Alpha Technologies Group Reports Fiscal 2002 Third Quarter and Nine Months Results.Business Editors LOS ANGELES--(BUSINESS WIRE)--Sept. 11, 2002 Alpha Technologies Group, Inc. (Nasdaq:ATGI ATGI Alpha Technologies Group, Inc. ATGi Active Technologies Group, Inc. ) today announced that revenue for the three months ended July 28, 2002 was $15,258,000, an increase of 9.5% compared to revenue of $13,933,000 for the second quarter of fiscal 2002. For the third quarter of fiscal 2001, revenue was $16,655,000. Net income (before a goodwill impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge) was $121,000, or $0.02 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share. After a goodwill impairment charge of $15,602,000 (before taxes) from the write-off of goodwill associated with the acquisition of National Northeast (NNE NNE abbr. north-northeast Noun 1. NNE - the compass point that is midway between north and northeast nor'-nor'-east, north northeast ) in January 2001, the net loss was $9,833,000, or $1.38 per share. This compares to net income before an extraordinary item of $16,000, or $0.00 per diluted share, for this year's second quarter. For the third quarter of fiscal 2001, the net loss was $426,000, or $0.06 per share. "Higher sales and sharply reduced expenses contributed to Alpha's improved operating performance for the third quarter compared to the second, which in turn was an improvement compared to the first quarter. With our efficient operations and lower costs, Alpha is capable of generating substantially higher earnings when the economic recovery gains momentum and supports more vigorous revenue growth," said Chairman and Chief Executive Officer Lawrence Butler. For the nine months ended July 28, 2002, the net loss (before the goodwill impairment charge and extraordinary item) was $177,000, or $0.02 per share, on revenue of $41,778,000. After the goodwill impairment charge and extraordinary item, the net loss was $10,495,000, or $1.48 per share. For the first nine months of fiscal 2001, net income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the was $1,432,000, or $0.19 per diluted share, on revenue of $52,453,000. Cash flow, as measured by earnings from continuing operations before interest, taxes, depreciation and amortization (EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become ), was $1,769,000 for this year's third quarter and $4,470,000 for this year's first nine months. This compares to EBITDA of $1,416,000 and $7,466,000 for the third quarter and first nine months of fiscal 2001, respectively. The Company repaid $750,000 of long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. during the third quarter of fiscal 2002. At July 28, 2002, stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. (after the goodwill impairment charge) was $26,572,000, or approximately $3.74 per diluted share. The Company has orally accepted an offer of $4.75 million for a sale and leaseback sale and leaseback The sale of a fixed asset that is then leased by the former owner from the new owner. A sale and leaseback permits a firm to withdraw its equity in an asset without giving up use of the asset. Also called leaseback. transaction of its Pelham, New Hampshire Pelham is a town in Hillsborough County, New Hampshire, United States. The population was 10,914 at the 2000 census. The estimated population in 2005 was 12,485.[1] History facility which will provide net cash proceeds of approximately $4.5 million from a group which includes a director of the Company and two other private investors. The director has a 50% ownership interest in this group. This transaction includes the issuance of 250,000 warrants of Company stock to the buyers at the market price of the Company's common stock on the date the transaction closes. The parties are currently in the final stages of documenting the transaction. The Company understands that the Purchasers are in the process of completing the loan documents to finance their acquisition. The transaction includes a 15-year lease for the building. The lease, which will be accounted for as an operating lease Operating Lease A lease contract that allows the use of an asset, but does not convey rights similar to ownership of the asset. Notes: An operating lease is not capitalized it is accounted for as a rental expense. in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System No. 13, "Accounting for Leases," requires minimum annual rental payments of approximately $629,000 subject to annual adjustments ranging from 2% to 2.5%. The Company expects to complete the sale and leaseback transaction before September 30, 2002. If it does not, it will be in default under the Credit Agreement and its lenders will have the right, among other things, to declare the entire debt outstanding amount to be due and payable. Conference Call Alpha has scheduled a conference call today at 11:00 AM EST EST electroshock therapy. EST abbr. electroshock therapy . A simultaneous WebCast of the conference call will be available at www.Alphatgi.com/pr.html or at www.companyboardroom.com/company.asp?client=cb&ticker ticker An automated quotation system on which security transactions are reported after they occur on an exchange floor. Even though the newer systems are electronic and no longer actually tick, the name of the old mechanical device has stuck. =atgi. A replay will be available after 1:00 PM EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT at these same Internet addresses There are two kinds of addresses that are widely used on the Internet. One is a person's e-mail address, and the other is the address of a Web site, which is known as a URL. Following is an explanation of Internet e-mail addresses only. For more on URLs, see URL and Internet domain name. . For a telephone replay, dial (800) 633-8284, reservation #20830798 after 1:00 PM EDT. About Alpha Technologies Group Alpha Technologies Group, Inc. is engaged in the manufacture, fabrication fabrication (fab´rikā´sh  n),n the construction or making of a restoration. and sale of thermal management products and aluminum extrusions. The Company is one of the leading manufacturers of thermal management products in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Thermal management products, principally heat sinks A material that absorbs heat. Typically made of aluminum, heat sinks are widely used in amplifiers and other electronic devices that build up heat. Small heat sinks are the most economical method for cooling microprocessors and other chips. , dissipate dis·si·pate v. dis·si·pat·ed, dis·si·pat·ing, dis·si·pates v.tr. 1. To drive away; disperse. 2. unwanted heat generated by electronic components. The Company's thermal management products serve the automotive, telecommunication, industrial controls, transportation, power supply, factory automation, consumer electronics, aerospace, defense, microprocessor, and computer industries. The Company also sells aluminum extrusions to various industries including the construction, sporting goods Noun 1. sporting goods - sports equipment sold as a commodity commodity, trade good, good - articles of commerce sports equipment - equipment needed to participate in a particular sport and other leisure activity markets. 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. This press release contains statements that are forward-looking statements within the meaning of 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. These statements are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and the following: changes in demand for the Company's products, product mix, the timing of customer orders and deliveries, the impact of competitive products and pricing, excess or shortage of production capacity, difficulties encountered in the integration of acquired businesses and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports. In addition, such statements could be affected by general industry and market conditions and growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. , and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
ALPHA TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited) (In Thousands, Except Per Share Data)
Three Months Ended Nine Months Ended
------------- ------------
July 28, July 29, July 28, July 29,
2002 2001 2002 2001
---------- --------- ---------- ---------
SALES $15,258 $16,655 $41,778 $52,453
COST OF SALES 12,768 14,120 35,119 40,658
---------- --------- ---------- ---------
Gross profit 2,490 2,535 6,659 11,795
---------- --------- ---------- ---------
OPERATING EXPENSES
Research and development 129 217 372 791
Selling, general and
administrative 1,540 2,128 4,678 6,940
Goodwill impairment charge 15,602 -- 15,602 --
Restructuring and other non
recurring charges -- 222 -- 222
---------- --------- ---------- ---------
Total operating expenses 17,271 2,567 20,652 7,953
---------- --------- ---------- ---------
OPERATING (LOSS) INCOME (14,781) (32) (13,993) 3,842
INTEREST EXPENSE (627) (741) (1,912) (1,856)
OTHER INCOME, net 8 100 26 257
---------- --------- ---------- ---------
(LOSS) INCOME BEFORE
(BENEFIT) PROVISION
FOR INCOME TAX (15,400) (673) (15,879) 2,243
(BENEFIT) PROVISION FOR
INCOME TAXES (5,567) (247) (5,748) 811
---------- --------- ---------- ---------
(LOSS) INCOME FROM CONTINUING
OPERATIONS BEFORE
EXTRAORDINARY ITEM (9,833) (426) (10,131) 1,432
LOSS FROM DISCONTINUED
OPERATION, net of
applicable taxes -- -- -- (59)
GAIN ON SALE OF
DISCONTINUED OPERATION,
net of applicable taxes -- -- -- 207
EXTRAORDINARY LOSS, EARLY
EXTINGUISHMENT OF DEBT,
net of applicable taxes -- -- (364) (400)
---------- --------- ---------- ---------
NET (LOSS) INCOME $(9,833) $ (426) $(10,495) $ 1,180
---------- --------- ---------- ---------
EARNINGS PER COMMON SHARE -- BASIC
(Loss) income from
continuing operations $ (1.38) $ (0.06) $ (1.43) $ 0.20
Loss from discontinued
operation -- -- -- (0.01)
Gain on sale of
discontinued operation -- -- -- 0.03
Extraordinary loss, early
extinguishment of debt -- -- (0.05) (0.06)
---------- --------- ---------- ---------
Net (loss) income $ (1.38) $ (0.06) $ (1.48) $ 0.17
---------- --------- ---------- ---------
EARNINGS PER COMMON SHARE
-- DILUTED
(Loss) income from
continuing operations $ (1.38) $ (0.06) $ (1.43) $ 0.19
Loss from discontinued
operation -- -- -- (0.01)
Gain on sale of
discontinued operation -- -- -- 0.03
Extraordinary loss, early
extinguishment of debt -- -- (0.05) (0.05)
---------- --------- ---------- ---------
Net (loss) income $ (1.38) $ (0.06) $ (1.48) $ 0.16
---------- --------- ---------- ---------
WEIGHTED AVERAGE NUMBER OF
COMMON AND COMMON EQUIVALENT
SHARES OUTSTANDING
Basic 7,109 7,083 7,110 7,006
Diluted 7,109 7,083 7,110 7,497
SELECTED BALANCE SHEET DATA Jul. 28, Oct. 28,
($ in thousands)(July 2002, unaudited) 2002 2001
---------- --------
Cash $ 492 $ 2,701
Working capital 3,960 (18,117)
Debt, including current maturities 30,118 33,226
Total assets 62,468 (1) 77,451
Stockholders' equity $26,572 (1) $36,870
Note (1) Reflects $15.6 million goodwill impairment charge.
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