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Appliance Recycling Centers of America (ARCA) Names Two New Members to Board of Directors
MINNEAPOLIS, June 20 /PRNewswire-FirstCall/ -- Appliance Recycling Centers of America, Inc. (OTC Bulletin Board:ARCI) today reported that W. William (Bill) Bednarczyk and Albin (Al) S. Dubiak have been named to the company's board of directors. Both fill new positions on the board and will initially serve until the next election of directors, which will be held at the company's annual meeting of shareholders in May 2006. Bednarczyk and Dubiak join current directors Duane S. Carlson, Harry W. Spell and Edward R. (Jack) Cameron, ARCA's president and CEO, to compose the five-member board.
Bednarczyk is currently an independent management consultant specializing in personal investment portfolios and venture capital activities. He formerly held the position of vice president, human resources/administration with Gelco Corporation and was director of employee/labor relations with The Toro Company. In addition, Bednarczyk was a partner in a Cost Cutter franchise, with salons in Wisconsin, Florida and Kansas. He served as a park commissioner and as treasurer for the City of Minneapolis and holds a B.A. from the University of St. Thomas and an M.A. in industrial relations from the University of Minnesota.
Since 2000, Dubiak has been a member of the investment committee of Sisters of Charity of Leavenworth Health System, and since 2003 has been chair of the committee. From 1993 until retiring in 2001, Dubiak was employed by First Asset Management, where he served as director of investment research and manager of the First American Small Cap Value Fund. Prior to that, he held management positions with First Bank System in investor relations and financial and strategic planning, and also served as treasurer. Dubiak earned a B.S. in business administration from Indiana University and an M.B.A. from the University of Arizona.
Edward R. (Jack) Cameron, president and chief executive officer, commented: "Over the years, ARCA has been fortunate to have had the expertise of board members Harry Spell and Duane Carlson, who have made major contributions to the development of our appliance retailing and recycling operations. Bill and Al also bring a wealth of experience to ARCA's board of directors, and I anticipate that they will have a significant impact on our future direction."
Appliance Recycling Centers of America Reports Improved First Quarter Operating Results
ApplianceSmart Same-Store Sales Up 19%
MINNEAPOLIS, May 4 /PRNewswire-FirstCall/ -- Appliance Recycling Centers of America, Inc. (OTC:ARCI) (BULLETIN BOARD: ARCI) today reported revenues of $16,909,000 for the first quarter of 2005 ended April 2, an increase of 46% from $11,597,000 in the year-earlier period. ARCA also reported a net loss of $433,000 or $0.10 per share, an improvement from the net loss of $732,000 or $0.31 per share in the first quarter of 2004.
Same-store sales of the nine ApplianceSmart factory outlets that were open during the complete first quarters of 2005 and 2004 rose 19%. Nationally, total retail sales from all 12 ApplianceSmart outlets nationally increased 53% to $14,911,000 in the first quarter of 2005 compared to the same period in the prior year, with 2005 sales including strong contributions from three stores opened late in the fourth quarter of 2004: St. Paul, Minnesota (the fifth store serving the Minneapolis/St. Paul market), San Antonio, Texas (a new market for ApplianceSmart) and Atlanta (the second ApplianceSmart store in this market). The Atlanta facility also serves as a regional distribution center that supplies appliances to the Columbus, San Antonio and Atlanta retail outlets.
ARCA recently announced that it will open a second ApplianceSmart factory outlet in San Antonio in August. This 37,000-square-foot superstore will enable ApplianceSmart to increase its market penetration of this growing area, while generating greater economies of scale by leveraging advertising support and other overhead expenses.
Recycling revenues, which increased 10% to $1,754,000 in the first quarter of 2005 compared to the year-earlier period, were affected by a temporary reduction in advertising support for recycling programs in California and Connecticut. Full advertising by ARCA's utility partners restarted during the latter stages of the first quarter, and the full impact of this resumption is expected in the second quarter. First quarter revenue contributions to the recycling operation also were made by new programs in the city of Austin, Texas, and in the state of Wisconsin.
First quarter results were affected by significantly increased operating expenses, reflecting growth-related investments in three new ApplianceSmart outlets and two additional recycling centers to support new programs in Connecticut and Austin. However, due to the impact of higher sales in this year's first quarter, operating expenses as a percentage of revenues were virtually unchanged at 32% on a year-over-year basis. As revenues associated with these new facilities continue to increase and given current plans for a more moderate pace of near-term expansion, the operating expense ratio is expected to trend downward as the year progresses.
Edward R. (Jack) Cameron, president and chief executive officer, commented: "We are encouraged by the improvement in ARCA's first quarter results, which were paced by the growing sales momentum of our ApplianceSmart operation. It is becoming increasingly clear that appliance manufacturers are viewing ARCA as a valuable distribution channel for their special-buy appliances, while consumers are responding favorably to our low prices and wide range of offerings. Our key to future success is to continue expanding our ApplianceSmart network at a steady, measured pace, and backed by the capital that we raised through a private placement of our common shares late in 2004, we have sufficient resources for opening additional outlets. Based upon our outlook for continued ApplianceSmart sales growth, strengthened recycling revenues and commitment to stringent expense management, we believe ARCA's performance should improve further in this year's second quarter."
About ARCA
Through its ApplianceSmart ( http://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 2005, ApplianceSmart was operating 12 factory outlets: five in the Minneapolis/St. Paul market; three in the Columbus, Ohio, market; two in the Atlanta market; one 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 http://www.arcainc.com/ and http://www.appliancesmart.com/ .
Appliance Recycling Centers of America, Inc. and Subsidiaries
CONSOLIDATED STATEMENT OF OPERATIONS
1st Quarter 2005 Results
(000's omitted except for share amounts)
Three months
ended
April 2 April 3
2005 2004
Revenues
Retail $14,911 $9,734
Recycling 1,754 1,595
Byproduct 244 268
Total revenues 16,909 11,597
Cost of Revenues 11,806 8,460
Gross profit 5,103 3,137
Selling, General & Administrative Expenses 5,335 3,675
Operating loss (232) (538)
Other Income (Expense)
Other income (expense) (2) (8)
Interest expense (196) (186)
Loss before provision for income taxes (430) (732)
Provision for Income Taxes 3 -
Net loss $(433) $(732)
Basic Earnings (Loss) per Common Share $(0.10) $(0.31)
Diluted Earnings (Loss) per Common Share $(0.10) $(0.31)
Basic Weighted Average No. of Common Shares
Outstanding 4,144 2,398
Diluted Weighted Average No. of Common Shares
Outstanding 4,144 2,398
Appliance Recycling Centers of America, Inc.
Web site: http://www.appliancesmart.com/
http://www.arcainc.com/
