EXHIBIT 99.1
|
|
Appliance Recycling Centers of America, Inc.
7400 Excelsior Boulevard, Minneapolis MN 55426 (952) 930-9000
|
|
For Immediate Release
|
|
For information
contact:
|
|
|
|
Edward R. (Jack)
Cameron (CEO)
|
|
|
|
Linda A. Koenig
(CFO)
|
|
|
|
(952) 930-9000
|
|
|
|
|
|
|
|
Richard G.
Cinquina
|
|
|
|
Equity Market
Partners
|
|
|
|
(904) 415-1415
|
|
|
|
|
Appliance Recycling Centers of
America Reports
First Quarter Results
Minneapolis, MN—May 4, 2006—Appliance Recycling Centers of America, Inc.
(Nasdaq: ARCI) today reported sales of
$17,916,000 for the first quarter of 2006 ended April 1, an increase of 6%
from $16,909,000 in the year-earlier period. ARCA’s net loss for this period
came to $678,000 or $0.16 per share, compared to the net loss of $433,000 or
$0.10 per share in the first quarter of 2005.
Same-store
sales of the 11 ApplianceSmart factory outlets that were open during the
complete first quarters of 2006 and 2005 increased 4%, while total retail sales
rose 6% to $15,837,000. ApplianceSmart’s third factory outlet in the Atlanta market
will open in this year’s second quarter, bringing the total number of stores to
14 nationally.
First
quarter recycling revenues of $1,763,000 were substantially unchanged from the
level in the year-earlier period. Utilities generally increase their
advertising support in the second quarter, which is expected to have a positive
impact on recycling volumes. ARCA has submitted a proposal for an extension of
the appliance recycling program sponsored by Southern California Edison Company
for the years 2006 through 2008. This proposal covers substantially the same
southern California territory as the 2004-2005 program, which has been rolled
over into 2006, pending approval of ARCA’s proposal by California’s Public
Utilities Commission. ARCA also has submitted a proposal for renewing its
appliance recycling program with San Diego Gas & Electric.
Edward R. (Jack) Cameron, president and chief executive officer,
commented: “ARCA’s results were affected by seasonal conditions that typically
cause the first quarter to be ApplianceSmart’s weakest
period of the year. In addition, we temporarily delayed planned
newspaper advertising in our large Minnesota market until we negotiated more
favorable advertising rates. We also believe high gasoline prices and rising
interest rates could have affected the discretionary purchasing decisions of
our value-conscious customer base. The second and third quarters are typically
ApplianceSmart’s seasonally strongest periods, and we entered the second
quarter with increased advertising support to coincide with this anticipated
strengthening. While the impact of national economic conditions on our
customers remains a concern, we believe the second quarter should be a stronger
period for our retail operation.”
About ARCA
Through
its ApplianceSmart (www.ApplianceSmart.com) operation, ARCA is one of the
nation’s leading retailers of special-buy household appliances, primarily those
manufactured by Maytag, GE, Frigidaire and Whirlpool. These special-buy
appliances, which include close-outs, factory overruns and scratch-and-dent
units, typically are not integrated into the manufacturer’s normal distribution
channel. ApplianceSmart sells these virtually new appliances at a discount to
full retail, offers a 100% money-back guarantee and provides warranties on
parts and labor. As of May 2006, ApplianceSmart was operating 13 factory
outlets: five in the Minneapolis/St. Paul market; three in the Columbus, Ohio,
market; two in the Atlanta market; two in San Antonio, Texas and one in Los Angeles.
ARCA is also one of the nation’s largest recyclers of major household
appliances for the energy conservation programs of electric utilities.
#
# #
Statements about ARCA’s outlook are forward-looking and involve risks
and uncertainties, including but not limited to: the strength of recycling
programs, the growth of appliance retail sales, the speed at which individual
retail stores reach profitability, and other factors discussed in the Company’s
filings with the Securities and Exchange Commission.
Visit
our web sites at www.arcainc.com and www.appliancesmart.com.
Appliance Recycling Centers of America, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEET
As of April 1, 2006
(000’s)
|
|
|
April 1,
2006
|
|
December 31,
2005
|
|
|
|
|
(Unaudited)
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
2,614
|
|
$
|
2,095
|
|
|
Receivables -
net of allowance of $252,000
|
|
2,063
|
|
2,896
|
|
|
Inventories, net
of reserves of $255,000 and $379,000 respectively
|
|
12,746
|
|
11,900
|
|
|
Deferred income
taxes
|
|
393
|
|
393
|
|
|
Other current
assets
|
|
296
|
|
449
|
|
|
Total Current
Assets
|
|
18,112
|
|
17,733
|
|
|
Property and
Equipment, at cost
|
|
|
|
|
|
|
Land
|
|
1,140
|
|
2,050
|
|
|
Building and
Improvements
|
|
2,220
|
|
4,501
|
|
|
Equipment
|
|
6,320
|
|
6,299
|
|
|
|
|
9,680
|
|
12,850
|
|
|
Less accumulated
depreciation
|
|
6,195
|
|
6,798
|
|
|
Net property and
equipment
|
|
3,485
|
|
6,052
|
|
|
Asset Held for
Sale, Net
|
|
2,437
|
|
—
|
|
|
Other assets
|
|
357
|
|
356
|
|
|
Restricted cash
|
|
50
|
|
350
|
|
|
Total
Assets
|
|
$
|
24,441
|
|
$
|
24,491
|
|
|
|
|
|
|
|
|
|
Liabilities
and Shareholders’ Equity
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
Line of credit
|
|
$
|
6,357
|
|
$
|
6,125
|
|
|
Current
maturities of long term obligations
|
|
399
|
|
262
|
|
|
Accounts payable
|
|
4,499
|
|
3,868
|
|
|
Accrued expenses
|
|
3,343
|
|
3,541
|
|
|
Income taxes
payable
|
|
58
|
|
58
|
|
|
Total Current
Liabilities
|
|
14,656
|
|
13,854
|
|
|
Long-Term
Obligations, less current maturities
|
|
4,626
|
|
4,823
|
|
|
Deferred Income
Tax Liabilities
|
|
393
|
|
393
|
|
|
Total
Liabilities
|
|
19,675
|
|
19,070
|
|
|
|
|
|
|
|
|
|
Shareholders’
Equity
|
|
|
|
|
|
|
Common stock, no
par value; authorized 10,000,000 shares; issued and outstanding 4,328,000 and
4,320,000 shares respectively
|
|
14,863
|
|
14,840
|
|
|
Accumulated
Deficit
|
|
(10,097
|
)
|
(9,419
|
)
|
|
Total
Shareholders’ Equity
|
|
4,766
|
|
5,421
|
|
|
Total
Liabilities and Shareholders’ Equity
|
|
$
|
24,441
|
|
$
|
24,491
|
|