Neebo, Inc. Reports Fiscal 2013 Second Quarter Financial Results

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Neebo, Inc. Reports Fiscal 2013 Second Quarter Financial Results

LINCOLN, Neb.--(BUSINESS WIRE)-- Neebo, Inc. (the "Company") today announced financial results for the fiscal second quarter ended September 30, 2012. Neebo, Inc. is a holding company and the beneficial owner of Nebraska Book Company, Inc., an industry leader in solutions for the college bookstore marketplace.

Fiscal 2013 Financial Highlights (six months ended September 30, 2012)

  • Debt reduced by $56.8 million, from $218.3 million at June 30, 2012 to $161.5 million at September 30, 2012. The Company made a $25.0 million voluntary prepayment on its senior secured term loan, permanently reducing the outstanding principal amount under this facility. In addition, the Company has repaid the full $31.8 million balance on its Bridge loan.
  • Adjusted EBITDA** of $31.8 million for the six months ended September 30, 2012, an increase of $5.9 million over prior year period.
  • Gross profit of 40.7% for the six months ended September 30, 2012, up from 39.2% in prior year period.

"I am proud to say that our team has continued to execute on our key strategies for continued growth and profitability," said Steve Clemente, President and Chief Executive Officer. "Our simple, yet effective approach focuses on best in class guest service, expanding textbook rental programs, growing our site Neebo.com and strengthening our balance sheet through disciplined working capital management, all of which contributed to significant improvements in gross profit and SG&A expenses during the past quarter."

"We fully intend to remain focused on paying down debt with free cash flow and net working capital improvements as we demonstrate our commitment to disciplined capital management," explains Alexi Wellman, Chief Financial Officer.

The following table presents selected financial data for continuing operations as of and for the six months ended September 30, 2012 and 2011 ($ in 000's).

 

Six months ended

 
   

September 30,
2012

 

September 30,
2011

 

Percent
Change

 

 
 
Total assets$377,389$547,144*
Long-term debt161,472452,073*
 
Revenues, net of returns264,065283,601-6.9%
Adjusted EBITDA**31,83725,93122.8%
Adjusted EBITDA Margin12.1%9.1%
 
Net cash flows provided by (used in) operating activities4,835(45,615)-110.6%
Net cash flows used in investing activities(4,769)(5,377)*
Net cash provided by (used in) financing activities(72,817)117,131*
 
Net income (loss) from operations$268,518$(115,370)-332.7%
 

* Not Meaningful

** Adjusted EBITDA is a non-GAAP financial measure. See additional disclosure below.

Item Impacting the Six Months Ended September 30, 2012 Comparability

  • The Company recorded the impact of fresh start accounting as of June 30, 2012. As a result of fresh start accounting, Adjusted EBITDA was positively impacted by approximately $3.0 million related to the recording of overhead capitalization.

Conference Call

Management will hold a conference call on November 29, 2012 at 11:00AM Eastern Time (10:00AM Central Time) to review the Company's fiscal second quarter financial results. To participate in the call, please dial (800) 553-5275 or (888) 428-4470 (International). Interested parties are asked to dial in ten minutes prior to the start time of the call.

A digitized replay of the call will be available from November 29, 2012 through December 6, 2012. To access the replay, call (800) 475-6701 or (320) 365-3844 (International) and use the access code 271935.

The unaudited condensed consolidated financial statements as of and for the three and six months ended September 30, 2012 and 2011 are located on the Company's website at: http://www.nebook.com/financial/company_filings.asp.

About the Company

Neebo, Inc. is the beneficial owner of the Nebraska Book Company, Inc. Nebraska Book Company, Inc. began in 1915 with a single college store near the University of Nebraska campus and now operates nearly 250 stores serving colleges and universities with more than two million students. Nebraska Book Company, Inc. serves more than 2,500 bookstores, selling six million textbooks annually and installing more than 1,600 technology platforms and e-commerce sites. Additional information about Nebraska Book Company, Inc. can be found at the Company's website: www.nebook.com.

Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they do not fully materialize or prove incorrect, could cause the Company's business and results of operations to differ materially from those expressed or implied by such forward-looking statements. Such forward-looking statements include statements that discuss management's beliefs and assumptions and can be identified by the use of words such as "will," "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "intends," "potential," "continue," or the negative of such terms, or other comparable terminology. These forward-looking statements speak only as of the date on which the statements were made. The Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by applicable law. Additional information regarding forward-looking statements as well as risks and uncertainties is contained in Management's Discussion and Analysis.

Selected Financial Data

The information contained herein is more fully detailed and explained in the Company's Unaudited Condensed Consolidated Financial Statements and Management Discussion & Analysis, which is available at: http://www.nebook.com/financial/company_filings.asp.

Consolidated Statement of Operations($ in 000's)

  Three months ended   Six months ended
   Successor   Predecessor  
three monthsthree months
SuccessorPredecessorendedendedPredecessor

September 30,
2012

September 30,
2011

September 30,
2012

June 30,
2012

September 30,
2011

Revenues, net of returns$195,911$217,744$195,911$68,153$283,601
Costs of sales 113,468  133,453  113,468  43,027  172,547 
Gross profit 82,443  84,291  82,443  25,127  111,054 

 

Operating expenses:
Selling, general, and administrative47,90148,65647,90131,31885,123
Depreciation1,7581,7431,7581,6423,618
Amortization 2,224  1,979  2,224  2,067  3,972 
 51,884  52,378  51,884  35,027  92,712 
Income (loss) from operations 30,559  31,912  30,559  (9,900) 18,342 
 
Operating expenses:
Interest expense10,0779,41710,0778,33722,182
Interest income(17)-(17)-(14)
Goodwill impairment -  122,639  -  -  122,639 
 10,060  132,056  10,060  8,337  144,806 

Income (loss) before reorganization items and income taxes

20,499(100,143)20,499(18,237)(126,464)
Reorganization items (679) 8,749  (679) (274,817) 15,266 

Income (loss) from continuing operations before income taxes

21,178(108,892)21,178256,580(141,731)
Income tax expense (benefit) 7,785  (16,396) 7,785  -  (26,353)
Income (loss) from continuing operations13,393(92,496)13,393256,580(115,378)

Income (loss) from discontinuing operations, net of tax

 (514) 823  (514) (941) 8 
 
Net income (loss)$12,879 $(91,674)$12,879 $255,639 $(115,370)
 

Net Revenues by Segment ($ in 000's)

  Three months ended  Six months ended
    Successor Predecessor  
three monthsthree months
SuccessorPredecessorendedendedPredecessor

September 30,

2012

Percent
of total

September 30,

2011

Percent
of total

September 30,

2012

June 30,

2012

September 30,

2011

Percent
of total

 
College Stores$141,76072.4%$167,49776.9%$141,760 $43,762$209,91974.0%
Textbooks58,14529.7%55,46325.5%58,14525,88581,42628.7%
Complementary Services7,6283.9%8,6124.0%7,6285,31915,5855.5%
Intersegment (11,621)-5.9% (13,829)-6.4% (11,621) (6,813) (23,330)-8.2%

Total net revenues

$195,911 100.0%$217,744 100.0%$195,911 $68,153 $283,601  Read Full Story

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