Third Consecutive Quarter of Improving Performance BOCA RATON,
Fla., May 20 /PRNewswire-FirstCall/ -- Sunair Services Corporation
(NYSE Amex: SNR) announced financial results for its second fiscal
quarter ended March 31, 2009. Revenues from continuing operations
for the second quarter ended March 31, 2009 were $12.6 million,
compared to revenues of $14.3 million for the second quarter of the
prior year. The Company incurred a loss from continuing operations
of $(1,086,685) for the second fiscal quarter ended March 31, 2009,
or $(0.08) per basic and diluted share, compared to a loss of
$(1,239,404) for the same quarter last year, or $(0.09) per basic
and diluted share. The Company incurred a tax affected income from
discontinued operations of $275,000 for the second quarter of 2009,
or $0.02 per basic and diluted share, compared to tax affected
income of $172,208 from discontinued operations for the comparable
period last year, or $0.01 per basic and diluted share. The Company
reported a net loss of $(811,685) for the second quarter ended
March 31, 2009, or $(0.06) per basic and diluted share, compared to
a net loss of $(1,067,196) for the same quarter last year, or
$(0.08) per basic and diluted share. Comments from Management Jack
I. Ruff, Chief Executive Officer and President of Sunair Services
stated, "This is our third consecutive quarter of improved
operating results over last year. Unfortunately our earnings
results were negatively impacted in the second quarter by
significant increased legal expenses due to a shareholder dispute.
Despite this, our commitment to improving Sunair's operations and
profitability were demonstrated through our enhanced financial
performance. We have instituted various initiatives that focus on
revenue growth which will both help our Company in the current
challenging business environment and strengthen Sunair's long-term
growth prospects. Our focus remains revenue growth, increasing
profitability and deleveraging." ABOUT SUNAIR Sunair Services
Corporation, a Florida corporation, through its wholly owned
subsidiary, Middleton Pest Control, Inc., with headquarters located
in Orlando, Florida, provides pest control and lawn care services
to both residential and commercial customers. Middleton provides
essential pest control services and protection against termites and
insects to homes and businesses. In addition, Middleton supplies
lawn care services to homes and businesses, which includes
fertilization treatments and protection against disease, weeds and
insects for lawns and shrubs. For more information about Sunair,
please visit http://www.sunairservices.com/. Information Regarding
Forward Looking Statements Some of the statements in this press
release, including those that contain the words "anticipate,"
"believe," "plan," "estimate," "expect," "should," "intend" and
other similar expressions, are "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. Those forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause our actual
results, performance or achievements or those of our industry to be
materially different from any future results, performance or
achievements expressed or implied by those forward-looking
statements. Among the factors that could cause actual results,
performance or achievement to differ materially from those
described or implied in the forward-looking statements include the
success of the Company's growth initiatives, demand for the
Company's lawn care and pest control services, general economic
conditions, competition, potential technology changes, the risks
inherent in new product and service introductions, the risks
inherent in the entry into new geographic markets, and other
factors included in Sunair's filings with the SEC, including but
not limited to the Company's annual report on Form 10-K for the
fiscal year ended September 30, 2009. Copies of Sunair's SEC
filings are available from the SEC or may be obtained upon request
from Sunair. Sunair does not undertake any obligation to update the
information contained herein, which speaks only as of this date.
SUNAIR SERVICES CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED
BALANCE SHEETS AS OF MARCH 31, 2009 AND SEPTEMBER 30, 2008
(UNAUDITED) March 31, September 30, 2009 2008 ---------- ----------
ASSETS CURRENT ASSETS: Cash and cash equivalents $1,267,875
$2,974,382 Accounts receivable, net 1,905,884 2,597,447
Inventories, net 1,185,965 1,403,832 Prepaid and other current
assets 631,856 2,829,535 ------- --------- Total Current Assets
4,991,580 9,805,196 --------- --------- PROPERTY, PLANT, AND
EQUIPMENT, net 1,601,888 1,907,213 OTHER ASSETS: Software costs,
net 439,849 246,979 Customer list, net 5,594,502 7,456,704 Goodwill
62,112,528 62,112,528 Other assets 227,751 254,790 ------- -------
Total Other Assets 68,374,630 70,071,001 ---------- ----------
TOTAL ASSETS $74,968,098 $81,783,410 =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts
payable $1,218,066 $1,787,406 Accrued expenses 3,470,494 3,256,342
Unearned revenues 665,272 863,770 Customer deposits 2,855,478
3,149,715 Revolving line of credit, current portion - 4,100,000
Notes payable and capital leases, current portion 2,574,012
2,306,189 --------- --------- Total Current Liabilities 10,783,322
15,463,422 ---------- ---------- LONG TERM LIABILITIES: Notes
payable and capital leases, net of current portion 3,101,922
3,682,184 Note payable -related party 5,000,000 5,000,000 Revolving
line of credit, net of current portion 5,500,000 5,500,000
--------- --------- Total Long Term Liabilities 13,601,922
14,182,184 ---------- ---------- TOTAL LIABILITIES 24,385,244
29,645,606 ---------- ---------- STOCKHOLDERS' EQUITY: Preferred
stock, no par value - - Common stock, $.10 par value 1,309,110
1,309,110 Additional paid-in capital 52,872,519 52,756,311
Accumulated deficit (3,598,775) (1,927,617) ---------- ----------
Total Stockholders' Equity 50,582,854 52,137,804 ----------
---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $74,968,098
$81,783,410 =========== =========== SUNAIR SERVICES CORPORATION AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) FOR THE SIX MONTHS FOR THE THREE MONTHS ENDED MARCH 31,
ENDED MARCH 31, 2009 2008 2009 2008 ---- ---- ---- ---- SALES
$25,324,234 $27,815,388 $12,604,368 $14,337,757 COST OF SALES
9,604,002 10,855,628 4,552,309 5,615,361 --------- ----------
--------- --------- GROSS PROFIT 15,720,232 16,959,760 8,052,059
8,722,396 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 17,143,024
19,821,852 8,926,832 9,667,352 ---------- ---------- ---------
--------- LOSS FROM OPERATIONS (1,422,792) (2,862,092) (874,773)
(944,956) OTHER INCOME (EXPENSES): Interest income 1,852 108,726
151 62,689 Interest expense (476,559) (725,937) (213,534) (346,310)
(Loss) gain on disposal of assets (10,353) (6,157) 1,471 (10,827)
Gain on extinguishment of debt 25,000 - - - ------ ---- ---- ----
Total Other Income (Expenses) (460,060) (623,368) (211,912)
(294,448) -------- -------- -------- -------- LOSS FROM OPERATIONS
BEFORE INCOME TAXES (1,882,852) (3,485,460) (1,086,685) (1,239,404)
INCOME TAX PROVISION - - - - ---- ---- ---- ---- LOSS FROM
CONTINUING OPERATIONS (1,882,852) (3,485,460) (1,086,685)
(1,239,404) (LOSS) INCOME FROM DISCONTINUED OPERATIONS, NET 211,694
304,451 275,000 172,208 ----------- ----------- ---------
----------- NET LOSS $(1,671,158) $(3,181,009) $(811,685)
$(1,067,196) =========== =========== ========= =========== BASIC
AND DILUTED (LOSS) INCOME PER SHARE: CONTINUING OPERATIONS $(0.14)
$(0.26) $(0.08) $(0.09) ====== ====== ====== ====== DISCONTINUED
OPERATIONS $0.01 $0.02 $0.02 $0.01 ===== ===== ===== ===== NET LOSS
$(0.13) $(0.24) $(0.06) $(0.08) ====== ====== ====== ======
WEIGHTED AVERAGE SHARES OUTSTANDING: BASIC and DILUTED 13,091,088
13,091,088 13,091,088 13,091,088 SUNAIR SERVICES CORPORATION AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR
THE SIX MONTHS ENDED MARCH 31, 2008 AND 2007 (UNAUDITED) 2008 2007
---- ---- CASH FLOWS FROM OPERATING ACTIVITIES: Net loss
$(1,671,158) $(3,181,009) Adjustments to reconcile net loss to net
cash provided by (used in) operating activities: Depreciation
417,499 454,946 Amortization 1,862,202 1,952,805 Bad debt reserve
107,646 168,194 Inventory reserve - (423,193) Loss on sale of
assets 10,353 6,157 Gain on extinguishment of debt (25,000) -
Stock-based compensation expense 116,208 203,087 (Increase)
decrease in assets: Accounts receivable 583,917 (1,382,957)
Inventories 217,867 202,980 Prepaid and other current assets
2,197,679 400,471 Other assets 27,039 3,875 Increase (decrease) in
liabilities: Accounts payable and accrued expenses (355,188)
(758,450) Unearned revenue (198,498) 50,619 Customer deposits
(294,237) 392,892 -------- ------- Net Cash Provided By (Used In)
Operating Activities 2,996,329 (1,909,583) --------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property, plant,
and equipment (156,784) (289,352) Software development costs
(192,870) - Cash paid for business acquisitions - (1,000,000) Net
proceeds from sale of assets 34,257 30,796 ------ ------ Net Cash
(Used In) Investing Activities (315,397) (1,258,556) --------
---------- CASH FLOWS FROM FINANCING ACTIVITIES: Repayment of line
of credit (net) (4,100,000) - Proceeds from line of credit -
3,800,000 Repayment of notes payable and capital leases (287,439)
(80,638) -------- ------- Net Cash (Used In) Provided By Financing
Activities (4,387,439) 3,719,362 ---------- --------- Effect of
exchange rate fluctuations on cash - (56,457) ---- ------- NET
DECREASE IN CASH AND CASH EQUIVALENTS (1,706,507) 494,766 CASH AND
CASH EQUIVALENTS, BEGINNING OF PERIOD 2,974,382 2,781,838 ---------
--------- CASH AND CASH EQUIVALENTS, END OF PERIOD $1,267,875
$3,276,604 ========== ========== SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION: Cash paid during the period for interest $529,822
$676,228 ======== ======== SUPPLEMENTAL DISCLOSURE OF NON-CASH
INVESTING AND FINANCING ACTIVITIES: Debt incurred in acquisitions
$- $600,000 ==== ======== DATASOURCE: Sunair Services Corporation
CONTACT: Jaime Torres, Investor Relations, +1-561-955-7300 Web
Site: http://www.sunairservices.com/
Copyright