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[researcher59]

hweb: SVLF hit their 2007 guidance but as you surmised, have lowered 2008 guidance .... though not by too much. They're now guiding for EPS of $0.70 versus $0.80 previously. Many investors may have feared worse news, judging by the stock action.

DALLAS, Mar 04, 2008 (BUSINESS WIRE) -- Silverleaf Resorts, Inc. (Nasdaq: SVLF) today reported the following results for the fourth quarter and year-ended December 31, 2007.

Financial highlights for the fourth quarter 2007:

-- Vacation Interval sales increased 30.3% to $59.9 million

-- Net income improved 23.4% to $4.9 million

Financial highlights for the full year:

-- Vacation Interval sales increased 25.4% to $235.1 million

-- Net in come improved 20.4% to $27.7 million

-- Diluted earnings per share increased to $0.70 from $0.59

Sharon K. Brayfield, President, commented, "We are very pleased with our operating results for 2007 based on another strong year of Vacation Interval sales and net income growth. The appeal of our resort product and the family vacation we provide continues to be well-received by both new customers and existing members alike, and our business remains fundamentally strong. While we have adequate credit facilities in place to fund our business for the foreseeable future, we've made a prudent strategic decision to slow the growth of our sales and expansion in light of uncertainties surrounding the capital markets and general economic conditions. This will allow us to focus our efforts on continuing to improve the credit quality of our customers and pay down debt. Consequently, we are revising our 2008 net income and diluted EPS guidance to approximately $28 million and $0.70, respectively, which is consistent with full-year 2007 results."

2007 Fourth Quarter Results

Vacation Interval sales increased 30.3% to $59.9 million during the fourth quarter of 2007 compared to $46.0 million in the prior-year period. Vacation Interval sales to new customers increased 26.0% to $23.4 million. Vacation Interval sales to existing customers increased 33.2% to $36.5 million.

Total revenue for the fourth quarter of 2007 increased 24.5% to $64.8 million compared to $52.1 million for the fourth quarter of 2006.

Sales and marketing expense decreased to 53.2% of Vacation Interval sales for the fourth quarter of 2007 compared to 55.3% in the prior-year period. The $6.5 million increase in sales and marketing expense is primarily attributable to the increased volume of Vacation Interval sales.

Net income for the quarter ended December 31, 2007 increased to $4.9 million, or $0.12 per diluted share, compared to net income of $4.0 million, or $0.10 per diluted share, for the quarter ended December 31, 2006.

2007 Full Year Results

Vacation Interval sales increased 25.4% to $235.1 million for 2007 compared to $187.5 million for 2006. Vacation Interval sales to new customers increased 14.2% to $94.7 million. Vacation Interval sales to existing customers increased 34.3% to $140.5 million.

Total revenue for 2007 increased 23.3% to $255.0 million compared to $206.9 million in 2006.

Sales and marketing expense increased to 50.9% of Vacation Interval sales for 2007 from 50.1% for 2006. The $25.7 million increase in sales and marketing expense is primarily attributable to the increased volume of Vacation Interval sales as well as increased costs related to new and existing promotional programs used to generate tours.

Net income for the year ended December 31, 2007 increased to $27.7 million, or $0.70 per diluted share, compared to net income of $23.0 million, or $0.59 per diluted share, for the year ended December 31, 2006.

Balance Sheet

Notes receivable and revolving debt balances as of December 31, 2007 have increased in accordance with increased Vacation Interval sales, as compared to the balances as of December 31, 2006. At December 31, 2007, senior credit facilities provided for loans of up to $507.5 million, of which $200.0 million is available for future advances. Expansion at existing resorts, including construction of lodging units, additional amenities, and other assets resulted in a $31.4 million net increase in inventories.

Outlook

For 2008, the Company has established revised net income and diluted EPS guidance of approximately $28 million and $0.70, respectively, which is consistent with full-year 2007 results.

Conference Call

The Company plans to host a conference call and Webcast to review these results at 9:00 a.m. Eastern Time on Wednesday, March 5, 2008.

To access the conference call, please dial [phone] in the U.S. or [phone] internationally. To listen to the simultaneous Webcast, please visit the "investor relations" section of the Company's Web site (www.silverleafresorts.com).

For those unable to access the live conference, there will be an audio replay available approximately two hours after the live call ends through March 19, 2008. To listen to the audio replay, please dial [phone] in the U.S. or [phone] internationally and use the following replay pin code: 34933942. A replay of the conference call will also be available in the "investor relations" section of the Company's Web site (www.silverleafresorts.com) approximately two hours after the live call ends through April 2, 2008.