| Precision Auto Care, Inc. | |||
| Proposed Ticker: | PACI | 748 Miller Drive, S.E. | |
| Exchange: | NASDAQ-National Market | Leesburg, VA 20175 | |
| Industry: | Service (SIC Code 7539) | (703) 777-9095 | |
| # of Employees: | 165 | ||
| Type of Shares: | Common Shares | Filing Date: | 8/26/97 | |
| U.S. Shares Filed: | 2,300,000 | Filing Range: | $10.00 - $12.00 | |
| Non-U.S. Shares Filed: | 0 | Offering Amount: | $25,300,000 | |
| Primary Shares: | 2,300,000 | Expenses: | - | |
| Secondary Shares: | 0 | Shares Out After: | 5,080,695 |
| Manager | Tier | Phone |
| A.G. Edwards & Sons, Inc. | Lead Manager | (314) 955-3039 |
| Ferris, Baker, Watts Inc. | Co-manager | (202) 429-3608 |
| Issuer's Law Firm: | Miles & Stockbridge |
| Bank's Law Firm: | Alston & Bird |
| Auditor: | Ernst & Young |
| Registrar/Transfer Agent: | First Union National Bank North Carolina |
Dollar amounts in U.S. millions except for per share data | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 6/30/97 | 6/30/97 | ||||
| Revenue: | $41.20 | Assets: | $57.68 | ||
| Net Income: | $0.75 | Curr Assets: | |||
| EPS: | $0.26 | Liabilities: | $31.46 | ||
| Prior EPS: | Curr Liabilities: | ||||
| Cash Flow/Oper: | Equity: | $26.21 | |||
| Cash Flow/Fin: | Cash: | ||||
| Cash Flow/Inv: | Working Cap: | -$7.91 | |||
| Business Description |
| The company is an international provider of automotive maintenance services which are offered principally as franchise operations and will be marketed under the "Precision" brand. The Company's operations include: (i) Precision Tune Auto Care, an international franchisor of automotive service centers; (ii) Precision Auto Wash, an operator and franchisor of self-service and touchless automatic car wash centers; and (iii) Precision Lube Express, an operator and franchisor of modular fast oil change and lube centers. The Company's management team has developed a strategic plan to capitalize on the market opportunities currently presented to the Company. These opportunities include leveraging Precision Tune Auto Care's existing brand name recognition and current market position into a broader "Precision" brand which symbolizes a high-quality, convenient and high-value auto services provider. Other opportunities involve the cross-selling of each service offering to existing and potential franchisees in order to provide multiple services and one-stop shopping to its customers and consolidating the automotive maintenance service industry through strategic acquisitions. Precision Tune Auto Care is a leading franchisor of automotive service centers with 556 centers owned and operated by franchisees as of June 30, 1997. Total system wide retail sales were approximately $207 million for the fiscal year ended June 30, 1997. Precision Auto Wash operates 35 company-owned touchless automatic and self-service car wash centers and has developed a proprietary marketing and operating system which provides computerized central control of its car wash system. Precision Lube Express owns and franchises express automobile oil and lubrication centers predicated upon a modular, above-ground building configuration designed to minimize the up-front cost of construction and provide flexibility in site selection and relocation. As of June 30, 1997, there were 21 fast oil change and lubrication centers in operation. In support of its franchisees and retail services, the Company manufactures and sells car wash equipment, modular fast oil change and lube buildings and car wash chemicals. The Company also distributes automotive parts, equipment and supplies. Pro forma revenue and operating income were $41.2 million and $4.3 million for the year ended June 30, 1997, respectively. |
| Competition |
| The Company encounters competition in all aspects of its business, including the sale by Precision Tune Auto Care, Precision Auto Wash and Precision Lube Express centers of automotive maintenance and repair services, self-service and automatic car wash services and fast oil and lubrication services, respectively. The Company believes that automobile dealerships, including recently emerging national and regional new and used auto dealerships, represent Precision Tune Auto Care's principal competitors; however, the Company also competes with national and regional tire companies, major oil manufacturers, local service stations, and local and regional automobile repair specialists. The Company believes the principal competitive factors in its market are location, name recognition and reputation, quality of service and price. The Company also competes with these and other parties in the sale of franchises, based on startup costs, royalty rates and Company support for the franchisee, and in the sale of supplies and equipment, based on availability, price and ability to provide prompt delivery. As the Company grows and expands into new markets, it will be necessary to establish and maintain local and regional support services for new franchisees and also parts and equipment distribution, and the failure to do so in a timely manner could have a material adverse effect on the Company's financial condition and results of operations. |
| Business Plan |
| The Company's growth strategy centers on the following elements: Maximizing Service Center Profitability; Service Center Growth; Acquisition or Conversion of Competitor Centers; Company Store Division; Manufacturing and Distribution. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to repay debt, to provide a point of sale management information system for each center, to assist franchises in converting to current image requirements and for an acquisition. |