Glacier Water Announces Second Quarter Fiscal Year 2015 Results

VISTA, Calif.--(BUSINESS WIRE)--Glacier Water Services, Inc. (GWSV.pk) announced results for the second quarter of the fiscal year 2015, ended June 28, 2015.

Brian McInerney, Chief Executive Officer of Glacier Water, said, “Our year-to-date revenues increased 1.1% versus the comparable period last year. Same-store revenues increased 0.5% year-to-date. The Company’s first six months of adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were $10,599,000, an increase of 1.2%, or $130,000, over the same period last year. Income from operations for the first six months grew 23.1% to $2,182,000. At the end of the second quarter, Glacier operated approximately 23,000 machines located at retailers across the U.S. and Canada, providing high quality, great tasting drinking water or premium ice.”

Revenues for the second quarter ended June 28, 2015 increased 0.4% to $34,107,000 compared to $33,985,000 for the same period last year. For the six-month period ended June 28, 2015, revenues increased 1.1% to $65,107,000 compared to $64,367,000 for the same period last year. Sales growth for the second quarter and six-month period ended June 28, 2015 was driven primarily by growth in ice revenues and partially offset by the impact of closed stores on the water vending side of the business and cooler comparable weather versus last year in key markets.

The Company’s income from operations for the second quarter ended June 28, 2015, increased 11.9% to $1,892,000 compared to $1,691,000 for the same period last year. For the six-month period ended June 28, 2015, income from operations increased 23.1% to $2,182,000 compared to $1,773,000 for the same period last year. The increase in income from operations was driven by the margin generated from growth in revenues, lower fuel and SG&A costs, and lower depreciation and amortization of $142,000 and $245,000, respectively, offset slightly by higher machine maintenance costs.

The Company’s net loss applicable to common stockholders for the quarter ended June 28, 2015, was $1,825,000 or $0.55 per basic and diluted share, compared to a net loss of $1,474,000, or $0.45 per basic and diluted share for the same period last year. For the six-month period ended June 28, 2015, the net loss applicable to common stockholders was $4,674,000 or $1.41 per basic and diluted share, compared to a net loss of $4,463,000 or $1.35 per basic and diluted share, for the same period last year. The quarter and six-month period ending June 28, 2015 net loss included a non-recurring charge to other expense of $518,000 adjusting contingent consideration liability for a 2012 Company acquisition. Excluding the non-recurring charge, the net loss applicable to common stockholders for the six-month period was $4,156,000, or $1.25 per basic and diluted share. Net loss attributable to the non-controlling interests for the second quarter and six-month period ended June 28, 2015, were $118,000 and $302,000, respectively.

With approximately 23,000 machines located in 47 states throughout the United States and Canada, Glacier is the leading provider of high-quality, low-priced drinking water dispensed to consumers through self-service bottled water machines located at supermarkets and other retail locations.

Statements in this announcement that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. A copy of the Company’s audited financial statements for the year ended December 28, 2014 can be obtained by contacting Steve Stringer at [phone].

GLACIER WATER SERVICES, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(In thousands, except share and per share data)
(Unaudited)
		Three Months Ended				Six Months Ended
		June 29,		June 28,		June 29,		June 28,
		2014		2015		2014		2015
Revenues	$	33,985		34,107		64,367		65,107
Cost of revenues:
Operating expenses		23,172		23,548		44,341		45,215
Depreciation and amortization		4,296		4,154		8,601		8,356
Total cost of revenues		27,468		27,702		52,942		53,571
Gross profit		6,517		6,405		11,425		11,536
Selling, general, and administrative expenses		4,826		4,513		9,652		9,354
Income from operations		1,691		1,892		1,773		2,182
Other expenses:
Other expense		463		1,011		928		1,502
Interest expense		2,694		2,749		5,393		5,486
Total other expense		3,157		3,760		6,321		6,988
Loss before income taxes		(1,466	)	(1,868	)	(4,548	)	(4,806	)
Income taxes expense		100		75		200		170
Net loss	$	(1,566	)	(1,943	)	(4,748	)	(4,976	)
Net loss attributable to noncontrolling interest		(92	)	(118	)	(285	)	(302	)
Net loss attributable to Glacier Water Services, Inc.	$	(1,474	)	(1,825	)	(4,463	)	(4,674	)
Basic and diluted net loss per share	$	0.45		0.55		1.35		1.41
Weighted average shares used in calculation		3,310,416		3,314,773		3,310,416		3,312,595
Pro-Forma, adjusted, EBITDA reconciliation
(In thousands)
(unaudited)
		Three Months Ended				Six Months Ended
		June 29,		June 28,		June 29,		June 28,
		2014		2015		2014		2015
Income (loss) from operations	$	1,691		1,892		1,773		2,182
EBITDA adjustments
Addback of depreciation and amortization		4,296		4,154		8,601		8,356
Non-cash stock compensation expense		47		14		95		61
Adjusted EBITDA	$	6,034		6,060		10,469		10,599

GLACIER WATER SERVICES, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands, except share data)
(unaudited)
Assets		December 28, 2014		June 28, 2015
Current assets:
Cash	$	4,519		5,444
Accounts receivable, net of allowance for doubtful accounts of $62 as of December 28, 2014 and June 28, 2015		2,844		3,015
Repair parts		5,046		5,094
Prepaid expenses and other current assets		1,347		1,787
Total current assets		13,756		15,340
Property and equipment, net		66,552		64,857
Goodwill		18,747		18,747
Intangible assets, net		4,573		4,212
Investment in Glacier Water Trust I Common Securities		2,629		2,629
Investment in Glacier Water Trust I Preferred Securities		3,648		3,648
Deferred financing costs, net		3,861		3,780
Other assets		973		656
Total assets	$	114,739		113,869
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	1,617		1,808
Accrued commissions		4,951		5,639
Accrued liabilities		4,495		3,893
Bank overdraft		2,233		1,936
Total current liabilities		13,296		13,276
Junior subordinated debentures		87,629		87,629
Line of credit		46,500		50,000
Series B junior subordinated debentures		10,466		10,544
Contingent consideration liability		2,225		2,809
Long-term portion of deferred rent		31		32
Total liabilities		160,147		164,290
Commitments and contingencies
Stockholders’ deficit:
Preferred Stock, $0.01 par value; liquidation preference $100 per share; 8% cumulative redeemable convertible; Authorized, 100,000 shares; issued and outstanding, 0 shares at December 28, 2014 and June 28, 2015		-		-
Common stock, $0.01 par value. Authorized 10,000,000 shares, issued 4,904,522, outstanding 3,310,416 and 3,316,916 at December 28, 2014 and June 28, 2015, respectively		50		50
Additional paid-in capital		24,416		24,529
Accumulated deficit		(65,171	)	(69,845	)
Treasury stock, at cost, 1,587,606 shares at December 28, 2014 and June 28, 2015		(32,562	)	(32,562	)
Accumulated other comprehensive income		(9	)	(159	)
Total stockholders’ deficit of Glacier Water Services, Inc.		(73,276	)	(77,987	)
Noncontrolling interest		27,868		27,566
Total stockholders’ deficit		(45,408	)	(50,421	)
Total liabilities and stockholders’ deficit	$	114,739		113,869