HENDERSON, Nev. – Seed company AgriBioTech Inc. (ABT) announced its fiscal 2000 second quarter results on Feb. 22 – just under one month after the company’s Jan. 24 announcement that it filed for Chapter 11 bankruptcy. For the quarter AgriBioTech reported a net loss of $19.5 million on revenues totaling $52.0 million, compared with a net loss of $10.3 million on sales of $75.9 million in the same period last year.
On an EBITDA basis (earnings before interest expense, income taxes, depreciation, amortization, restructuring and special charges and extraordinary items), the company reported a negative $13.4 million, compared with a negative $4.4 million in the second quarter a year ago. EBITDA is an important, cash-based measure of operating performance, particularly in companies engaged in significant industry consolidation through acquisitions and mergers.
Net loss for the first six months of fiscal 2000 was $23.1 million, compared with a net loss of $9.9 million in the same period last year. EBITDA for the first six months of fiscal 2000 was a negative $11.9 million, compared with a positive $0.8 million for the same period last year.
On Feb. 15 the Bankruptcy Court approved the appointment of William Brandt Jr. as the company’s responsible person under Federal Rule of Bankruptcy Procedure 9001(5). As the responsible person, Brandt will be in complete control of the day-to-day operations of the company. Although he will not be an officer of the company, Brandt will have all of the powers vested in the members of the board of directors and officers of ABT.
To assist Brandt in fulfilling his duties as the responsible person, the court approved the company’s retention of Development Specialists Inc. (DSI) as reorganization consultants. Brandt is a principal of DSI. Following Brandt’s appointment, all of the members of the company’s board of directors and all of its officers have resigned.
Brandt, DSI and ABT’s have determined to sell the assets of the company. ABT is now in the process of preparing a bid-solicitation package, which will be disseminated to all parties expressing interest in purchasing any of the company’s assets.
The company anticipates that the filing of the bankruptcy case, lack of liquidity and current absence of debtor-in-possession financing will have an immediate negative impact on the results of operations. Lower revenues and net losses are anticipated for the foreseeable future as a result of lack of adequate cash reserves to undertake certain activities (e.g., purchase of seed for blends and mixes, freight costs, quality testing, etc.) needed to move products to market during this shipping season.
For more information regarding ABT’s bankruptcy case, click here for a Lawn & Landscape Online News article, or visit ABT's web site at www.agribiotech.com.
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