SPACEHAB Reports Financial Results for Third Quarter Fiscal Year 2006.HOUSTON -- SPACEHAB, Incorporated (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :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 third quarter ended March 31, 2006 of its fiscal year 2006. Third Quarter Results SPACEHAB posted a third quarter fiscal 2006 net loss of $1.7 million, or $0.13 per share, on revenue of $12.4 million compared with third quarter fiscal year 2005 net loss of $0.5 million, or $0.04 per share, on revenue of $14.3 million. "Our third quarter results were impacted due to additional slips in NASA's launch of the 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. ," stated Michael E. Kearney, SPACEHAB President and Chief Executive Officer. "With a scheduled launch date of July 2006, we have completed preparations for the upcoming STS-121 mission by implementing hardware change-outs on our cargo pallet in order to meet new International Space Station assembly and maintenance requirements. We are continuing our module and carrier integration services on the STS-116 mission, scheduled for launch in December 2006, and we have recently been authorized by NASA NASA: see National Aeronautics and Space Administration. NASA in full National Aeronautics and Space Administration Independent U.S. to initiate processing work on the STS-118 flight currently set for a June 2007 liftoff." Nine Months Results SPACEHAB's net loss for the nine months ended March 31, 2006 was $12.4 million, or $0.98 per share, on revenue of $36.2 million compared to a net income of $5.2 million, or $0.36 per share, on revenue of $40.4 million for first nine months of the prior fiscal year. The nine month period 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 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. Included in the prior year results was a recovery of $8.2 million from NASA in partial indemnification 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 and other 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. "During the first nine months of our fiscal year, we have taken significant steps to adjust the book value of our existing shuttle-based assets to align them with NASA's current manifest, began to shift our business focus away from shuttle operations to next generation vehicle support, and pursued new business opportunities that leverage the skills and competencies of our talented workforce," stated Brian K. Harrington, SPACEHAB Chief Financial Officer. "In the meantime Adv. 1. in the meantime - during the intervening time; "meanwhile I will not think about the problem"; "meantime he was attentive to his other interests"; "in the meantime the police were notified" meantime, meanwhile , we continue to provide stellar support to NASA in preparation for three upcoming space shuttle missions, STS-121, 116, and 118." Liquidity SPACEHAB's cash and short-term investments were approximately $5.9 million as of March 31, 2006. 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 $18.9 million at March 31, 2006 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 March 31, 2006 SPACEHAB carried a contract backlog of $62.0 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. Update of Ongoing Operations During the quarter the Company submitted its proposal to NASA to demonstrate its capability to provide commercial cargo transportation services to and from the International Space Station while providing space access to customers worldwide. The proposal lays out SPACEHAB's plan to develop and demonstrate a next generation commercial space service, called Apex, in response to the Agency's Commercial Orbital Transportation Service (COTS) Demonstrations solicitation. This service offers frequent, reliable, and affordable access to space in support of NASA's space station needs but also opens the door to a robust, sustainable commercial space market for corporations, academic institutions, and government users around the globe. "Our Apex solution provides a non-shuttle-based, end-to-end space access solution that complements the customer-responsive capabilities we've proven successful over the previous decade on numerous space shuttle and space station missions," stated Kearney. "As a pioneer in the development of the early stages of the space commerce market, SPACEHAB is ideally positioned to grow and expand the market via the COTS initiative and related commercial services." SPACEHAB's three major business units continue 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. ) is concluding integration and operation tasks associated with the STS-121 space shuttle mission set for launch in July 2006. The Company is providing an Integrated Cargo Carrier, a pallet that resides in the space shuttle's cargo bay, which is being used to transport critical spares needed on the International Space Station. 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. Astrotech Space Operations provides support necessary for its customers to successfully process their spaceflight hardware for launch, including advanced 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 successful in obtaining new business including the support to Lockheed Martin's SES ASTRA SES Astra SA, is a corporate subsidiary of SES, based in Betzdorf, in eastern Luxembourg, that owns and operates the Astra series of geostationary satellites, which transmit approximately 1100 analogue and digital television and radio channels via 176 transponders to 91 1KR satellite. Additionally, the Astrotech teams located in both Florida and California supported the processing of numerous spacecraft, including NASA's CloudSat and CALIPSO CALIPSO Cloud-Aerosol Lidar and Infrared Pathfinder Satellite Observations , GOES-N, and JCSAT. This quarter saw the successful launch of the EchoStar X satellite 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 . EchoStar is designed to deliver direct-to-home broadcast services to DISH Network See DBS. customers throughout 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. . 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. The Company is actively pursuing an additional NASA contract in 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. role to support configuration management initiatives. The five-year, $17 million contract, for which SPACEHAB expects to receive a portion of the work, is anticipated to be awarded in September. 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 third 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 800-289-0494 (domestic calls) or 913-981-5520 (international calls). A taped replay is available following the conference call until 11:59 p.m. Eastern time on May 10, 2006 at 888-203-1112 (domestic calls) or 719-457-0820 (international calls) via access code 2490394. 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:
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 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 Nine Months
Ended March 31, Ended March 31,
-----------------------------------------------
2006 2005 2006 2005
----------- ----------- ----------- -----------
Revenue $12,400 $14,272 $36,178 $40,443
Costs of revenue 9,979 11,085 36,263 32,592
----------- ----------- ----------- -----------
Gross profit 2,421 3,187 (85) 7,851
----------- ----------- ----------- -----------
Operating expenses
Selling, general
and administrative 2,923 2,321 7,858 6,556
Research and
development 91 21 302 37
Goodwill impairment - - - -
Impairment of
investment in
Guigne - - - -
Recovery of
nonrecurring
charge, loss of
Research Double
Module - - - (8,244)
----------- ----------- ----------- -----------
Total
operating
expenses 3,014 2,342 8,160 (1,651)
----------- ----------- ----------- -----------
Income from
operations (593) 845 (8,245) 9,502
Interest expense (1,168) (1,413) (4,428) (4,299)
Interest and other
income, net 88 40 260 121
----------- ----------- ----------- -----------
Income (loss) before
income taxes (1,673) (528) (12,413) 5,324
Income tax expense - (13) (32) (155)
----------- ----------- ----------- -----------
Net income (loss) $(1,673) $(541) $(12,445) $5,169
=========== =========== =========== ===========
Income (loss) per
share:
Net income (loss) per
share - basic $(0.13) $(0.04) $(0.98) $0.41
=========== =========== =========== ===========
Shares used in
computing net income
(loss) per share -
basic 12,765,720 12,626,130 12,718,168 12,603,240
=========== =========== =========== ===========
Net income (loss) per
share - diluted $(0.13) $(0.04) $(0.98) $0.36
=========== =========== =========== ===========
Shares used in
computing net income
(loss) per share -
diluted 12,765,720 12,626,130 12,718,168 14,203,597
=========== =========== =========== ===========
SPACEHAB, INCORPORATED AND SUBSIDIARIES
Unaudited Condensed Consolidated Balance Sheets
(In thousands, except share data)
March 31, June 30,
2006 2005
ASSETS (unaudited)
----------- -----------
Cash and cash equivalents, including restricted
amounts $0 and $970 $5,941 $8,297
Accounts receivable, net 11,524 16,906
Prepaid expenses and other current assets 3,259 693
----------- -----------
Total current assets 20,724 25,896
Property and equipment, net of accumulated
depreciation and amortization 62,354 73,647
Other assets, net 3,242 2,408
----------- -----------
Total assets $86,320 $101,951
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities 18,870 20,461
Long-term liabilities 64,789 66,693
Stockholders' equity 2,661 14,797
----------- -----------
Total liabilities and stockholders' equity $86,320 $101,951
=========== ===========
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