Company Reports 13% Increase in Adjusted EPS and Affirms 2012 Guidance
Standard Parking Corporation, one of the nation's leading providers of parking management, ground transportation and other ancillary services, today announced first quarter 2012 results. The 2012 first quarter's reported earnings per share was $0.14, which includes $0.12 per share for costs incurred during the quarter related to the proposed merger with Central Parking Corporation, which was announced on February 29, 2012. Without these costs, the quarter's adjusted earnings per share would have been $0.26, a 13% increase over the first quarter of 2011.
James A. Wilhelm, President and Chief Executive Officer, said, "During the first quarter, we announced our intent to merge with Central Parking and produced solid operating results across the business compared to the first quarter of 2011. The first quarter's total gross profit this year was up 7%, and same location gross profit increased 5%. Paid exits at same leased locations increased 3% as compared to the first quarter of 2011. We maintained our excellent location and operating profit retention rates of 91% and 96%, respectively, compared to the end of last year. These metrics suggest to us that the Company is well positioned to grow as economic conditions improve."
Mr. Wilhelm also noted that, "The first quarter's performance demonstrates our ability to maintain our focus regarding our day-to-day business operations without distraction from the planning associated with our pending merger with Central Parking. That deal continues to move forward on schedule with a view towards a closing by the end of the third quarter."
First Quarter Operating Results
Revenue of $85.5 million for the first quarter of 2012, excluding reimbursement of management contract expense, was an increase of 5% compared to $81.2 million in the first quarter of 2011, with both lease and management revenue contributing to the growth.
Gross profit increased in the quarter by 7% to $21.6 million from $20.2 million in the same period last year. Lower snow removal costs as a result of a mild winter across most of the country contributed to an overall 5% growth in same location gross profit.
General and administrative (G&A) expenses for the first quarter were $15.0 million, an increase of 35% compared to $11.2 million in the first quarter of 2011. This change was primarily due to $3.2 million of costs associated with the proposed merger with Central Parking. Without these merger-related costs, G&A would have increased 6%. While the Company experienced a first quarter G&A uptick, the run rate for the remainder of 2012 is expected to average approximately $11.5 million per quarter, in line with the Company's second half 2011 G&A expenses of $11.4 million per quarter, all excluding merger-related costs. On a full-year basis, G&A expenses for 2012 is expected to be approximately 2% higher when compared to 2011, excluding merger and acquisition related costs for both years.
Net income attributable to the Company was $2.2 million, or $0.14 per share, for the first quarter of 2012 compared to $3.8 million, or $0.23 per share, for the same period of 2011. Excluding the $0.12 per share impact of merger-related costs incurred during the quarter, 2012 first quarter net income attributable to the Company would have been $0.26 per share.
The Company had a negative $10.0 million of free cash flow during the first quarter of 2012, as compared with $6.0 million of positive free cash flow generated in the first quarter of 2011. As expected, unusually favorable movements in working capital at the end of 2011 reversed out in the first quarter of 2012, and $2.7 million of cash was consumed by merger-related activities. In addition, there was a temporary increase in accounts receivable at several large airports at the end of the 2012 first quarter that is expected to normalize during the year.
Affirms 2012 Outlook
The Company affirms its full-year earnings per share guidance in the range of $1.25 - $1.35 and its full-year free cash flow guidance of between $20 - $25 million. These numbers exclude year-to-date costs as well as future revenue and costs related to the proposed Central Parking merger.