Home Solutions Comments on Relationship With American Renaissance Homes
June 06 2006 - 12:27PM
Business Wire
Home Solutions (AMEX: HOM), a provider of recovery, restoration and
rebuilding/remodeling services, commented today on its relationship
with American Renaissance Homes (ARH), a provider of affordable
housing. On May 23rd, the Company announced through a press release
that it had been awarded a contract by ARH. The Company has
assumed, for purposes of its 2006 business outlook, that this
relationship will generate $5 million in revenue, largely in the
fourth quarter, representing a small portion of its 2006 financial
guidance of revenue of $160 million to $165 million as ARH is a
start-up company. In addition, Home Solutions has entered into an
agreement with ARH, under which it would loan up to $800,000, upon
ARH meeting certain performance criteria, to support ARH's working
capital requirements, secured by ARH's ownership in modular homes
and land. The parties have been in discussions regarding Home
Solutions taking an ownership position in the Company, but no
agreement has been consummated and Home Solutions does not, at the
present time, have an ownership stake in ARH. "We believe this
relationship is very strategic for the Company, and as the
rebuilding of New Orleans accelerates it will, in future years,
become a more important component to our revenue base," said Frank
J. Fradella, Chairman and CEO of Home Solutions. "The demand for
affordable housing is expected to be significant, however, we have
anticipated that much of that work will contribute to 2007
results." Currently, many New Orleans area residents live in 200
square foot trailers provided by FEMA. ARH will provide homes
between 1,200 and 2,300 square feet at a fraction of the cost of
construction in the area, which is currently approaching $150 per
square foot. Home Solutions is a provider of recovery, restoration
and rebuilding/remodeling services to commercial and residential
areas that are (i) prone to flooding, hurricanes, tornados, fires
or other naturally occurring and repetitive weather related
emergencies; and/or (ii) experiencing robust housing development.
The Company has operations in California, Texas, Florida, Alabama,
Georgia, Louisiana, Mississippi and South Carolina through its five
subsidiaries, Cornerstone Building and Remodeling, Southern
Exposure, P.W. Stephens, Home Solutions Restoration of Louisiana
and Fiber Seal Systems. Cornerstone is a leading supplier and
installer of granite materials for kitchens and baths to national
home centers, as well as national builders and remodeling
companies, in the southeastern United States. Southern Exposure and
related companies is a manufacturer and installer of cabinet and
countertop services in the Florida marketplace. P.W. Stephens
provides mold and asbestos remediation services, and fire and water
restoration services in California, Florida and Louisiana. Home
Solutions Restoration of Louisiana provides Recovery Restoration
Services in Florida, Louisiana, Mississippi and Texas and Fiber
Seal Systems is a national licensor of cleaning and fabric
protection businesses. For more information on Home Solutions,
please see the Company's website at http://www.homcorp.com.
Statements included in this update that are not historical in
nature are intended to be, and are hereby identified as,
"forward-looking statements" for purposes of the safe harbor
provided by Section 21E of the Securities Exchange Act of 1934, as
amended by Public Law 104-67. Forward-looking statements may be
identified by words including "anticipate," "believe," "intends,"
"estimates," "expect," and similar expressions. The Company
cautions readers that forward-looking statements including, without
limitation, those relating to the Company's future business
prospects are subject to certain risks and uncertainties that could
cause actual results to differ materially from those indicated in
the forward-looking statements, due to factors such as those
relating to economic, governmental, technological, and other risks
and factors identified from time to time in the Company's reports
filed with the SEC.
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