Business News
Cenveo Updates Shareholders
Wednesday 08. October 2008 - Re-affirms 3rd Quarter Adjusted EBITDA Guidance Board of Directors Authorizes Share Repurchase Program
Robert G. Burton, Sr., Chairman and Chief Executive Officer of Cenveo, Inc. (NYSE:CVO), today gave shareholders the following update:
“Given the recent unprecedented volatility in the financial markets and the Company’s share price, I wanted to update our shareholders that our business plan remains on track. Although we have not finalized our third quarter results, I believe that our results for the third quarter will be consistent with the financial targets that we issued on our last earnings call of $80 million of adjusted EBITDA. Despite a very challenging economic climate, the Company continues to perform well and will be able to deliver on its financial commitments by improving margins and paying down debt during the 3rd quarter. During my thirty plus year business career I have personally witnessed many periods of economic unrest and widespread uncertainty. Even during those periods, we were able to be successful by following a simple game plan that focused on matching costs with revenues. These times are no different. We will continue to navigate through these difficult times by following that game plan, and I am very confident that we will be successful in the long run here at Cenveo, as we have been in the past.
Also given the current weakness in the Company’s share price, the Board of Directors has authorized a $15 million share repurchase program. The repurchase plan approved is effective for 12 months and may be limited or terminated at any time without prior notice. Stock repurchases under the plan may be made through open-market and privately negotiated transactions. The timing and actual number of shares (if any) that the Company actually repurchases will depend on a variety of factors including price, corporate and regulatory requirements and other market conditions.
The Company always looks to be opportunistic in regards to all of the publicly-traded components of its capital structure. This action by the Board provides the flexibility to take advantage of market conditions with respect to the Company’s shares. As we are with all of our capital investments, we will be financially prudent with this or any capital allocation. As I stated before, despite the current credit and economic conditions, I remain optimistic about the Company’s short and long term prospects. I look forward to sharing these positive successes in more detail on our conference call on November 6th.”
In addition to results presented in accordance with generally accepted accounting principles in the U.S. (“GAAP”), included in this release is the Non-GAAP financial measure Adjusted EBITDA. Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, excluding restructuring, impairment and other charges, integration, acquisition and other charges, loss on early extinguishment of debt, stock-based compensation provision, and income (loss) from discontinued operations, net of taxes and should be read in conjunction with GAAP financial measures. This Non-GAAP financial measure is not presented as an alternative to cash flow from operations, as a measure of our liquidity or as an alternative to reported net income as an indicator of our operating performance. The Non-GAAP financial measure as used herein may not be comparable to similarly titled measures reported by competitors.
We believe the use of Adjusted EBITDA, along with GAAP financial measures enhances the understanding of our operating results and may be useful to investors in comparing our operating performance with that of our competitors and estimating our enterprise value. Adjusted EBITDA is also a useful tool in evaluating the core operating results of the Company given the significant variation that can result from, for example, the timing of capital expenditures, the amount of intangible assets recorded or the differences in assets’ lives. We also use Adjusted EBITDA internally to evaluate operating performance of our segments, to allocate resources and capital to such segments, to measure performance for incentive compensation programs, and to evaluate future growth opportunities.