BSTW Bestway (MM)

Bestway, Inc. Announces Fiscal 2004 Fourth Quarter and Year End Results Same Store Revenues Increase 7.1%; Eight Consecutive Quarters of Increased Same Store Revenues DALLAS, Oct. 8 /PRNewswire-FirstCall/ -- Bestway, Inc. (NASDAQ:BSTW), today reported financial results for its fourth quarter and full year ended July 31, 2004. For the three months ended July 31, 2004, revenue increased 7.9% to $9,845,031, compared to $9,125,742 for the fourth quarter of last year. Same store revenues (revenues earned in stores operated for the entirety of both periods) increased 7.1% in the quarter. Net earnings, after a charge of $43,649 for a legal matter currently on appeal, decreased to $54,078, or $.03 per share on a diluted basis, compared to $94,553, or $.05 per share on a diluted basis, a year ago. Without this significant item, net income would have been $97,727, or $.05 per share on a diluted basis. For the full year ended July 31, 2004, revenue increased 6.8% to $37,916,130, compared to $35,506,828 for the same period of 2003. Same store revenues increased 6.4% for the year. Net earnings for the full year increased to $365,801, or $.20 per share on a diluted basis, compared to $47,588, or $.03 per share on a diluted basis, last year. "People, products and programs continue to be our primary focus," commented David A. Kraemer, President and Chief Executive Officer. "Focusing on these key drivers and initiatives, along with a targeted marketing campaign has allowed us to continue our momentum through 2004 and into 2005. Results from these initiatives are encouraging, which I feel is a testament to our team's ability to execute our plan. In fiscal 2005, we intend to grow our store count through new store openings, as well as seek out acquisitions that meet our return on investment criteria." Bestway, Inc. owns and operates a total of sixty-nine rent-to-own stores located in the southeastern United States. These stores generally offer high quality brand name merchandise such as home entertainment equipment, appliances, furniture and computers under flexible rental purchase agreements that generally allow the customer to obtain ownership of the merchandise at the conclusion of an agreed upon rental period. This press release and the guidance above contain various "forward-looking statements" that involve risks and uncertainties. Forward-looking statements represent the Company's expectations or beliefs concerning future events. Any forward-looking statements made by or on behalf of the Company are subject to uncertainties and other factors that could cause actual results to differ materially from such statements. These uncertainties and other factors include, but are not limited to, (i) the ability of the Company to open or acquire additional rental-purchase stores on favorable terms, (ii) the ability of the Company to improve the performance of such acquired stores and to integrate such opened or acquired stores into the Company's operations, (iii) the impact of state and federal laws regulating or otherwise affecting rental- purchase transactions, (iv) the impact of general economic conditions in the United States and (v) the impact of terrorist activity, threats of terrorist activity and responses thereto on the economy in general and the rental- purchase industry in particular. Undue reliance should not be placed on any forward-looking statements made by or on behalf of the Company as such statements speak only as of the date made. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, the occurrence of future events or otherwise. BESTWAY, INC. SELECTED BALANCE SHEET DATA (Unaudited) July 31, July 31, 2004 2003 Cash and cash equivalents $692,476 $305,869 Prepaid expenses and other assets 243,619 234,908 Rental merchandise, net 13,946,095 13,858,064 Property and equipment, net 2,235,985 2,732,798 Total assets 19,375,622 20,002,168 Accounts payable 606,009 751,328 Debt 8,433,907 9,451,299 Total liabilities 10,657,088 11,683,375 Stockholders' Equity 8,718,534 8,318,793 BESTWAY, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Twelve Months Ended July 31, July 31, 2004 2003 2004 2003 Revenues: Rental and fee income $9,499,352 $8,822,282 $36,203,299 $33,618,007 Sales of merchandise 345,679 303,460 1,712,831 1,888,821 9,845,031 9,125,742 37,916,130 35,506,828 Cost and operating expenses: Depreciation and amortization: Rental merchandise 2,046,671 1,775,910 7,490,990 6,868,366 Other 294,155 353,341 1,228,166 1,480,329 Cost of merchandise sold 255,376 233,743 1,241,408 1,681,771 Salaries and wages 2,847,441 2,744,668 11,053,364 10,433,146 Advertising 379,547 370,239 1,725,515 1,649,104 Occupancy 614,022 595,167 2,500,809 2,383,807 Other operating expenses 3,176,752 2,734,544 11,500,903 10,255,610 Interest expense 128,372 175,269 545,986 694,185 Loss (gain) on sale of property and equipment 5,082 (2,741) 31,820 (9,827) 9,747,418 8,980,140 37,318,961 35,436,491 Income before income taxes 97,613 145,602 597,169 70,337 Income tax expense 43,535 51,049 231,368 22,749 Net income $54,078 $94,553 $365,801 $47,588 Basic net income per share $0.04 $0.06 $0.22 $0.03 Diluted net income per share $0.03 $0.05 $0.20 $0.03 Weighted average common shares outstanding 1,683,272 1,677,972 1,681,289 1,669,955 Diluted weighted average common shares outstanding 1,837,321 1,828,226 1,823,286 1,774,409 DATASOURCE: Bestway, Inc. CONTACT: Beth A. Durrett, Chief Financial Officer, , or David A. Kraemer, President and Chief Executive Officer, , both of Bestway, Inc., +1-214-630-6655

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