Daktronics, Inc. Announces Record Third Quarter Results.Business Editors BROOKINGS, S.D.--(BUSINESS WIRE)--Feb. 19, 2003 Daktronics, Inc. (Nasdaq:DAKT), a worldwide leader in the design, manufacture, sales and service of large screen video displays, scoreboards and computer-programmable display systems, announced fiscal year 2003 third quarter 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 of $38.2 million and net income of $1.9 million or $.10 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, compared with third quarter net sales of $30.9 million and a net loss of $293,000, or $.02 per diluted share, one year ago. Both net sales and net income were records for the Company's third quarter. Net sales, net income and earnings per share for the nine months ended Feb. 1, 2003 were $130.4 million, $9.0 million and $.47 per diluted share, respectively, compared with $112.7 million, $3.3 million, and $.17 per diluted share, respectively, for the same period one year ago. 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. at the end of the quarter was approximately $51 million, compared with approximately $30 million at the end of the third quarter one year ago. The timing of large orders can cause significant fluctuations in the Company's backlog. The $51 million backlog does not include the order for the Texas Rangers Texas Rangers, mounted fighting force organized (1835) during the Texas Revolution. During the republic they became established as the guardians of the Texas frontier, particularly against Native Americans. that was announced Feb. 11, 2003 and booked in the fourth quarter. "We are pleased with the strong quarterly results," said Jim Morgan Morgan, American family of financiers and philanthropists. Junius Spencer Morgan, 1813–90, b. West Springfield, Mass., prospered at investment banking. , president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Daktronics. "The third quarter is historically our most challenging quarter for both booking orders and generating revenue, primarily because of lost work time due to the holidays and the fact that many of our potential customers, especially those in the school and college markets, are more difficult to reach during that time of year. The seasonality of the sports business may have an effect on third quarter results. In addition, weather sometimes affects the progress and completion of outdoor projects. "We booked significantly more business this quarter than one year ago and maintained a nice balance of sport, commercial and transportation bookings during the quarter, from both smaller standard orders as well as larger contract work. For the year to date, orders are up more than 16 percent with increases in each of the three major market areas of sport, commercial and transportation, including services related revenues. "Net sales are up nicely as well, increasing nearly 24 percent for the quarter and more than 15 percent for the nine month period, compared with the same periods one year ago. Each of the major market areas of sport, commercial and transportation showed increases quarter over quarter, with our transportation market showing the greatest percentage increase. Year to date, our commercial market continues to show the greatest percentage increase, while sports accounts for the highest dollar increase year over year," Morgan said. "We entered the fourth quarter with a solid backlog of more than $51 million, a record for the end of the third quarter, which should help position us for strong fourth quarter results. However, we realize the importance of continuing to book quality orders and delivering on those orders. We estimate that net sales for the fourth quarter of fiscal year 2003 will be in the range of $43 million to $48 million, with earnings in the range of $.10 to $.17 per share," Morgan said. "We continued to work on strengthening our financial position during what is typically our weakest quarter each year," said Bill Retterath, chief financial officer. "Our cash position was maintained during the quarter, while at the same time we reduced our debt by almost 20 percent. Year to date, cash from operations is in excess of $14 million, including $3.6 million in the third quarter. "We also saw a decline in operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. from the previous quarters although we expect a slight rise in the coming quarters. Finally, as expected, gross margin percentage went down for the quarter but at 32.3 percent is still greater than prior year levels. We expect margins to go down slightly in the fourth quarter," Retterath said. Noteworthy projects booked in the third quarter include display systems for the Houston Multi-Purpose Arena, Houston, Texas “Houston” redirects here. For other uses, see Houston (disambiguation). Houston (pronounced /'hjuːstən/) is the largest city in the state of Texas and the ; Los Angeles Dodgers "Dodgers" and "Brooklyn Dodgers" redirect here. For the American football team, see Brooklyn Dodgers (football). For the Eastern Basketball Association team, see Brooklyn Dodgers (basketball). , Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. , Calif.; Bank One Ballpark, Phoenix, Ariz.; Fenway Park • • [ , Boston, Mass.; National Training Center - L.A. Galaxy, Carson, Calif.; Frisco Professional Baseball, Frisco, Texas Frisco is a city in Collin County and Denton County, Texas (USA). It is a northern suburb of Dallas. As of the 2000 census, the city population was 33,714, while according to 2007 estimate, the city's population is approximately 95,000. ; Oklahoma State University Oklahoma State University, at Stillwater; land-grant and state supported; coeducational; chartered 1890, opened 1891 as Oklahoma Agricultural and Mechanical College, renamed 1957. , Stillwater, Okla.; University of Florida University of Florida is the third-largest university in the United States, with 50,912 students (as of Fall 2006) and has the eighth-largest budget (nearly $1.9 billion per year). 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It is bordered by Minnesota, across the Red River of the North (E), South Dakota (S), Montana (W), and the Canadian provinces of Saskatchewan and Manitoba (N). , Grand Forks Grand Forks, city (1990 pop. 49,425), seat of Grand Forks co., E N.Dak., at the confluence of the Red and the Red Lake rivers; inc. 1881. In a spring wheat, livestock, and farm area, the city has grain elevators, state-operated flour mills, and plants that process , N.D.; Indianapolis Indians The Indianapolis Indians are a minor league baseball team based in Indianapolis, Indiana. The team, which plays in the International League, is the Triple-A affiliate of the Pittsburgh Pirates major-league club. The Indians play at Victory Field, located in downtown Indianapolis. , Indianapolis, Ind IND Investigational new drug Therapeutics A status assigned by the FDA to a drug before allowing its use in humans, exempting it from premarketing approval requirements so that experimental clinical trials may be conducted. See Phase 1.2, 3 studies, Sponsorship. .; Dixie Stampede stam·pede n. 1. A sudden frenzied rush of panic-stricken animals. 2. A sudden headlong rush or flight of a crowd of people. 3. , Orlando, Fla. and Branson, Mo.; Grand Casino casino or cassino (both: kəsē`nō). 1 Card game played with a full deck by two to four players. Its origins are obscure though it probably traces back to the Italian game of Scopa. , Biloxi, Miss.; Tropicana Casino & Resort, Atlantic City Atlantic City, city (1990 pop. 37,986), Atlantic co., SE N.J., an Atlantic resort and convention center; settled c.1790, inc. 1854. Situated on Absecon Island, a barrier island 10 mi (16. , N.J.; Southwest Hospital, Lafayette, La.; PSA (Professional Services Automation) An information system designed to organize, track and manage all opportunities, work, resources, costs, revenues and invoices to improve the productivity and efficiency of the workforce. Peugeot Citroen, Paris, France; New Jersey Dept. of Transportation, Trenton, N.J.; MTA (1) (Message Transfer Agent or Mail Transfer Agent) The store and forward part of a messaging system. See messaging system. (2) See M Technology Association. 1. (messaging) MTA - Message Transfer Agent. Long Island Railroad railroad or railway, form of transportation most commonly consisting of steel rails, called tracks, on which freight cars, passenger cars, and other rolling stock are drawn by one locomotive or more. , Hollis, N.Y.; Caltrain, San Carlos San Carlos (săn kär`lōs), residential city (1990 pop. 26,167), San Mateo co., W Calif.; inc. 1925. The chief manufactures are plastic products, hardware, and machine parts. , Calif.; Virginia Dept. of Transportation, Hampton, Va.; North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. Dept. of Transportation, Raleigh, N.C.; Denver International Airport This article is about Denver International Airport. For other uses, see KDEN (disambiguation). Denver International Airport (IATA: DEN, ICAO: KDEN, FAA LID: DEN), often called DIA , Denver, Colo.; and Dallas Fort Worth International Airport. The Company will webcast its quarterly conference call at 10:00 am (central) on Wednesday, Feb. 19. To listen to the webcast, go to the home page of www.daktronics.com, and click on the webcast icon at the bottom right corner of the screen. Completion of a short registration form, along with Windows(R) Media Player software, are required to hear the webcast. A replay of the teleconference via the internet will also be accessible shortly after the conclusion of the conference call through the investor relations Investor relations The process by which the corporation communicates with its investors. section of www.daktronics.com. A replay of the teleconference accessible by telephone will be available for 24 hours Adv. 1. for 24 hours - without stopping; "she worked around the clock" around the clock, round the clock starting at noon Central Time on Feb. 19. To access the replay, call toll-free in the U.S. and Canada 800-633-8284 and enter code 21119137. International callers can dial 402-977-9140 and enter code 21119137 to hear the replay by phone. Daktronics has strong leadership positions in, and is one of the world's largest suppliers of, electronic scoreboards, computer-programmable displays, and large screen video display and control systems. The Company excels in the control of large display systems, including those that require integration of complex multiple displays showing real time information, graphics, animation and video. Daktronics designs, manufactures, markets and services display systems for customers around the world in sport, business and transportation applications, and celebrates its 35th year in business in 2003. For more information, visit the Company's worldwide web site at http://www.daktronics.com, email the Company at sales@daktronics.com, call toll-free 1-800-DAKTRONICS (800-325-8766) in the U.S., or write to the Company at 331 32nd Avenue, P.O. Box 5128, Brookings, SD 57006-5128. Cautionary Notice: In addition to statements of historical fact, this news 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. reflecting the Company's expectations or beliefs concerning future events which could materially affect company performance in the future. The Company cautions that these and similar statements involve risk and uncertainties including changes in economic and market conditions, management of growth, timing and magnitude of future contracts, and other risks noted in the company's SEC filings which may cause actual results to differ materially. Forward-looking statements are made in the context of information available as of the date stated. The Company undertakes no obligation to update or revise such statements to reflect new 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 or unanticipated events as they occur.
DAKTRONICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
--------------------- ---------------------
Feb. 1, Jan. 26, Feb. 1, Jan. 26,
2003 2002 2003 2002
(13 weeks) (13 weeks) (40 weeks) (39 weeks)
---------- ---------- ---------- ----------
Net sales $ 38,220 30,863 130,400 112,682
Cost of goods sold 25,855 21,817 86,925 79,829
---------- ---------- ---------- ----------
Gross profit 12,365 9,046 43,475 32,853
---------- ---------- ---------- ----------
Operating expenses:
Selling 5,868 5,592 18,649 16,408
General and
administrative 1,824 1,744 5,159 5,084
Product design and
development 1,534 1,890 5,086 5,312
---------- ---------- ---------- ----------
Total operating expenses 9,226 9,226 28,894 26,804
---------- ---------- ---------- ----------
Operating income 3,139 (180) 14,581 6,049
Nonoperating income
(expense):
Interest income 184 201 516 565
Interest expense (195) (361) (675) (1,204)
Other income (expense),
net 58 (111) 323 (41)
---------- ---------- ---------- ----------
Income (loss) before
income taxes and
minority interest 3,186 (451) 14,745 5,369
Income tax expense
(benefit) 1,288 (179) 5,688 2,023
---------- ---------- ---------- ----------
Income (loss) before
minority interest 1,898 (272) 9,057 3,346
Minority interest in
income of subsidiary (10) (21) (10) (49)
---------- ---------- ---------- ----------
NET INCOME (LOSS) $ 1,888 (293) 9,047 3,297
========== ========== ========== ==========
Earnings (loss) per share:
Basic $ 0.10 $ (0.02) $ 0.49 $ 0.18
========== ========== ========== ==========
Diluted $ 0.10 $ (0.02) $ 0.47 $ 0.17
========== ========== ========== ==========
Weighted average number of
common shares outstanding:
Basic 18,383 18,217 18,330 18,307
Diluted 19,697 19,208 19,396 19,518
DAKTRONICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
Feb. 1, 2003 April 27, 2002
(unaudited) (audited)
------------ --------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 8,863 $ 2,097
Accounts receivable, less allowance for
doubtful accounts 15,274 17,878
Current maturities of long-term
receivables 2,140 2,515
Inventories 17,018 16,472
Costs and estimated earnings in excess
of billings 18,007 10,277
Prepaid expenses and other 670 524
Deferred income taxes 3,297 2,784
------------ --------------
Total current assets 65,269 52,547
------------ --------------
Property and equipment, net 25,133 26,845
Advertising rights, net 400 489
Long term receivables, less current
maturities 4,457 5,366
Goodwill, net of accumulated amortization 1,043 1,061
Intangible and other assets, other than
goodwill, net 946 1,038
------------ --------------
TOTAL ASSETS $ 97,248 $ 87,346
============ ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable, bank $ -- $ 51
Accounts payable 8,470 6,690
Accrued expenses 8,765 7,337
Current maturities of long-term debt 3,394 4,254
Billings in excess of costs and
estimated earnings 3,521 2,944
Customer deposits 2,298 2,185
Income tax payable 1,368 733
------------ --------------
Total current liabilities 27,816 24,194
------------ --------------
Long-term debt, less current maturities 5,926 9,574
Deferred income 1,063 711
Deferred income taxes 1,203 1,282
------------ --------------
8,192 11,567
------------ --------------
TOTAL LIABILITIES 36,008 35,761
MINORITY INTEREST IN SUBSIDIARY 94 84
------------ --------------
SHAREHOLDERS' EQUITY
Common stock 13,974 13,533
Additional paid-in capital 649 505
Retained earnings 46,539 37,492
Less cost of treasury stock (9) (9)
Accumulated other comprehensive loss,
foreign currency translation
adjustment (7) (20)
------------ --------------
TOTAL SHAREHOLDERS' EQUITY 61,146 51,501
------------ --------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 97,248 $ 87,346
============ ==============
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