Silverleaf Resorts Reports Operating Net Of $0.29 Beats First Call Consensus By $.02 Per Share


DALLAS, August 1, 2000 (PRIMEZONE) -- Silverleaf Resorts, Inc. (NYSE:SVR) today reported financial results for the second quarter ended June 30, 2000.

Second Quarter Results

Total revenue for the second quarter increased 26.5% to $71.3 million from $56.4 million in the second quarter of 1999. Demand for the Company's product continued to grow as vacation interval sales increased 27.4% to $59.2 million for the quarter ended June 30, 2000, from $46.4 million in the comparative prior year period. Interest income for the quarter increased 38.4% to $9.4 million, compared to $6.8 million in the year-ago period. Upgrade sales accounted for approximately 34.7% of total vacation interval sales, a 70.5% increase in dollar volume compared with last year's second quarter.

For the quarter ended June 30, 2000, net income was $4.0 million, or $0.31 per share, compared to $5.5 million, or $0.42 per share, in the second quarter of 1999, but it is an increase from $1.9 million, or $0.15 per share, in the first quarter of 2000. The improvement in net income from the first quarter is primarily the result of improved marketing efficiencies during the second quarter. Results for the 2000 second quarter include an extraordinary gain on the extinguishment of debt in the amount of $316,000, net of taxes, or $0.02 per diluted share. Total shareholders' equity at June 30, 2000 was $167.0 million and book value was $12.96 per diluted share.

"During the quarter, we began to see the initial results of our efforts to improve our marketing efficiencies and call center productivity," said Robert Mead, Chairman and Chief Executive Officer. "These initial results are reflected in earnings for the quarter that exceeded analyst estimates. We look forward to further improvements in our marketing efficiencies. In connection therewith in the third quarter we have retained a database management firm to assist us in improving the efficiency of our telemarketing centers. The result is that Silverleaf now has a more experienced team utilizing a more reliable database to target the right people more consistently."

"At the same time, the Company continues to achieve strong revenue growth. The high level of demand for Silverleaf vacations is perhaps most evident at our Fox River resort, which serves the greater Chicago area, a market we entered just two and a half years ago. Since then, this resort has become a major sales leader for the Company, with over $70.0 million in sales since it opened. Our success at Fox River and our continued expansion at Holiday Hills in Branson demonstrate that the Silverleaf model works well beyond our core market in Texas and sets the standard for all our branding efforts nationwide," Mead concluded.

For the six months ended June 30, 2000, total revenues increased 29.1% to $136.2 million compared to $105.5 million in the comparative prior year period. Vacation interval sales for the six months ended June 30, 2000 were $113.0 million, representing an increase of 28.8% compared to $87.8 million for the six months ended June 30, 1999. Net income decreased to $5.8 million, or $0.45 per diluted share, compared to $10.3 million, or $.80 per diluted share in the year-ago period. As anticipated, the decrease in net income is due to marketing efficiencies not yet in line with the Company's expectations compared to 1999. Results for the 2000 second quarter 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

Fox River Resort. The Company completed the construction of Section 2 at its Fox River Resort, outside Chicago, IL. Driven by dramatic sales of more than $70 million in just two years, Silverleaf's Fox River Resort has already completed its first two sections totaling 174 Lodge Getaway units and plans to begin construction on the next two sections, which will include the upscale Presidential units.

Seaside Resort. In response to stronger-than-expected demand for units, the Company accelerated construction at the Seaside Resort in Galveston, TX. Sales at the property began in January, and the resort officially opened in April.

Holiday Hills Resort. The Company has obtained final approval and plans to develop 372 additional timeshare units and member amenities at Holiday Hills Resort in Branson, MO. The expansion will more than double capacity at the resort, which currently features 212 units. Construction of another 60 units is scheduled to be completed by the end of 2000.

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 109,000. 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       Six Months Ended 
                              June 30,                June 30, 
                         -----------------        ---------------- 
                         2000         1999        2000        1999 
                         ----         ----        ----        ---- 
 Revenues: 
  Vacation Interval 
   sales           $    59,159  $    46,447  $   113,045  $    87,775 
  Sampler sales            984        1,327        2,281        2,027 
                   -----------  -----------  -----------  ----------- 
   Total sales          60,143       47,774      115,326       89,802 

    Interest income      9,367        6,761       18,136       12,427 
    Interest income 
     from affiliates         8           12           17           24 
    Management fee 
     income                466          640          547        1,540 
    Other income         1,335        1,186        2,200        1,660 
                   -----------  -----------  -----------  ----------- 
     Total revenues     71,319       56,373      136,226      105,453 

 Costs and Operating 
  Expenses: 
   Cost of Vacation 
    Interval 
    sales               10,618        7,587       20,060       13,357 
   Sales and marketing  31,597       24,143       62,124       44,828 
   Provision for 
    uncollectible notes  5,916        4,645       11,304        8,777 
   Operating, general 
     and administra- 
     tive                6,767        5,180       14,074       10,548 
   Other expense           953          833        1,888        1,586 
   Depreciation and 
    amortization         1,854        1,335        3,635        2,540 
   Interest expense      7,690        3,745       14,168        7,027 
                    -----------  -----------  -----------  -----------
     Total costs and 
      operating 
      expenses          65,395       47,468      127,253       88,663

    Income before 
     provision for 
     income taxes and 
     extraordinary 
     item                5,924        8,905        8,973       16,790
    Provision for 
     income taxes       (2,281)      (3,428)      (3,455)      (6,464)
                    -----------  -----------  -----------  -----------
 Income before 
  extraordinary 
  item             $     3,643  $     5,477  $     5,518  $    10,326 
  Extraordinary gain 
   on extinguishment 
   of debt (net of 
   income tax of $197)     316         --            316         -- 
                    -----------  -----------  -----------  -----------
 Net income        $     3,959  $     5,477  $     5,834  $    10,326 
                    ===========  ===========  ===========  ===========
 Basic and diluted 
  earnings per share: 
   Income before 
    extraordinary 
    item           $      0.29  $      0.42  $      0.43  $      0.80 
   Extraordinary 
    item                  0.02         --           0.02         -- 
                    -----------  -----------  -----------  -----------
 Net income        $      0.31  $      0.42  $      0.45  $      0.80 
                    ===========  ===========  ===========  ===========
 Weighted average 
  basic and 
  diluted shares 
  outstanding:      12,889,417   12,889,417   12,889,417   12,889,417 
                    ===========  ===========  ===========  ===========


               SILVERLEAF RESORTS, INC. AND SUBSIDIARIES

                CONDENSED CONSOLIDATED BALANCE SHEETS
          (in thousands, except share and per share amounts)
                             (Unaudited)

                                           June 30,  December 31,
                                             2000        1999
                                          ---------    ---------
                           ASSETS

 Cash and cash equivalents                $   4,243    $   4,814
 Restricted cash                                978          903
 Notes receivable, net of
  allowance for uncollectible
  notes of $39,242 and $32,326,
  respectively                              352,905      286,581
 Amounts due from affiliates                  8,694        6,596
 Inventories                                121,304      112,810
 Land, equipment, buildings,
  and utilities, net                         50,982       51,050
 Prepaid and other assets                    18,726       17,203
                                          ---------    ---------
  TOTAL ASSETS                            $ 557,832    $ 479,957
                                          =========    =========
 
              LIABILITIES AND SHAREHOLDERS' EQUITY
 
 LIABILITIES
 
 Accounts payable and accrued expenses    $  16,560    $  15,539
 Unearned revenues                            8,427        5,601
 Income taxes payable                          --            185
 Deferred income taxes, net                  29,299       28,251
 Notes payable and capital
  lease obligations                         262,502      194,171
 Senior subordinated notes                   74,000       75,000
                                          ---------    ---------
                Total Liabilities           390,788      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                           62,571       56,737
 Treasury stock, at cost
  (422,100 shares)                           (4,999)      (4,999)
                                          ---------    ---------
  Total Shareholders' Equity                167,044      161,210
                                          ---------    ---------
  TOTAL LIABILITIES AND
   SHAREHOLDERS' EQUITY                   $ 557,832    $ 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
                                     -------------------------------
                                      6/30/00    3/31/00    12/31/99
                                      -------    -------    --------
 FINANCIAL DATA
 Earnings Before Interest expense,
   Provision for Income Taxes, and
   Depreciation and Amortization
    expense
   ("EBITDA")                         $ 15,469   $ 11,308   $ 12,555
 Gross notes receivable               $392,147   $352,254   $318,907
 Allowance for uncollectible notes    $ 39,242   $ 35,942   $ 32,326
 Delinquency percentage (overall)
   (90 day basis)                         10.9%      11.9%      10.4%
 
 OPERATING DATA:
 
 Number of Vacation Intervals sold
   (excluding upgrades)                  3,931      3,816      3,971
 Number of upgraded
   Vacation Intervals sold               4,211      3,495      3,238
 Average price of Vacation Intervals
   sold (excluding upgrades)          $  9,822   $  9,828   $  9,541
 Average price of upgraded
   Vacation Intervals sold            $  4,879   $  4,688   $  4,583
 
 
 SILVERLEAF RESORTS, INC. AND SUBSIDIARIES
 
                   CONDENSED SELECTED FINANCIAL DATA
               (in thousands, except average price data)
                              (Unaudited)
 
                                    As of and for the Quarters Ended
                                     --------------------------------
                                         9/30/99     6/30/99
                                         -------     -------
 FINANCIAL DATA:
 Earnings Before Interest expense,
   Provision for Income Taxes, and
   Depreciation and Amortization
   expense
   ("EBITDA")                            $ 14,780    $ 13,985
 Gross notes receivable                  $287,517    $254,766
 Allowance for uncollectible notes       $ 29,018    $ 26,343
 Delinquency percentage (overall)
   (90 day basis)                             9.3%        9.1%
 
 OPERATING DATA:
 
 Number of Vacation Intervals sold
   (excluding upgrades)                     3,948       4,031
 Number of upgraded
   Vacation Intervals sold                  3,152       2,762
 Average price of Vacation Intervals
   sold (excluding upgrades)             $  9,357    $  8,532
 Average price of upgraded
   Vacation Intervals sold               $  4,367    $  4,364


            

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