Intermark Has End-of-Year Loss of $67.5 Million : * Finance: La Jolla conglomerate’s debt load, economy send fourth-quarter losses to almost $34 million.
Straining under a heavy debt load and the recession, Intermark reported a loss of $33.9 million for its fourth quarter and a loss of $67.5 million for the fiscal year ended March 31.
The La Jolla-based conglomerate said “virtually all” of its 12 “partner companies” lost money during the fiscal year. The operating losses were exacerbated by corporate interest expense that last year totaled $49.3 million, the result of a debt taken on to finance various acquisitions and restructurings.
The losses have reduced Intermark’s shareholder equity to about $40 million, corporate counsel Mitchell R. Woodbury said Friday. That means the company cannot absorb another year of similar losses and remain solvent.
The fourth-quarter loss came on revenue of $109.5 million, contrasted with a loss of $14 million on revenue of $117.7 million over the same three months the previous year. The full-year loss was on revenue of $407.6 million, contrasted with a loss of $10.7 million on revenue of $286.5 million over fiscal 1990.
The most recent results reflect the elimination of sales and profits of Pier 1 Imports, the Dallas concern in which Intermark owned a 52% interest until it sold the stock this month in a public offering. The results also do not include an Intermark stake in Sunbelt Nurseries, which it sold to Pier 1 last September.
The Pier 1 Imports stock sale was done at the behest of Intermark’s lenders to generate proceeds to pay off a significant portion of Intermark’s debt. But it also deprived the parent company of its most profitable “partner company.”
The 1991 results also include an unspecified operating loss from Fuqua Industries, an Atlanta-based company of which Intermark owns 26% of outstanding shares. Fuqua’s losses have caused its stock to plunge. As a result, Intermark has incurred a $75-million “paper loss” on its Fuqua shares, Woodbury said.
Problems at Fuqua prompted Intermark Chairman Charles R. Scott to move to Atlanta earlier this year to assume personal management control of the company.
