CompuDyne Reports GAAP Earnings Per Share of $0.10 for 2006 First Quarter - Adjusted Earnings Per Share, Excluding Stock Option Expense, Was $0.13 - Company's Recovery is Taking Hold.ANNAPOLIS Annapolis, river, Canada Annapolis, river, c.75 mi (120 km) long, rising in W Nova Scotia, Canada, and flowing SW past Annapolis Royal to Annapolis Basin, an arm of the Bay of Fundy. , Md. -- CompuDyne Corporation (Nasdaq:CDCY), an industry leader in sophisticated security products, integration and technology for the public security markets, today reported net income of $0.10 per share for the first quarter of 2006, compared to a loss of $0.04 per share reported in the first quarter of 2005. Revenues in the first quarter of 2006 were $40.5 million, up from $36.3 million in the first quarter of 2005. Expenses in the first quarter of 2006 included $255 thousand in non-cash stock option expense. Earnings per share before this non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. was $0.13. Institutional Security Systems revenue was $13.4 million in the first quarter of 2006 compared to $15.7 million in the first quarter of 2005. Pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta income declined from $1.2 million in the 2005 first quarter to $0.1 million in the 2006 first quarter. First quarter 2006 revenues and earnings were negatively impacted by delays in the start of some projects. Legal costs remained high at $138 thousand for the quarter as we continue to pursue recoveries on prior year contract losses. Attack Protection revenue was $11.7 million in the first quarter of 2006, up 69.4% compared to $6.9 million in the first quarter of 2005. Pre-tax income improved from $499 thousand in the 2005 first quarter to a pre-tax income of $1.2 million in the 2006 first quarter. The Norshield brand business, which supplies bullet, blast 1. blast - BLT, used especially for large data sends over a network or comm line. Opposite of snarf. Usage: uncommon. The variant "blat" has been reported. 2. blast - [HP/Apollo] Synonymous with nuke. Sometimes the message "Unable to kill all processes. and attack resistant windows and doors as well as vehicle barrier systems, benefited from sharply increased backlogs as well as from significant progress made during 2005 in reducing costs and improving quality. The Fiber SenSys SenSys is the acronym for the ACM Conference on Embedded Networked Sensor Systems About SenSys ACM SenSys is a highly selective, single-track forum for the presentation of research results on systems issues in the area of embedded networked sensors. ("FSI FSI Foreign Service Institute FSI Fluid Structure Interaction FSI Fuel Stratified Injection FSI Federazione Scacchistica Italiana (Italian Chess Federation) FSI Free Standing Insert FSI Flight Simulator ") brand business, which is one of the world's largest supplier of fiber optic optic /op·tic/ (op´tik) ocular (1). op·tic or op·ti·cal adj. 1. Of or relating to the eye or vision. 2. based perimeter The boundary of a system or network, which defines the inside and outside. It is typically determined by firewalls and addresses. See DMZ. alarm systems, continued to be negatively impacted by delays in military tests of important new products. This process is now substantially behind us and FSI is expected to have much improved results during the balance of the year. Public Safety & Justice ("PS&J") revenues increased to $11.8 million in the first quarter of 2006 compared to $11.7 million in the first quarter of 2005. Pre-tax results for PS&J in the first quarter of 2006 were breakeven breakeven 1. The level of output or sales necessary to cover fixed expenses. Companies in industries that have high fixed costs and, consequently, high breakevens, such as automobile and steel manufacturing, are likely to exhibit large fluctuations compared to a loss of $482 thousand in the first quarter of 2005. While PS&J started the year with improved backlogs, they are still not at levels necessary for adequate profitability, although the pipeline of prospective new business is sharply higher. In addition, the decision was made in 2005 to significantly accelerate the research and development effort to migrate to a full Service Oriented o·ri·ent n. 1. Orient The countries of Asia, especially of eastern Asia. 2. a. The luster characteristic of a pearl of high quality. b. A pearl having exceptional luster. 3. Architecture and .NET based product suite, a commitment which is expected to negatively impact PS&J income in 2006 by $2.5 million but which will materially improve future revenues and margins. The late 2005 acquisition of Xanalys, with one of the country's foremost suites of investigative and case management software, is being introduced to PS&J's client base, and had an important sale to the Australian Australian pertaining to or originating in Australia. Australian bat lyssavirus disease see Australian bat lyssavirus disease. Australian cattle dog a medium-sized, compact working dog used for control of cattle. Department of Defense in the first quarter of 2006. During the first quarter of 2006 PS&J moved its headquarters to Pleasanton, California Pleasanton, nicknamed "P-town"<ref name="">Ptown (Pleasanton) Bike Advocates Meeting, East Bay Bicycle Coalition website, August 14, 2007, retrieved August 17, 2007, is a city in Alameda County, California and was incorporated in 1894. , a move that should both increase the efficiency and effectiveness of its headquarters operations. Integrated Electronic Systems revenue was $3.6 million in the first quarter of 2006 compared to $2.0 million in the first quarter of 2005 and resulted in pre-tax income of $184 thousand for the first quarter of 2006 compared to breakeven results for the first quarter of 2005. The re-bid of the Bureau of Engraving engraving, in its broadest sense, the art of cutting lines in metal, wood, or other material either for decoration or for reproduction through printing. In its narrowest sense, it is an intaglio printing process in which the lines are cut in a metal plate with a & Printing contract, occasioned by a protest filed by the previous incumbent Refers to an entity that is currently in power. For example, in politics, the "incumbent senator" is the person who holds that office today. An "incumbent company" is an organization that has been providing goods and services for some time. See ILEC. , remains unresolved Not completed; not finished; not linked together. See resolve. . For the first quarter of 2006, our corporate pre-tax loss totaled $0.9 million. Full year audit and costs related to compliance with Section 404 of Sarbanes-Oxley are expected to be far below 2005 levels. While backlogs declined during the first quarter of 2006, by $19.7 million to $128.5 million, quoting and bidding activity levels continue much higher than in recent years. While the Company does not provide estimates of future results, we do expect the second quarter of 2006 to generate positive results. Certain statements made in this press release constitute "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 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, including those statements concerning the Company's expectations with respect to future operating results and other events. Although the Company believes it has a reasonable basis for these forward-looking statements, these statements involve risks and uncertainties that cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements. Factors which could cause actual results to differ from expectations include, among others, capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. patterns of the security market and the demand for the Company's products, competitive factors and pricing pressures, changes in legislation, regulatory requirements Regulatory requirements are part of the process of drug discovery and drug development. Regulatory requirements describe what is necessary for a new drug to be approved for marketing in any particular country. , government budget problems, the Company's ability to secure new contracts, the ability to remain in compliance with its bank covenants, delays in government procurement Government procurement, also called public tendering, is the procurement of goods and services on behalf of a public authority, such as a government agency. With 10 to 15% of GDP in developed countries, and up to 20% in developing countries, government procurement accounts processes, inability to obtain bid, payment and performance bonds on various of the Company's projects, technological change or difficulties, the ability to refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. debt when it becomes due, product development risks, commercialization difficulties, adverse results in litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , the level of product returns, the amount of remedial REMEDIAL. That which affords a remedy; as, a remedial statute, or one which is made to supply some defects or abridge some superfluities of the common law. 1 131. Com. 86. The term remedial statute is also applied to those acts which give a new remedy. Esp. Pen. Act. 1. work needed to be performed, costs of compliance with Sarbanes-Oxley requirements and the impact of the failure to comply with such requirements, risks associated with internal control weaknesses identified in complying with Section 404 of Sarbanes-Oxley, the Company's ability to realize anticipated cost savings, the Company's ability to simplify its structure and modify its strategic objectives, and general economic conditions. Risks inherent in the Company's business and with respect to future uncertainties are further described in its other filings with the Securities Exchange Commission, such as the Company's 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. , Form 10-Q Form 10-Q See 10-Q. , and Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. reports.
COMPUDYNE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
March 31, December 31,
ASSETS 2006 2005
---------- ------------
(dollars in
thousands)
Current Assets
Cash and cash equivalents $ 9,647 $ 6,938
Marketable securities 6,522 11,429
Cash and marketable securities - pledged 440 -
Accounts receivable, net 32,741 39,625
Contract costs in excess of billings 11,994 13,764
Inventories 6,556 6,195
Prepaid expenses and other 2,318 2,809
---------- ------------
Total Current Assets 70,218 80,760
Cash and marketable securities - pledged 6,004 -
Property, plant and equipment, net 9,548 9,962
Goodwill 26,846 26,846
Other intangible assets, net 8,157 8,221
Other 807 903
---------- ------------
Total Assets $ 121,580 $ 126,692
========== ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued liabilities $ 19,039 $ 23,030
Billings in excess of contract costs
incurred 11,315 13,847
Deferred revenue 8,688 8,094
Current portion of notes payable 440 440
---------- ------------
Total Current Liabilities 39,482 45,411
Notes payable 3,125 3,125
Convertible subordinated notes payable, net 39,352 39,305
Deferred tax liabilities 2,060 2,060
Other 328 369
---------- ------------
Total Liabilities 84,347 90,270
----------
Commitments and Contingencies
Shareholders' Equity 37,233 36,422
---------- ------------
Total Liabilities and Shareholders'
Equity $ 121,580 $ 126,692
========== ============
COMPUDYNE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended
March 31,
2006 2005
----------- ----------
(in thousands, except
per share data)
Revenues $ 40,470 $ 36,306
Cost of sales 27,961 23,923
----------- ----------
Gross profit 12,509 12,383
Selling, general and administrative expenses 9,736 10,027
Research and development 1,767 2,111
----------- ----------
Income from operations 1,006 245
----------- ----------
Total other expense, net 383 564
----------- ----------
Income (loss) before income taxes 623 (319)
Income tax benefit (184) -
----------- ----------
Net income (loss) $ 807 $ (319)
=========== ==========
Income (loss) per share:
------------------------
Basic income (loss) per common share $ .10 $ (.04)
=========== ==========
Weighted average number of common
shares outstanding 8,119 8,163
=========== ==========
Diluted income (loss) per common share $ .10 $ (.04)
=========== ==========
Weighted average number of common
shares and equivalents 8,159 8,163
=========== ==========
COMPUDYNE CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL DATA
(in thousands, unaudited)
Three Months Ended
March 31,
2006 2005
---------- ---------
Revenues
Institutional Security Systems $ 13,355 $ 15,732
Attack Protection 11,684 6,898
Integrated Electronic Systems 3,587 2,019
Public Safety and Justice 11,844 11,657
---------- ---------
$ 40,470 $ 36,306
========== =========
Three Months Ended
March 31,
2006 2005
---------- ---------
Pre-tax income (loss)
Institutional Security Systems $ 136 $ 1,230
Attack Protection 1,205 499
Integrated Electronic Systems 184 (8)
Public Safety and Justice 7 (482)
Corporate (909) (1,558)
---------- ---------
$ 623 $ (319)
========== =========
March 31, December March 31,
2006 31, 2005 2005
--------- --------- ---------
Backlog
Institutional Security Systems $ 57,030 $ 58,128 $ 42,700
Attack Protection 20,961 28,802 20,139
Integrated Electronic Systems 6,590 7,503 8,395
Public Safety and Justice 43,874 53,705 44,488
--------- --------- ---------
$128,455 $148,138 $115,722
========= ========= =========
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(in thousands, unaudited)
Three Months Ended
March 31,
2006 2005
---------- ----------
Net income (loss) $ 807 $ (319)
Interest expense 815 803
Income tax benefit (184) -
Depreciation and amortization 795 877
Non-cash stock option expense 255 -
---------- ----------
EBITDA adjusted for non-cash stock option
expense
(EBITDAS) $ 2,488 $ 1,361
========== ==========
This press release contains unaudited financial information that is not prepared 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 generally accepted accounting principals (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ). Investors are cautioned that the non-GAAP financial measures are not to be construed as an alternative to GAAP. The Company's management uses earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
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