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CORRECTING and REPLACING FinishMaster Announces Second Quarter Financial Results

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  Published in House and Home on Wednesday, August 11th 2010 at 9:25 GMT by Market Wire
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INDIANAPOLIS--([ BUSINESS WIRE ])--For the Selected Historical Financial Data table, the figure for "Gross margin" under the "Three Months Ended June 30, 2009" column should read 33,242 (sted 75,378).

The corrected release reads:

FINISHMASTER ANNOUNCES SECOND QUARTER FINANCIAL RESULTS

FinishMaster, Inc. (Pink Sheets: FMST) today reported net income for the quarter ended June 30, 2010 of $3,775,000, or $0.48 per diluted share, compared with net income of $3,842,000, or $0.49 per diluted share, in the prior year period. For the six months ended June 30, 2010, net income was $5,884,000, or $0.75 per diluted share, compared to net income of $6,304,000, or $0.80 per diluted share, in the prior year period.

Net sales decreased 1.4% to $107,104,000 for the quarter and 4.9% to $208,704,000 for the year-to-date period due entirely to a same branch sales decline. Same branch sales, which have been steadily improving over the last twelve months, turned positive late in the second quarter as a result of both the addition of new customers and increased purchases from existing customers. The Company remains focused on sales growth, expense control and net working capital management.

Gross margin dollars decreased $380,000 or 1.1% for the quarter and $3,378,000 or 5.1% for the year-to-date period due primarily to lower sales volume. Gross margin as a percent of net sales increased 10 basis points to 30.7% for the quarter and decreased 10 basis points to 30.2% for the year-to-date period.

Total expenses as a percentage of net sales increased 10 basis points to 24.4% and 25.1% for the quarter and year-to-date period, respectively, as a result of expenses decreasing at a slower rate than net sales. Total expenses decreased $251,000 or 1.0% for the quarter and $ 2,414,000 or 4.4% for the year-to-date period. The decrease in total expenses for both periods is a result of lower wages associated with reduced headcount, lower incentive plan costs associated with reduced profitability, lower commission expense due to reduced sales, and lower bad debt and information technology expenses. Partially offsetting these lower expenses were higher health and workersa™ compensation expenses.

Reduced interest expense for the quarter and year-to-date period resulted primarily from lower average outstanding borrowings.

Inventory and accounts payable levels decreased from the prior year-end as management brings net working capital more in line with historical levels. Free cash flow has been used to reduce debt by $9,548,000 to $42,316,000 as of June 30, 2010.

FinishMaster is the largest national independent distributor of automotive paints, coatings, and related accessories to the automotive collision repair industry. The Company is headquartered in Indianapolis, Indiana, and operates three major distribution centers and 159 branches in 39 of the 50 largest metropolitan areas in the country. For more information on FinishMaster via the Internet, visit FinishMastera™s website at [ http://www.finishmaster.com/ ].