Multi-Color Corporation Issues Disappointing First Quarter Outlook
Press release from the issuing company
CINCINNATI, June 28 -- Multi-Color Corporation today announced a preliminary outlook of financial results for the first quarter ending June 30, 2004, as follows:
Revenues for the quarter are expected to be slightly below revenues of $29.1 million for the FY2004 first quarter, ended June 30, 2003;
* Diluted earnings per share for the FY2005 first quarter are expected to be within a range of 13 to 16 cents, compared with diluted earnings per share of 25 cents for the FY2004 first quarter (adjusted for a 3-for-2 stock split in November 2003).
Frank Gerace, President and CEO of Multi-Color said, "Three key factors have contributed to what we expect will be a disappointing quarter. They are as follows:
a delay of anticipated sales orders from a major customer,
* operating inefficiencies at our plant in Scottsburg, IN, related to the integration of our Las Vegas shrink sleeve label operations and
* start-up expenses to achieve compliance with new accounting and financial control provisions of the Sarbanes-Oxley Act."
To address these factors Multi-Color's response included the following:
* The Company expects the sales order shortfall to be made up in the second quarter as this customer returns to their normal purchasing pattern.
* It has taken longer than expected to smoothly integrate the Las Vegas shrink sleeve production into our major plant in Scottsburg, IN. However, we have continued to meet or exceed all customer commitments. Recent changes in both management and operations are now showing that the Company is beginning to realize the anticipated benefits from this more efficient plant.
* We are projecting the cost of Sarbanes-Oxley compliance to decrease throughout the year.
"While the combined effect of these events will significantly affect our first-quarter results," Gerace added, "I remain confident that fiscal 2005 will be another good year for Multi-Color, and that we will capture substantial cost savings from the recent consolidation of our facilities. Our new gravure printing press will go online in Scottsburg, IN next quarter, our sales outlook has improved in recent weeks and by month-end we are renewing our acquisition loan and expanding our long-term financing to support our growth strategy. I am optimistic that Multi-Color can achieve the long-term revenue and earnings growth objectives that I have outlined in the past."
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