Vector group reports first quarter 2017 financial results
Miami--(business wire)--vector group ltd. (nyse:vgr) today announced financial results for the three months ended march 31, 2017. gaap financial results first quarter of 2017 revenues were $415.2 million, compared to revenues of $380.8 million in the first quarter of 2016. the company recorded operating income of $52.9 million in the first quarter of 2017, compared to operating income of $62.2 million in the first quarter of 2016. net loss attributed to vector group ltd. for the first quarter of 2017 was $4.2 million, or $(0.03) per diluted common share, compared to net income of $19.3 million, or $0.15 per diluted common share, in the first quarter of 2016. non-gaap financial measures non-gaap financial measures also include adjustments for purchase accounting associated with the company's acquisition of its additional 20.59% interest in douglas elliman realty, llc in december 2013, litigation settlement and judgment expenses in the tobacco segment, settlements of long-standing disputes related to the master settlement agreement in the tobacco segment, restructuring and pension settlement expense in the tobacco segment, stock-based compensation expense (for purposes of adjusted ebitda only) and non-cash interest expense associated with the company's convertible debt. reconciliations of non-gaap financial results to the comparable gaap financial results for the three months ended march 31, 2017 and 2016 are included in tables 2 through 7. three months ended march 31, 2017 compared to the three months ended march 31, 2016 first quarter of 2017 adjusted ebitda attributed to vector group (as described in table 2 attached hereto) were $61.3 million compared to $69.6 million for the first quarter of 2016. adjusted net income (as described in table 3 attached hereto) was $18.4 million or $0.14 per diluted share for the first quarter of 2017 and $18.1 million or $0.14 per diluted share for the first quarter of 2016. adjusted operating income (as described in table 4 attached hereto) was $54.1 million for the first quarter of 2017 compared to $65.2 million for the first quarter of 2016. tobacco segment financial results for the first quarter of 2017, the tobacco segment had revenues of $257.5 million, compared to $221.0 million for the first quarter of 2016. the increase in revenues was primarily due to a 21.0% increase in unit sales volume. operating income from the tobacco segment was $59.8 million for the first quarter of 2017 compared to $61.5 million for the first quarter of 2016. non-gaap financial measures tobacco adjusted operating income (as described in table 5 attached hereto) for the first quarter of 2017 and 2016 was $60.5 million and $63.9 million, respectively. for the first quarter of 2017, the tobacco segment had conventional cigarette (wholesale) shipments of approximately 2.17 billion units compared to 1.80 billion units for the first quarter of 2016. liggett's retail market share increased to approximately 3.75% during the first quarter of 2017. compared to the first quarter of 2016, liggett's retail shipments increased 6.2% while the overall industry's retail shipments declined by 2.7%, according to data from management science associates, inc. real estate segment financial results for the first quarter of 2017, the real estate segment had revenues of $157.8 million, compared to $159.7 million for the first quarter of 2016. for the first quarter of 2017, the real estate segment reported a net income of $7.1 million, compared to net income of $3.0 million for the first quarter of 2016. douglas elliman's results are included in vector group ltd.'s real estate segment. for the first quarter of 2017, douglas elliman had revenues of $155.5 million, compared to $157.6 million for the first quarter of 2016. for the first quarter of 2017, douglas elliman reported net income of $0.1 million, compared to $7.1 million for the first quarter of 2016. non-gaap financial measures for the first quarter of 2017, real estate adjusted ebitda attributed to the company (as described in table 6 attached hereto) were $2.5 million, compared to $7.5 million for the first quarter of 2016. douglas elliman's results are included in vector group ltd.'s real estate segment. for the first quarter of 2017, douglas elliman's adjusted ebitda (as described in table 7 attached hereto) were $1.8 million ($1.2 million attributed to the company), compared to $9.1 million ($6.4 million attributed to the company) for the first quarter of 2016. for the first quarter of 2017, douglas elliman achieved closed sales of approximately $5.6 billion, compared to $5.7 billion for the first quarter of 2016. e-cigarettes segment financial results for the first quarter of 2017, the e-cigarette segment had a loss of adjusted ebitda of $0.1 million compared to a loss of adjusted ebitda of $0.2 million for the first quarter of 2016. non-gaap financial measures adjusted ebitda, adjusted net income, adjusted operating income, tobacco adjusted operating income, new valley llc adjusted ebitda and douglas elliman realty, llc adjusted ebitda ("the non-gaap financial measures") are financial measures not prepared in accordance with generally accepted accounting principles (“gaap”). the company believes that the non-gaap financial measures are important measures that supplement discussions and analysis of its results of operations and enhances an understanding of its operating performance. the company believes the non-gaap financial measures provide investors and analysts with a useful measure of operating results unaffected by differences in capital structures and ages of related assets among otherwise comparable companies. management uses the non-gaap financial measures as measures to review and assess operating performance of the company's business, and management and investors should review both the overall performance (gaap net income) and the operating performance (the non-gaap financial measures) of the company's business. while management considers the non-gaap financial measures to be important, they should be considered in addition to, but not as substitutes for or superior to, other measures of financial performance prepared in accordance with gaap, such as operating income, net income and cash flows from operations. in addition, the non-gaap financial measures are susceptible to varying calculations and the company's measurement of the non-gaap financial measures may not be comparable to those of other companies. attached hereto as tables 2 through 7 is information relating to the company's non-gaap financial measures for the three months ended march 31, 2017 and 2016. conference call to discuss first quarter results as previously announced, the company will host a conference call and webcast on friday, may 5, 2017 at 9:00 am (et) to discuss first quarter 2017 results. investors can access the call by dialing 800-859-8150 and entering 90330388 as the conference id number. the call will also be available via live webcast at www.investorcalendar.com. webcast participants should allot extra time to register before the webcast begins. a replay of the call will be available shortly after the call ends on may 5, 2017 through may 19, 2017. to access the replay, dial 877-656-8905 and enter 90330388 as the conference id number. the archived webcast will also be available at www.investorcalendar.com for one year. vector group is a holding company that indirectly owns liggett group llc and vector tobacco inc. and directly owns new valley llc, which owns a controlling interest in douglas elliman realty, llc. additional information concerning the company is available on the company's website, www.vectorgroupltd.com. [financial tables follow] table 1 vector group ltd. and subsidiaries condensed consolidated statements of operations (dollars in thousands, except per share amounts) * revenues and cost of sales include federal excise taxes of $109,368 and $90,846, respectively. table 2 vector group ltd. and subsidiaries reconciliation of adjusted ebitda (unaudited) (dollars in thousands) table 3 vector group ltd. and subsidiaries reconciliation of adjusted net income (unaudited) (dollars in thousands, except per share amounts) douglas elliman realty, llc purchase accounting adjustments (c) 321 table 4 vector group ltd. and subsidiaries reconciliation of adjusted operating income (unaudited) (dollars in thousands) table 5 vector group ltd. and subsidiaries reconciliation of tobacco adjusted operating income and tobacco adjusted ebitda (unaudited) (dollars in thousands) table 6 vector group ltd. and subsidiaries reconciliation of real segment (new valley llc) adjusted ebitda (unaudited) (dollars in thousands) table 7 vector group ltd. and subsidiaries reconciliation of douglas elliman realty, llc adjusted ebitda and douglas elliman realty, llc adjusted ebitda attributed to real estate segment (unaudited) (dollars in thousands)
