SPACEHAB Reports Financial Results for First Quarter Fiscal Year 2005.HOUSTON -- SPACEHAB, Incorporated (Nasdaq/NMS:SPAB SPAB Society for the Protection of Ancient Buildings (UK) SPAB School Pupil Activity Bus SPAB Supply Priorities and Allocations Board SPAB Security Policy Advisory Board SPAB Society for the Preservation of Adolescent Behavior ) Highlights --Net income of $7.0 million (inclusive of inclusive of prep. Taking into consideration or account; including. amounts received in NASA NASA: see National Aeronautics and Space Administration. NASA in full National Aeronautics and Space Administration Independent U.S. claim) --First quarter revenue of $13.0 million despite space shuttle space shuttle, reusable U.S. space vehicle. Developed by the National Aeronautics and Space Administration (NASA), it consists of a winged orbiter, two solid-rocket boosters, and an external tank. grounding and anticipated lull in Astrotech payload processing --Cash plus short-term investments of $6.2 million (exclusive of amounts received in NASA claim) --Contract backlog of $88.9 million SPACEHAB, Incorporated (Nasdaq/NMS:SPAB), a leading provider of commercial space services, today announced financial results for its first quarter fiscal year 2005 ended September 30, 2004. Earnings and Revenue SPACEHAB posted a first quarter fiscal year 2005 net income of $7.0 million, or $0.55 per share ($0.49 per share diluted), on revenue of $13.0 million compared with prior year quarter net income of $0.67 million, or $0.05 per share ($0.05 per share diluted), on revenue of $18.9 million. First quarter 2005 results reflect the recovery of $8.0 million from NASA for the loss of SPACEHAB's Research Double Module (RDM RDM Ring Deutscher Makler (German Realty Association) RDM Red Mage (Final Fantasy, gaming) RDM Remote Device Management (protocol used in theatre lighting equipment) ) on the STS-107 space shuttle accident. The recovery, along with $0.2 million of interest, is reflected 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. and accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying for the first quarter fiscal year 2005. In October 2004 the Company received the payment of $8.2 million from NASA. Revenue for the first fiscal quarter of 2005 decreased from the prior year primarily due to the continuing postponement of space shuttle missions <onlyinclude> This is a list of missions flown by space shuttles. As of 2006, only the United States has flown human spaceflight shuttle missions, in the Space Shuttle program, while the Soviet Union flew one unmanned flight of the Buran. as well as an anticipated slow quarter in spacecraft processed through the Company's Astrotech subsidiary. Additionally, the prior year's first quarter included revenue from certain contracts that have now expired in the Company's SPACEHAB Government Services (SGS SGS Société Générale de Surveillance SGS Symantec Gateway Security (appliance) SGS School of Graduate Studies SGS Subgrid Scale SGS Singapore Government Securities SGS Shell Global Solutions ) business unit. "Although we anticipated the first quarter of 2005 to be our biggest financial challenge for the year, we experienced a better quarter than expected with the award of new business derived from non-shuttle programs," said Brian K. Harrington, SPACEHAB Senior Vice President, Finance and Chief Financial Officer. "Our new role on NASA's lunar exploration lunar exploration: see space exploration. initiative and our successful commercial delivery of research hardware to the International Space Station via a Russian Progress vehicle are two examples of growing space commerce opportunities." Selling, general and administrative expenses declined to approximately $2.0 million for the first quarter 2005 compared to $2.9 million for the same period a year ago. This improvement in selling, general and administrative expenses is due to decreases in personnel expenses from the Company's on-going cost reduction efforts and benefits from consolidating the Company's corporate offices in 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 . The first quarter 2005 selling, general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. also include legal expenses incurred on the claim with NASA. Liquidity The Company's cash and short-term investments were approximately $6.2 million as of September 30, 2004. As mentioned, in October 2004 the Company received $8.2 million from NASA in indemnification of losses suffered in the STS-107 accident, which had been recorded in accounts receivable as of September 30, 2004. SPACEHAB expects to utilize existing cash, cash anticipated from future operations, and any potential additional proceeds from NASA in settlement of the Company's claims related to the losses in the accident to support strategies for new business initiatives and to reduce long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. . Deferred revenue as of September 30, 2004 was reduced to $4.2 million compared to $14.7 million at September 30, 2003. The decrease is primarily due to the successful execution of a commercial contract with the Japan Aerospace Exploration Agency The Japan Aerospace Exploration Agency (宇宙航空研究開発機構 (JAXA JAXA Japan Aerospace Exploration Agency ) where SPACEHAB provided for the delivery of a thermal incubator system to the International Space Station (ISS ISS See Institutional Shareholder Services (ISS). ) via the Russian Progress for one of its international customers. Current liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. decreased to $19.9 million at September 30, 2004 compared to $24.5 million at September 30, 2003 mainly due to reductions in current deferred revenue, accounts payable, and accrued expenses. Update of Ongoing Operations "I am pleased to see us begin our 2005 fiscal year stable, lean, and primed," said Michael E. Kearney, SPACEHAB President and Chief Executive Officer. "With the Space Shuttle Discovery in process for an anticipated launch next May, a full processing schedule for the remainder of the year at Astrotech, emerging opportunities for new commercial business, and a NASA charter to develop new concepts that support the Nation's vision for Moon, Mars, and beyond, this promises to be an exciting year." SPACEHAB Flight Services (SFS (1) (Self-certifying File System) A global, network file system sponsored by DARPA that runs under Unix. Providing strong security in an untrusted environment, it enables any client to access any server that supports it. ) continues to provide logistics capabilities and assets in support of the ISS program. This business unit is under contract for the use of SPACEHAB's single module as well as its Integrated Cargo Carriers (ICCs) to support four logistics missions to the ISS: STS-114, STS-121, STS-116, and STS-118, in order of their scheduled launch dates. As mentioned previously, the SFS business unit provided JAXA with launch and on-orbit use of a protein crystal growth incubation system under a contract with Mitsubishi Corporation Mitsubishi Corporation (三菱商事株式会社 , SPACEHAB's marketing representative in Japan. Flown aboard a Russian Progress vehicle, this payload demonstrates SPACEHAB's ability to offer timely and affordable commercial access to space via the Company's international alliances. With the successful transition of all systems integration and operations capabilities from SPACEHAB's previous Boeing subcontractor to an in-house capability, the Company has improved the efficiency of its module services. SPACEHAB now provides end-to-end mission integration, hardware development, and sustaining engineering functions and has a stronger team able to support future logistics and research missions to the ISS as well as support NASA's exploration initiatives. During the fourth quarter fiscal year 2004, SPACEHAB's Astrotech subsidiary supported the processing of two NASA spacecraft that were successfully launched during the first quarter of 2005. The Aura mission, processed at the Company's Vandenberg Air Force Base Vandenberg Air Force Base, U.S. military installation, 3,456 acres (1,399 hectares), SW Calif., near Lompoc; chief Pacific coast launch site for military satellites. location, will study the ozone, pollution, and climatic changes in the Earth's atmosphere “Air” redirects here. For other uses, see Air (disambiguation). Earth's atmosphere is a layer of gases surrounding the planet Earth and retained by the Earth's gravity. It contains roughly (by molar content/volume) 78% nitrogen, 20.95% oxygen, 0.93% argon, 0. . NASA's Messenger spacecraft, processed at SPACEHAB's Florida facilities, is designed to orbit the planet Mercury at a distance of 125 miles to collect information on the planet's crust, atmosphere, and polar materials. After the first quarter 2005 scheduled downtime scheduled downtime Informatics A planned, suspension of one or more computer functions to perform maintainance or enhance system operations. Cf Extended downtime. , Astrotech is moving into high gear with the arrival of NASA's Deep Impact spacecraft at the Company's Titusville, Florida Titusville is a city in Brevard County, Florida, United States. The population was 40,670 at the 2000 census. According to the U.S. Census Bureau's 2004 estimates, the city had a population of 42,614. It is the county seat of Brevard CountyGR6. location, the first new processing activity scheduled for the fiscal year. The purpose of this mission is to launch a copper projectile projectile something thrown forward. projectile syringe see blow dart. projectile vomiting forceful vomiting, usually without preceding retching, in which the vomitus is thrown well forward. into the surface of Comet Tempel Comet Tempel may mean:
Astrotech Long Beach operations supported the arrival of the Intelsat Americas-8 (IA-8) spacecraft, built by Space Systems/Loral Space Systems/Loral (SS/L), of Palo Alto, California, is the wholly owned manufacturing subsidiary of Loral Space & Communications. It was acquired in 1990 for $715 million by Loral Corp. from Ford Motor Company as the Space Systems Division of Ford Aerospace. , at the Sea Launch Home Port facilities in preparation for a December 2004 launch date. Set to arrive at the Astrotech Florida facilities in November is the AMC-16 spacecraft, a hybrid Ku/Ka-band satellite built by Lockheed Martin Commercial Space Systems and the first of its kind to be launched on an Atlas V launch vehicle. Astrotech is also working with NASA on finalizing an Indefinite Delivery/Indefinite Quantity (IDIQ IDIQ Indefinite Delivery, Indefinite Quantity (contracting/procurement) ) contract format for future processing support for missions scheduled for launch during 2006 through 2010. SPACEHAB Government Services continues to provide configuration management services within the Program Integration and Control (PI&C) contract supporting the ISS program. The first task order of this contract was successfully completed at the end of the Company's first quarter 2005 which coincides with the end of NASA's fiscal year. A new task order at the same funding level to support another year's effort has been negotiated and approved by NASA despite reductions in the Agency's 2005 budget in this area. As reported, in January 2004 the Company filed a formal proceeding with NASA seeking indemnification under the Company's Research and Logistics Mission Support (ReALMS) contract in the amount of $87.7 million for the value of the Company's RDM and related equipment that was destroyed during the STS-107 space shuttle Columbia tragedy. NASA responded to this contract claim on October 5, 2004. NASA's determination states that its liability is limited under the ReALMS contract to $8.0 million. The Company received payment of $8.2 million, which included $0.2 million of interest, from NASA in October 2004. The Company has the right to appeal NASA's decision to deny its claim for indemnification in excess of $8.0 million. The appeal can be filed with either the Armed Services The Constitution authorizes Congress to raise, support, and regulate armed services for the national defense. The President of the United States is commander in chief of all the branches of the services and has ultimate control over most military matters. Board of Contract Appeals or the U.S. Court of Federal Claims. SPACEHAB is evaluating its options in appealing NASA's determination. On November 8, 2004 the Company filed a second claim with NASA seeking damages of $79.7 million under the Federal Tort Claims Act Enacted in 1946 the Federal Tort Claims Act (FTCA) (60 Stat. 842) removed the inherent Immunity of the federal government from most tort actions brought against it and established the conditions for the commencement of such suits. for the loss of the RDM resulting from NASA's alleged negligence leading to the destruction of the Space Shuttle Columbia and the loss of the RDM. The Company's claim represents its loss of $87.7 million less the $8.0 million recovered from NASA. Under federal tort claim procedures, NASA has statutory deadlines for responding to such claims. In the event that the Company's administrative claim is denied, the Company would have the right to pursue the claim in the Federal district court. In January 2004 Lloyd's of London Not to be confused with Lloyds Bank or Lloyd's Register. Lloyd's of London is a British insurance market. It serves as a meeting place where multiple financial backers or “members”, whether individuals (traditionally known as (Lloyd's), the Company's insurer for the RDM, filed a complaint in the United States District Court for the Western District of Washington The United States District Court for the Western District of Washington is the Federal district court whose jurisdiction comprises the following counties: Clallam, Clark, Cowlitz, Grays Harbor, Island, Jefferson, King, Kitsap, Lewis, Mason, Pacific, Pierce, San Juan, Skagit, seeking the return of the $17.7 million Lloyd's had paid to the Company under the RDM insurance policy alleging that, among other things, (i) such proceeds were paid erroneously primarily due to the fact that NASA had not paid indemnification due to the Company prior to the payment of the insurance proceeds, (ii) the Company and its insurance broker misled Lloyd's in issuing the policy, and (iii) the Company has not cooperated with Lloyd's in protecting Lloyd's right of subrogation The substitution of one person in the place of another with reference to a lawful claim, demand, or right, so that he or she who is substituted succeeds to the rights of the other in relation to the debt or claim, and its rights, remedies, or Securities. . In February 2004 Lloyd's withdrew its complaint from the United States District Court United States District Court In the U.S., any of the 94 trial courts of general jurisdiction in the federal judicial system. Each state, as well as the District of Columbia and the Commonwealth of Puerto Rico, has at least one federal district court. and filed a similar complaint in Superior Court of the State of Washington. On November 1, 2004 SPACEHAB filed a motion with the Superior Court of the State of Washington to dismiss under forum non conveniens forum non conveniens (for-uhm nahn cahn-veen-nee-ehns) n. Latin for a forum which is not convenient. This doctrine is employed when the court chosen by the plaintiff (the party suing) is inconvenient for witnesses or poses an undue hardship on the defendants, who . The Company believes that Lloyd's complaint is without merit and will continue to respond to the complaint accordingly. Conference Call SPACEHAB will host a conference call today at 10:00 a.m. Central time following the earnings release. During the call, management will discuss the Company's first quarter financial results as well as other recent and potential future developments relating to SPACEHAB. To participate on the call, please dial 800-377-4872 (domestic calls) or 816-650-0783 (international calls) and ask for the SPACEHAB Earnings Conference. A taped replay will be available following the conference call and accessible via access code 28810984 until 11:59 p.m. Eastern time on November 10, 2004 at 800-252-6030 (domestic calls) or 402-220-2491 (international calls). To hear a replay of the call via the Internet, visit the Investor Information section of the SPACEHAB website at www.spacehab.com. This audio archived webcast of the conference call will be available on the Company website for approximately 90 days. About SPACEHAB, Incorporated SPACEHAB, Incorporated (www.spacehab.com) is a leading provider of commercial and government space services with three primary business units. The Flight Services business unit develops, owns, and operates habitat and laboratory modules and cargo carriers aboard NASA's Space Shuttles for Space Station resupply re·sup·ply tr.v. re·sup·plied, re·sup·ply·ing, re·sup·plies To provide with fresh supplies, as of weapons and ammunition. re and research purposes. SPACEHAB's Astrotech subsidiary provides payload processing support services support services Psychology Non-health care-related ancillary services–eg, transportation, financial aid, support groups, homemaker services, respite services, and other services for both commercial and government customers at company-owned facilities in Florida and California. The Company's Government Services business unit supports NASA's Johnson Space Center providing configuration management, product engineering, and support services for both the Space Station and Space Shuttle programs. Additionally, through The Space Store, Space Media provides space merchandise to the public and space enthusiasts worldwide (www.thespacestore.com). The statements in this document may contain forward-looking statements that are made pursuant to the Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions 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. Such forward-looking statements are subject to risks, trends, and uncertainties that could cause actual results to be materially different from the forward-looking statement. These factors include, but are not limited to, continued government support and funding for key space programs, product performance and market acceptance of products and services, as well as other risk factors and business considerations described in the company's Securities & Exchange Commission filings including the 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. . Any forward-looking statements in this document should be evaluated in light of these important risk factors. The Company assumes no obligation to update these forward-looking statements.
SPACEHAB, Incorporated and Subsidiaries
Unaudited Condensed Consolidated Statements of Operations
(In Thousands, Except Share Data)
Three Months
Ended September 30,
-----------------------
2004 2003
----------- -----------
Revenue $13,033 $18,850
Costs of revenue 10,786 13,527
----------- -----------
Gross profit 2,247 5,323
----------- -----------
Operating expenses
Selling, general and administrative 1,966 2,932
Research and development 7 -
Recovery of nonrecurring charge, loss of
Research Double Module (8,244)
----------- -----------
Total operating expenses (6,271) 2,932
----------- -----------
Income from operations 8,518 2,391
Interest expense (1,458) (1,740)
Interest and other income, net 41 33
----------- -----------
Income before income taxes 7,101 684
Income tax expense (142) (18)
----------- -----------
Net income $6,959 $666
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Income per share:
Net income per share - basic $0.55 $0.05
=========== ===========
Shares used in computing net income
per share - basic 12,574,224 12,370,955
=========== ===========
Net income per share - diluted $0.49 $0.05
=========== ===========
Shares used in computing net income
per share - diluted 14,247,860 13,745,450
=========== ===========
Condensed Consolidated Balance Sheets
(In thousands) September 30, June 30,
2004 2004
ASSETS (unaudited)
-------------- --------
Cash and cash equivalents $558 $936
Short-term investments 5,677 6,641
Accounts receivable, net 14,676 7,878
Prepaid expenses and other current assets 648 495
-------------- --------
Total current assets 21,559 15,950
Property and equipment, net of accumulated
depreciation and amortization of $51,040 and
$49,755, respectively 78,420 79,600
Other assets, net 3,194 4,375
-------------- --------
Total assets $103,173 $99,925
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $19,855 22,301
-------------- --------
Long-term liabilities 66,905 68,214
Stockholders' equity 16,413 9,410
-------------- --------
Total liabilities and stockholders' equity $103,173 $99,925
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