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Bestway revenues up 4.7%

By Furniture Today Staff -- Furniture Today, March 31, 2003

Dallas — Strong same-store growth helped rent-to-own company Bestway to a 4.7% increase in revenues in its second quarter ended Jan. 31.

The company, which operates 69 stores in the Southwest, said same-store revenues jumped 15.1% from the comparable period a year earlier. Offsetting that gain was a reduction in revenue from 14 stores that were consolidated or sold in 2002.

Revenue for the quarter came to $8.9 million. Net income was $42,619, an improvement from a net loss of $73,723 a year earlier. The company said its pro forma net loss in the year-ago quarter, adjusted to remove the effect of the required adoption of a new accounting standard, was $10,636.

Bestway said it achieved the improvement partly by adjusting its merchandise mix to eliminate lower-margin product lines and focus on higher-revenue merchandise, which has increased its gross margins and its average income per rental agreement. Investments in store personnel and advertising helped yield gains in customers and agreements on rent, the company said.

"We committed ourselves seven months ago to make '03 a year of growth," said David Kreamer, president and chief executive officer, "and I'm pleased to say we are seeing the rewards of good planning and execution as evidenced by an impressive 12.7% improvement in same-store sales for the six-month period, as well as returning the company to profitability for the quarter."

Bestway
Earnings per share are fully diluted, and all figures in parentheses are loses or declines.
Quarter ended 1/31	2003	2002	Change
(a) Includes non-rental revenues of $391,591 in the 2003 quarter, $179,888 in the 2002 quarter, $670,362 in the 2003 six months and $388,858 in the 2002 six months. (b) Revenues minus cost of goods sold, depreciation and amortization of rental merchandise, salaries and wages, advertising, occupancy and other operating expenses. (c) Includes pretax gains on the sale of property and equipment of $9,347 in the 2003 quarter and $8,561 in the 2003 six months and income tax benefits of $32,714 in the 2003 quarter and $116,938 in the 2003 six months. (d) Includes income tax benefits of $8,391 in the 2002 quarter and $92,711 in the 2002 six months. The 2002 quarter also includes a $962 pretax loss on the sale of property and equipment and a $15,233 pretax loss on the sale of assets. The 2002 six months also includes a $4,609 pretax gain on the sale of property and equipment and a $55,892 pretax gain on the sale of assets. (e) Based on average shares outstanding of 1.75 million in the 2003 quarter, 1.66 million in the 2002 quarter, 1.66 million in the 2003 six months and 1.67 million in the 2002 six months.
Revenues (a)	$8,894,260	$8,493,850	4.7%
Operating income (b)	555,068	597,836	(7.2%)
Net income	(c)42,619	(d)(73,723)	—
Earnings per share (e)	0.02	(0.04)	—
6 months ended 1/31	2003	2002	Change
Revenues (a)	$17,167,222	$16,944,355	1.3%
Operating income (b)	782,641	961,246	(18.6%)
Net income	(c)(194,072)	(d)(265,605)	—
Earnings per share (e)	(0.12)	(0.16)	—

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