16th Consecutive Year of Increased Membership Revenues
2008 Membership Revenues Up 2%; 2008 EPS Up 30%
ADA, Okla., Feb. 23 /PRNewswire-FirstCall/ -- Pre-Paid Legal Services,
Inc. (NYSE: PPD), announced results for the fourth quarter and year ended
December 31, 2008. Net income for the fourth quarter of 2008 increased 26% to
$14.7 million from $11.7 million for the prior year's fourth quarter due to a
fourth quarter 2007 charge of $2.9 million relating to income taxes. Diluted
earnings per share for the 2008 fourth quarter increased 38% to $1.27 per
share from 92 cents per share for the prior year's comparable quarter due to
an increase in net income of 26% and a decrease of 9% in the weighted average
outstanding shares. Membership revenues in the fourth quarter of 2008
increased slightly to $109.0 million compared to $108.9 million for the same
period last year.
Net income for the full year of 2008 increased 18% to $60.2 million from
$51.2 million for 2007. Diluted earnings per share for 2008 increased 30% to
$5.04 per share from $3.88 per share for the prior year due to increased net
income of 18% and a 10% decrease in the weighted average number of outstanding
shares. Membership revenues for 2008 were up 2% to $436.8 million from $427.4
million for the prior year marking the sixteenth consecutive year of increased
membership revenue.
Net cash provided by operating activities decreased 4% to $64.3 million
for 2008 from $67.2 million for 2007. During 2008, we purchased and formally
retired 1,053,614 shares of our common stock for $44.7 million, or an average
price of $42.44 per share. From April 1999 to year-end 2008, we invested
$407.1 million in the repurchase of 13.7 million shares at an average price of
$29.62 per share, reducing the number of shares outstanding at year-end 2008
to 11.4 million. At December 31, 2008, we had $59.7 million of debt
outstanding and $60.0 million in cash and cash equivalents and unpledged
investments.
Fourth quarter 2008 membership fees decreased slightly to $109.0 million
compared to $109.3 million for the 2008 third quarter while associate services
revenues declined to $5.0 million compared to $6.2 million in the third
quarter of 2008. Commissions decreased 8% while associate services and direct
marketing expenses increased approximately 4%. Membership benefits were 35%
of membership fees for the 2008 fourth quarter compared to 34% for the third
quarter of 2008. General and administrative expenses were 13% and 11%, of
membership fees, respectively, for the two periods.
Our Board of Directors has authorized an additional repurchase of 1
million shares, as we have purchased virtually all of our previously announced
stock repurchase authorizations totaling 14 million shares.
