Bell Industries Reports 2005 Second Quarter Results; Company Records Higher Net Income on Lower Revenues.EL SEGUNDO El Segundo (ĕl sēgŭn`dō), industrial city (1990 pop. 15,223), Los Angeles co., S Calif., on Santa Monica Bay; inc. 1917. Its products include navigation and computer systems, aircraft parts, office machines, telephone apparatus, and , Calif. -- Bell Industries, Inc. (AMEX AMEX See: American Stock Exchange :BI) today reported improved net income on lower revenues for the three and six months ended June June: see month. 30, 2005. For the 2005 second quarter, net income rose 15 percent to $948,000, equal to $0.11 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, from $827,000, or $0.10 per diluted share, a year ago. Consolidated net revenues for the quarter amounted to $37.4 million, compared with $43.8 million last year. Net income for the year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. period more than doubled to $271,000, or $0.03 per diluted share, from $128,000, or $0.02 per diluted share, for the first half of 2004. Consolidated net revenues totaled $66.0 million for the current six-month period, down from $78.2 million a year earlier. "We are encouraged that our efforts to focus on higher margin business while managing operating costs operating costs npl → gastos mpl operacionales resulted in improved profitability for the company, despite lower revenues," said Russell Russell, English noble family. It first appeared prominently in the reign of Henry VIII when John Russell, 1st earl of Bedford, 1486?–1555, rose to military and diplomatic importance. A. Doll doll, small figure of a human being, usually used as a child's toy. The many types of dolls found among the relics of primitive peoples were cult objects. Egypt, Greece, and Rome have left well-preserved dolls of wood, clay, bone, ivory, and bronze that were used , acting president and chief executive officer. For the 2005 second quarter, Bell's largest operating unit operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon , the Tech.logix Group (BTL BTL Between the Lines BTL Battle BTL Bottle BTL Buy To Let BTL Below The Line (advertising) BTL Biomass-to-Liquids BTL Bubba the Love Sponge BTL Between the Lions (PBS children's TV show) ), experienced a reduction in product sales, posting revenues of $21.4 million, down from $27.0 million in the year-ago second quarter. While services revenues were slightly lower than the prior-year period, product revenues declined by $5.6 million, principally reflecting one significant product deployment in the prior-year period that was not repeated this quarter. Additionally, product sales continue to experience significant market pressure due to direct sales models, intense price competition and extended technology purchasing cycles. Despite lower overall revenues at BTL, 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. for the division increased more than four-fold Adj. 1. four-fold - having four units or components; "quadruple rhythm has four beats per measure"; "quadruplex wire" quadruple, quadruplex, quadruplicate, fourfold to $307,000 for the second quarter of 2005 from $75,000 a year earlier. "BTL's profitability was improved from the prior year as a result of an increase in reverse logistics This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. and depot repair business and stronger margins from our education account base," Doll said. "As one of only a few companies designated as a Microsoft (Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful and influential software company. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. Education Large Account Reseller An organization that sells hardware and software to the general public. Resellers purchase products from software publishers and hardware manufacturers. , BTL continues to experience strength in the academic sector." Most recently, BTL was awarded the renewal of the Maryland Maryland (mâr`ələnd), one of the Middle Atlantic states of the United States. It is bounded by Delaware and the Atlantic Ocean (E), the District of Columbia (S), Virginia and West Virginia (S, W), and Pennsylvania (N). Education Enterprise Consortium (MEEC MEEC Midwest Ecology and Evolution Conference MEEC Mennonite Elementary Education Council ) Microsoft License contract for three years, plus two one-year option terms, extending through July 31, 2010. The MEEC consortium was formed by the State of Maryland to facilitate licensing on a more cost effective basis for all academic institutions statewide, including public library systems, public museums and teaching hospitals. Based on an anticipated full-time faculty and staff count of 200,000, the company said the value of the contract is estimated at approximately $5 million per year. BTL has provided services to MEEC under a Microsoft Enterprise License since 1999. Doll said that following the recent announcement by BTL's largest customer, Phillip Morris USA, that it will be transitioning certain outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. services and product sales to another vendor, Bell intends to aggressively realign re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. its cost structure in response to this development, while continuing its focus on depot repair, reverse logistics and wireless support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services . He said details have not yet been communicated to the company, but the transition is expected to begin on or before the contract termination Defense procurement: the cessation or cancellation, in whole or in part, of work under a prime contract or a subcontract thereunder for the convenience of, or at the option of, the government, or due to failure of the contractor to perform in accordance with the terms of the contract (default). date of April 2006. Revenues of Bell's Recreational Products Group (RPG (Report Program Generator) One of the first program generators designed for business reports, introduced in 1964 by IBM. In 1970, RPG II added enhancements that made it a mainstay programming language for business applications on IBM's System/3x midrange computers. ) in the second quarter were impacted by Midwest weather that resulted in a delay to the start of the spring selling season. For the most recent second quarter, RPG posted revenues of $13.9 million, compared with $14.7 million a year ago. Operating income totaled $834,000 for the 2005 second quarter, compared with $1.0 million in the same quarter last year. J.W. Miller, Bell's electronic components operation, recorded a 10 percent increase in operating income during the most recent second quarter to $510,000 from $464,000 a year ago, on approximately the same revenues for both periods, $2.1 million. Although revenues were consistent within both periods, increased sales of custom products and better vendor pricing resulted in a higher overall gross margin during the 2005 period. Bell continues to maintain a strong balance sheet with no bank debt. At June 30, 2005, cash and cash equivalents totaled $8.6 million, and net working capital amounted to $19.3 million, compared with $8.0 million and $18.7 million, respectively, at June 30, 2004. Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. totaled $21.1 million, or $2.50 per share, at June 30, 2005. Bell's primary business, the Tech.logix Group, offers a comprehensive portfolio of technology products and managed lifecycle services, including planning, product sourcing, deployment and disposal, and support services. Support services include help desk support, desk side support, technical maintenance services, and reverse logistics and depot services. Bell also distributes after-market parts and accessories to the recreational vehicle market and manufactures and sells standard and custom magnetic components used in electronic applications for computer, medical, lighting and telecommunication telecommunication Communication between parties at a distance from one another. Modern telecommunication systems—capable of transmitting telephone, fax, data, radio, or television signals—can transmit large volumes of information over long distances. equipment. Certain matters discussed in this news release are forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from current trends. These include, but are not limited to, the impact of the announced Philip Morris USA Philip Morris USA is the United States tobacco division of Altria Group, Inc. General information On January 27, 2003, Philip Morris Companies Inc. changed its name to Altria Group, Inc. Even under this new name, Altria continues to own 100% of Philip Morris USA. engagement transition and anticipated realignment re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. of the company's cost structure, continued growth in the academic sector, potential opportunities resulting from new engagements and strengthened business development activities by BTL, and other factors described in the company's public filings from time to time.
Bell Industries, Inc.
Consolidated Operating Results
(In thousands, except per share data)
(Unaudited)
Three months ended Six months ended
June 30 June 30
2005 2004 2005 2004
----------------------------------------------------------------------
Net revenues
Products $29,896 $36,250 $51,380 $62,345
Services 7,462 7,568 14,666 15,901
------- ------- ------- -------
37,358 43,818 66,046 78,246
------- ------- ------- -------
Costs and expenses
Cost of products sold 23,374 29,973 40,248 51,388
Cost of services provided 5,835 6,000 11,847 12,732
Selling and administrative 7,207 7,012 13,723 14,022
Interest, net (36) (38) (88) (68)
------- ------- ------- -------
36,380 42,947 65,730 78,074
------- ------- ------- -------
Income before income taxes 978 871 316 172
Income tax expense 30 44 45 44
------- ------- ------- -------
Net income $ 948 $ 827 $ 271 $ 128
======= ======= ======= =======
Basic and diluted share data
Net income
Basic $ .11 $ .10 $ .03 $ .02
======= ======= ======= =======
Diluted $ .11 $ .10 $ .03 $ .02
======= ======= ======= =======
Weighted average common stock
Basic 8,460 8,375 8,457 8,373
======= ======= ======= =======
Diluted 8,493 8,475 8,513 8,467
======= ======= ======= =======
----------------------------------------------------------------------
OPERATING RESULTS BY BUSINESS SEGMENT
Net revenues
Technology Solutions
Products $13,895 $19,459 $22,123 $31,901
Services 7,462 7,568 14,666 15,901
------- ------- ------- -------
21,357 27,027 36,789 47,802
Recreational Products 13,920 14,651 25,311 26,171
Electronic Components 2,081 2,140 3,946 4,273
------- ------- ------- -------
$37,358 $43,818 $66,046 $78,246
======= ======= ======= =======
Operating income (loss)
Technology Solutions $ 307 $ 75 $ (460) $ (488)
Recreational Products 834 1,002 1,052 1,108
Electronic Components 510 464 935 902
Corporate costs (709) (708) (1,299) (1,418)
------- ------- ------- -------
942 833 228 104
Interest, net 36 38 88 68
Income tax expense (30) (44) (45) (44)
------- ------- ------- -------
Net income $ 948 $ 827 $ 271 $ 128
======= ======= ======= =======
Bell Industries, Inc.
Consolidated Condensed Balance Sheet
(In thousands)
(Unaudited)
June 30, December
2005 31, 2004
----------------------------------------------------------------------
ASSETS
Current assets
Cash and cash equivalents $ 8,642 $10,801
Accounts receivable, net 19,254 11,455
Inventories 10,920 14,364
Prepaid expenses and other 2,247 1,813
------- -------
Total current assets 41,063 38,433
------- -------
Fixed assets, net 3,314 3,139
Other assets 3,438 3,617
------- -------
$47,815 $45,189
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $13,949 $11,170
Accrued payroll and liabilities 7,794 8,178
------- -------
Total current liabilities 21,743 19,348
------- -------
Long-term liabilities 4,930 5,025
Shareholders' equity 21,142 20,816
------- -------
$47,815 $45,189
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