Calloway's Nursery, Inc.

Condensed Consolidated Statements of Income (Unaudited)

(amounts in thousands, except per share amounts)

Three Months Ended

March 31,
2019 2018
Net revenue $11,385 $14,461
Cost of goods sold 5,401 6,755
Gross profit 5,984 7,706
Selling, general and administrative expenses 5,963 5,365
Net interest expense 151 61
Income before provision for income taxes (130) 2,280
Income tax expense (benefit) (17) 496
Net income (loss) ($ 113) $ 1,784
Weighted average number of common shares
outstanding - basic and diluted 7,346 7,346
Net income per common share - basic and diluted ($ 0.02) $ 0.24

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 Calloway's Nursery, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
(amounts in thousands, except share amounts)

Assets
March 31,
2019 2018
Cash and cash equivalents $ 750 $ 5,077
Accounts receivable 1,504 2,076
Inventories 7,986 6,748
Prepaids 166 89
Total current assets 10,406 13,990
Property and equipment, net 23,651 23,972
Assets under capital leases 6,034 2,575
Assets under operating leases 8,338 --
Other assets 50 42
Total assets $48,479 $40,579

Liabilities and Shareholders' Equity

Accounts payable and accrued expenses $7,276 $10,199

Deferred revenue 1,006 888
Current portion of long-term debt 366 357
Current portion of capital lease obligations 122 50
Current portion of operating lease obligations 1,295 --
Total current liabilities 10,065 11,494
Long-term debt (net of current portion and unamortized
debt issuance costs) 4,251 4,606
Obligations under capital leases, net of current portion 5,950 2,525
Obligations under operating leases, net of current portion 7,132 --
Deferred rent payable -- 96
Deferred income taxes 1,356 1,201
Total liabilities 28,754 19,922
Commitments and contingencies
Shareholders' equity:
Common stock ($.01 par value; 30,000,000 shares
authorized; 7,607,848 shares issued) 76 76
Additional paid-in capital 8,608 8,566
Retained earnings 12,449 13,423
21,133 22,065
Less: treasury stock, at cost (261,888 shares) (1,408) (1,408)
Total shareholders' equity 19,725 20,657
Total liabilities and shareholders' equity $48,479 $40,579

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 Calloway's Nursery, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(amounts in thousands)

Three Months Ended

March 31,
2019 2018
Cash flows from operating activities:
Net income (loss) ($ 113) $1,784
Adjustments to reconcile net income (loss) to net
cash provided by (used for) operating activities:
Depreciation and amortization 302 200
Amortization of deferred borrowing costs 3 3
Stock-based compensation 6 11
Deferred income taxes (2) (60)
Change in operating assets and liabilities:
Inventories (3,918) (3,290)
Accounts payable and accrued expenses 3,107 5,435
Other operating assets and liabilities (1,430) (1,996)
Net cash flows provided by (used for) operating
activities (2,045) 2,087

Cash flows from investing activities:

Additions to property and equipment (184) (519)
Net cash flows used for investing activities (184) (519)

Cash flows from financing activities:

Repayments of debt (90) (88)
Repayments of capital lease obligations (52) --
Payment of dividends (3,673) (3,673)
Net cash flows used for financing activities (3,815) (3,761)

Net decrease in cash and cash equivalents (6,044) (2,193)

Cash and cash equivalents at beginning of period 6,794 7,270
Cash and cash equivalents at end of period $750 $ 5,077

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