Badger Meter Reports Record Third Quarter Results.MILWAUKEE Milwaukee (mĭlwŏk`ē), city (1990 pop. 628,088), seat of Milwaukee co., SE Wis., at the point where the Milwaukee, Menominee, and Kinnickinnic rivers enter Lake Michigan; inc. 1846. -- Badger badger, name for several related members of the weasel family. Most badgers are large, nocturnal, burrowing animals, with broad, heavy bodies, long snouts, large, sharp claws, and long, grizzled fur. Meter, Inc. (AMEX AMEX See: American Stock Exchange : BMI BMI body mass index. BMI abbr. body mass index Body mass index (BMI) A measurement that has replaced weight as the preferred determinant of obesity. ) today reported record sales, earnings and earnings per share for the third quarter ended September September: see month. 30, 2007. Third Quarter Highlights * Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight 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 were a record $62,782,000 for the third quarter of 2007, a 4.3% increase from sales of $60,208,000 for the third quarter of 2006. * Earnings from continuing operations were a record $6,016,000 for the third quarter of 2007, up 52.5% from earnings from continuing operations of $3,945,000 for the comparable prior period. Earnings from continuing operations exclude the results of the company's French subsidiary, which has been classified as a discontinued operation discontinued operation A segment of a business that has been abandoned or sold or for which plans for one or another of these actions have been approved. See also continuing operations. 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 current accounting standards. * Net earnings were a record $5,751,000 for the third quarter of 2007, compared to a net loss of $519,000 in the third quarter of 2006. * Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were a record $0.39 for the third quarter of 2007, compared to a loss of $0.04 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 for the same period in the prior year. Nine Months Highlights * Net sales from continuing operations were $177,618,000 for the nine months of 2007, compared to sales of $177,049,000 for the same period in 2006. * Earnings from continuing operations were $14,205,000 for the nine months of 2007, compared to earnings from continuing operations of $14,235,000 for the comparable prior period. * Net earnings were $13,791,000 for the nine months of 2007, a 77.7% increase from earnings of $7,761,000 for the same period in 2006. * Diluted earnings per share were $0.95 for the nine months of 2007, a 72.7% increase from earnings of $0.55 per diluted share for the same period in the prior year. "We continued to build momentum in the third quarter. This was our second consecutive quarter of record-breaking Adj. 1. record-breaking - surpassing any previously established record; "a record-breaking high jump"; "record-breaking crowds" best - (superlative of `good') having the most positive qualities; "the best film of the year"; "the best solution"; "the best time for sales, earnings and earnings per share that surpassed previous records not only for the third quarter, but for any quarter in our history," said Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a A. Meeusen, chairman, president and chief executive officer of Badger Meter. Meeusen said third quarter sales increased in all of the company's utility and industrial product lines, except commercial water meters, which were essentially flat. "Our ORION([R]) proprietary mobile radio frequency automatic meter reading Automatic meter reading, or AMR, is the technology of automatically collecting data from water meter or energy metering devices (water, gas, electric) and transferring that data to a central database for billing and/or analyzing. system continued its double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. growth and was the largest contributor to the overall sales increase," he said. "The increase in net earnings was due to the higher sales, and more significantly, an improvement in the profit margin. Our margin benefited from the increase in ORION sales, which have a higher margin than products we sell that are manufactured by other companies, and the continuing shift to automatic meter reading systems. We are also seeing the impact of price increases implemented earlier in the year," said Meeusen. "The $39.8 million ORION metering contract with the city of Chicago Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. is proceeding on schedule. The pilot program was successfully completed in October October: see month. . We expect to begin shipping product in November November: see month. and will record the revenues after the meters have been installed and tested," said Meeusen. He noted that construction of the company's new manufacturing facility in Nogales Nogales (nōgä`lās), city (1990 pop. 19,489), Santa Cruz co., S Ariz. on the Mexican border with its adjacent city, Nogales (1990 pop. 105,873), Sonora, NW Mexico. There are copper, silver, and lead mines. , Mexico Mexico, city, Mexico Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. , is also on schedule, with occupancy planned for the third quarter of 2008. "While we are pleased with the improving margins in our business, we expect to see the typical seasonality in the fourth quarter. As always, our focus is on positioning the company for continued growth over the long term," said Meeusen. Conference Call and Webcast Badger Meter management will host a conference call to discuss the third quarter results on Tuesday Tuesday: see week. , October 16, 2007, at 10:00 AM Central/11:00 AM Eastern time. Interested parties can listen to the call live on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the through the company's Web site: www.badgermeter.com or by dialing 1-866-831-6267 and entering the passcode 87068211. Listeners should dial in to the call at least 5-10 minutes prior to the start of the call or should go to the Web site at least 15 minutes prior to the call to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. A telephone replay of the conference call will be available through Tuesday, October 23, 2007, by dialing 1-888-286-8010 and entering the passcode 67675071. The Webcast will be archived on the company's Web site until its next earnings release. About Badger Meter Badger Meter is a leading marketer and manufacturer of flow measurement and control technology, developed both internally and with other companies, as well as the leader in providing digital connectivity to AMR (1) (Adaptive Multi-Rate) A variable rate speech codec selected by the 3GPP for the 3G evolution of the GSM cellphone system (WCDMA). Using the Algebraic CELP (ACELP) compression technology, AMR provides toll quality sound at transmission rates from 4.75 to 12. technologies. Its products are used to measure and control the flow of liquids in a variety of applications. Certain statements contained in this press release, as well as other information provided from time to time by the Company or its employees, may contain forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward looking statements. The words "anticipate," "believe," "estimate," "expect," "think," "should" and "objective" or similar expressions are intended to identify forward looking statements. All such forward looking statements are based on the Company's then current views and assumptions and involve risks and uncertainties that include, among other things: * the continued shift in the Company's business from lower cost, local read meters toward more expensive, value-added automatic meter reading (AMR) systems; * the success or failure of newer Company products, including the Orion[R] radio frequency AMR system, the absolute digital encoder A hardware device or software that assigns a code to represent data. See encode. 1. (algorithm, hardware) encoder - Any program, circuit or algorithm which encodes. Example usages: "MPEG encoder", "NTSC encoder", "RealAudio encoder". 2. (ADE[TM]) and the Galaxy[R] fixed network AMR system; * changes in competitive pricing and bids in both the domestic and foreign marketplaces, and particularly in continued intense price competition on government bid contracts for lower cost, local read meters; * the actions (or lack thereof) of the Company's competitors; * changes in the Company's relationships with its alliance partners, primarily its alliance partners that provide AMR connectivity solutions, and particularly those that sell products that do or may compete with the Company's products; * changes in the general health of 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. and foreign economies, including, to some extent, housing starts in the United States and overall industrial activity; * increases in the cost and/or availability of needed raw materials and parts, including recent increases in the cost of brass castings as a result of increases in commodity prices, particularly for copper, at the supplier level and resin resin, any of a class of amorphous solids or semisolids. Resins are found in nature and are chiefly of vegetable origin. They are typically light yellow to dark brown in color; tasteless; odorless or faintly aromatic; translucent or transparent; brittle, fracturing as a result of increases in petroleum and natural gas prices; * the ability of the Company to maximize the value of the remaining assets in its discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: French operations; * the Company's expanded role as a prime contractor for providing complete AMR systems to governmental authorities, which brings with it added risks, including but not limited to, Company responsibility for subcontractor One who takes a portion of a contract from the principal contractor or from another subcontractor. When an individual or a company is involved in a large-scale project, a contractor is often hired to see that the work is done. performance; additional costs and expenses if the Company and its subcontractors fail to meet the agreed-upon timetable with the governmental authority; and the Company's expanded warranty and performance obligations; * changes in foreign economic conditions, particularly currency fluctuations between the United States dollar and the euro; * the loss of certain single-source suppliers; and * changes in laws and regulations, particularly laws dealing with the use of lead (which can be used in the manufacture of certain meters incorporating brass housings) and Federal Communications Commission Federal Communications Commission (FCC), independent executive agency of the U.S. government established in 1934 to regulate interstate and foreign communications in the public interest. rules affecting the use and/or licensing of radio frequencies necessary for AMR products. All of these factors are beyond the Company's control to varying degrees. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward looking statements and are cautioned not to place undue reliance on such forward looking statements. The forward looking statements made in this document are made only as of the date of this document and the Company assumes no obligation, and disclaims any obligation, to update any such forward looking statements to reflect subsequent 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 . Badger Meter company news is available 24 hours a day, on-line at: http://www.badgermeter.com.
BADGER METER, INC. > > > > >
CONSOLIDATED STATEMENT OF OPERATIONS > > > > >
(Unaudited) > > > > >
> > > > >
Nine Months Ended September 30, > > > > >
> > > > >
> > > > 2007 >
2006
Net sales > $ > > > 177,618,000 >
$
177,049,000
Gross margin > $ > > > 61,457,000 >
$
59,505,000
Earnings from continuing operations > $ > > > 22,435,000 >
$
22,955,000
before income taxes > > > > >
Provision for income taxes > $ > > > 8,230,000 >
$
8,720,000
Earnings from continuing operations > $ > > > 14,205,000 >
$
14,235,000
Loss from discontinued operations > > > > ($414,000 >
)
($6,474,000
)
Net earnings > $ > > > 13,791,000 >
$
7,761,000
Earnings (loss) per share: > > > > >
Basic from continuing operations > $ > > > 1.00 >
$
1.03
Basic from discontinued operations > > > > ($0.03 >
)
($0.47
)
Total basic > $ > > > 0.97 >
$
0.56
> > > > >
Diluted from continuing operations > $ > > > 0.97 >
$
1.00
Diluted from discontinued operations > > > > ($0.02 >
)
($0.45
)
Total diluted > $ > > > 0.95 >
$
0.55
Shares used in computation of: > > > > >
Basic > > > > 14,166,811 >
13,831,668
Diluted > > > > 14,584,492 >
14,207,310
> > > > >
Three Months Ended September 30, > > > > >
> > > > >
> > > > 2007 >
2006
Net sales > $ > > > 62,782,000 >
$
60,208,000
Gross margin > $ > > > 22,668,000 >
$
17,889,000
Earnings from continuing operations > $ > > > 9,416,000 >
$
6,327,000
before income taxes > > > > >
Provision for income taxes > $ > > > 3,400,000 >
$
2,382,000
Earnings from continuing operations > $ > > > 6,016,000 >
$
3,945,000
Loss from discontinued operations > > > > ($265,000 >
)
($4,464,000
)
Net earnings (loss) > $ > > > 5,751,000 >
($519,000
)
Earnings (loss) per share: > > > > >
Basic from continuing operations > $ > > > 0.42 >
$
0.28
Basic from discontinued operations > > > > ($0.02 >
)
($0.32
)
Total basic > $ > > > 0.40 >
($0.04
)
> > > > >
Diluted from continuing operations > $ > > > 0.41 >
$
0.28
Diluted from discontinued operations > > > > ($0.02 >
)
($0.32
)
Total diluted > $ > > > 0.39 >
($0.04
)
> > > > >
Shares used in computation of: > > > > >
Basic > > > > 14,288,860 >
13,935,229
Diluted > > > > 14,661,224 >
13,935,229
[TABLE OMITTED]
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