Glacier Water Announces Third Quarter Fiscal Year 2014 Results

VISTA, Calif.--(BUSINESS WIRE)--

Glacier Water Services, Inc. (OTC Pink: GWSV) announced results for the third quarter of the fiscal year 2014, ended September 28, 2014.

Brian McInerney, Chief Executive Officer of Glacier Water, said, “Our third quarter and year-to-date revenues increased 6.3% versus the comparable periods last year. On a same-store basis, revenues increased 5.3% year-to-date. The Company's first nine months of adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $18,379,000, an increase of 11.1% or $1,832,000 over the same period last year. At the end of the third quarter, Glacier operated approximately 23,500 machines located at retailers across the U.S. and Canada, providing high quality, great tasting drinking water or premium ice.”

Revenues for the third quarter ended September 28, 2014 increased 6.3% to $37,690,000 compared to $35,458,000 for the same period last year. For the nine-month period ended September 28, 2014, revenues increased 6.3% to $102,057,000 compared to $96,032,000 for the same period last year. Sales growth for the third quarter and nine-month period ended September 28, 2014 was driven primarily by positive growth in same-store productivity.

The Company's income from operations for the third quarter ended September 28, 2014 increased 31.2% to $3,589,000 compared to $2,735,000 for the same period last year. For the nine-month period ended September 28, 2014, income from operations increased 25.5% to $5,362,000 compared to $4,273,000 for the same period last year. The increase in income from operations was driven by the margin generated from growth in revenues and better asset utilization across the Company, offset by increased depreciation and amortization of $175,000 and $743,000, respectively, and operating costs, in particular labor and benefits and vehicle fleet expense.

The Company's net income applicable to common stockholders for the quarter ended September 28, 2014 was $320,000 or $0.10 per basic and diluted share, compared to a net loss of $358,000, or $0.11 per basic and diluted share for the same period last year. For the nine-month period ended September 28, 2014, the net loss applicable to common stockholders was $4,139,000 or $1.25 per basic and diluted share, compared to a net loss of $4,708,000 or $1.42 per basic and diluted share, for the same period last year. Net income attributable to the non-controlling interests for the third quarter ended September 28, 2014 was $21,000 and the net loss for the nine-month period ended September 28, 2014 was $268,000.

With approximately 23,500 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 29, 2013 can be obtained by contacting Steve Stringer at 760-560-1111.

FINANCIAL RESULTS				GLACIER WATER SERVICES, INC.
GLACIER WATER SERVICES, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(In thousands, except share and per share data)
(Unaudited)
				Three Months Ended										Nine Months Ended
				September 29,						September 28,				September 29,					September 28,
				2013						2014				2013					2014
Revenues				$	35,458					37,690				96,032					102,057
Cost of revenues:
Operating expenses					24,063					25,253				65,934					69,593
Depreciation and amortization					4,099					4,274				12,132					12,875
Total cost of revenues					28,162					29,527				78,066					82,468
Gross profit					7,296					8,163				17,966					19,589
Selling, general, and administrative expenses					4,561					4,574				13,693					14,227
Income from operations					2,735					3,589				4,273					5,362
Other expenses:
Other expense					393					464				987					1,392
Interest expense					2,703					2,684				8,143					8,077
Total other expense					3,096					3,148				9,130					9,469
Income (loss) before income taxes					(361	)				441				(4,857	)				(4,107	)
Income taxes expense					13					100				39					300
Net income (loss)				$	(374	)				341				(4,896	)				(4,407	)
Net income (loss) attributable to noncontrolling interest					(16	)				21				(188	)				(268	)
Net income (loss) attributable to Glacier Water Services, Inc.				$	(358	)				320				(4,708	)				(4,139	)
Basic and diluted net income (loss) per share
Basic net income (loss) per share				$	(0.11	)				0.10				(1.42	)				(1.25	)
Weighted average shares used in calculation					3,310,286					3,310,416				3,310,128					3,310,416
Diluted net income (loss) per share				$	(0.11	)				0.10				(1.42	)				(1.25	)
Weighted average shares used in calculation					3,310,286					3,360,196				3,310,128					3,310,416
Pro-Forma, adjusted, EBITDA reconciliation
(In thousands)
(unaudited)
				Three Months Ended										Nine Months Ended
				September 29,						September 28,				September 29,					September 28,
				2013						2014				2013					2014
Income from operations				$	2,735					3,589				4,273					5,362
EBITDA adjustments
Addback of depreciation and amortization					4,099					4,274				12,132					12,875
Non-cash stock compensation expense					47					47				142					142
Adjusted EBITDA				$	6,881					7,910				16,547					18,379

FINANCIAL RESULTS	GLACIER WATER SERVICES, INC.
GLACIER WATER SERVICES, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands, except share data)
(unaudited)
Assets				December 29,						September 28,
				2013						2014
Current assets:
Cash				$	4,264					6,674
Accounts receivable, net of allowance for doubtful accounts of $62 as of December 29, 2013 and September 28, 2014					2,617					3,168
Repair parts					4,344					4,783
Prepaid expenses and other current assets					1,808					2,053
Total current assets					13,033					16,678
Property and equipment, net					69,852					67,585
Goodwill					18,747					18,747
Intangible assets, net					5,474					4,798
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					4,008					3,907
Other assets					1,046					836
Total assets				$	118,437					118,828
Liabilities and Stockholders' Deficit
Current liabilities:
Accounts payable				$	1,608					1,481
Accrued commissions					4,726					6,302
Accrued liabilities					3,854					4,553
Bank overdraft					2,297					3,324
Total current liabilities					12,485					15,660
Junior subordinated debentures					87,629					87,629
Line of credit					43,500					45,000
Series B junior subordinated debentures					10,311					10,427
Contingent consideration liability					2,202					2,250
Long-term portion of deferred rent					91					26
Total liabilities					156,218					160,992
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 29, 2013 and September 28, 2014					-					-
Common stock, $0.01 par value. Authorized 10,000,000 shares, issued 4,898,022 outstanding 3,310,416 at December 29, 2013 and September 28, 2014;					50					50
Additional paid-in capital					24,227					24,369
Accumulated deficit					(58,042	)				(62,181	)
Treasury stock, at cost, 1,587,606 shares at December 29, 2013 and September 28, 2014					(32,562	)				(32,562	)
Accumulated other comprehensive income					216					98
Total stockholders' deficit of Glacier Water Services, Inc.					(66,111	)				(70,226	)
Noncontrolling interest					28,330					28,062
Total stockholders' deficit					(37,781	)				(42,164	)
Total liabilities and stockholders' deficit				$	118,437					118,828