Mace Announces Increase In Annual Revenues

MOUNT LAUREL, N.J. -- Mace Security International, Inc. Monday announced financial results for the year and fourth quarter ended December 31, 2000.

Highlights of 2000

- Increased revenue 86 percent to $48.0 million from $25.8 million in 1999

- Increased EBITDA 69 percent to $6.0 million from $3.6 million in 1999, on a pro forma basis

- Increased cash position to $4.8 million at December 31, 2000 from $2.3 million at December 31, 1999

- Secured approximately $17 million in financing from Bank One, Texas, N.A. to term out substantially all short term acquisition-related debt

- Maintained strong financial position with a debt-to-total capitalization ratio of .37 to 1

- Completed four acquisitions consisting of three carwashes and five truck washes

- Completed integration of 57 carwashes and five truck washes into central operating and accounting systems

Revenues for the year ended December 31, 2000 increased 86 percent to $48.0 million from $25.8 million for the same period in 1999. Operating income for the year ended December 31, 2000 was $2.4 million compared to a loss of $1.1 million for the same period in 1999. Earnings per share on a fully diluted basis for the year was $.01 per share compared to a loss of $.10 per share in 1999. EBITDA for the year was $5.3 million or 11.0 percent of revenues compared to EBITDA of $159,000 or 0.6 percent of revenues for the same period in 1999.

Revenues for the fourth quarter of 2000 were $11.4 million compared to $11.5 million for the fourth uarter of 1999. Operating income for the quarter was $267,000 compared to $874,000 in the fourth quarter of 1999. EBITDA for the quarter was $1.0 million or 8.9% of revenues compared to $1.4 million or 12.2 percent of revenues in the same quarter of 1999. The net loss for the fourth quarter of 2000 was $273,000 or $.01 per share compared to net income of $207,000 or $.01 per share on a fully diluted basis in the same quarter of 1999. Operating results for the quarter ended December 31, 2000 include a non-recurring write-down of $138,000 on a pending sale of assets, net of related taxes.

Mace continues to increase its detailing revenue as well as improve its average wash revenue per car. During the fourth quarter of 2000, the company generated $1.73 million in detailing revenue, a 17.9 percent increase over the $1.47 million generated in the same period in 1999. In addition, Mace increased its average wash revenue per car from $10.22 in the December 1999 quarter to $10.46 in the December 2000 quarter through added emphasis on marketing various on-line and off-line carwash services.

These increases in detailing revenue and average wash revenue per car were offset by the impact of unfavorable weather conditions. During the quarter ended December 31, 2000, the company's markets, on a combined basis, experienced rain or clouds on approximately 54 percent of its operating days as compared to 25% in the same period in 1999, according to information gathered from the National Climatic Data Center. In addition, it was rainy or cloudy on 60 percent of the available weekend days in the fourth quarter of 2000, as compared to only 26 percent of the available weekend days in the same period in 1999. Weekends are typically the highest volume periods for carwashing. This unfavorable weather resulted in flat quarter-to-quarter revenues despite the previously mentioned increase in average revenue per car and the addition of eight new car and truck washes in 2000.

These acquisitions produced additional operating costs, which, combined with the flat revenues, had the effect of decreasing operating margins and net results for the current quarter. On a year-to-year comparison, the company's markets, on a combined basis, experienced rain or clouds on approximately 43 percent of its operating days during 2000 as compared to 34 percent in 1999. While the company continues to believe that the geographic diversity of its car wash locations minimizes weather-related influence on its carwash volume, it cannot completely eliminate short-term negative weather-related effects.

"In September 2000, we began reorganizing our operational management team by appointing Robert Kramer, the company's executive vice president, to the role of overseeing day-to-day car wash operations. Since then, Mace has successfully integrated all of its regional operations into one centralized operating and accounting system, restructured regional management with individuals having on average over 15 years' experience in the car care industry and revitalized employee moral at the carwash site level,'' said Louis D. Paolino, Jr., chairman and chief executive officer of Mace. "We are very pleased with the results Mr. Kramer has produced in the fourth quarter of 2000, in spite of unfavorable weather effects in our regional markets.''

In commenting on the current status of Mace, Paolino said, "The fundamentals of the business continue to be strong. We entered 2001 with a well-diversified portfolio of real estate properties located in several high- worth regions of the United States, which is the foundation of our strong balance sheet. In addition, we have a .37 to 1 debt-to-total capitalization ratio, positive cash flow and an experienced senior management team with a high equity stake in the company. We believe that all these factors combined position us to steadily improve future operating results, while continuing to search for potential cquisition and merger candidates.''

Paolino added, "Management has been aggressively exploring new opportunities. As previously mentioned, this includes potential acquisitions, mergers and strategic alliances with historically profitable companies, including companies outside the car care industry. We believe that such opportunities will result in higher shareholder value. We have researched several companies within several industries, which have the potential to provide reasonable growth opportunities. Although we have given several companies preliminary consideration, no agreements have been reached. Finally, we consider Mace's stock price to be significantly undervalued, and continue to believe that Mace's stock is an excellent investment.''

Mace Security International, Inc. is a provider of car care services, which owns and operates car and truck washes nationwide.

Source: Mace Security International, Inc.

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