ITASCA, Ill. (Feb. 27, 2004) — Charges following the completion of Midas Inc.'s restructuring pulled down earnings to a net loss of $76.2 million in 2003, the automotive service chain said.
The yearly loss compares with a net loss of $33.6 million in 2002. In the fourth quarter, Midas posted a net loss of $25.3 million, compared with a net loss of $40.4 million the year before.
The charges of $102.6 million are related to the restructuring whereby Midas exited its unprofitable wholesale distribution business and refocused its resources on the profitable retail franchising and real estate businesses.
“The significant loss for fiscal 2003 was expected,” said Alan Feldman, president and CEO. “The actions we took in 2003 significantly reduced the company's debt level and position the Midas system for future growth in revenues and profitability.”
Sales and revenues for the fiscal year were $311.0 million compared with $333.0 million in 2002. Midas attributed the decrease primarily to the shutdown of its Parts Warehouse Inc. quick-delivery business. For the fourth quarter, sales and revenues were $81.6 million, up from $74.8 million in 2002.
Midas said company-operated shops generated $41.7 million of sales in 2003 and $9.2 million in the fourth quarter vs. $53.2 million for fiscal 2002 and $12.2 million for that year's fourth quarter.
Also in 2003, Midas announced plans for its nearly 1,900 North American stores to become authorized Bridgestone/Firestone outlets, although the tire maker said it planned to impose safeguards to limit their direct competition with independent dealers. Worldwide, the company has 2,700 franchised, licensed and company-owned shops in 19 countires.