Urges Stockholders to Vote FOR the Committee's Highly Experienced and Qualified Director Nominees on the GOLD Proxy Card
FORT WORTH, Texas, April 28 /PRNewswire/ -- The members of the Cavalier Homes Committee for Change (the 'Committee') expressed their disappointment with the first quarter financial results of Cavalier Homes, Inc. (the 'Company') (NYSE Alternext US: CAV). The Committee is seeking to elect its slate of director Nominees, Michael R. O'Connor, Kenneth E. Shipley and Curtis D. Hodgson, at the Company's 2009 annual meeting of stockholders, scheduled to be held on May 19, 2009. The Committee urges stockholders to vote FOR the Committee's highly experienced and qualified director Nominees on the GOLD proxy card.
'We question how Cavalier can declare 'profitable financial results' when they report a 60% decline in revenues from the first quarter of 2008 and the only reason for positive net income this quarter was the sale of two of the Company's assets - Cavalier's financial arm, CIS Financial Services Inc., and an idled facility in Cordele, Georgia,' said Hodgson. 'In our opinion, this Board has overseen a significant decline in revenues, beginning well before the current economic crisis, and has sold asset after asset in order to maintain the appearance of profitability, rather than changing course and investing in new opportunities,' continued Hodgson. 'With total assets down to approximately $76.5 million this quarter from approximately $244.8 million just ten years earlier, and with the retention of Avondale Partners to evaluate 'the Company's strategic alternatives,' we are deeply concerned that Cavalier's operations and business will not survive unless some changes are immediately made,' added Hodgson.
The Committee also addressed stockholder concerns relating to the potential for a business combination between the Company and Legacy Housing, a member of the Committee. Mr. Hodgson stated, 'Legacy has no intention of pursuing a merger with Cavalier at this time. We are seeking representation on the Board to protect our investment and the investment of all stockholders in the Company. We believe our Nominees are the only hope to reverse the downward trend in revenue.'
The Committee's plan to restore profitability to the Company includes expanding into retail and wholesale 'floor plan' financing and rebuilding the Company's brand names, among other things. 'We believe our plan will cause Cavalier's stock price to reflect a healthy enterprise value. Then, and only then, would our slate of Nominees encourage the other members of the Board to fully explore available strategic alternatives.
