CENTERPLATE, INC 
By
Adjusted earnings before interest, income taxes, depreciation and
amortization (EBITDA) decreased
"We continue to be focused on completing our merger with Kohlberg &
Company as we are confident it will enhance our current partnerships and make
us more competitive in the market," said
For the thirty-nine weeks ended
For the third quarter of 2008, the company reported a net loss of
In light of the company's pending transaction with Kohlberg, the company
will not hold a conference call to discuss the third quarter results.
Additional information about the quarter will be available in the company's
Form 10-Q which is being filed with the United States Securities and Exchange
Commission later today,
About Centerplate
Centerplate, with its principal executive office in
Presentation of Information in this Press Release
Centerplate presents Adjusted EBITDA because covenants in the indenture governing the company's subordinated notes contain ratios based on this measure. A reconciliation of adjusted EBITDA to net income or loss is included in the attached tables.
Forward-Looking Statements
This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act. These statements may involve risks and uncertainties that could cause actual results to differ materially from those described in such statements. Although Centerplate believes that the expectations reflected in these forward-looking statements are reasonable, the company can give no assurance that these expectations will prove to have been correct or that they will occur. Important factors beyond Centerplate's control, including general economic conditions, the outcome of the company's contemplated merger agreement, consumer spending levels, changing trends in its business and competitive environment, adverse weather conditions and other factors, as well as the risks identified in its most recent annual report on Form 10-K and other filings with the Securities and Exchange Commission, could cause actual results to differ materially from Centerplate's expectations. Centerplate undertakes no obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
Contact Information
Gael Doar
Director of Communications
203-975-5941
gael.doar@centerplate.com
CENTERPLATE, INC.
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
Thirteen Weeks Ended Thirty-nine Weeks Ended
September 30, October 2, September 30, October 2,
2008 2007 2008 2007
------------- ---------- ------------- -----------
(In thousands, except share data)
Net sales $278,773 $246,141 $650,289 $572,313
Cost of sales 229,093 197,357 539,384 466,563
Selling, general and
administrative expense 27,102 23,112 70,371 60,473
Depreciation and
amortization 9,599 7,995 26,727 23,090
Transaction related
expenses - 667 - 1,000
Trademark impairment 3,623 - 3,623 -
------------- ---------- ------------- -----------
Income from operations 9,356 17,010 10,184 21,187
------------- ---------- ------------- -----------
Interest expense, net 7,919 7,329 24,611 22,460
Other income, net (55) (470) (339) (1,514)
------------- ---------- ------------- -----------
Income (loss) before
income taxes 1,492 10,151 (14,088) 241
Income tax provision 26,413 4,155 19,465 53
------------- ---------- ------------- -----------
Net income (loss) $(24,921) $5,996 $(33,553) $188
============= ========== ============= ===========
Basic and diluted net
income (loss) per share
with and without
conversion option $(1.19) $0.27 $(1.60) $0.01
============= ========== ============= ===========
Weighted average shares
outstanding with
conversion option - 4,060,997 - 4,060,997
Weighted average shares
outstanding without
conversion option 20,981,813 18,463,995 20,981,813 18,463,995
============= ========== ============= ===========
Total weighted average
shares outstanding 20,981,813 22,524,992 20,981,813 22,524,992
============= ========== ============= ===========
Dividends declared per
share $- $0.20 $0.26 $0.59
============= ========== ============= ===========
CENTERPLATE, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EARNINGS BEFORE INTEREST,
INCOME TAXES, DEPRECIATION, AND AMORTIZATION (UNAUDITED)
Thirteen Weeks Ended Thirty-nine Weeks Ended
September 30, October 2, September 30, October 2,
2008 2007 2008 2007
------------- ---------- ------------- ----------
(In thousands)
Net income (loss) $(24,921) $5,996 $(33,553) $188
Income tax provision 26,413 4,155 19,465 53
------------- ---------- ------------- ----------
Income (loss) before
income taxes 1,492 10,151 (14,088) 241
Adjustments:
Interest expense 7,919 7,329 24,611 22,460
Depreciation and
amortization 9,599 7,995 26,727 23,090
------------- ---------- ------------- ----------
EBITDA (1) $19,010 $25,475 $37,250 $45,791
============= ========== ============= ==========
The following adjustments to EBITDA
were made to compute Adjusted
EBITDA:
EBITDA $19,010 $25,475 $37,250 $45,791
Adjustments:
Transaction related
expenses (2) - 667 - 1,000
Trademark impairment (3) 3,623 - 3,623 -
------------- ---------- ------------- ----------
Adjusted EBITDA (1) $22,633 $26,142 $40,873 $46,791
============= ========== ============= ==========
(1) EBITDA is not a measure in accordance with GAAP. EBITDA is not intended to represent cash flows from operations as determined by GAAP and should not be used as an alternative to income (loss) before taxes or net income (loss) as an indicator of operating performance or to cash flows as a measure of liquidity. We believe that EBITDA is an important measure of the cash returned on our investment in capital expenditures under our contracts. Adjusted EBITDA as defined in the indenture governing our subordinated notes issued in 2003, is determined as EBITDA as adjusted for transaction related expenses, contract related losses, other non-cash charges, and the former annual management fee paid to affiliates of Blackstone and GE Capital, less any non-cash credits. We present Adjusted EBITDA because covenants in the indenture governing our 2003 notes contain ratios based on this measure and it is used by management to among other things evaluate our ability to make interest payments.
(2) Reflects expenses associated with the 2007 follow-on offering to the Company's 2003 initial public offering.
(3) Reflects a non-cash expense for the write down of trademarks as a
result of the determination that an impairment was incurred during the
thirteen weeks ended
CENTERPLATE, INC.
SELECTED CONSOLIDATED CASH FLOW DATA (UNAUDITED)
Thirteen Weeks Ended Thirty-nine Weeks Ended
September 30, October 2, September 30, October 2,
2008 2007 2008 2007
------------- ---------- ------------- ----------
(In thousands) (In thousands)
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss) $(24,921) $5,996 $(33,553) $188
Adjustments to reconcile
net income (loss) to net
cash provided by operating
activities:
Depreciation and
amortization 9,599 7,995 26,727 23,090
Amortization of
deferred financing
costs 990 643 2,960 1,927
Change in fair value
of derivative - 250 (311) 368
Interest earned on
restricted cash - (118) (111) (350)
Charge for impaired
assets 3,623 - 3,623 -
Deferred tax change 26,713 4,241 19,724 256
Gain (loss) on disposition
of assets (96) - (98) (26)
Other 17 (5) (13) -
Changes in assets and
liabilities 11,049 (5,565) 30,463 4,709
------------- ---------- ------------- ----------
Net cash provided
by operating
activities 26,974 13,437 49,411 30,162
------------- ---------- ------------- ----------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of business - - (1,000) -
Purchase of property and
equipment (5,938) (4,139) (14,061) (12,249)
Proceeds from sale of
property and equipment 251 - 309 17
Contract rights
acquired (2,819) (6,937) (15,497) (10,980)
Restricted cash - 5,809 354 6,658
------------- ---------- ------------- ----------
Net cash used in
investing
activities (8,506) (5,267) (29,895) (16,554)
------------- ---------- ------------- ----------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Restricted Cash - - 8,033 -
Repayments - revolving
loans (22,000) (24,500) (64,500) (65,500)
Borrowings - revolving
loans (5,500) 17,000 57,000 55,500
Net borrowings -
swingline loans - - (4,000) -
Principal payments on
long-term debt - (269) (8,840) (807)
Dividend payments - (4,460) (6,925) (13,380)
Increase in bank
overdrafts 2,421 3,391 4,707 4,733
------------- ---------- ------------- ----------
Net cash used in
financing
activities (25,079) (8,838) (14,525) (19,454)
------------- ---------- ------------- ----------
Effect of exchange rate
on cash (198) 453 (438) 453
DECREASE (INCREASE) IN CASH (6,809) (215) 4,553 (5,393)
CASH AND CASH EQUIVALENTS:
Beginning of period 45,215 34,413 33,853 39,591
------------- ---------- ------------- ----------
End of period $38,406 $34,198 $38,406 $34,198
============= ========== ============= ==========
CENTERPLATE, INC.
SELECTED CONSOLIDATED BALANCE SHEET DATA (UNAUDITED)
September 30, January 1,
2008 2008
------------- ----------
ASSETS (in thousands)
Current assets $109,737 $95,517
Property and equipment, net 54,713 51,986
Contract rights, net 92,805 85,183
Cost in excess of net assets
acquired 41,142 41,142
Deferred financing costs, net 11,388 10,361
Other assets 20,847 48,162
------------- ----------
TOTAL ASSETS $330,632 $332,351
============= ==========
LIABILITIES AND STOCKHOLDERS'
DEFICIENCY
Current liabilities $366,287 $114,992
Long-term debt 0 223,334
Other liabilities 21,499 11,559
Total stockholders' deficiency (57,154) (17,534)
------------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIENCY $330,632 $332,351
============= ==========
SOURCE Centerplate, Inc.
