For Further Information:
Scheid Vineyards Inc.
305 Hilltown Road
Salinas, CA 93908
(831) 455-9990
Contact: Scott D. Scheid,
President and Chief Executive Officer
Mike Thomsen,
Chief Financial Officer
For Immediate Release:
June 14, 2006
SCHEID VINEYARDS INC. REPORTS 1ST QUARTER
RESULTS
COMMENTS ON REVERSE STOCK SPLIT AND DEREGISTRATION
SALINAS, CA, June 14, 2006 – Scheid Vineyards Inc.
today reported financial results for the first quarter ended March 31,
2006.
Financial Results
Revenues for the first quarter of
2006 totaled $7.0 million, compared to 2005 first quarter revenues of $1.1
million. This substantial increase was
driven by sales of bulk wine. Net
income for the first three months of 2006 was $465,000, compared to a net loss
of $643,000 in 2005.
Commenting on the results, Mr. Mike Thomsen, Chief
Financial Officer of Scheid Vineyards, said, “bulk wine sales for the first
quarter of 2006 totaled $6.5 million, as compared to $0.8 million for the 2005
period. This increase was due primarily
to the increase in the amount of bulk wine that was made by the Company after
the record 2005 grape harvest. In
addition, the Company’s new winery facility, which was completed in September
2005, generated approximately $0.3 million in storage revenues during the first
quarter of 2006.” Mr. Thomsen cautioned
that, “quarterly results vary from year-to-year as the result of the prices
received for bulk wine sold under contract and on the speculative market, and
the timing of such sales. The wine
grape business is extremely seasonal and Scheid Vineyards recognizes a large
portion of its crop sale and winery processing revenues at the time of its
annual harvest in September and October.”
Reverse Stock Split and Deregistration
Mr. Scott Scheid, President and Chief Executive Officer,
commented on the recently completed reverse stock split. Mr. Scheid stated, “As expected, on May 12,
2006, we completed a 1-for-5 reverse stock split of our Class A and Class B
Common Stock. The transaction resulted
in the Company having fewer than 300 stockholders of record, which enabled the Company to
voluntarily terminate the registration of its Class A Common Stock under the
Securities Exchange Act of 1934, as amended, and become a non-reporting company.
As a result, we are no longer required to file periodic reports and other
information with the Securities and Exchange Commission. In connection with the deregistration, we
requested that Nasdaq delist our Class A Common Stock from The Nasdaq SmallCap
Market. The Class A Common Stock of
Scheid Vineyards is currently being traded on the Pink Sheets Electric
Quotation Service. The “Pink Sheets” is
a centralized quotation service that collects and publishes market maker quotes
in real time, primarily through its website, www.pinksheets.com.
About
Scheid Vineyards Inc.
Scheid Vineyards Inc. (www.scheidvineyards.com) is an
independent producer of premium wine grapes and bulk wine. The Company operates approximately 5,700
acres of vineyards, primarily in Monterey County, California. The Company sells
most of its grape production under short and long-term grape and bulk wine contracts
to wineries producing high quality table wine.
The Company also operates a winery with an approximately 11,000 ton
processing capability in which the Company produces bulk wine, as well as a
small amount of ultra premium wine under its own label.
This release contains
forward-looking statements as well as historical information. Statements of
goals and strategies and words such as “plan”, “believe”, “anticipate”,
“expect”, “objectives”, “forecast”, and “predict” and other similar words are
intended to identify forward-looking statements. These forward looking
statements are included in accordance with the “safe harbor” provisions of the
Private Securities Litigation Reform Act of 1995, and involve risks,
uncertainties and other factors that may cause the Company’s actual results,
performance, or financial condition to be materially different from any
results, performance, or financial condition suggested by the statements in
this release.
SCHEID VINEYARDS INC. AND SUBSIDIARY
CONSOLIDATED
BALANCE SHEETS
(Amounts in thousands,
except share data)
(Unaudited)
|
|
|
March 31,
2006
|
|
December 31,
2005
|
|
|
ASSETS
|
|
|
|
|
|
|
CURRENT ASSETS:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
741
|
|
$
|
1,197
|
|
|
Accounts receivable
|
|
5,059
|
|
10,273
|
|
|
Inventories
|
|
7,207
|
|
6,992
|
|
|
Supplies, prepaid expenses and other current assets
|
|
1,050
|
|
949
|
|
|
Total current assets
|
|
14,057
|
|
19,411
|
|
|
PROPERTY, PLANT AND EQUIPMENT, net
|
|
70,922
|
|
69,964
|
|
OTHER ASSETS, net
|
|
502
|
|
550
|
|
|
|
|
$
|
85,481
|
|
$
|
89,925
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$
|
1,407
|
|
$
|
2,956
|
|
|
Deferred revenues
|
|
—
|
|
233
|
|
|
Income taxes payable
|
|
—
|
|
1,612
|
|
|
Deferred income taxes
|
|
721
|
|
398
|
|
|
Total current liabilities
|
|
2,128
|
|
5,199
|
|
|
LONG-TERM DEBT, net of current portion
|
|
33,929
|
|
35,804
|
|
|
DEFERRED INCOME TAXES
|
|
6,905
|
|
6,905
|
|
|
Total liabilities
|
|
42,962
|
|
47,908
|
|
|
STOCKHOLDERS’ EQUITY:
|
|
|
|
|
|
|
Preferred stock, $.001 par value; 2,000,000 shares
authorized; no
shares issued and outstanding
|
|
—
|
|
—
|
|
|
Common stock,
|
|
|
|
|
|
|
Class A, $.001 par value; 4,000,000 shares
authorized;
804,884,and 409,250 shares outstanding at
March
31, 2006 and December 31, 2005,
respectively
|
|
|
|
|
|
|
Class B, $.001 par value; 2,000,000 shares
authorized;
219,443 and 612,443 and shares issued and
outstanding
at March 31, 2006 and December 31,
2005,
respectively
|
|
7
|
|
7
|
|
|
Additional paid-in capital
|
|
21,964
|
|
21,892
|
|
|
Retained earnings
|
|
28,133
|
|
27,668
|
|
|
Less: treasury stock; 309,829 and 308,829 Class A
shares at cost at March 31, 2006 and December 31, 2005,
respectively
|
|
(7,585
|
)
|
(7,550
|
)
|
|
Total stockholders’ equity
|
|
42,519
|
|
42,017
|
|
|
|
|
$
|
85,481
|
|
$
|
89,925
|
|
SCHEID VINEYARDS INC. AND
SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands,
except per share data)
|
|
|
|
|
Three
Months Ended March 31,
|
|
|
|
|
|
|
2006
|
|
2005
|
|
|
REVENUES:
|
|
|
|
|
|
|
|
|
Bulk wine sales
|
|
|
|
$
|
6,485
|
|
$
|
811
|
|
|
Winery processing and other revenues
|
|
|
|
254
|
|
—
|
|
|
Vineyard management, services and other
fees
|
|
|
|
168
|
|
173
|
|
|
Tasting room revenues
|
|
|
|
105
|
|
76
|
|
|
Total revenues
|
|
|
|
7,012
|
|
1,060
|
|
|
COST OF SALES
|
|
|
|
3,838
|
|
731
|
|
|
GROSS PROFIT
|
|
|
|
3,174
|
|
329
|
|
|
General and administrative expenses
|
|
|
|
1,561
|
|
1,298
|
|
|
Selling expenses
|
|
|
|
130
|
|
106
|
|
|
Write-down of vineyard improvements
|
|
|
|
120
|
|
—
|
|
|
Interest expense
|
|
|
|
579
|
|
147
|
|
|
Investment and interest income
|
|
|
|
(3
|
)
|
(31
|
)
|
|
Gain on sale of land and equipment
|
|
|
|
—
|
|
(118
|
)
|
|
INCOME (LOSS) BEFORE PROVISION FOR
(BENEFIT FROM) INCOME TAXES
|
|
|
|
787
|
|
(1,073
|
)
|
|
PROVISION FOR (BENEFIT FROM) INCOME
TAXES
|
|
|
|
322
|
|
(430
|
)
|
|
NET INCOME (LOSS)
|
|
|
|
$
|
465
|
|
$
|
(643
|
)
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) PER SHARE
|
|
|
|
$
|
0.45
|
|
$
|
(0.63
|
)
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING
|
|
|
|
1,022
|
|
1,021
|
|
#######