SPACEHAB Reports Financial Results for Second Quarter Fiscal Year 2006.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 ), a leading provider of commercial space services, today announced financial results for the second quarter ended December 31, 2005 of its fiscal year 2006. Second Quarter Results SPACEHAB posted a second quarter fiscal 2006 net loss of $8.9 million, or $0.70 per share, on revenue of $11.8 million compared with second quarter fiscal year 2005 net loss of $1.2 million, or $0.10 per share, on revenue of $13.1 million. The quarter loss includes a 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. of $6.3 million as the Company wrote down the book value of one of its two pressurized pres·sur·ize tr.v. pres·sur·ized, pres·sur·iz·ing, pres·sur·iz·es 1. To maintain normal air pressure in (an enclosure, as an aircraft or submarine). 2. 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. modules and changed the depreciable depreciable Of, relating to, or being a long-term tangible asset that is subject to depreciation. life of its remaining space shuttle assets to align with NASA's current launch manifest that anticipates retiring the space shuttle fleet at the end of 2010. "With a limited number of shuttle flights remaining, we anticipate that the most efficient use of our flight assets to support NASA's objectives is the combined use of our pressurized module flown in conjunction with our cargo carrying pallet in support of International Space Station assembly and operations," stated Brian K. Harrington, SPACEHAB Chief Financial Officer. "This approach optimizes the amount of equipment and provisions shipped to the space station. Since this more favorable method uses our single module, Flight Unit 2, we have reduced the book value of our aft module, Flight Unit 3, which in the past provided a larger, double module capability when needed," concluded Harrington. SPACEHAB's single module is under contract for use on the STS-116 and 118 shuttle missions as is the cargo carrier. Second quarter results also include a non-cash charge of $0.6 million of deferred financing cost relative to the note exchange transaction completed in November. "As NASA NASA: see National Aeronautics and Space Administration. NASA in full National Aeronautics and Space Administration Independent U.S. and the aerospace community implement the nation's Vision for Space Exploration, we will be transitioning our existing programs away from shuttle operations, subsequently retiring certain space assets, and developing new capabilities and hardware that support next-generation services," stated Michael E. Kearney, SPACEHAB President and Chief Executive Officer. "As with most companies, requirements change, technology improves, and the need to develop new and improved assets is imperative for market leadership." Six Months Results SPACEHAB's net loss for the six months ended December 31, 2005 was $10.8 million, or $0.85 per share, on revenue of $23.8 million compared to a net income of $5.7 million, or $0.40 per share, on revenue of $26.2 million for first six months of the prior fiscal year. Included in the prior year results was a recovery of $8.2 million from NASA in partial indemnification Indemnification Used in insurance policy agreements as to compensation for damage or loss. In the context of corporate governance, Director Indemnification uses the bylaws and/or charter to indemnify officers and directors from certain legal expenses and judgements resulting from for losses the Company sustained in the Space Shuttle Columbia tragedy in February 2003. Following launch of the STS-114 mission in July 2005, 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. have been deferred until resolution of foam-related technical issues. This rescheduling of space shuttle missions has had an impact on Company revenues and margins for the fiscal year and is expected to have a continued impact on revenue through the end of the fiscal year. However, SPACEHAB is generally reimbursed under its contract with NASA, through Lockheed Martin For the former company, see . Lockheed Martin (NYSE: LMT) is a leading multinational aerospace manufacturer and advanced technology company formed in 1995 by the merger of Lockheed Corporation with Martin Marietta. , for additional costs due to delays. Liquidity SPACEHAB's cash and short-term investments were approximately $3.8 million as of December 31, 2005. 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 $18.4 million at December 31, 2005 compared to $20.5 million at June 30, 2005 due to reductions in accounts payable and accrued expense Accrued Expense An accounting expense recognized in the books before it is paid for. It is a liability, usually current. These expenses are typically periodic and documented upon a company's balance sheet due to the high probability of collection. . As of December 31, 2005 SPACEHAB carried a contract backlog of $66.5 million which represents the expected value Expected value The weighted average of a probability distribution. Also known as the mean value. of contractually-committed work, portions of which are subject to the space shuttle's return to flight or future government funding decisions. The Company's revolving line of credit Revolving line of credit A bank line of credit on which the customer pays a commitment fee and can take and repay funds at will. Normally a revolving LOC involves a firm commitment from the bank for a period of several years. in the amount of $5.0 million is secured by 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 and includes financial covenants that, if not met, require cash deposits securing advances. SPACEHAB currently has no outstanding advances on this line of credit. The line of credit terminates on February 11, 2006 and the Company is currently negotiating an extension. During the quarter the Company completed an offer to exchange its 5.5% senior convertible notes due 2010 for all of its outstanding 8.0% convertible subordinated notes due 2007. At the close of the offer, SPACEHAB issued approximately $52,944,000 in new notes leaving approximately $10,306,000 of old notes outstanding. The new notes are convertible into SPACEHAB common stock at the rate of $1.50 per share and are subject to mandatory conversion if the Company's stock trades above $1.95 per share for 20 consecutive days. The issuance of the convertible notes is consistent with SPACEHAB's strategy 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. its outstanding debt in advance of maturity, reduce its cash requirements and strengthen its balance sheet. As announced on February 3, 2005 SPACEHAB filed a civil complaint with the Federal District Court for the Southern District of Texas against NASA. The Company is seeking recovery of losses of $79.7 million from the Space Shuttle Columbia tragedy. Update of Ongoing Operations Leveraging its extensive hands-on experience in architecting, defining, developing and operating commercial space flight asset services, SPACEHAB is preparing its proposal in support of NASA's commercial 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 requirements known as the Commercial Orbital Transportation Service (COTS) Demonstration. With anticipated funding of $500 million, NASA is seeking a commercial service to provide cargo transportation to and from the International Space Station. In addition, the objective of the spaceflight capability demonstrations is to stimulate commercial enterprises in space and lead to innovative, cost effective access to low-Earth orbit See LEO. . In preparation for this procurement, which has a scheduled award date of June 2006, SPACEHAB has established partnerships and is securing suppliers with the objective of constructing an operationally-viable and affordable commercial solution for supplying a high-value logistics service to the International Space Station. "I am confident our proven expertise and established infrastructure in this area, and the versatility that our approach provides, give us an advantage in this competition," said Kearney in a Company announcement issued subsequent to quarter end. In addition to this high priority business development opportunity, SPACEHAB's three major business units carry on their support to manned and unmanned missions to space, assisting both commercial and government initiatives. 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 its support of the STS-121 space shuttle mission set for launch in May 2006. Changes in the equipment needed for International Space Station operations have resulted in NASA's need to further engage SPACEHAB's support, through its contract with Lockheed Martin, in removing and replacing equipment set for launch on the Company's cargo carrier being flown on this mission. As announced after quarter end, SPACEHAB has been authorized approximately $500,000 for the first sixty days of this effort. The SFS business unit is also under contract to support the STS-116 and 118 flights. These missions use the Company's cargo pallets, one set for permanent deployment and attachment to the space station, but also utilize SPACEHAB's patented module system which will transport thousands of pounds of equipment and provisions, much of it transferred to the space station for use by the astronaut astronaut, crew member on a U.S. manned spaceflight mission; the Soviet term is cosmonaut. Candidates for manned spaceflight are carefully screened to meet the highest physical and mental standards, and they undergo rigorous training. crews that live for extended periods in space. In December 2005 SPACEHAB signed an agreement with Netherlands-based HE Space Operations to market the Company's commercial space services throughout Europe. The strategic alliance creates opportunities for SPACEHAB to provide commercial space access to a broad range of government, industry and academic institutions eager to engage in space-based research, technology development and industrial processing. Astrotech Space Operations provides support necessary for its customers to successfully process their spaceflight hardware for launch, including advance planning; use of unique facilities; and spacecraft checkout, fueling, encapsulation (1) In object technology, the creation of self-contained modules that contain both the data and the processing. See object-oriented programming. (2) The transmission of one network protocol within another. , transport, and remote control through launch. During the quarter the Company was awarded a new NASA mission, THEMIS, under its indefinite-delivery, indefinite-quantity contract with NASA. THEMIS joins the STEREO and Dawn spacecraft, all of which are in the launch processing queue preparing to visit Astrotech's extensive facilities in 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. . For this contract Astrotech is making facility and equipment improvements that will be reimbursed by NASA as they are completed. This quarter saw the successful launch of the Inmarsat-4 communications satellite communications satellite artificial satellite that functions as part of a global radio-communications network. Echo 1, the first communications satellite, launched in 1960, was an instrumented inflatable sphere that passively reflected radio signals back to from the Odyssey Launch Platform. Astrotech provided payload (1) Refers to the "actual data" in a packet or file minus all headers attached for transport and minus all descriptive meta-data. In a network packet, headers are appended to the payload for transport and then discarded at their destination. processing and facilities management The management of a user's computer installation by an outside organization. All operations including systems, programming and the datacenter can be performed by the facilities management organization on the user's premises. support for this Sea Launch program at the Home Port facilities in Long Beach, California Long Beach is a city located in southern Los Angeles County, California, USA, on the Pacific coast. It borders Orange County on its southeast edge. It is about 20 miles (30 km) south of downtown Los Angeles. under a long-term contract with Sea Launch Company LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control . Inmarsat-4 is designed to provide high-speed mobile service to people throughout the Americas. It is one in a series of satellites supporting the Broadband Global Area Network A Broadband Global Area Network or BGAN for short, is a form of Satellite internet and telephony provided by INMARSAT. The system uses two geostationary satellites with additional satellites planned to be launched in 2007/2008 to increase coverage to global. for high-speed delivery of Internet and intranet content and solutions, video-on-demand, video conferencing See videoconferencing. (communications) video conferencing - A discussion between two or more groups of people who are in different places but can see and hear each other using electronic communications. , fax, e-mail, phone and LAN (Local Area Network) A communications network that serves users within a confined geographical area. The "clients" are the user's workstations typically running Windows, although Mac and Linux clients are also used. access. SPACEHAB Government Services continues its exceptional support to NASA's International Space Station program, primarily in the areas of configuration and data management supporting the final acceptance of space station hardware and software for NASA and the sixteen international partners. During the quarter, NASA bestowed a 100% award fee evaluation score on the Program Integration and Control contract for which the Company is a subcontractor One who takes a portion of a contract from the principal contractor or from another subcontractor. When an individual or a company is involved in a large-scale project, a contractor is often hired to see that the work is done. . SPACEHAB began work on the five-year contract in November 2003 as a subcontractor to the ARES Corporation  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Mark blatant advertising for , using . . NASA has the option to issue two one-year contract options that could expand the overall contract to seven years. Conference Call SPACEHAB will host a conference call at 10:00 a.m. Central time following the earnings release. During the call management will discuss the Company's second quarter financial results as well as other recent and potential future developments relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc SPACEHAB. To participate on the call please dial 800.289.0569 (domestic calls) or 913.981.5542 (international calls). A taped replay will be available following the conference call until 11:59 p.m. Eastern time on February 8, 2006 at 888.203.1112 (domestic calls) or 719.457.0820 (international calls) via access code 5419074. 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 is available on the Company website for approximately one year. 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 The term Space Shuttles refers to partly or fully reusable launch vehicles for regularly placing payloads into low earth orbit. See:
The statements in this document may contain 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. 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.
Tables follow
SPACEHAB, INCORPORATED AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Operations
(In thousands, except share data)
Three Months Six Months
Ended December 31, Ended December 31,
-----------------------------------------------
2005 2004 2005 2004
----------- ----------- ----------- -----------
Revenue $11,793 $13,138 $23,778 $26,171
Costs of revenue 16,072 10,721 26,284 21,507
----------- ----------- ----------- -----------
Gross profit (4,279) 2,417 (2,506) 4,664
----------- ----------- ----------- -----------
Operating expenses
Selling, general and
administrative 2,655 2,269 4,935 4,235
Research and
development 133 8 211 16
Recovery related to
Research Double
Module - - - (8,244)
----------- ----------- ----------- -----------
Total operating
expenses 2,788 2,277 5,146 (3,993)
----------- ----------- ----------- -----------
Income from
operations (7,067) 140 (7,652) 8,657
Interest expense (1,852) (1,428) (3,260) (2,886)
Interest and other
income, net 63 39 172 81
----------- ----------- ----------- -----------
Income (loss) before
income taxes (8,856) (1,249) (10,740) 5,852
Income tax expense - - (32) (142)
----------- ----------- ----------- -----------
Net income (loss) $(8,856) $(1,249) $(10,772) $5,710
=========== =========== =========== ===========
Income (loss) per
share:
Net income (loss) per
share - basic $(0.70) $(0.10) $(0.85) $0.45
=========== =========== =========== ===========
Shares used in
computing net income
(loss) per share -
basic 12,718,242 12,609,863 12,694,909 12,592,044
=========== =========== =========== ===========
Net income (loss) per
share - diluted $(0.70) $(0.10) $(0.85) $0.40
=========== =========== =========== ===========
Shares used in
computing net income
(loss) per share -
diluted 12,718,242 12,609,863 12,694,909 14,200,519
=========== =========== =========== ===========
SPACEHAB, INCORPORATED AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands)
December 31,
2005 June 30,
(unaudited) 2005
---------------------------
ASSETS
Cash and cash equivalents, including
restricted amounts of $2,550 and $970 $3,846 $8,297
Accounts receivable, net 13,433 16,906
Prepaid expenses and other current assets 3,412 693
------------- -------------
Total current assets 20,691 25,896
Property, plant, and equipment, net of
accumulated depreciation and amortization 63,786 73,647
Other assets, net 3,655 2,408
------------- -------------
Total assets $88,132 $101,951
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $18,412 $20,461
Long-term liabilities 65,445 66,693
Stockholders' equity 4,275 14,797
------------- -------------
Total liabilities and stockholders'
equity $88,132 $101,951
============= =============
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion