Champion Reports Net Losses for Second Quarter and First Six Months
HUNTINGTON, WV—June 14, 2012—Champion Industries announced a second quarter 2012 net loss of $21 million, compared to net income of $493,000 for the three months ended April 30, 2011. Its net loss for the six months ended April 30, 2012 was $21.1 million vs. net income of $566,000 for the six months ended April 30, 2011.
The losses for the second quarter and six months ended April 30, 2012 were reflective of pre-tax non-cash charges of $9.5 million associated with impairment of goodwill at the newspaper segment and an increase in the deferred tax asset valuation allowance of $15.2 million.
Marshall T. Reynolds, chairman of the board and CEO of Champion, said, “Our second quarter and first six months of 2012 was negatively impacted due to two charges associated with certain non-cash events. When we step back and look at the fundamental operations of the company, we have grown sales for the year to date period to $65.0 million from $62.9 million in the previous year or 3.4 percent and when we look at the second quarter of 2012 compared to the prior year we have grown sales 7.7 percent.
“We have been able to continue to successfully operate our businesses while devoting substantial efforts, funds and resources to identify an appropriate deleveraging path with our secured lenders. As a result of these actions we incurred approximately $1.1 million in increased professional fees primarily associated with actions associated with our credit facilities,” Reynolds continued. “The company continues to work diligently to implement a restructuring plan submitted to our secured lenders and we believe certain facets of this plan will improve overall productivity and efficiency of the company, which should result in enhanced results and benefit all interested parties.
“The key for us in 2012 will be to continue to focus on our cost structure while assuring we provide an adequate infrastructure to support our sales initiatives and address our secured lender initiatives. To accomplish this we must get better and more efficient in all components of our business.”