Press Release
November 1, 2000
DALLAS, TX -- Silverleaf Resorts, Inc. (NYSE:SVR) yesterday reported financial results for the third quarter ended
September 30, 2000.
Third Quarter Results
Total revenue for the third quarter increased 23% to $75.5 million from $61.5 million in the third quarter of 1999.
Vacation interval sales increased 22% to $61.8 million for the quarter ended September 30, 2000, from $50.7 million
in the comparative prior year period. Interest income for the quarter increased 30% to $9.8 million, compared to
$7.6 million in the year-ago period. Upgrade sales accounted for approximately 34% of total vacation interval sales,
a 54% increase in dollar volume compared with last year's third quarter.
For the quarter ended September 30, 2000, net income was $4.3 million, or $0.34 per share, compared to $5.4 million,
or $0.42 per share, in the third quarter of 1999. Sequentially, the Company's results improved from $4.0 million,
or $0.31 per share. The improvement in net income from the second quarter is primarily the result of improved marketing
efficiencies during the third quarter. Total shareholders' equity at September 30, 2000 was $171.4 million and
book value was $13.30 per diluted share.
``Our results for the third quarter reflect progress in improving our telemarketing efficiencies,'' commented Robert
Mead, Chairman and Chief Executive Officer. ``Further, we continue the diversification of our marketing programs
to grow our tour flow through a broad spectrum of the marketplace. The tour flow growth resulted in better-than-expected
vacation interval sales and bottom-line results for the quarter.''
For the nine months ended September 30, 2000, total revenues increased 27% to $211.7 million compared to $167.0
million in the comparative prior year period. Vacation interval sales for the nine months ended September 30, 2000
were $174.9 million, representing an increase of 26% compared to $138.5 million for the nine months ended September
30, 1999. Net income decreased to $10.2 million, or $0.79 per diluted share, compared to $15.8 million, or $1.22
per diluted share in the year-ago period. As anticipated, the decrease in net income for the nine months compared
to 1999 is due to marketing efficiencies not yet in line during the first half of the year. Results for the nine
months include an extraordinary gain on the extinguishment of debt in the amount of $316,000,net of taxes, or $0.02
per diluted share.
Resort Update
During the third quarter, the Company received RCI's highest resort recognition of Gold Crown for Holiday Hills
in Branson, MO, Apple Mountain Resort outside Atlanta, GA and Timber Creek Resort outside St. Louis, MO. In addition,
the Villages Resort outside Dallas, TX, the Hill Country Resort outside Austin, TX and Fox River Resort outside
Chicago, IL, received Resort of International Distinction awards. These awards graphically illustrate the quality
of Silverleaf's resorts and confirm the Company's standing as one of the premier resort operators. RCI is the world's
largest resort exchange company.
Outlook
The Company estimates that its earnings for 2000 will be approximately $1.00. Based upon current expectations,
the Company projects that revenue and earnings growth for 2001 will be in the 10 to 15 percent range.
``During 2000, our top priority and major growth driver has been implementing the improvements in our marketing
efficiencies,'' Mead commented. ``We have made real progress toward meeting our objectives in this key area. Now
we are moving forward toward raising the financial profile of our customer, which will enhance the credit quality
of our portfolio.''
Live Internet Broadcast
Silverleaf will be hosting a conference call on the Internet to discuss earnings on Wednesday, November 1, 2000
at 10:00 a.m. EST. To participate in this call please visit www.vcall.com approximately
15 minutes before the call to register, download and install any necessary audio software.
Based in Dallas, Texas, Silverleaf Resorts, Inc. currently owns and/or operates 22 resorts in various stages of
development. Silverleaf resorts offer a wide array of country club-like amenities, such as golf, swimming, horseback
riding, boating, and many organized activities for children and adults. Silverleaf has a managed ownership base
of over 113,000. Further information on the Company may be found on its website, www.silverleafresorts.com.
This release contains certain forward-looking statements which involve risks and uncertainties and actual results
may differ materially from those anticipated. The Company is subject to specific risks associated with the timeshare
industry, the regulatory environment, and various economic factors. Additionally, anticipated results are dependent
upon the Company's ability to identify and acquire or develop other operations under terms which are beneficial
to the Company and its shareholders. Other risk factors are more fully discussed under ``Cautionary Statements''
in the Company's SEC reports, including the Company's 1999 annual report on Form 10K (pages 29 through 35).
SILVERLEAF RESORTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
2000 1999 2000 1999
--------- -------- -------- --------
Revenues:
Vacation
Interval
sales $ 61,831 $ 50,706 $ 174,876 $ 138,481
Sampler sales 1,891 1,247 4,172 3,274
------------ ------------ ------------ ------------
Total sales 63,722 51,953 179,048 141,755
Interest
income 9,803 7,554 27,939 19,981
Interest
income from
affiliates 8 12 25 36
Management
fee income 150 678 697 2,218
Other income 1,836 1,337 4,036 2,997
------------ ------------ ------------ ------------
Total revenues 75,519 61,534 211,745 166,987
Costs and
Operating
Expenses:
Cost of
Vacation
Interval sales 10,936 7,826 30,995 21,183
Sales and
marketing 32,270 26,709 94,393 71,537
Provision for
uncollectible
notes 6,183 5,071 17,488 13,848
Operating,
general and
administrative 7,190 6,156 21,264 16,704
Other expense 1,004 992 2,892 2,578
Depreciation
and
amortization 1,893 1,439 5,528 3,979
Interest
expense 8,973 4,517 23,141 11,544
------------ ------------ ------------ ------------
Total costs and
operating
expenses 68,449 52,710 195,701 141,373
Income before
provision for
income taxes
and
extraordinary
item 7,070 8,824 16,044 25,614
Provision for
income taxes (2,722) (3,397) (6,178) (9,861)
------------ ------------ ------------ ------------
Income before
extraordinary
item 4,348 5,427 9,866 15,753
Extraordinary
gain on
extinguishment
of debt
(net of
income tax
of $197) -- -- 316 --
------------ ------------ ------------ ------------
Net income $ 4,348 $ 5,427 $ 10,182 $ 15,753
============ ============ ============ ============
Basic and
diluted
earnings per
share:
Income before
extraordinary
item $ 0.34 $ 0.42 $ 0.77 $ 1.22
Extraordinary
item -- -- 0.02 --
------------ ------------ ------------ ------------
Net income $ 0.34 $ 0.42 $ 0.79 $ 1.22
============ ============ ============ ============
Weighted average
shares
outstanding:
Basic 12,889,417 12,889,417 12,889,417 12,889,417
============ ============ ============ ============
Diluted 12,889,417 12,889,417 12,892,057 12,889,417
============ ============ ============ ============
SILVERLEAF RESORTS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
(Unaudited)
September 30, December 31,
ASSETS 2000 1999
-------------- --------------
Cash and cash equivalents $ 7,596 $ 4,814
Restricted cash 1,178 903
Notes receivable, net of
allowance for uncollectible
notes of $31,942 and
$32,326, respectively 389,113 286,581
Amounts due from affiliates 10,898 6,596
Inventories 123,599 112,810
Land, equipment, buildings,
and utilities, net 51,630 51,050
Prepaid and other assets 19,211 17,203
TOTAL ASSETS $ 603,225 $ 479,957
LIABILITIES AND
SHAREHOLDERS' EQUITY
LIABILITIES
Accounts payable and
accrued expenses $ 18,993 $ 15,539
Unearned revenues 8,704 5,601
Income taxes payable -- 185
Deferred income taxes, net 31,180 28,251
Notes payable and capital
lease obligations 298,956 194,171
Senior subordinated notes 74,000 75,000
-------- -------
Total Liabilities 431,833 318,747
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Common stock, par value
$0.01 per share,
100,000,000 shares authorized,
13,311,517 shares issued, and
12,889,417 shares outstanding 133 133
Additional paid-in capital 109,339 109,339
Retained earnings 66,919 56,737
Treasury stock, at
cost (422,100 shares) (4,999) (4,999)
------- -------
Total Shareholders' Equity 171,392 161,210
------- -------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 603,225 $ 479,957
========= =========
SILVERLEAF RESORTS, INC. AND SUBSIDIARIES
CONDENSED SELECTED FINANCIAL DATA
(in thousands, except average price data)
(Unaudited)
As of and for the Quarters Ended
9/30/00 6/30/00 3/31/00
FINANCIAL DATA:
Earnings Before Interest expense,
Provision for Income Taxes, and
Depreciation and Amortization
expense
("EBITDA") $ 17,936 $ 15,469 $ 11,308
Gross notes receivable $421,055 $392,147 $352,254
Allowance for uncollectible notes $ 31,942 $ 39,242 $ 35,942
Delinquency percentage (overall)
(90 day basis) 7.1% 10.0% 11.0%
OPERATING DATA:
Number of Vacation Intervals sold
(excluding in-house) 4,517 3,931 3,816
Number of in-house
Vacation Intervals sold 4,804 4,211 3,495
Number of in-house Vacation
Intervals sold (excluding
downgrades) 4,406 4,211 3,495
Average price of Vacation Intervals
sold (excluding in-house) $ 9,751 $ 9,822 $ 9,828
Average price of in-house
Vacation Intervals sold $ 3,702 $ 4,879 $ 4,688
Average price of in-house Vacation
Intervals sold (excluding
downgrades) $ 4,797 $ 4,879 $ 4,688
SILVERLEAF RESORTS, INC. AND SUBSIDIARIES
CONDENSED SELECTED FINANCIAL DATA
(in thousands, except average price data)
(Unaudited)
As of and for the Quarters Ended
12/31/99 9/30/99
FINANCIAL DATA:
Earnings Before Interest expense,
Provision for Income Taxes, and
Depreciation and Amortization
expense
("EBITDA") $ 12,555 $ 14,780
Gross notes receivable $318,907 $287,517
Allowance for uncollectible notes $ 32,326 $ 29,018
Delinquency percentage (overall)
(90 day basis) 9.3% 8.4%
OPERATING DATA:
Number of Vacation Intervals sold
(excluding in-house) 3,971 3,948
Number of in-house
Vacation Intervals sold 3,238 3,152
Number of in-house Vacation
Intervals sold (excluding
downgrades) 3,238 3,152
Average price of Vacation Intervals
sold (excluding in-house) $ 9,541 $ 9,357
Average price of in-house
Vacation Intervals sold $ 4,583 $ 4,367
Average price of in-house Vacation
Intervals sold (excluding
downgrades) $ 4,583 $ 4,367
-----------------------------------------------
Contact:
Silverleaf Resorts, Inc.
Harry J. White, Jr., CFO
214/631-1166
or
Morgen-Walke Associates
Michele Katz/Michael Polyviou
Press: Steven DiMattia
212/850-5600