(Source: PrimeNewswire)WESTLAKE, Texas, May 7, 2009 (GLOBE NEWSWIRE) -- Animal Health International, Inc. (Nasdaq:AHII) announced today that net sales declined 11.6%, or $19.7 million, to $150.9 million for the three months ended March 31, 2009, compared to $170.6 million for the same quarter last year. Net loss was $0.3 million or $-0.01 per fully diluted share. Last year, net income for the third quarter was $1.9 million or $0.08 per fully diluted share.

    * The decrease in net sales was primarily attributable to lower    spending by production animal customers whose profits have been    constrained by fluctuating commodity prices and the general economic    slowdown.  * Gross margin declined $7.5 million with $3.3 million due to lower    sales volume and $1.5 million due to lower rebates from vendors.    Margins in our Canadian subsidiary, Kane Veterinary Supplies (Kane)    declined $0.9 million due to exchange rates and a heavier mix of low    margin product. Margins in the third quarter were 16.8% of net sales    compared to 19.2% in the third quarter last year.  * Selling, General & Administrative (SG&A) expenses for the quarter    declined $3.3 million from the same period last year as a result of    lower variable selling expense and cost reductions.  * Earnings before interest, tax, depreciation and amortization    (EBITDA) for the quarter was $3.7 million, a decrease of $4.2    million compared to the same period last year. 

Year to date net sales declined 6.3%, or $33.8 million, to $504.4 million. Net income was $2.2 million or $0.09 per fully diluted share. Last year the net income for the year to date was $8.4 million or $0.35 per fully diluted share.

    * As in the quarter, the decrease in net sales year to date was    primarily attributable to lower spending by production animal    customers whose profits have been constrained by fluctuating    commodity prices and the general economic slowdown.  * Gross margin declined $13.5 million for the nine months and was    17.4% of net sales compared to 18.8% for the same period last year.    Domestic gross margin was down $14.7 million with the decline driven    equally by reductions in volume and rebates. Kane gross margins    increased $1.2 million. Volume contributed $2.2 million while    margins declined $1.0 million due to unfavorable exchange rates and    a heavier mix of low margin product. Last year reflected only second    and third quarter operations for Kane, as it was acquired in October    2007.  * SG&A expenses for the nine months decreased $2.5 million from the    same period last year. Kane caused a $1.4 million increase in SG&A    this year while domestic spending on SG&A declined $3.9 million as a    result of lower variable selling expense and cost reductions.  * EBITDA for the year to date was $17.3 million, a decrease of $11.1    million when compared to the same period last year. 

At March 31, 2009, the Company's availability under its Revolver totaled $24.9 million, and the Company is in compliance with all of its financial covenants.

Extension and Change in Terms of Revolving Credit Facility

On May 5, 2009, the Company extended the expiration of its Revolving Credit Facility to the earlier of June 30, 2012 or 60 days prior to the maturity date of the Term Note, which currently matures on May 31, 2011. Other changes to the Revolver include increasing the margin pricing matrix from LIBOR + 200 bps to LIBOR plus 350 bps and amending total capacity to $130 million. Availability immediately following this Revolver amendment totaled $27.0 million.

Fiscal Year 2009 Guidance

The following statements are based on current information and the Company assumes no obligation to update them. These statements are forward-looking and inherently uncertain.

Net sales for fiscal year 2009 are expected to be in the range of $645 to $660 million. EBITDA, excluding any one-time charges, is estimated to be in the range of $22.0 to $25.0 million, and net income to be in the range of $2.1 to $3.7 million for the fiscal year ending June 30, 2009.

Conference Call

The Company plans to host its investor conference call today at 10:00 a.m. Eastern Daylight Time to discuss these results and its business outlook. You can access the conference call by dialing 877-407-9205. Participants will be required to register their name and company affiliation for the conference call. Audio replay will be made available by accessing the Company's web site at www.ahii.com under the Investor Relations tab.

Use of Non-GAAP measures

EBITDA represents net income (loss) before interest expense, income tax expense, depreciation and amortization, stock option expense, and acquisition costs.