Rent-A-Wreck turns around by cutting costs FTC

June 30, 1995|By Michael Dresser | Michael Dresser,Sun Staff Writer

Owings Mills-based Rent-A-Wreck of America Inc. reported yesterday that fiscal 1995 was a bang-up year during which it stemmed a flow of red ink by severely cutting its costs.

The franchised chain of used auto rental agencies earned $383,214, or 6 cents a share, during the 12 months ended March 31. That compared with a loss of $235,647, or 10 cents a share, in fiscal 1994.

The company's revenues actually decreased, to $3 million this year from $3.2 million in 1994. But it cut back its expenses from $3.5 million to $2.7 million, more than enough to make up for the revenue drop.

Rent-a-Wreck's franchise network actually produced higher sales in 1995, increasing to $26.5 million from $25.5 in 1994. But the company's 384 franchises passed along less in royalties than the 365 franchisees from the year before.

The company did not announce quarterly results, but a comparison with nine-month results at the end of the third quarter showed earnings of about $85,000 on revenues of $679,000.

Rent-A-Wreck was formerly based in Los Angeles.

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