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Movie Gallery Releases Glum 2006 Numbers

20 Feb, 2007 By: Jessica Wolf

Preliminary 2006 numbers from Movie Gallery spell a less-than-stellar year for the debt-laden rental chain.

Total same-store sales were down 2.9% for the fourth quarter, the company announced Tuesday. Following the trend of the year, Movie Gallery locations fared better in the quarter, with a slight 0.3% slump, than the 4.3 % decline at Hollywood Video-branded stores.

That's better than last year's overall 8.9% same-store sales decline in the fourth-quarter and 4.7% fiscal-year droop.

Total revenue for the year hit $2.54 billion. Broken out, that's $868 million from Movie Gallery, $1.35 billion from Hollywood Video and $325 million from Game Crazy. Operating Income was $24 million for the fourth quarter and $102 million for the year. Gallery did not release net income information, promising full accounting of the 2006 full year and fourth quarter in March.

Meanwhile, the country's No.2 chain also released specs of its recent debt refinancing with Goldman Sachs Credit partners.

The $900 million financing includes a $100 million in revolving credit; a $535 million first lien term loan; a $250 million second-term lien and a $25 million synthetic letter of credit.

Movie Gallery will use the proceeds of the financing to refinance its senior debt, replace existing letters of credit, generate working capital, for general corporate purposes and to pay fees and expenses related to the transaction. The company will not garner any incremental debt at the close of the financing.

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