FORT WORTH, Texas, Nov. 4 /PRNewswire-FirstCall/ -- Calloway's Nursery, Inc. (Pink Sheets: CLWY) today reported revenues and operating results for the third quarter and nine-month periods ended September 30, 2009. Results for the Third Quarter -- Sales were $5.0 million for 2009, compared to sales of $5.7 million for 2008. Same-store (16 stores) sales were $4.3 million for 2009, compared to same-store sales of $5.1 million for 2008. -- Net loss was $1,386,000 for 2009, compared to net loss of $850,000 for 2008. The 2008 quarter included a $140,000 extraordinary gain on the involuntary conversion of assets. -- Diluted net loss per common share was $.20 for 2009, compared to diluted net loss per common share of $.12 for 2008. The 2008 quarter included $.02 per-share extraordinary gain on the involuntary conversion of assets. Results for the Nine-Month Period -- Sales were $30.3 million for 2009, compared to sales of $35.8 million for 2008. Same-store (16 stores) sales were $25.4 million for 2009, compared to same-store sales of $27.4 million for 2008. -- Net loss was $787,000 for 2009, compared to net income of $947,000 for 2008. The 2008 period included a $140,000 extraordinary gain on the involuntary conversion of assets. -- Diluted net loss per common share was $.11 for 2009, compared to diluted net income per common share of $.14 for 2008. The 2008 period included $.02 per-share extraordinary gain on the involuntary conversion of assets. Founded in 1986, Calloway's Nursery, Inc. operates 18 retail garden centers in Texas: Calloway's Nursery in Dallas-Fort Worth and Cornelius Nursery in Houston. CALLOWAY'S NURSERY, INC. CONDENSED CONSOLIDATED INCOME STATEMENTS (UNAUDITED) (Amounts in thousands, except per share amounts) Nine- Three- Months Ended Months Ended September 30, September 30, 2009 2008 2009 2008 ---- ---- ---- ---- Net sales $30,255 $35,754 $5,042 $5,712 Cost of goods sold 16,849 18,670 2,918 3,050 ------ ------ ----- ----- Gross profit 13,406 17,084 2,124 2,662 ------ ------ ----- ----- Operating expenses 10,294 11,546 2,917 3,134 Advertising expenses 959 1,267 81 167 Occupancy expenses 2,491 2,241 834 573 Depreciation and amortization 360 285 126 98 Net interest expense 476 469 177 174 --- --- --- --- Total expenses 14,580 15,808 4,135 4,146 ------ ------ ----- ----- Income (loss) before provision for income taxes and extraordinary gain (1,174) 1,276 (2,011) (1,484) Income tax expense (benefit) (387) 469 (625) (494) ---- --- ---- ---- Net income (loss) before extraordinary gain (787) 807 (1,386) (990) Extraordinary gain, net of income tax expense of $72 -- 140 -- 140 --- --- --- --- Net income (loss) $(787) $947 $(1,386) $(850) ===== ==== ======= ===== Weighted average number of common shares outstanding - basic and diluted 6,980 6,950 7,035 6,950 Income (loss) before extraordinary gain per common share - basic and diluted $(0.11) $0.12 $(0.20) $(0.14) Extraordinary gain, net of tax, per common share - basic and diluted -- 0.02 -- 0.02 --- ---- --- ---- Net income (loss) per common share - basic and diluted $(0.11) $0.14 $(0.20) $(0.12) ====== ===== ====== ====== CALLOWAY'S NURSERY, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Amounts in thousands) ASSETS September 30, September 30, 2009 2008 ---- ---- Cash and cash equivalents $841 $1,133 Accounts receivable - trade 145 659 Accounts receivable - insurance 546 -- Inventories 2,822 3,982 Prepaids and other assets 22 57 Deferred income taxes 405 - - --- --- Total current assets 4,781 5,831 Property and equipment, net 16,963 17,622 Deferred income taxes 578 408 Other assets 326 312 --- --- Total assets $22,648 $24,173 ======= ======= LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable and accrued expenses $5,063 $4,314 Current portion of long-term debt 610 541 --- --- Total current liabilities 5,673 4,855 Deferred rent payable 58 103 Long-term debt, net of current portion 11,986 13,243 ------ ------ Total liabilities 17,717 18,201 ------ ------ Shareholders' equity: Common stock 73 72 Additional paid-in capital 10,285 10,220 Accumulated deficit (4,019) (2,912) ------ ------ 6,339 7,380 Less: Treasury stock, at cost (1,408) (1,408) ------ ------ Total shareholders' equity 4,931 5,972 ----- ----- Total liabilities and shareholders' equity $22,648 $24,173 ======= ======= CALLOWAY'S NURSERY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Amounts in thousands) Nine-Months Ended September 30, ------------- 2009 2008 ---- ---- Cash flows from operating activities: Net income (loss) $(787) $947 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 360 285 Deferred income taxes (418) 238 Gain on involuntary conversion of assets -- (140) Net change in operating assets and liabilities 984 (1,237) --- ------ Net cash provided by operating activities 139 93 --- --- Cash flows from investing activities: Additions to property and equipment (923) (1,955) Insurance proceeds from involuntary conversion of property and equipment -- 277 --- --- Net cash used for investing activities (923) (1,678) ---- ------ Cash flows from financing activities: Repayments of debt (372) (489) Proceeds from issuance of common stock 66 -- -- --- Net cash used for financing activities (306) (489) ---- ---- Net decrease in cash and cash equivalents (1,090) (2,074) Cash and cash equivalents at beginning of period 1,931 3,207 ----- ----- Cash and cash equivalents at end of period $841 $1,133 ==== ====== DATASOURCE: Calloway's Nursery, Inc. CONTACT: Dan Reynolds of Calloway's Nursery, Inc., +1-817-222-1122 Web Site: http://www.calloways.com/

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