DLLR » Topics » Fiscal Second Quarter Outlook

This excerpt taken from the DLLR 8-K filed Jan 23, 2007.

Fiscal Second Quarter Outlook

 


The Company continued to experience strong growth in its international businesses and in U.S. consumer lending revenue in the second quarter ended December 31, 2006. Commenting on the results, Jeff Weiss, the Company’s Chairman and CEO stated, “While the core operating earnings were strong and will exceed the Company’s expectations, the Company realized higher interest expense (a portion of which is non-recurring) related to the previously announced acquisitions and debt refinancing in the second quarter than was expected. With the debt refinancing and cross-currency swap transactions completed, the Company would expect interest expense to decline to approximately $8.2 million in the third quarter of fiscal 2007. Overall, the second quarter financial results are anticipated to exceed the Company’s expectations with total revenue for the second quarter expected to be between $101.5 million and $102.5 million. EBITDA is projected to be between $27.5 million and $28.0 million, and income before income taxes, excluding approximately $51.6 million of one-time charges discussed below, is projected to be between $14.5 million and $15.0 million. “

 

In the second quarter of fiscal 2007, the Company will record a one-time non-cash charge of $6.6 million due to the mark to market adjustment of the Company’s approximately $375.0 million of term loans, which occurred at the time of the conversion of the loans to the individual local currencies as a result of the cross-currency swap transactions. The cross-currency swap transactions provide a hedge against any future mark to market adjustments to the Company’s term loans. That $6.6 million one-time charge combined with $23.8 million of one-time charges incurred in October 2006 represent the total costs related to the Company’s previously announced $375.0 million debt financing.

 

In addition, in the second quarter of fiscal 2007, the Company will incur a net charge of approximately $21.2 million related primarily to the write-off of goodwill associated with the previously announced reorganization of its We The People business unit, which is net of one-time income of approximately $3.25 million associated with the previously announced settlement of its litigation with IDLD, Inc.

 

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