFE). Moody's review
focused on the impact of the TDA revenue diversion.
The confirmation of ratings reflects OCTA Board approval of a
financial and operating plan to mitigate the up-front loss of $38
million in fiscal year 1996 and the net loss of $15 million per year
thereafter for 14 years of TDA public transit funding. The
difficult systemic and budgetary adjustments that have been
implemented within the past year will contribute to the long-term
financial viability of the Authority and its various operating
programs.
Effective today, Moody's Investors
Service has reviewed and
confirmed the following OCTA ratings:
----------------------------------------------------------------------
Moody's Amount
Issue Rating
Outstanding
----------------------------------------------------------------------
Orange County Local Transportation
Authority
Sales Tax Revenue Bonds, First
Senior Aa $302,840,000
Orange County Local Transportation
Authority
Commercial Paper Program[1] P-1 74,200,000
Orange County Transit District,
1990 Business
Acquisition Project Certificates
of Participation A1 10,395,000
California Transit Finance
Corporation-Orange
County Transit District
Certificates of
Participation, 1993C A1 21,100,000
[1]Maximum authorization is $115 million.
----------------------------------------------------------------------
The Transportation Development Act established for each county a
Local Transportation Fund (LTF) to funnel revenues derived from a
1/4 percent state sales tax for mass transit purposes. In existence
since 1972, the LTF primarily serves to subsidize the OCTD's
operating and capital expenses. For fiscal year 1997 - the initial
year of the revenue diversion - OCTD faces a $38 million budget
shortfall. For each of the remaining 14 years thereafter, OCTD will
face net shortfalls of $15 million.
On December 11, 1995, the OCTA Board approved a long-term plan
to mitigate the initial $38 million loss and the loss of $15 million
per year thereafter until 2011. Rather than impose onerous service
reductions to close the fiscal year 1997 budget gap, the Board
approved: (1) a $34.4 million reallocation of Orange County Unified
Transportation Trust (OCUTT) funds to support bus operations; (2)
elimination of 40 administrative staff positions saving $2 million
per year; and (3) charging the cost of providing rail feeder
services to the commuter rail program instead of bus operations.
The $34.4 million was originally set aside for development
investment for two projects: the Anaheim Intermodal Transportation
Center and the Route 57 Extension along the Santa Ana River. Both
projects require partnership funding from the private sector and
will require extensive development resources. Given the
complexities of juggling federal, state, local and private sector
funding, the timing and likelihood of realization of these two
projects have always been uncertain.
A major component of the plan to mitigate the net loss of $15
million per year for 14 years beginning in fiscal year 1998 is the
creation of a Bus Operations Fund initially capitalized primarily
with $68 million from all non-Measure M Commuter Urban Rail
Endowment program funds and $4.1 million from transit capital
reserves. Annually, OCTA plans to utilize $8 million of principal
and interest from the Bus Operations Fund to help mitigate the
diversion. The remaining $2 - 3 million shortfall will be addressed
before the fiscal year 1998 budget. Options under consideration
include modest fare increases and reduction of services. Any
recovery of bankruptcy claims could also be used in part to
subsidize the shortfall. The Major Investment Study for the urban
rail corridor project will be presented to the Board in 1996. If
the corridor is determined to be economically unfeasible and the
project is abandoned, then additional Measure M funds may be freed
up for other public transit uses. OCTA would like to review as many
options as possible and will not close the $2 - 3 million funding
gap until all options are studied.
Mitigation Initiatives Come on the Heels of Earlier Structural
Improvements to Bus System Operations
The one-time reallocation of authority resources comes after
recent OCTD structural improvements to overall transit operations,
which will result in long-term tightening of operating costs. In
general, significant reductions in Federal Transit Administration
(FTA) Section 9 Operating Subsidies have helped spur overall belt-
tightening in the mass transit industry. Since consolidation in
1991, OCTA has reduced total staffing by 16%. Additional cost
savings include closing one of three maintenance bases, reducing
work shifts from three to two and deciding to stay with clean diesel
buses rather than a more costly changeover to alternative fuel
equipment. On October 1, 1995, OCTA implemented bus service changes
including revised service scheduling of 50 fixed bus routes, closure
of four less productive routes resulting in an overall 5% reduction
in services, addition of 11 routes, doubled use of more cost
effective small buses. These changes were based on a year-long
study designed to expand ridership, improve efficiency and provide
more service options without increasing net operating costs. These
structural improvements are expected to provide long-term benefits
to the bottom line and augment the one-time initiatives designed to
infuse the mass transit system with sufficient resources to mitigate
the loss of TDA funds.
Repayment of 1990 and 1993 Certificates Is Not Expected to Be
Negatively Impacted
Repayment of the 1990 and 1993 Certificates, issued to finance
the purchase of buses, is not expected to be negatively impacted by
the loss of TDA funds. While 80% of certificate debt service is
expected to continue to come from FTA Section 9 Capital Grants,
additional repayment sources include farebox revenues, TDA funds,
State Transit Assistance (STA) funds derived from state-wide sales
taxes and appropriated annually for transit purposes, property tax
collections, interest income and other operating revenues of the
OCTD. Projected total capital funding sources in fiscal year 1995
are expected to cover certificate debt service in excess of 9x; peak
debt service coverage by fiscal year 1995 capital funds exceeds 5x.
Further, OCTA has $6 million in unreserved STA funds, which could be
applied to repayment of debt service.
The Loss of TDA Funds Is Not Expected to Impact the OCTA Measure M
Sales Tax Revenue Bonds
The voters of Orange County authorized the collections of a half-
cent sales tax for transportation improvements in November, 1990.
The Measure M Program outlines clear funding parameters including a
43% allocation for freeways, 25% for transit, 11% for regional
streets and roads, and 21% for local streets and roads. Within the
category of freeway construction, the revised Freeway Strategic Plan
adopted on November 14, 1994 identified some 30 priority projects
including improvements to the Santa Ana Freeway (I-5) and Interstate
405. The Measure M construction program remains on track. All
major Measure M freeway projects are under way and project costs are
coming in under budget. On the Santa Ana Freeway, 24 out of 25
projects are environmentally cleared, designed, under contruction or
completed.
In fiscal year 1995 - the fourth full year of Measure M
collections - revenues were up by 6% from the previous year. Gross
Measure M collections in fiscal year 1995 were $140.7 million.
Measure M sales taxes continue to average $10 - 12 million per
month. Debt service coverage on aggregate first and second senior
Sales Tax Revenue Bonds is estimated at 1.8x for fiscal year 1995
and is projected to continue to exceed 1.8x over the next five years
even under modest growth assumptions.
Forecasts of nominal taxable sales by California State
University, Fullerton, Chapman University and UCLA range between 4
- 7% in the period from 1995 to 2011.
Management Remains Strong
OCTA continues to exhibit strong, proactive management in
mitigating the impact of revenue diversion and in undertaking the
necessary structural changes to position the transit system and the
Measure M Program to move ahead even in the face of the Orange
County bankruptcy. Recently, the Board reaffirmed its policy
recognizing the importance of full and timely repayment of debt
obligations and placing all bond and certificate payments among the
Authority's highest priorities.
CONTACT: Moody's Investors Service,
Chee Mee Hu, 212/553-3665,
Vice President/Assistant Director
MOUNTAIN VIEW, Calif.--Jan. 4, 1996--Adobe
Systems Inc. today announced results for its fiscal year 1995.
Results for the year include the effect of the acquisition of
Frame Technology Corp., and all comparative data include the Frame
data for prior periods as well as the current year periods.
Fourth Quarter Results
Revenue for the fourth quarter ended Dec. 1, 1995, on a combined
basis, was $200.9 million, an increase of 7 percent from the $187.6
million posted for the fourth quarter of fiscal 1994. The fourth
quarter results include a restructuring charge of $31.5 million
associated with the Frame Technology acquisition, and a write-off of
$15.0 million for in-process research and development acquired in
conjunction with the purchase of Ceneca Communications. The effect
of the restructuring charge and the write-off of in-process research
and development was to create a fourth quarter loss for the company
of $11.8 million, and a corresponding loss per share of $.16. This
compares to a net loss of $45.2 million for the fourth quarter of
fiscal 1994 and a loss per share of $.65, which included a
restructuring charge of $72.2 million associated with the Aldus
acquisition and a $12.4 million write-off of in-process research and
development associated with the purchase of Laser Tools Corp.
Fourth quarter revenue on a normalized basis, would have been up
12 percent from the $179.1 million posted in the fourth quarter of
fiscal 1994. Net income for the fourth quarter, excluding all one-
time charges, would have been $30.5 million, for earnings per share
of $.40. This compares to fourth quarter results from fiscal 1994,
without one-time charges and without discontinued or divested
businesses, of $30.1 million, and earnings per share of $.41 per
share.
"Operating income for the quarter was below our stated business
goals," commented John Warnock, chairman and chief executive officer
of Adobe Systems. "The timing and effect of the Frame acquisition
had a more substantial impact than anticipated, and our expenses as
a percent of sales were higher than our targets. It is our intent
to correct this situation and bring operating margins in line with
our business objectives."
Fiscal Year Results
Total revenue for the fiscal year ended Dec. 1, 1995, was $762.3
million, an increase of 13 percent from the $675.6 million posted
for fiscal 1994. Net income and earnings per share were $93.5
million and $1.26, respectively, compared to net income of $15.3
million and earnings per share of $.22 for fiscal 1994.
Comparing year-end results on a normalized basis, removing non-
recurring expenses and excluding the Freehand and Photostyler
businesses, fiscal 1995 revenue was up 22 percent from fiscal 1994
revenue of $622.4 million. On this basis, net income for fiscal
1995, was $135.6 million, up 79 percent from net income of $75.9
million in fiscal 1994. Earnings per share, at $1.80, represents a
gain of 68 percent compared to earnings per share of $1.07 in fiscal
1994.
"This has been a remarkable year for Adobe," continued Warnock.
"We shipped major versions of PageMaker, FrameMaker, Photoshop,
Acrobat, Acrobat Capture, After Effects and PageMill. And, we
delivered over 300 PostScript implementations to our OEM customers.
In addition, we met the challenge of integrating two major
companies, while addressing the opportunities that are emerging with
the growth of the Internet. Our ability to recognize strategic
business opportunities and provide innovative solutions has helped
establish Adobe as a leader in Internet publishing. We believe the
Internet is changing the way organizations communicate, and we will
continue to make key investments in this area."
Licensing revenue for the fourth quarter was $47.0 million, a 15
percent increase over the $40.9 million posted for the fourth
quarter of fiscal 1994. For the full fiscal year, licensing revenue
increased 17% to $183.4 million from $156.7 million in fiscal 1994.
Application product revenue for the fourth quarter grew 5% to
$153.8 million, compared to $146.7 million for the same quarter last
year. For all of fiscal 1995, application product sales were $578.9
million, compared to $519.0 million for fiscal 1994, a gain of 12
percent. Without Freehand and PhotoStyler, product revenue of 1994
was $138.2 million for the fourth quarter and $465.8 million for the
full year, for a year over year gain of 11 percent and 24 percent,
respectively.
Adobe's Board of Directors declared a cash dividend for its
fourth fiscal quarter of $.05 per common share for its shareholders
of record as of Jan. 19, 1996 and payable on Feb. 2, 1996.
Except for the historical information contained herein, the
matters discussed in this news release are forward looking
statements that involve risks and uncertainties, including the
timely development and market acceptance of new products and
upgrades to existing products, the impact of competitive products
and pricing, and the other risks detailed from time to time in the
Company's SEC reports.
Adobe Systems Inc., founded in 1982, is headquartered in
Mountain View, California. Adobe develops, markets and supports
computer software products and technologies that enable users to
create, display, print and communicate electronic documents. The
company licenses its technology to major computer, printing and
publishing suppliers, and markets a line of applications software
and type products for authoring visually rich documents.
Additionally, the company markets a line of powerful, but easy to
use, products for home and small business users. Adobe has
subsidiaries in Europe and the Pacific Rim, serving a worldwide
network of dealers and distributors. Adobe's stock is traded on The
Nasdaq Stock Market under the symbol "ADBE".
Note to Editors: Adobe, Acrobat Capture, After Effects,
FrameMaker, PageMaker, PageMill and Photoshop are trademarks of
Adobe Systems Incorporated which may be registered in certain
jurisdictions. Macintosh is a registered trademark of Apple
Computer Inc. Windows is a trademark of Microsoft Corp.
CONTACT: Adobe Systems Inc.,
M. Bruce Nakao, 415/962-2071 (IR),
bnakao@adobe.com
or
Carolyn Schwartz, 415/962-3302 (IR),
cschwart@adobe.com;
http://www.adobe.com" target=_new>http://www.adobe.com">http://www.adobe.com
or
Carol Sacks, 415/962-4989 (PR)
TROY, Mich., January 4, 1996 -- Kmart Corporation
(NYSE: KM) today reported, on a comparable store basis, consolidated
sales rose 4.5% for the five-week period ended December 27, 1995
over sales for the five weeks ended December 28, 1994, excluding
sales of the divested Borders Group, OfficeMax and The Sports
Authority operations. December sales in U.S. Kmart stores increased
5.5% on a comparable store basis.
Total sales for the month from consolidated operations increased
2.0%. On that basis, sales amounted to $5.301 billion in December
1995, versus sales of $5.199 billion for the same period last year.
Sales from consolidated operations for the 48 weeks ended
December 27, 1995 were $31.994 billion, up 4.5% from the
$30.617 billion for the first 48 weeks of 1994, excluding sales of
the divested Borders Group, OfficeMax and The Sports Authority
operations. On a comparable store basis, consolidated sales rose
4.2% for the same period.
"Our December sales met expectations, and reflect additional print
and electronic media support as well as planned levels of
promotions," said Floyd Hall, Chairman, President, and CEO of Kmart.
"Increases over the holiday season were led by toys and domestics.
Apparel, particularly in the women's area, was softer than
anticipated."
Kmart Corporation serves America with 2,169 Kmart and 169 Builders
Square retail outlets, and operates 147 stores internationally.
Kmart Corporation common stock is listed on the New York, Pacific
and Chicago Stock Exchanges.
KMART CORPORATION
SALES BY BUSINESS
4 Weeks Ended % Change
All Comparable
(Millions U.S. $) 12-27-95 12-28-94 Stores Stores
General Merchandise
United States $ 4,855 $ 4,722 2.8 5.5
International 202 206 (1.7) (2.4) (a)
Total General Merchandise 5,057 4,928 2.6 5.2
Builders Square 244 271 (9.9) (7.4)
Total Kmart $ 5,301 $ 5,199 2.0 4.5
48 Weeks Ended % Change
All Comparable
(Millions U.S. $) 12-27-95 12-28-94 Stores Stores
General Merchandise
United States $28,331 $26,751 5.9 5.5
International 1,175 1,091 7.8 3.3 (a)
Total General Merchandise 29,506 27,842 6.0 5.4
Builders Square 2,488 2,775 (10.4) (8.1)
Total Kmart $31,994 $30,617 4.5 4.2
(a) International Comparable Store Sales Change is calculated on
sales in the applicable local currency.
NEW YORK, Jan. 4, 1996 -- Marvel Entertainment
Group, Inc.
(NYSE: MRV) announced that it has taken certain actions to
restructure its publishing and trading card businesses to quickly
improve profitability of those operations.
William C. Bevins, CEO of Marvel, stated, "We have set a course
designed to promptly strengthen the profitability of both businesses
and to position them for strong future growth."
As to publishing, the Company is eliminating unprofitable and
marginally profitable titles, to create a strong line-up comprising
Marvel's most popular, most profitable titles. The Company's comic
books will focus more on editorial events and less on physical
product features and enhancements in order to bring back old readers
and attract new readers. The recently announced return of Jim Lee
and Rob Liefeld, two of the preeminent comic creators of this era,
to reshape four core titles is an example of Marvel's commitment to
strengthening editorial product content. In addition, an exciting
new mass market comic product will be introduced in early 1996.
Operations are being streamlined through introduction of new
technology and consolidation of facilities. Combined with the
reduction in titles, these measures will significantly reduce
editorial, production, distribution and administrative overhead
expense. In addition, the focus on editorial content rather than
enhanced covers and expensive papers will bring about significant
reductions in manufacturing costs. These cost savings will so
improve direct margins as to enable the publishing unit to realize a
healthy profit in 1996 and beyond.
Trading card operational overhead is being reduced through the
consolidation of production facilities at Fleer's Bahalia,
Mississippi plant and the reduction of sales and distribution
overhead. As a result trading card operations should return
promptly to higher profit margins while also positioning the
business well for future growth.
These restructuring activities which include the termination of
approximately 275 employees will result in a fourth quarter pre-tax
restructuring charge of approximately $25 million, bringing to $65
million the total for one-time special charges Marvel has taken in
1995. The Company will report a loss for the fourth quarter. Net
income before extraordinary item for the full year will be
approximately $0.05 per share. The restructuring activities are
expected to result in future period savings of approximately $16
million annually.
Mr. Bevins said, "We continue to be very optimistic about the
long- term prospects for Marvel as a diversified youth entertainment
company based on key intellectual properties. Our franchise in
comics and cards continues to be very strong with Marvel Comics
dominating the top 100 list and Fleer/SkyBox holding key licenses
with all the major sports leagues and entertainment properties. We
anticipate that 1996 cost savings generated by the restructuring
plan will significantly improve profitability for these businesses
in 1996 and beyond. Meanwhile, our sticker, entertainment card, toy
and character licensing, advertising and promotion businesses
continue to be strong performers.
"We are very excited about the future growth of Marvel in the
emerging electronic publishing area. As an example, we will soon be
announcing a major on-line license which was concluded in the fourth
quarter of 1995. We also expect our first MarvelMania restaurant to
open in 1996. When combined with anticipated strong performance
from Marvel's other businesses, we look forward to a success in 1996
consistent with our pre-1995 performance."
/CONTACT: Media, Pam Rutt, Marvel Entertainment Group,
212-576-8535, or Investors, Gary Fishman of Hudson Stone Group,
212-983-8550/