Axsys Technologies Announces Fourth Quarter and Year-End Results.Business Editors ROCKY HILL Rocky Hill, town (1990 pop. 16,554), Hartford co., central Conn., a suburb of Hartford, on the Connecticut River; settled c.1650, inc. 1843. Chemical coatings and synthetic textiles are made there. Rocky Hill was an important river port from 1700 to 1820. , Conn.--(BUSINESS WIRE)--Feb. 17, 2004 Axsys Technologies, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AXYS) -- Annual Sales Increase 6.9% Over 2002 -- Net Income Of $1.5 Million for the Quarter, $5.0 Million for the Year -- Backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. up 12.1% Over the Prior Year End and 14.1% Over Prior Quarter Axsys Technologies, Inc. (NASDAQ: AXYS), a global leader in the design, manufacture and distribution of precision opto-mechanical components and assemblies for the aerospace, defense and high-performance Adj. 1. high-performance - modified to give superior performance; "a high-performance car" superior - of high or superior quality or performance; "superior wisdom derived from experience"; "superior math students" commercial markets, today announced results for the fourth quarter and year ended 2003. Sales totaled $21.8 million in the quarter ended December December: see month. 31, 2003, compared to $20.8 million in the fourth quarter of 2002, an increase of $1.0 million, or 4.8 percent. In the fourth quarter of 2003, Axsys reported net income of $1.5 million, or $0.31 per share, compared to net income of $0.6 million, or $0.12 per share, in the quarter ended December 31, 2002. The net income for the fourth quarter of 2002 included a net loss from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. of $0.3 million, or ($0.07) per share. The income tax provision for the fourth quarter of 2003 reflects only state income tax expense due to the utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be of $536,000 of the previously established federal tax valuation allowance. Pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta income in the fourth quarter of 2003 was $1.5 million. Pre-tax 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 in the fourth quarter of 2002 was $1.4 million, which included $0.2 million of income related to the reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of a restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and special charge. Sales within the Aerospace and Defense Group during the quarter totaled $12.6 million, an increase of 2.6 percent from the fourth quarter of 2002. Sales within the Commercial Products Group totaled $3.2 million, a 13.5 percent decrease from the fourth quarter of 2002. The Distributed Products Group's sales totaled $6.0 million, representing a 25.4 percent increase from the fourth quarter of 2002. Gross margin in the fourth quarter of 2003 was 27.1 percent, which compares favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. to a 26.4 percent gross margin reported for the same period in 2002. The gross margin improvement over the prior year is primarily the result of an increase in shipments of higher margin optical products within the Aerospace and Defense Group. For the twelve-month period ended December 31, 2003, sales totaled $85.1 million, compared to $79.6 million in 2002, an increase of $5.5 million, or 6.9 percent. In 2003, Axsys reported pre-tax income of $5.2 million and net income of $5.0 million, or $1.07 per share. Net income for the year reflects only state income tax expense due to the utilization of $1.8 million of the previously established valuation allowance. For the twelve months ended December 31, 2002, Axsys reported a net loss of $7.1 million dollars or ($1.50) per share. As previously reported, the net loss in 2002 included losses from discontinued operations, restructuring and special charges, an asset 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 related to the sale of Teletrac Inc., a significant income tax charge due to the establishment of a valuation allowance and income related to a change in accounting principle (see Schedule I for a pro-forma comparison of 2003 and 2002). Stephen Stephen, 1097?–1154, king of England (1135–54). The son of Stephen, count of Blois and Chartres, and Adela, daughter of William I of England, he was brought up by his uncle, Henry I of England, who presented him with estates in England and France and W. Bershad Bershad (Ukrainian: Бершадь, translit., Bershad’), is a small city in the Vinnytsia Oblast (province) of western Ukraine. It is the administrative center of the Bershadsky Raion (district). , Chairman and Chief Executive Officer of Axsys, commented: "We are pleased with the financial performance of the business over the past year. With fourth quarter bookings in excess of $30 million and record backlog of $68.9 million, we have never been better positioned to enter a new year. As we look forward, we expect continued growth in the Aerospace and Defense Group, which is supported by the segment's backlog of $51.3 million at the end of 2003. We will continue to focus on the national missile defense National Missile Defense (NMD) as a generic term is a military strategy and associated systems to shield an entire country against incoming Intercontinental Ballistic Missiles (ICBMs). The missiles could be intercepted by other missiles, or possibly by lasers. market, homeland security Noun 1. Homeland Security - the federal department that administers all matters relating to homeland security Department of Homeland Security executive department - a federal department in the executive branch of the government of the United States initiatives, unmanned vehicle applications and new weapons platforms within the Group. In our Commercial Products Group, we anticipate a recovery in the semiconductor market and expect to expand our market position within the health imaging market. We also believe that our fast steering The process whereby builders, brokers, and rental property managers induce purchasers or lessees of real property to buy land or rent premises in neighborhoods composed of persons of the same race. mirror technology will be disruptive disruptive /dis·rup·tive/ (-tiv) 1. bursting apart; rending. 2. causing confusion or disorder. to existing galvanometer technology in markets that utilize lasers for material processing. Although it is difficult to accurately forecast future performance due to the impact in timing of any single large order and unforeseen changes in customer requirements, we anticipate that Axsys' revenue growth in 2004 will be between 5-7%, with operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. growth estimated to be between 18-20%." Axsys' management invites you to listen to our conference call or our live audio webcast on February February: see month. 18, 2004, at 10 a.m. ET regarding fourth quarter of 2003 financial results. The domestic dial-in number is (888) 433-1657, the international dial-in number is (212) 676-5264 and the access number is 21182014. This call is being webcast by CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network and can be accessed at Axsys Technologies' Web site at www.axsys.com. A replay of the conference call will begin at 1:00 p.m. ET on February 18, 2004, and will be available until February 24, 2004, at 1:00 p.m. ET. The replay can be accessed by dialing (800) 633-8284 or, outside the U.S., (402) 977-9140, with an access number of 21182014. The webcast replay will be available until March 18, 2004. Axsys Technologies, Inc. is a vertically integrated supplier of precision optical and motion control components and assemblies for high-technology applications, serving the aerospace, defense, semiconductor, graphic arts graphic arts: see aquatint; drawing; drypoint; engraving; etching; illustration; linoleum block printing; lithography; mezzotint; niello; pastel; poster; silk-screen printing; silhouette; silverpoint; sketch; stencil; woodcut and wood engraving. and health imaging markets. For more information, contact Axsys Technologies, Inc., at www.axsys.com. This press release contains 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. within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. . One can identify these forward-looking statements by the use of the words such as "expect," "anticipate," "plan," "may," "will," "estimate" or other similar expressions. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors, which could cause actual results to differ materially, are described in Axsys' reports on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and 10-Q on file with the Securities and Exchange Commission.
AXSYS TECHNOLOGIES, INC.
Consolidated Balance Sheets
(Unaudited, in thousands)
December December
31, 31,
2003 2002
--------- ---------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 5,197 $ 9,920
Short-term investments 6,983 -
Accounts receivable - net 10,197 10,068
Inventories - net 24,786 22,080
Income taxes - deferred and current 2,203 4,077
Other current assets 1,223 1,046
--------- ---------
TOTAL CURRENT ASSETS 50,589 47,191
PROPERTY, PLANT AND EQUIPMENT - net 11,315 11,263
EXCESS OF COST OVER NET ASSETS ACQUIRED 3,600 3,600
OTHER ASSETS 1,341 318
--------- ---------
TOTAL ASSETS $ 66,845 $ 62,372
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 4,240 $ 3,108
Accrued expenses and other liabilities 7,955 9,285
Deferred income 4,546 3,115
Current portion of capital lease obligation 423 1,055
--------- ---------
TOTAL CURRENT LIABILITIES 17,164 16,563
CAPITAL LEASES, less current portion 568 1,191
OTHER LONG-TERM LIABILITIES 5,215 5,525
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Common stock 47 47
Capital in excess of par 39,375 39,587
Accumulated other comprehensive loss (39) -
Retained earnings 5,750 752
Treasury stock (1,235) (1,293)
--------- ---------
TOTAL SHAREHOLDERS' EQUITY 43,898 39,093
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 66,845 $ 62,372
========= =========
AXSYS TECHNOLOGIES, INC.
Consolidated Statements of Operations
(Unaudited, in thousands)
For the Three For the Twelve
Months Ended Months Ended
------------------- -------------------
December 31, December 31,
2003 2002 2003 2002
--------- --------- --------- ---------
Net sales $ 21,840 $ 20,822 $ 85,109 $ 79,586
Cost of sales 15,914 15,329 62,036 59,454
--------- --------- --------- ---------
Gross margin 5,926 5,493 23,073 20,132
Selling, general and
administrative expenses 4,018 3,856 15,986 16,262
Research, development and
engineering expenses 431 498 2,059 2,049
Restructuring and special
charges -- (221) -- 1,854
--------- --------- --------- ---------
Operating income (loss) 1,477 1,360 5,028 (33)
Interest expense (35) (55) (172) (212)
Interest income 38 51 115 190
Other income, net 52 81 263 10
--------- --------- --------- ---------
Income (loss) from continuing
operations before tax and
cumulative effect of change in
accounting principle 1,532 1,437 5,234 (45)
Provision for income taxes (69) (565) (236) (2,969)
--------- --------- --------- ---------
Income (loss) from continuing
operations before cumulative
effect of change in accounting
principle 1,463 872 4,998 (3,014)
Loss from discontinued
operations -- (316) -- (4,582)
Cumulative effect of change in
accounting principle -- -- -- 535
--------- --------- --------- ---------
Net income (loss) 1,463 $ 556 $ 4,998 (7,061)
========= ========= ========= =========
BASIC INCOME (LOSS) PER SHARE:
Income (loss) from continuing
operations before cumulative
effect of change in accounting
principle $ 0.31 $ 0.19 $ 1.07 $ (0.64)
Loss from discontinued
operations -- (0.07) -- (0.97)
Cumulative effect of change in
accounting principle -- -- -- 0.11
--------- --------- --------- ---------
Total $ 0.31 $ 0.12 $ 1.07 $ (1.50)
========= ========= ========= =========
Weighted average basic common
shares outstanding 4,660 4,667 4,657 4,691
DILUTED INCOME (LOSS) PER SHARE:
Income (loss) from continuing
operations before cumulative
effect of change in accounting
principle $ 0.31 $ 0.19 $ 1.06 $ (0.64)
Loss from discontinued
operations -- (0.07) -- (0.97)
Cumulative effect of change in
accounting principle -- -- -- 0.11
--------- --------- --------- ---------
Total $ 0.31 $ 0.12 $ 1.06 $ (1.50)
========= ========= ========= =========
Weighted average dilutive common
shares outstanding 4,770 4,680 4,716 4,691
SCHEDULE I
----------
AXSYS TECHNOLOGIES, INC.
Pro-Forma Financial Information
Reconciliation to GAAP
(Unaudited, in thousands)
For the Twelve
Months Ended
December 31,
-------------------
2003 2002
--------- ---------
Income (loss) from continuing operations before tax
and cumulative effect of change in accounting
principle $ 5,234 $ (45)
Add back:
Relocation of OEM product lines (1) - 1,053
Sale of Teletrac, Inc. (2) - 1,009
Segment reorganization (3) - 286
--------- ---------
Adjusted income from continuing operations before
tax and cumulative effect of change in accounting
principle 5,234 2,303
--------- ---------
Provision for income taxes (4) (2,041) (898)
--------- ---------
Pro-forma income from continuing operations before
cumulative effect of change in accounting
principle $ 3,193 $ 1,405
========= =========
Adjusted basic operating income per share $ 0.69 $ 0.30
Weighted average basic common shares outstanding 4,657 4,691
(1) During the second quarter of 2002, the Santa Barbara, California
facility was closed and several product lines were relocated to
the Rochester Hills, Michigan facility. The total charge included
$136 in cost of sales, $358 in selling, general and administrative
expenses and $559 in restructuring and special charges.
(2) During the second quarter of 2002, Teletrac, Inc. (a wholly owned
subsidiary) was sold to Storage Test Solutions in Colorado. All
costs were recorded as restructuring and special charges.
(3) During the first quarter of 2002, Axsys reorganized its segments
into the Aerospace and Defense Group, Commercial Products Group
and Distributed Products Group. All costs were recorded as
restructuring and special charges.
(4) The proforma effective tax rate for 2003 and 2002 is 39.0 %.
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