Odetics Reports Fourth Quarter Fiscal 2001 Results; Company Reports Significantly Narrower Losses on 4% Increase in Revenues.Business Editors and High-Tech high-tech also hi-tech adj. Informal Of, relating to, or resembling high technology. high-tech Adjective same as hi-tech Adj. 1. Writers ANAHEIM Anaheim (ăn`əhīm), city (1990 pop. 266,406), Orange co., S Calif., SE of Los Angeles; inc. 1870. Anaheim was founded by Germans in 1857 as an experiment in communal living. , Calif.--(BUSINESS WIRE)--May 15, 2001 For the fourth quarter ended March 31, 2001, Odetics Inc. (Nasdaq:ODETA) (Nasdaq:ODETB) today reported a net loss of $7,753,000 or $0.74 per share, compared with a net loss of $13,884,000 or $1.51 per share, reported for the fourth quarter ended March 31, 2000. For the fourth quarter ended March 31, 2001, 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 and contract revenues were $19,552,000 compared with $18,853,000 reported in the fourth quarter ended March 31, 2000. Joel Joel, book of the Bible Joel, prophetic book of the Bible. It is a collection of the oracles of an otherwise unknown prophet, dated variously from the 9th to the 3d cent. B.C., though a date in c.400 B.C. is likely. Slutzky, Chairman and Chief Executive Officer, commented: "This past January January: see month. we took a number of significant actions to restructure our business model -- all of which were intended to lower our 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 level in each of our businesses and return Odetics to positive cash flow operations as quickly as possible." These actions produced the following results during the quarter ended March 31, 2001: 1. We reduced our 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. , before goodwill amortization, to approximately $12.7 million during the quarter, in line with our expectations set at the beginning of the quarter. 2. We expanded consolidated gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. to approximately 30.9% of net sales in the quarter, exceeding our expectations of 30.0% of net sales set at the beginning of the quarter. 3. Negative cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses was $4.5 million in the quarter, 60.5% narrower than negative cash flow from operations in the third quarter of fiscal 2001. The following is a summary of business highlights of each of Odetics businesses during the fourth quarter of fiscal 2001: Iteris Inc. -- Revenues during the fourth quarter of fiscal 2001 were $8.0 million, up 34.7% compared with the fourth quarter of fiscal 2000. Growth in Iteris continues to be driven by strong growth in Vantage video detection products and by growth in Iteris' transportation management systems business. Sales order backlog in the transportation management systems business was $23.2 million at March 31, 2001 compared with $22.8 million at Dec. 31, 2000. -- Sales of Vantage products increased 53.4% compared with the fourth quarter of fiscal 2000, and ended the quarter with record sales order backlog of $5.0 million. -- Total operating expenses in Iteris declined approximately $850,000, or 23%, during the fourth quarter compared with the third quarter of fiscal 2001, as a result of our decision to reduce spending on the development of personalized traveler information systems. -- In the seasonally soft first quarter of fiscal 2002, we expect to experience approximately a 5% decrease in Iteris revenues compared with the fourth quarter of fiscal 2001. Zyfer Inc. -- Revenues during the quarter were $2.6 million, up 30% from the fourth quarter of fiscal 2000. Revenue growth during the current quarter reflects sales of Zyfer's CommSync II time and frequency systems. -- In May 2001 we received approval from the Joint Program Office of the U.S. Air Force and U.S. Navy to sell our CommSync II system with a specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. GPS receiver for use in defense related applications. This key approval substantially broadens the government customer base for CommSync II and uniquely positions Zyfer as a provider of this system. -- We expect approximately $1.5 million in revenues in the first quarter of fiscal 2002, reflecting a normal seasonal softness in our government customer base. Mariner Mariner Any of a series of unmanned U.S. space probes sent near Venus, Mars, and Mercury. Mariners 2 (1962) and 5 (1967) passed Venus within 22,000 mi (35,000 km) and 2,500 mi (4,000 km), respectively, and made measurements of temperature and atmospheric density. Networks Inc. -- Revenues from the recently introduced Dexter dexter /dex·ter/ (deks´ter) [L.] right; on the right side. dex·ter adj. Of or located on the right side. product family were approximately $100,000 in the fourth quarter. Although revenues in the quarter were below our expectations, we made significant progress in establishing reseller An organization that sells hardware and software to the general public. Resellers purchase products from software publishers and hardware manufacturers. relationships in both 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 Europe, which we believe will be important to the future success of the Dexter product family. These reseller partnerships address the breadth of the telecom market from the enterprise segment to the government and service provider segments. -- We expect Mariner to increase revenues to approximately $300,000 in the first quarter of fiscal 2002. Broadcast Inc. -- Revenues were $1.6 million, up 6% from the fourth fiscal quarter of 2000. -- As a result of recently completed restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and cost-reduction activities, fourth quarter operating expenses were down more than 50% sequentially compared with the third quarter. Gross margins increased to approximately 45% of net sales in the quarter as a result of sales of a newly focused product line directed to Airo automation systems. -- The market for broadcast automation systems continues to be negatively impacted by a generally soft market for broadcast advertising, and consequently we expect revenues to be flat in the first quarter of fiscal 2002, compared with the fourth quarter of fiscal 2001. Gyyr Inc. -- In the fourth quarter, revenues were $7.5 million and Gyyr completed its turnaround Turnaround A situation where a company that has had poor performance for an extended period of time experiences a positive reversal. Notes: A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. strategy begun in the preceding quarter. Operating expenses in the fourth quarter were reduced 18% from the third quarter levels and reduced 34% from the levels at the beginning of the fiscal year. These cost reductions, in conjunction with wider gross profit margins, allowed Gyyr to return to break even EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become during the quarter. -- We announced on April 11, 2001 that we divested the Vortex Dome dome, a roof circular or (rarely) elliptical in plan and usually hemispherical in form, placed over a circular, square, oblong, or polygonal space. Domes have been built with a wide variety of outlines and of various materials. and Quarterback Controller product lines for $1.3 million in cash. This divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). is consistent with Gyyr's strategy to focus on innovative solutions for network-based digital storage and remote video products. -- We expect a moderate reduction in revenues in the first quarter of fiscal 2002 compared with the fourth quarter for fiscal 2001 primarily reflecting the divestiture of the Vortex Dome product line. Odetics Inc. is engaged in the development of communication and technology companies that may be spun-off to its shareholders. Odetics' companies develop software and hardware-based solutions for the intelligent transportation systems, telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. , video security, and television broadcast markets. Odetics headquarters are located in Anaheim with additional operations in Europe and Asia. IMPORTANT NOTICE This news release contains statements that may be deemed to be forward looking. These 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. may include statements about revenue growth, profit margins, the effect of cost reduction measures, and other statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the operating results of Odetics or its subsidiaries. Actual results could differ materially from those projected in the forward-looking statements as a result of risk factors such as: short product lives, technological shifts, current technical issues that cannot be resolved on a timely basis, component availability, competition (including new and directly competitive products from others), pricing pressures, incorrect assumptions regarding market demand, the significant uncertainty of market acceptance of new products by both distributors and end-user customers, unanticipated capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. , retention of key personnel, general economic conditions, the inability of the company to execute its strategy including the completion of both private and public equity financings Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. of its subsidiaries, and other factors identified in the Odetics' Annual Report on 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. and Quarterly Report on Form 10-Q Form 10-Q See 10-Q. . Investors are strongly encouraged to review the risk factors set forth in the Odetics most recent SEC filings.
Odetics Inc.
Summary Financial Data
(in thousands, except per share amounts)
Three Months Ended Twelve Months Ended
March 31, March 31,
Consolidated Statement of
Operations 2000 2001 2000 2001
Net sales and contract revenues:
Net sales $14,166 $13,943 $62,041 $57,030
Contract revenues 4,687 5,609 18,666 20,039
Total net sales and
contract revenues 18,853 19,552 80,707 77,069
Costs and expenses:
Cost of sales 12,953 8,937 50,883 46,244
Cost of contract revenues 3,234 4,579 13,431 13,781
Gross profit 2,666 6,036 16,393 17,044
Selling, general and
administrative expense 11,607 9,728 38,173 41,780
Research and development expense 4,716 3,401 16,888 18,812
Special charge 0 0 0 6,285
Total operating expenses 16,323 13,129 55,061 66,877
Loss from operations (13,657) (7,093) (38,668) (49,833)
Non-operating items
Other income 0 0 38,437 19,055
Interest expense, net (227) (660) (2,048) (1,762)
Loss before taxes (13,884) (7,753) (2,279) (32,540)
Income taxes 0 0 0 0
Net loss ($13,884) ($7,753) ($2,279)($32,540)
Loss per share basic and diluted ($1.51) ($0.74) ($0.25) ($3.26)
Shares used to calculate
basic and diluted
earnings (loss) per share 9,167 10,500 9,089 9,977
Odetics Inc.
Summary Financial Data
(in thousands, except per share amounts)
Three Months Ended Twelve Months Ended
March 31, March 31,
2000 2001 2000 2001
Revenues by segment:
Iteris $5,964 $8,029 $23,411 $28,057
Video Products 10,857 8,893 47,504 41,028
Telecom Products 2,032 2,630 9,792 7,984
$18,853 $19,552 $80,707 $77,069
(audited) (unaudited)
Balance Sheet Highlights 03/31/00 03/31/01
Current assets $41,929 $34,038
Property, plant & equipment, net $20,736 $21,135
Other assets $19,185 $12,888
Current liabilities $29,074 $42,883
Long-term debt -- less current portion $11,666 $4,800
Shareholders' equity $36,110 $20,378
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