Aavid Thermal Technologies, Inc. Fourth Quarter Sales Exceed $50 Million; EPS 19 % Increase Over Previous Quarter.CONCORD, N.H.--(BUSINESS WIRE)--Jan. 25, 1999-- Annual Sales Increase 24 % To $209 Million; EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. Increase 26 % To $1.23 Aavid Thermal thermal /ther·mal/ (ther´m'l) pertaining to or characterized by heat. ther·mal adj. 1. Of, relating to, using, producing, or caused by heat. 2. Technologies, Inc. (Nasdaq: AATT AATT Advanced Air Transportation Technologies (NASA air traffic control project) AATT Advanced Aviation Transportation Technology AATT Advanced Air Traffic Technologies (US FAA) AATT Absolute Arrival Time Technique ) today announced record 1998 sales of $209 million, an increase of 24 percent over 1997 sales of $168 million. Prior to one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. charges, net income for 1998 was $11.7 million, 37 percent ahead of 1997 net income of $8.5 million. Earnings were $1.23 per share for 1998, 26 percent ahead of the $0.97 per share for 1997. Fourth quarter 1998 sales were $50.4 million, as compared to third quarter 1998 sales of $48.8 million. Net income for the fourth quarter was $2.9 million, or $0.31 per share, compared with $2.5 million of net income and earnings per share of $0.26 for the third quarter of 1998, prior to one-time charges. Aavid Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Ronald F. Borelli said, "Our strong performance in 1998, against an uncertain worldwide electronics market and a major decline in business from Intel, reflects Aavid's position and strength to be able to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the rapidly growing thermal market, our traditional business. Driven by end-user (job) end-user - The person who uses a computer application, as opposed to those who developed or support it. The end-user may or may not know anything about computers, how they work, or what to do if something goes wrong. demands for increased functionality and features, especially in computing computing - computer and networking products, heat dissipation Noun 1. heat dissipation - dissipation of heat chilling, cooling, temperature reduction - the process of becoming cooler; a falling temperature has emerged as a major problem for the electronics industry and a major opportunity for Aavid." Borelli continued, "Thermal complexity and thermal content are going up and we see this trend only intensifying in·ten·si·fy v. in·ten·si·fied, in·ten·si·fy·ing, in·ten·si·fies v.tr. 1. To make intense or more intense: in the future. We see this as a unique opportunity for Aavid because of our full service capability: thermal analysis Thermal analysis is a branch of materials science where the properties of materials are studied as they change with temperature. Techniques include:
 n),n the construction or making of a restoration. through Aavid Thermal Products. "In 1998 we saw our Applied Thermal Technologies subsidiary's design center in Silicon Valley celebrate its first birthday and record revenues of over $1 million for the year. Because of the success of this operation, we are pleased to announce the opening of an Applied Thermal Technologies facility in Manchester, New Hampshire This article is about the city in New Hampshire. For other uses, see Manchester (disambiguation). Manchester is the largest city in the U.S. state of New Hampshire and the largest city of northern New England, an area composed of Vermont, New Hampshire and Maine. to service our East Coast customers. "Fluent, our software company continues to perform well and we are particularly pleased with the success of Fluent's Icepak software for electronics cooling analysis, which has captured nearly 25 percent of the North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. market. On the global delivery side of our business, we continue to expand our production facility in China, which is the fastest growing part of our business. Today, 25 percent of our workforce resides in China, which was a start-up Start-up The earliest stage of a new business venture. less than a year ago." Borelli concluded, "As we enter 1999, our indicators reflect continued, strong growth in our traditional business." Company Background Aavid Thermal Technologies is a leading provider of thermal management solutions for dissipating potentially damaging heat from digital and power electronics. Aavid serves a highly diversified diversified (di·verˑ·s range of markets, principally in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and the Far East. Aavid's 1998 sales totaled
$209 million, driven by the company's operations in two distinct
markets: thermal management solutions and computational fluid dynamics Computational fluid dynamicsThe numerical approximation to the solution of mathematical models of fluid flow and heat transfer. Computational fluid dynamics is one of the tools (in addition to experimental and theoretical methods) available to solve software. Thermal management solutions include products and services for problems associated with the dissipation Dissipation See also Debauchery. Breitmann, Hans lax indulger. [Am. Lit.: Hans Breitmann’s Ballads] Burley, John wasteful ne’er-do-well. [Br. Lit. of unwanted heat in electronic and electrical components and systems. Computational fluid dynamics (CFD CFD - Computational Fluid Dynamics ) software involves developing software for computer modeling and flow analysis of products and processes that would otherwise require time consuming and expensive physical models and the facilities to test them. Ongoing increases in silicon and system integration, higher processing speeds See MHz. and frequencies, smaller form factors, more sophisticated power requirements and other advances in chip technology create excessive heat in microprocessors This is a list of microprocessors. Intel
Miniature electronic circuits produced within and upon a single semiconductor crystal, usually silicon. Integrated circuits range in complexity from simple logic circuits and amplifiers, about 1/20 in. (1. operate efficiently only in a narrow temperature band. The excessive heat generated by these semiconductors not only harms their own performance but also degrades system performance and reliability and can cause system failure. These negative effects are exacerbated by the increasingly wide range of environmental conditions, including temperature extremes, in which electronic systems are expected to operate. The use of Aavid's thermal solutions helps maintain device and system performance and reliability and helps avoid premature pre·ma·ture adj. 1. Occurring or developing before the usual or expected time. 2. Born after a gestation period of less than the normal time, especially, in human infants, after a period of less than 37 weeks. component and system failure. Additional information on Aavid Thermal Technologies is available on the World Wide Web at <http://www.aatt.com> . "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " Statement Under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 The matters discussed in this release contain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. (as such term is defined in the Private Securities Litigation Reform Act of 1995) and information relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company that is based on the beliefs of the management of the Company, as well as assumptions made by and information currently available to the management of the Company. When used in this release, the words "estimate," "project," "believe," "anticipate," "intend," "expect," "see," and similar expressions are intended to identify forward-looking statements. Such statements reflect the current views of the Company with respect to future events, and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. The Company does not undertake any obligation to publicly release any revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. to these forward-looking statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" or to reflect the occurrence of unanticipated events. Conference call is scheduled for Tuesday Tuesday: see week. , January January: see month. 26, 1999 at 9:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy . Conference call number is (212) 346-6400 - reservation A clause in a deed of real property whereby the grantor, one who transfers property, creates and retains for the grantor some right or interest in the estate granted, such as rent or an Easement ,a right of use over the land of another. number 11450727. -0-
AAVID THERMAL TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
(Unaudited)
Dec.31, Dec. 31,
1998 1997
ASSETS
Cash and cash equivalents $ 20,027 $ 6,919
Notes receivable 1,459 --
Accounts receivable-trade 31,266 33,766
Inventories 15,283 13,368
Refundable income taxes 370 1,138
Deferred income taxes 9,731 2,365
Prepaid and other current assets 2,962 2,256
-------- --------
Total current assets 81,098 59,812
Property, plant and equipment, net 42,496 43,155
Other assets, net 6,321 7,829
-------- --------
Total assets $129,915 $110,796
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of debt obligations $ 3,442 $ 3,360
Accounts payable - trade 17,362 16,378
Accrued expenses and other current
liabilities 23,717 17,778
-------- --------
Total current liabilities 44,520 37,516
Debt obligations, net of current portion 11,208 20,596
Deferred income taxes 2,867 2,269
-------- --------
Total liabilities 58,595 60,381
-------- --------
Stockholders' equity:
Common stock, $0.01 par value 93 76
Additional paid-in capital 56,708 43,793
Retained earnings 14,518 6,546
-------- --------
Total stockholders' equity 71,319 50,415
-------- --------
Total liabilities and stockholders'
equity $129,915 $110,796
======== ========
AAVID THERMAL TECHNOLOGIES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except share data)
(UNAUDITED)
QUARTER ENDED
Dec. 31, Dec. 31,
1998 1997
Net sales $ 50,394 $ 52,570
Cost of goods sold 32,207 34,632
---------- ----------
Gross profit 18,187 17,938
Selling, general
and administrative
expenses 11,559 10,864
Research and
Development 1,910 1,830
---------- -----------
Income from
Operations 4,718 5,244
Interest expense, net (187) (575)
Other expense, net (34) (485)
---------- -----------
Income before
income taxes and
extraordinary item 4,497 4,184
Provision for
income tax
expense (1,553) (1,514)
---------- -----------
Net income $ 2,944 $ 2,670
========== ===========
Diluted Net income
(loss) per share $ 0.31 $ 0.30
========== ===========
Weighted average
common shares and
equivalents 9,574,799 9,003,601
========== ===========
AAVID THERMAL TECHNOLOGIES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except share data)
(UNAUDITED)
YEAR ENDED
Dec. 31, Dec.31,
1998 1997
From One-time As
Operations Charge Reported
Net sales $ 209,076 $ -- $ 209,076 $ 167,745
Cost of goods sold 138,429 -- 138,429 107,401
---------- ----------- ---------- ----------
Gross profit 70,647 -- 70,647 60,344
Selling, general
and administrative
expenses 43,783 -- 43,783 36,709
Research and
development 6,756 -- 6,756 6,939
Restructuring and
buyout of compensation
agreement charges -- 5,740 5,740 --
---------- ----------- ---------- ----------
Income from
operations 20,108 (5,740) 14,368 16,696
Interest expense,
net (1,342) -- (1,342) (2,178)
Other expense, net (520) -- (520) (1,201)
---------- ----------- ---------- ----------
Income before
income taxes and
extraordinary item 18,246 (5,740) 12,506 13,317
Provision for
income tax
expense (6,578) 2,192 (4,386) (4,824)
---------- ----------- ---------- ----------
Net income
$ 11,668 ($ 3,548) $ 8,120 $ 8,493
========== =========== ========== ==========
Diluted Net income
(loss) per share $ 1.23 ($ 0.37) $ 0.86 $ 0.98
========== =========== ========== ==========
Weighted average
common shares and
equivalents 9,482,476 9,482,476 9,482,476 8,638,611
========== =========== ========== ==========
AAVID THERMAL TECHNOLOGIES, INC.
COMPARATIVE FINANCIAL DATA (a)
(in millions, except EPS)
1997
Unaudited
Q1 Q2 Q3 Q4 Y/E
NET SALES 34.4 37.1 43.7 52.6 167.7
(b) ATP-
Power Electronics 14.6 15.2 15.0 17.8 62.6
ATP-
Computer and Network 11.2 14.0 21.1 25.8 72.1
Fluent 8.6 7.8 7.5 8.7 32.5
Applied Thermal
Technologies 0.0 0.1 0.1 0.3 0.5
Cost of Sales 20.6 23.0 29.1 34.6 107.4
GROSS PROFIT 13.8 14.0 14.6 17.9 60.3
SG&A 8.3 8.6 8.9 10.9 36.7
R&D 1.8 1.7 1.6 1.8 6.9
OPERATING EXPENSES 10.1 10.4 10.5 12.7 43.6
OPERATING INCOME 3.7 3.7 4.1 5.2 16.7
Interest Inc/
(Exp), net (0.5) (0.5) (0.6) (0.6) (2.2)
Other, net (0.5) (0.2) 0.0 (0.5) (1.2)
PRETAX INCOME 2.7 3.0 3.5 4.2 13.3
Provision for Taxes 1.0 1.0 1.3 1.5 4.8
NET INCOME 1.7 1.9 2.2 2.7 8.5
EPS (excl. one-time
charges) 0.21 0.23 0.25 0.30 0.98
Shares O/S 8.1 8.5 8.9 9.0 8.6
Capital Expenditures 1.4 2.2 4.6 6.9 15.1
Depreciation and
Amortization 1.6 1.4 1.7 1.4 6.1
Cash 3.2 4.6 5.3 6.9
Debt 26.2 27.3 30.2 24.0
Leverage Ratio 83% 77% 77% 48%
Inventory Turns
(Therm Products only) 7.3 7.8 8.9 9.6
A/R DSO 69 69 71 61
Number of employees 1,496 1,502 1,794 1,934
AAVID THERMAL TECHNOLOGIES, INC.
COMPARATIVE FINANCIAL DATA (a)
(in millions, except EPS)
1998
Unaudited
Q1 Q2 Q3 Q4 Y/E
NET SALES 55.6 54.3 48.8 50.4 209.1
(b)ATP-
Power Electronics 17.4 16.5 13.0 13.3 60.2
ATP-
Computer and Network 27.7 28.3 27.1 26.3 109.4
Fluent 10.2 9.2 8.6 10.6 38.6
Applied Thermal
Technologies 0.3 0.3 0.3 0.3 1.2
Intercompany
Eliminations 0.0 0.0 (0.1) (0.2) (0.3)
Cost of Sales 37.2 35.9 33.2 32.2 138.4
GROSS PROFIT 18.4 18.4 15.7 18.2 70.6
SG&A 11.0 11.2 10.0 11.6 43.8
R&D 1.7 1.7 1.5 1.9 6.8
OPERATING EXPENSES 12.7 12.9 11.5 13.5 50.5
OPERATING INCOME 5.7 5.5 4.2 4.7 20.1
Interest Inc/
(Exp), net (0.5) (0.4) (0.3) (0.2) (1.3)
Other, net (0.3) (0.1) (0.1) 0.0 (0.5)
PRETAX INCOME 4.9 5.1 3.8 4.5 18.2
Provision for Taxes 1.8 1.9 1.3 1.6 6.6
NET INCOME 3.1 3.2 2.5 2.9 11.7
EPS (excl.
one-time charges) 0.33 0.34 0.26 0.31 1.23
Shares O/S 9.3 9.5 9.5 9.6 9.5
Capital Expenditures 4.6 2.4 1.7 1.9 10.6
Depreciation and
Amortization 2.2 2.5 2.4 2.0 9.2
Cash & S/T Notes Rec 5.9 4.4 12.5 21.5
Debt 21.8 17.3 15.7 14.7
Leverage Ratio 39% 27% 23% 21%
Inventory Turns
(Therm Products only) 10.1 10.4 9.6 7.7
A/R DSO 61 64 68 56
Number of employees 2,042 1,997 2,152 2,243
AAVID THERMAL TECHNOLOGIES, INC.
COMPARATIVE FINANCIAL DATA (a)
(in millions, except EPS)
1997
Unaudited
Q1 Q2 Q3 Q4 Y/E
MARGIN ANALYSIS
Cost of Sales 60.0% 62.1% 66.6% 65.9% 64.0%
Gross Margin 40.0% 37.9% 33.4% 34.1% 36.0%
SG&A 24.1% 23.3% 20.4% 20.7% 21.9%
R&D 5.3% 4.6% 3.6% 3.5% 4.1%
Operating
Margin 10.6% 10.0% 9.4% 10.0% 10.0%
Interest
Inc/Exp, net (1.4%) (1.4%) (1.4%) (1.1%) (1.3%)
Pre Tax Income 7.9% 8.0% 7.9% 8.0% 7.9%
Tax Rate 37.7% 34.6% 36.5% 36.2% 36.2%
Net Income 4.9% 5.2% 5.0% 5.1% 5.1%
Yr to Yr %
Change
Sales 32.2% 61.1% 69.8% 63.1% 56.8%
Gross Profit 47.2% 55.8% 48.3% 40.3% 47.2%
Operating
Profit 56.6% 501.3% 127.0% 74.8% 115.2%
Pre Tax Income 37.8% 853.7% 185.7% 99.2% 138.3%
Net Income 34.0% 1008.0% 173.7% 97.8% 136.8%
Earnings per
Share 13.6% 922.0% 141.5% 76.0% 111.1%
Qtr to Qtr %
Change
Sales 6.7% 7.8% 17.8% 20.3%
Gross Profit 7.7% 2.0% 4.0% 22.9%
Operating
Profit 21.7% 1.0% 11.1% 27.9%
Pre Tax Income 29.2% 9.3% 16.5% 21.1%
Net Income 25.1% 14.8% 13.2% 21.6%
Earnings per
Share 23.4% 9.1% 9.1% 19.7%
Revenue By Market
Domestic 67% 68% 56% 50% 59%
International 33% 32% 44% 50% 41%
AAVID THERMAL TECHNOLOGIES, INC.
COMPARATIVE FINANCIAL DATA (a)
(in millions, except EPS)
1998
Unaudited
Q1 Q2 Q3 Q4 Y/E
MARGIN ANALYSIS
Cost of Sales 66.9% 66.1% 67.9% 63.9% 66.2%
Gross Margin 33.1% 33.9% 32.1% 36.1% 33.8%
SG&A 19.8% 20.7% 20.4% 22.9% 20.9%
R&D 3.0% 3.0% 3.1% 3.8% 3.2%
Operating
Margin 10.2% 10.2% 8.6% 9.4% 9.6%
Interest
Inc/Exp, net (0.8%) (0.7%) (0.7%) (0.4%) (0.6%)
Pre Tax Income 8.8% 9.4% 7.7% 8.9% 8.7%
Tax Rate 37.2% 37.1% 34.9% 34.5% 36.1%
Net Income 5.5% 5.9% 5.0% 5.8% 5.6%
Yr to Yr %
Change
Sales 61.5% 46.4% 11.7% (4.1%) 24.6%
Gross Profit 33.6% 31.2% 7.2% 1.4% 17.1%
Operating
Profit 55.7% 49.6% 1.8% (10.1%) 20.4%
Pre Tax Income 81.0% 71.2% 8.9% 7.5% 37.0%
Net Income 82.3% 64.7% 11.6% 10.2% 37.4%
Earnings per
Share 58.9% 48.2% 3.8% 3.4% 25.5%
Qtr to Qtr %
Change
Sales 5.7% (2.3%) (10.1%) 3.2%
Gross Profit 2.5% 0.2% (15.0%) 16.2%
Operating
Profit 8.4% (2.9%) (24.4%) 13.0%
Pre Tax Income 17.4% 3.4% (25.9%) 19.5%
Net Income 15.3% 3.7% (23.3%) 20.1%
Earnings per
Share 11.4% 1.9% (23.6%) 19.2%
Revenue By Market
Domestic 54% 46% 47% 52% 50%
International 46% 54% 53% 48% 50%
Notes:
(a) The above analysis does not include certain one-time charges.
Q3 1995 excludes $6.194 million, which consist of $2.649 million
relating to the Buyout of a Compensation Arrangement, $2.770 million
for the Purchase of Undeveloped Technology and $0.775 million
Write-off of Deferred Financing Costs. Q2 1996 excludes $3.446 million
relating to the Purchase of Undeveloped Technology. Q1 1998 excludes
$1.858 million relating to Buyout of Compensation Arrangements. Q3
1998 excludes $3.882 million relating to costs associated with the
closing of a plant.
(b) ATP - Power Electronics formally known as ATP
Telecommunications, Industrial Electronics, Instrumentation and Other.
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