The Fairchild Corporation, McLean, Va., posted net earnings of $11.2 million, or 0.44 per share, for the quarter ended Sept. 30, 2004. Those results compare to a net loss of $2.8 million, or $0.11 per share, for the quarter ended September 30, 2003.
Earnings from continuing operations was $2.5 million, or $0.10 per share, for the quarter ended Sept. 30, 2004, as compared to a loss from continuing operations of $2.5 million, or $0.10 per share, for the quarter ended Sept. 30, 2003.
Company officials say non-cash items in the earnings from continuing operations include a $6.9 million income tax benefit, $2.7 million of depreciation and amortization expense, and $0.6 million of non-cash interest expense, offset partially by a $0.9 million fair market value decrease on an interest rate hedge contract. Net earnings were recorded after a $13.4 million income tax benefit from discontinued operations, offset partially by a $4.8 million expense from discontinued operations, primarily for environmental issues related to a former business.
Overall revenues increased by $77.4 million, or 402%, in the fourth quarter, as compared to the quarter ended September 30, 2003, due primarily to the acquisition of Fairchild Sports, which includes Hein Gericke and IFW acquired on November 1, 2003, and Polo Express acquired on January 2, 2004.
Revenues for Fairchild Sports between April and September 2004 were $163.2 million, which generated pre-tax earnings of $11.5 million.
"We have owned Hein Gericke, Polo, and IFW for less than a year and, in that time, have made substantial strides to improve their businesses,” said Eric Steiner, President and Chief Operating Officer of The Fairchild Corporation. “We have built a management team which is capable of prospering in the difficult retail environment in Europe, implemented a new sales strategy, and introduced new products. Our efforts are beginning to translate into tangible economic growth. These businesses offer substantial long-term growth opportunities for expansion, both in Europe and elsewhere. We intend to vigorously pursue those opportunities."
Together, Hein Gericke and PoloExpress operate 229 retail shops in Germany, Austria, Belgium, England, France, Ireland, Italy, Luxembourg and the Netherlands. IFW, located in Tustin, Calif., is a designer and distributor of motorcycle protective apparel, boots and helmets, under several labels, including First Gear and Hein Gericke. In addition, IFW designs and produces protective apparel under private labels for third parties, including Harley-Davidson.
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