Hurco Reports Record Orders, Sales and Operating Income in Its Second Quarter 2005 Results.INDIANAPOLIS Indianapolis (ĭn'dēənă`pəlĭs), city (1990 pop. 731,327), state capital and seat of Marion co., central Ind., on the White River; selected 1820 as the site of the state capital (which was moved there in 1825), inc. 1847. -- Hurco Companies, Inc. (Nasdaq:HURC) today announced that for its second fiscal quarter, which ended April 30, 2005, it recorded net income of $3,299,000, or $.52 per share, compared to $1,737,000, or $.29 per share, for the corresponding quarter of 2004. For the first six months of fiscal 2005, Hurco recorded net income of $6,329,000 or $1.00 per share, compared to $2,406,000, or $.41 per share, for the corresponding 2004 period.Sales and service fees for the second quarter of fiscal 2005 were the highest in the Company's history and totaled $30,990,000, an increase of $6,735,000, or 28%, from the amount recorded in the corresponding quarter of 2004. The Company attributed the significant growth in its revenues to a 27% increase in unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. of its computerized computerized adapted for analysis, storage and retrieval on a computer. computerized axial tomography see computed tomography. machine tools. Hurco has introduced several new machine tool models over the past two and one half years and shipments of those models represented 70% of all units shipped during the quarter. In addition, approximately $1,200,000, or 18%, of the revenue increase was attributable to the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. effects of stronger European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. currencies in relation to the U.S. dollar. Approximately 68% of Hurco's sales during the 2005 period were made outside 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 were denominated in local currencies (primarily the Euro and Pound Sterling) and translated to U.S. dollars for financial reporting purposes. New order bookings for the second quarter of fiscal 2005 were also the highest in the company's history and totaled $32,932,000, an increase of $10,587,000, or 47%, from the amount recorded in the second quarter of 2004. Approximately $1,300,000, or 12%, of the increase was attributable to currency translation. For the six months ended April 30, 2005, new orders totaled $59,816,000 and increased $13,925,000, or 31%, over the 2004 period of which $2,500,000, or 18%, of the increase was attributable to currency translation. 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. was $11,473,000 at April 30, 2005, compared to $9,629,000 at January January: see month. 31, 2005, and $12,746,000 at October October: see month. 31, 2004. Gross margin for the second quarter of fiscal 2005 was 34.7% compared to 30.6% for the prior year period. The improvement was due to the combined effects of increased unit sales and the favorable effects of stronger European currencies. Selling, general and administrative expenses were $6,363,000 for the 2005 period, an increase of $1,236,000, or 24%, over the amount recorded for the corresponding 2004 period, due to increased research and development spending and sales and marketing expenses. 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 second quarter of fiscal 2005 was a record for Hurco and totaled $4,404,000, or 14% of sales and service fees, compared to $2,286,000, or 9% of sales and service fees, for the same period in the prior year. Total debt was $4,395,000 at April 30, 2005, as compared to $4,600,000 at October 31, 2004, and represented 8% of the Company's total capitalization Total capitalization The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. , which aggregated $52,641,000. As of April 30, 2005, the Company had unutilized credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities of $11,047,000 available for direct borrowing or commercial letters of credit Commercial letters of credit Trade-related agreement that a certain amount of bank funds is available to an entity. . Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. Doar, Chief Executive Officer, stated, "The financial results for our second quarter are very rewarding because they reflect what our company can do when we focus our efforts on designing and building the best machine tools and software for the markets we serve. We recorded record orders in the second quarter indicating the growing enthusiasm for our expanded line of machine tools all over the world. Even in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , where the economy has been somewhat soft, the dollar
value of orders increased 29% in the second quarter of 2005 compared to
the first quarter of 2005.""The customer response to our machines at the shows we attended in China and Singapore Singapore (sĭng`gəpôr, sĭng`ə–, sĭng'gəpôr`), officially Republic of Singapore, republic (2005 est. pop. 4,426,000), 240 sq mi (625 sq km). were very positive. In addition, the introduction of our lathe lathe (lāth), machine tool for holding and turning metal, wood, plastic, or other material against a cutting tool to form a cylindrical product or part. It also drills, bores, polishes, grinds, makes threads, and performs other operations. product line continues to be on schedule and positive as lathe sales totaled approximately $1,400,000 during the second quarter and has contributed $2,200,000 to sales for the full fiscal year." "We are building momentum and making the most of our strengths and opportunities. We want to continue to gain market share in the U.S. and we are expanding our presence in China. We also have begun to explore our opportunities in India India, officially Republic of India, republic (2005 est pop. 1,080,264,000), 1,261,810 sq mi (3,268,090 sq km), S Asia. The second most populous country in the world, it is also sometimes called Bharat, its ancient name. India's land frontier (c. ." Hurco Companies, Inc. is an industrial technology company that designs and produces interactive computer controls, software and computerized machine tools for the worldwide metal cutting industry. The end market for the Company's products consists primarily of independent job shops and short-run Adj. 1. short-run - relating to or extending over a limited period; "short-run planning"; "a short-term lease"; "short-term credit" short-term short - primarily temporal sense; indicating or being or seeming to be limited in duration; "a short life"; "a manufacturing operations Manufacturing operations concern the operation of a facility, as opposed to maintenance, supply and distribution, health, and safety, emergency response, human resources, security, information technology and other infrastructural support organizations. within large corporations in industries such as the aerospace, defense, medical equipment, energy, transportation and computer equipment. The Company is based in Indianapolis, Indiana “Indianapolis” redirects here. For other uses, see Indianapolis (disambiguation). Indianapolis (IPA: [ˌɪndiəˈnæpəlɪs]) is the capital city of the U.S. , and has sales, application engineering and service subsidiaries in High Wycombe High Wycombe (wĭk`əm), city (1991 pop. 69,575), Buckinghamshire, S England. The city is well known for its furniture industry and also has paper mills, sawmills, and engineering works. , England England, the largest and most populous portion of the United Kingdom of Great Britain and Northern Ireland (1991 pop. 46,382,050), 50,334 sq mi (130,365 sq km). It is bounded by Wales and the Irish Sea on the west and Scotland on the north. ; Munich Munich (my  `nĭk), Ger. München (mün`khən), city (1994 pop. 1,255,623), capital of Bavaria, S Germany, on the Isar River near the Bavarian Alps. , Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). ;
Paris, France; Milan, Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. ; Shanghai Shanghai (shăng`hī`, shäng`hī`), city (1994 est. pop. 12,980,000), in, but independent of, Jiangsu prov., E China, on the Huangpu (Whangpoo) River where it flows into the Chang (Yangtze) estuary. , China and Singapore, along with
manufacturing operations in Taiwan. Products are sold through
independent agents and distributors in the United States, Europe and
Asia. The Company also has direct sales forces in the United Kingdom,
Germany, France, Italy, and Asia.Web Site: www.hurco.com This news release contains forward looking statements which involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such 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. . These factors include, among others, changes in general economic and business conditions that affect demand for computerized machine systems, computer numerical control Computer numerical control The method of controlling machines by the application of digital electronic computers and circuitry. Machine movements that are controlled by cams, gears, levers, or screws in conventional machines are directed by computers and systems and software products, changes in manufacturing markets, innovations by competitors, quality and delivery performance by our contract manufacturers and governmental actions and initiatives including import and export restrictions Export restrictions (Restriction on exportation) are restrictions to the quantity of goods exported to a specific country or countries by the government. This is mainly:
Hurco Companies, Inc.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per-share data)
Three Months Ended Six Months Ended
April 30, April 30,
--------------------- ---------------------
2005 2004 2005 2004
------------------------------------- ---------- ---------- ----------
(unaudited) (unaudited)
Sales and service fees $ 30,990 $ 24,255 $ 61,236 $ 46,973
Cost of sales and service 20,223 16,842 40,729 33,029
---------- ---------- ---------- ----------
Gross profit 10,767 7,413 20,507 13,944
Selling, general and
administrative expenses 6,363 5,127 12,550 10,054
---------- ---------- ---------- ----------
Operating income 4,404 2,286 7,957 3,890
Interest expense 86 117 169 261
Variable Option Expense - 67 - 322
Other income (expense), net (238) 23 (309) (147)
---------- ---------- ---------- ----------
Income before taxes 4,080 2,125 7,479 3,160
Provision for income taxes 781 388 1,150 754
---------- ---------- ---------- ----------
Net income $ 3,299 $ 1,737 $ 6,329 $ 2,406
========== ========== ========== ==========
Earnings per common share
Basic $ 0.53 $ 0.31 $ 1.03 $ 0.43
========== ========== ========== ==========
Diluted $ 0.52 $ 0.29 $ 1.00 $ 0.41
========== ========== ========== ==========
Weighted average common
shares outstanding
Basic 6,193 5,695 6,131 5,641
========== ========== ========== ==========
Diluted 6,370 5,976 6,307 5,838
========== ========== ========== ==========
OTHER CONSOLIDATED Three Months Ended Six Months Ended
FINANCIAL DATA April 30, April 30,
--------------------- ---------------------
Operating Data: 2005 2004 2005 2004
---------- ---------- ---------- ----------
(unaudited) (unaudited)
Gross margin 34.7% 30.6% 33.5% 29.7%
SG&A expense as a
percentage of sales 20.5% 21.1% 20.5% 21.4%
Operating income as a
percentage of sales 14.2% 9.4% 13.0% 8.3%
Income before taxes as a
percentage of sales 13.2% 8.8% 12.2% 6.7%
Depreciation 305 310 622 641
Capital expenditures 452 519 1,075 990
Balance Sheet Data: 4/30/2005 4/30/2004
---------- ----------
Working capital (excluding
short term debt) $ 35,504 $ 23,057
Days sales outstanding 44 47
Inventory turns 2.3 2.6
Capitalization
Total debt $ 4,395 $ 5,330
Shareholders' equity 48,246 33,347
---------- ----------
Total $ 52,641 $ 38,677
========== ==========
Hurco Companies, Inc.
CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands, except per-share data)
April 30, October 31,
2005 2004
--------------------------------------------------------- ------------
(unaudited) (audited)
ASSETS
Current assets:
Cash and cash equivalents $ 11,669 $ 8,249
Cash - restricted - 277
Accounts receivable 18,195 17,337
Inventories 33,828 28,937
Other 3,494 1,672
------------ ------------
Total current assets 67,186 56,472
------------ ------------
Property and equipment:
Land 761 761
Building 7,218 7,205
Machinery and equipment 12,880 12,106
Leasehold improvements 712 676
------------ ------------
21,571 20,748
Less accumulated depreciation and
amortization (13,003) (12,512)
------------ ------------
8,568 8,236
------------ ------------
Software development costs, less amortization 3,098 2,920
Investments and other assets 5,825 5,818
------------ ------------
$ 84,677 $ 73,446
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 20,189 $ 18,361
Accrued expenses 11,493 11,447
Current portion of long-term debt 321 317
------------ ------------
Total current liabilities 32,003 30,125
------------ ------------
Non-current liabilities:
Long-term debt 4,074 4,283
Deferred credits and other obligations 354 583
------------ ------------
Total liabilities 36,431 34,991
------------ ------------
Shareholders' equity:
Preferred stock: no par value per share;
1,000,000 shares authorized; no shares
issued - -
Common stock: no par value; $.10 stated
value per share; 12,500,000 shares
authorized; and 6,201,920 and 6,019,594
shares issued, respectively 620 602
Additional paid-in capital 47,487 46,778
Retained earnings (deficit) 2,887 (3,442)
Accumulated other comprehensive income (2,748) (5,483)
------------ ------------
Total shareholders' equity 48,246 38,455
------------ ------------
$ 84,677 $ 73,446
============ ============
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