CALLOWAY'S NURSERY, INC. 
By Results for the Third Quarter
-- Sales were
-- Net loss was
-- Diluted net loss per common share was
Results for the Nine-Month Period
-- Sales were
-- Net income was
-- Diluted net income per common share was
Founded in 1986, Calloway's
CALLOWAY'S NURSERY, INC.
CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED)
(amounts in thousands, except per share amounts)
Nine-Months Ended Three-Months Ended
September 30, September 30,
2008 2007 2008 2007
Net sales $35,754 $35,451 $5,712 $7,050
Cost of goods sold 18,670 18,942 3,050 3,683
Gross profit 17,084 16,509 2,662 3,367
Operating expenses 11,546 11,603 3,134 3,350
Advertising expenses 1,267 1,001 167 216
Occupancy expenses 2,241 2,405 573 751
Depreciation and amortization 285 290 98 97
Net interest expense 469 436 174 157
Total expenses 15,808 15,735 4,146 4,571
Income (loss) before provision
for income taxes and
extraordinary gain 1,276 774 (1,484) (1,204)
Income tax expense (benefit) 469 318 (494) (414)
Net income (loss) before
extraordinary gain 807 456 (990) (790)
Extraordinary gain, net of income
tax expense of $72 140 -- 140 --
Net income (loss) $947 $456 $(850) $(790)
Weighted average number of common
shares outstanding - basic
and diluted 6,950 6,950 6,950 6,950
Income (loss) before extraordinary
gain per common share - basic
and diluted $0.12 $0.07 $(0.14) $(0.11)
Extraordinary gain,
net of tax, per common share
- basic and diluted 0.02 -- .02 --
Net income (loss) per common
share - basic and diluted $0.14 $0.07 $(0.12) $(0.11)
CALLOWAY'S NURSERY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands)
ASSETS
September 30, December 31, September 30,
2008 2007 2007
Cash and cash equivalents $1,133 $3,207 $1,480
Accounts receivable 659 148 507
Inventories 3,982 3,324 5,541
Prepaids and other assets 57 88 234
Deferred income taxes -- 259 --
Total current assets 5,831 7,026 7,762
Property and equipment, net 17,622 11,890 11,357
Deferred income taxes 408 387 848
Other assets 312 288 280
Total assets $24,173 $19,591 $20,247
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable and accrued
expenses $4,314 $4,355 $5,253
Current portion of long-term debt 541 577 540
Total current liabilities 4,855 4,932 5,793
Deferred rent payable 103 137 149
Long-term debt, net of current
portion 13,243 9,497 9,200
Total liabilities 18,201 14,566 15,142
Shareholders' equity:
Common stock 72 72 72
Additional paid-in capital 10,220 10,220 10,220
Accumulated deficit (2,912) (3,859) (3,779)
7,380 6,433 6,513
Less: Treasury stock, at cost (1,408) (1,408) (1,408)
Total shareholders' equity 5,972 5,025 5,105
Total liabilities and
shareholders' equity $24,173 $19,591 $20,247
CALLOWAY'S NURSERY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
Nine-Months Ended
September 30,
2008 2007
Cash flows from operating activities:
Net income $947 $456
Adjustments to reconcile net income to net cash
provided by (used for) operating activities:
Depreciation and amortization 285 290
Net change in operating assets and liabilities (999) (2,862)
Net cash provided by (used for) operating activities 233 (2,116)
Cash flows from investing activities:
Additions to property and equipment (9,294) (1,562)
Insurance proceeds from involuntary conversion of
property and equipment 277 --
Proceeds from sale of property and equipment 3,000 693
Net cash used for investing activities (6,017) (869)
Cash flows from financing activities:
Proceeds from issuance of debt 6,504 867
Repayments of debt (2,794) (369)
Retirement of preferred stock -- --
Net cash provided by (used for) financing activities 3,710 498
Net decrease in cash and cash equivalents (2,074) (2,487)
Cash and cash equivalents at beginning of period 3,207 3,967
Cash and cash equivalents at end of period $1,133 $1,480
SOURCE Calloway's
