Archive for November, 2009
Netlist (NLST) Demonstrates New HyperCloud Memory Modules at Supercomputing 09
Nov. 16, 2009 (PR Newswire) — PORTLAND, Ore., Nov. 16 /PRNewswire-FirstCall/ — Visit Netlist at SC09 in Booth # 2398 — At Supercomputing 09, Netlist, Inc. (Nasdaq: NLST), a designer and manufacturer of high-performance memory subsystems, is demonstrating the world’s first 16GB 2 virtual rank (vRank) double-data-rate three, registered dual in-line memory module (DDR3 RDIMM), HyperCloud(TM). Netlist will also showcase the interoperability of HyperCloud memory with standard JEDEC server memory solutions on popular enterprise servers. This demonstration reinforces HyperCloud’s ability to function as a standard RDIMM while increasing memory bandwidth and capacity for datacenter servers.
To showcase its 2-vRank HyperCloud modules, Netlist is using industry standard servers, such as the HP ProLiant DL380, demonstrated in the following configurations:
-- 8GB and 16GB 2 vRank DDR3 RDIMM functionality -- Three 2 vRank modules per channel -- 1333 Mega Transfers per second (MT/s) -- Interoperability with standard JEDEC DDR3 modules -- Interoperability with different RDIMM capacities
“This technology maximizes server utilization with a simple plug-and-play memory module,” said Paul Duran, director of business development at Netlist. “HyperCloud enables high-performance cloud computing while reducing datacenter costs and increasing application performance.”
“Customers running memory intensive computing environments, such as virtualization, cloud computing, and HPC applications, are often limited by memory bottlenecks in their servers,” said Mike Gill, vice president, Industry Standard Servers Platform Engineering at HP. “The Netlist technology on HP industry-standard servers increases server memory capacity and bandwidth to enhance application performance in converged infrastructures.”
HyperCloud will debut at the Supercomputing trade-show, taking place in Portland, Oregon during November 17-19, 2009, in booth number 2398. Netlist plans to sample HyperCloud to major OEM customers in December with production slated for Q1 2010. HyperCloud will be available in 4GB, 8GB, and 16GB 2 vRank module options.
About Netlist:
Netlist, Inc. designs and manufactures high-performance, logic-based memory subsystems for the server and high-performance computing and communications markets. The Company’s memory subsystems are developed for applications in which high-speed, high-capacity memory, enhanced functionality, small form factor, and heat dissipation are key requirements. These applications include tower-servers, rack-mounted servers, blade servers, high-performance computing clusters, engineering workstations, and telecommunication equipment. Netlist was founded in 2000 and is headquartered in Irvine, California with manufacturing facilities in Suzhou, People’s Republic of China.
Netlist is listed on the NASDAQ stock exchange under the ticker “NLST.” More information can be found on the Company’s web site: www.netlist.com.
Spherix Inc. (SPEX) To Raise $6.3 Million In Registered Direct Offering
BETHESDA, Md., Nov. 16 /PRNewswire-FirstCall/ — Spherix Incorporated (Nasdaq: SPEX), an innovator in biotechnology for diabetes therapy, and a provider of technical and regulatory consulting services to food, supplement, biotechnology and pharmaceutical companies, today announced that it has received commitments from investors to purchase $6.3 million of securities in a registered direct offering. Spherix expects to receive net proceeds of approximately $6 million after deducting placement agent fees and other offering expenses. Spherix has entered into securities purchase agreements with the investors pursuant to which Spherix has agreed to sell an aggregate of 2,760,870 shares of its common stock and warrants to purchase up to 1,104,348 additional shares of its common stock. Each unit, consisting of one share of common stock and a warrant to purchase 0.40 of a share of common stock, will be sold for a purchase price of $2.30.
“The proceeds from this offering will provide critical support for the Company’s on-going development of D-tagatose as a treatment for Type 2 diabetes, currently in Phase 3 clinical trial,” said Dr. Claire L. Kruger, CEO of Spherix.
The warrants to purchase additional shares will be exercisable immediately at an exercise price of $3.25 per share and will expire 5 years from the date they are first exercisable. All of the securities were offered pursuant to an effective shelf registration statement. The offering is expected to be consummated by November 19, 2009, subject to customary closing conditions. Rodman & Renshaw, LLC (Nasdaq: RODM), a wholly owned subsidiary of Rodman & Renshaw Capital Group, Inc., acted as the exclusive placement agent for the transaction.
A shelf registration statement relating to the shares of common stock and warrants issued in the offering (and the shares of common stock issuable upon exercise of the warrants) has been filed with the Securities and Exchange Commission (the “SEC”) and has been declared effective. A prospectus supplement relating to the offering will be filed by Spherix with the SEC. Copies of the prospectus supplement and accompanying prospectus may be obtained directly from Spherix by contacting Spherix Incorporated, 6430 Rockledge Drive, #503, Bethesda, MD 20817. This announcement is neither an offer to sell nor a solicitation of an offer to buy any shares of common stock or warrants of Spherix. No offer, solicitation or sale will be made in any jurisdiction in which such offer, solicitation or sale is unlawful.
About Spherix
Spherix Incorporated was launched in 1967 as a scientific research company under the name Biospherics Research. The company now leverages its scientific and technical expertise and experience through its two subsidiaries — Biospherics Incorporated and Spherix Consulting, Inc. Biospherics is currently running a Phase 3 clinical trial to study the use of D-tagatose as an oral, monotherapy treatment for patients with Type 2 diabetes. Its Spherix Consulting subsidiary provides scientific and strategic support for suppliers, manufacturers, distributors and retailers of conventional foods, biotechnology-derived foods, medical foods, infant formulas, food ingredients, dietary supplements, food contact substances, pharmaceuticals, medical devices, consumer products, and industrial chemicals and pesticides. For more information, please visit www.spherix.com.
Forward-Looking Statements
This release contains forward-looking statements which are made pursuant to provisions of Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that such statements in this release, including statements relating to planned clinical study design, regulatory and business strategies, plans and objectives of management and growth opportunities for existing or proposed products, constitute forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those anticipated by the forward-looking statements. The risks and uncertainties include, without limitation, risks that product candidates may fail in the clinic or may not be successfully marketed or manufactured, we may lack financial resources to complete development of Naturlose, the FDA may interpret the results of studies differently than us, competing products may be more successful, demand for new pharmaceutical products may decrease, the biopharmaceutical industry may experience negative market trends, our continuing efforts to develop Naturlose may be unsuccessful, our common stock could be delisted from the Nasdaq Capital Market, and other risks and challenges detailed in our filings with the U.S. Securities and Exchange Commission, including our current report on Form 8-K filed on October 10, 2007. Readers are cautioned not to place undue reliance on any forward-looking statements which speak only as of the date of this release. We undertake no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances that occur after the date of this release or to reflect the occurrence of unanticipated events.
Maxygen, Inc. (MAXY) Commences Dutch Auction Tender Offer to Repurchase 6,557,377 Shares of Common Stock
REDWOOD CITY, Calif., Nov. 13 /PRNewswire-FirstCall/ — Maxygen, Inc. (Nasdaq: MAXY – News), a biotechnology company focused on the development of improved protein drugs, today announced that it is commencing a modified “Dutch Auction” tender offer to repurchase 6,557,377 shares of its common stock, representing approximately 17% of Maxygen’s outstanding shares. The closing price of Maxygen’s common stock on the Nasdaq Global Market on November 12, 2009 was $5.03.
Maxygen intends to finance the repurchases from cash on hand. At September 30, 2009, cash, cash equivalents and marketable securities totaled $203.0 million, $20.3 million of which was held by Maxygen’s majority-owned subsidiary, Perseid Therapeutics LLC, and may only be used for Perseid’s operations.
Under the tender offer, stockholders will have the opportunity to tender some or all of their shares at a price within a range of $5.30 to $6.10 per share. Based on the number of shares tendered and the prices specified by the tendering stockholders, Maxygen will determine the lowest per share price within the range that will enable it to buy 6,557,377 shares, or such lesser number of shares that are properly tendered. If more than 6,557,377 shares are properly tendered at or below the determined price per share, Maxygen will purchase shares tendered at the determined price per share, on a pro rated basis. Additionally, if more than 6,557,377 shares are properly tendered, the number of shares to be repurchased by Maxygen pursuant to the tender offer may, at the discretion of Maxygen, be increased by up to 2% of Maxygen’s outstanding shares, or approximately 787,726 shares, without amending or extending the tender offer.
Stockholders whose shares are purchased in the offer will be paid the determined purchase price per share net in cash, without interest, promptly after the expiration of the offer period. The offer is not contingent upon any minimum number of shares being tendered, and is subject to a number of other terms and conditions specified in the offer to purchase that is being distributed to stockholders. The offer will expire at 12:00 midnight, New York City Time, on Friday, December 11, 2009 (which is the end of the day on December 11, 2009), unless extended by Maxygen. Tenders of Maxygen’s common stock must be made prior to the expiration of the tender offer and may be withdrawn at any time prior to the expiration of the tender offer.
The information agent for the offer is Okapi Partners LLC and the depositary for the offer is Computershare Trust Company. Lazard Freres & Co. LLC is providing strategic advisory services to Maxygen in connection with the offer. None of Maxygen, its board of directors or the information agent is making any recommendation to stockholders as to whether to tender or refrain from tendering their shares into the tender offer. Stockholders must decide how many shares they will tender, if any, and the price within the stated range at which they will offer their shares for purchase by Maxygen.
IMPORTANT NOTICE: This press release is for informational purposes only and is neither an offer to buy nor the solicitation of an offer to sell any shares of Maxygen’s common stock. The tender offer is being made solely by the offer to purchase, the related letter of transmittal and other related documents that Maxygen is sending to its stockholders. The materials will be filed as exhibits to Maxygen’s tender offer statement on Schedule TO, which will be filed with the Securities and Exchange Commission, as well as any subsequent amendment or supplement. These tender offer materials contain important information that investors are urged to read carefully before making any decision with respect to the tender offer. Each of these documents has been or will be filed with the Securities and Exchange Commission, and investors may obtain them for free from the Securities and Exchange Commission at its website (www.sec.gov) or from Okapi Partners, the information agent for the tender offer, by directing such request to: Okapi Partners LLC, 780 Third Avenue, 30th Fl., New York, NY 10017, telephone (212) 297-0720 or toll-free (877) 285-5990.
Cautionary Statement Regarding Maxygen Forward-Looking Statements
This press release contains forward-looking statements. These statements are based on the current expectations and beliefs of Maxygen’s management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The forward-looking statements contained in this document include references to completion of the tender offer and the payment for shares related thereto. These statements, including their underlying assumptions, are subject to risks and uncertainties and are not guarantees of future performance. Results may differ due to various factors such as the possibility that stockholders may not tender their shares in the tender offer, or other conditions to completion of the tender offer are not satisfied. For further details of these risks, you should read our filings with the Securities and Exchange Commission related to the tender offer, including our Schedule TO and the documents referred to therein. Except as required by law, Maxygen is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.
About Maxygen
Maxygen is a biopharmaceutical company focused on developing improved versions of protein drugs through both internal development and external collaborations and other arrangements. Maxygen uses its proprietary DNA shuffling technology and extensive protein modification expertise to pursue the creation of biosuperior proteins. For more information, please visit www.maxygen.com.
China Holdings Acquisition Corp. (CHHL) To Hold Special Meeting on November 20, 2009
Nov. 13, 2009 (PR Newswire) — WILMINGTON, Del. and JINJIANG , China, Nov. 13 /PRNewswire-FirstCall/ — On August 7th, 2009, China Holdings Acquisition Corp. (Amex: HOL) (“CHAC”) announced that it had entered into a definitive share purchase agreement to acquire Jinjiang Hengda Ceramics Co., Ltd. (“Hengda”). Hengda is a leading Chinese manufacturer of ceramic tiles used for exterior siding and for interior flooring and design in residential and commercial buildings.
A special meeting of stockholders of China Holdings Acquisition Corp. will be held at the offices of Loeb & Loeb, 345 Park Avenue, New York, New York on November 20, 2009 at 9:00 am to vote on the acquisition of Hengda. Following a successful vote and the completion of the transaction, CHAC will redomesticate to the BVI and the new company will be called China Ceramics Co., Ltd (“China Ceramics”). The transaction, which has been unanimously approved by the board of directors of CHAC, is expected to be completed by November 21, 2009. The proxy statement/prospectus and other relevant documents are filed with the SEC under the company name China Ceramics and can be obtained, without charge, from the SEC’s website at http://www.sec.gov.
Recent Developments
The following is preliminary summary third quarter 2009 financial information for Hengda.
Highlights
-- Revenue for the third quarter ending September 30,2009 increased 15.8%
compared to the third quarter ending September 30, 2008 and revenue for
nine months ending September 30, 2009 increased by 9.6% from the
equivalent period in 2008
-- Net income for the third quarter ending September 30, 2009 increased
18.8% compared to the third quarter ending September 30, 2008 and net
income for nine months ending September 30, 2009 decreased by 2.8% from
the equivalent period in 2008 since the tax rate changed from
approximately 12.5% in 2008 to approximately 25% in 2009
-- Earnings Before Interest Tax Depreciation and Amortization ("EBITDA")
for the third quarter 2009 increased 36.3% compared to the third quarter
2008 and EBITDA for 9 months 2009 increased by 12.7% from the equivalent
period in 2008
-- Sales volume for the third quarter increased by 16.4% compared to the
third quarter 2008
-- Average selling price per square meter increased by 4.3% from Q2 2009
-- Sales volume backlog for Q4 2009 (as of October 15) was 8.7 mm square
meters, which is 20% year over year growth from 7.2 mm square meters Q4
2008
Summary Financials In RMB '000 Q3 2009 Q2 2009 Q3 2008 9 Mo. 2009 9 mo. 2008 -------------------------------------------------------- Revenue 248,911 221,497 214,974 648,640 591,807 Net Income 52,698 43,096 44,340 126,963 130,557 EBITDA 74,804 61,628 54,878 182,373 161,782 Sales volume (square meters) 9,369,226 8,692,665 8,046,826 25,027,824 21,639,226 Average selling price (RMB/per square meter) 26.6 25.5 26.7 25.9 27.4 In US$'000 Q3 2009 Q2 2009 Q3 2008 9 Mo. 2009 9 mo. 2008 -------------------------------------------------------- Revenue 36,337 32,335 31,383 94,692 86,395 Net Income 7,693 6,291 6,473 18,535 19,059 EBITDA 10,920 8,997 8,011 26,624 23,618 In RMB '000 In US$'000 -------------------------------------------- Q3 2009 Q2 2009 Q3 2009 Q2 2009 Cash and Bank Balances 162,344 93,247 23,700 13,613 Inventories 102,327 107,845 14,938 15,744 Trade Receivables 291,227 251,664 42,515 36,739 Trade Payables 118,502 97,847 17,300 14,284 Interest-bearing bank borrowings 34,500 34,500 5,036 5,036 Note: Converted at 6.85 RMB/US$
Non GAAP Reconciliation
In RMB '000 9 Mo. 9 Mo. Q3 2009 Q2 2009 Q3 2008 2009 2008 -------------------------------------------------- Net Income 52,698 43,096 44,340 126,963 130,557 -------------------------------------------------- Plus Tax 17,668 14,369 6,350 42,648 18,894 Plus Interest 513 208 263 929 660 Plus Dep. and Amort. 3,925 3,955 3,925 11,833 11,671 -------------------------------------------------- EBITDA 74,804 61,628 54,878 182,373 161,782 In US$'000 9 Mo. 9 Mo. Q3 2009 Q2 2009 Q3 2008 2009 2008 -------------------------------------------------- Net Income 7,693 6,291 6,473 18,535 19,059 -------------------------------------------------- Plus Tax 2,579 2,098 927 6,226 2,758 Plus Interest 75 30 38 136 96 Plus Dep. and Amort. 573 577 573 1,727 1,704 -------------------------------------------------- EBITDA 10,920 8,997 8,011 26,624 23,618 Note: Converted at 6.85 RMB/US$
About China Holdings Acquisition Corp.
Founded in 2007, China Holdings Acquisition Corp. (“CHAC”) is a blank check company focused on acquiring companies with primary operations in Asia through a merger, capital stock exchange, stock purchase, asset acquisition or other similar business combination or contractual arrangements. CHAC currently has no operating businesses.
Additional Information about the Transaction and Where to Find It
In connection with the proposed acquisition, China Ceramics Co., Ltd. has prepared a registration statement containing a proxy statement/prospectus that is filed with the SEC. The definitive proxy statement/prospectus and a form of proxy have been mailed to the stockholders of CHAC, seeking their approval of the transaction. Stockholders are urged to read the proxy statement/prospectus regarding the proposed acquisition carefully and in its entirety because it will contain important information about the proposed acquisition. Stockholders can obtain, without charge, a copy of the proxy statement/prospectus and other relevant documents filed with the SEC from the SEC’s website at http://www.sec.gov. Stockholders will also be able to obtain, without charge, a copy of the proxy statement/prospectus and other relevant documents (when available) by directing a request by mail to Mark L. Wilson at China Holdings Acquisition Corp., 1000 North West Street Suite 1200, Wilmington, DE. 19801, or by telephone at (302) 295-4832.
CHAC and its directors and officers may be deemed to be participants in the solicitation of proxies from CHAC’s stockholders with respect to the proposed acquisition. Information about CHAC’s directors and executive officers and their ownership of CHAC’s common stock and warrants is set forth in CHAC’s annual report on Form 10-K for the Fiscal Year ended December 31, 2008. Stockholders may obtain additional information regarding the interests of CHAC and its directors and executive officers in the proposed acquisition, which may be different than those of CHAC’s stockholders generally, by reading the proxy statement/prospectus and other relevant documents regarding the proposed acquisition when filed with the SEC.
Non-GAAP Financials
The financial information and data contained in this communication is unaudited and does not conform to the SEC’s Regulation S-X. Accordingly, such information and data may not be included in, may be adjusted in or may be presented differently in, CHAC’s proxy statement to solicit stockholder approval for the proposed acquisition of Hengda.
This communication includes certain estimated financial information that is not derived in accordance with generally accepted accounting principles (“GAAP”), and which may be deemed to be non-GAAP financial measures within the meaning of Regulation G promulgated by the SEC. CHAC and Hengda believe that the presentation of these non-GAAP financial measures serves to enhance the understanding of the financial performance of Hengda and the proposed acquisition. However, these non-GAAP financial measures should be considered in addition to and not as substitutes for, or superior to financial measures of financial performance prepared in accordance with GAAP. Our pro forma financial measures may not be comparable to similarly titled pro forma measures reported by other companies.
This communication contains disclosure of EBITDA for certain periods, which may be deemed to be a non-GAAP financial measure within the meaning of Regulation G promulgated by the Securities and Exchange Commission. Management believes that EBITDA, or earnings before interest, taxes, depreciation and amortization, is an appropriate measure of evaluating operating performance and liquidity, because it reflects the resources available for strategic opportunities including, among others, investments in the business and strategic acquisitions. EBITDA may not be comparable to similarly titled measures reported by other companies. EBITDA is not a recognized term under U.S. GAAP, and EBITDA should be considered in addition to, and not as substitutes for, or superior to, operating income, cash flows, revenues, or other measures of financial performance prepared in accordance with generally accepted accounting principles. EBITDA is not a completely representative measure of either the historical performance or, necessarily, the future potential of Hengda.
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. Forward-looking statements in this press release include matters that involve known and unknown risks, uncertainties and other factors that may cause actual results, levels of activity, performance or achievements to differ materially from results expressed or implied by this press release. Such risk factors include, among others: future operating or financial results; future growth expectations and acquisitions; uncertainties as to the timing of the acquisition; approval of the transaction by CHAC stockholders; the satisfaction of closing conditions to the transaction; costs related to the acquisition; the performance of Hengda; the impact of inflation generally as well as on the rising costs of materials; specific economic conditions in China generally or in the markets in which Hengda Ceramics operates; changes in laws and regulations; potential liability from future litigation; the diversion of management time on acquisition and integration related issues; modifications or adjustments to the financial statements of Hengda as a result of applicable securities laws; and general economic conditions such as inflation or recession. Actual results may differ materially from those contained in the forward-looking statements in this communication and documents filed with the SEC. CHAC undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after the date of this communication. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this communication. All forward-looking statements are qualified in their entirety by this cautionary statement.
RINO International Corp. (RINO) Announces Record Third Quarter 2009 Financial Results
DALIAN, China, Nov. 13 /PRNewswire-Asia-FirstCall/ -- - Q3 2009 net sales increased 41.0% to $63.3 million vs. Q3 2008; net income increased 73.3% to $17.1 million; EPS of $0.68 vs. $0.39 - First nine months of 2009 net contract sales increased 41.7% to $139.6 million YOY; net income increased 94.5% to $39.4 million; EPS was $1.57 vs. $0.81 - Cash flow from operations was $9.5 million for the first nine months of 2009 - Backlog on September 30, 2009 was approximately $52.7 Million - Management to host earnings conference call November 13th at 8:30 a.m. ET
RINO International Corp. (OTC Bulletin Board: RINO), which through its subsidiaries and controlled affiliates in the People’s Republic of China (collectively, the “Company” or “RINO”), designs, manufactures, installs and services proprietary and patented wastewater treatment, desulphurization equipment, and high temperature anti-oxidation systems for iron and steel manufacturers in the People’s Republic of China (“PRC”), today announced the Company’s financial results for the third quarter of 2009.
SUMMARY FINANCIALS First Quarter 2009 Results Q3 2009* Q3 2008** CHANGE Sales $63.3 million $44.9 million +41.0% Gross Profit $26.1 million $20.6 million +27.1% Adjusted Net Income $19.7 million $15.7 million +25.5% GAAP Net Income $17.1 million $9.9 million +73.3% Adjusted EPS (Diluted) $0.78 $0.62 +25.8% GAAP EPS (Diluted) $0.68 $0.39 +74.4%
*Q3 2009 included a $2.6 million non-cash charge related to the changes in the value of warrants.
**Q3 2008 included $5.8 million in non-cash equity compensation charges not present in 2009.
Adjusted Net Income and EPS are non-GAAP and utilized to illustrate operating numbers.
First Nine Months of 2009 Results 2009 2008* CHANGE Sales $139.6 million $98.5 million +41.7% Gross Profit $56.3 million $43.6 million +29.1% Adjusted Net Income $43.8 million $31.9 million +37.2% GAAP Net Income $39.4 million $20.3 million +94.5% Adjusted EPS (Diluted) $1.74 $1.27 +37.0% GAAP EPS (Diluted) $1.57 $0.81 +93.8%
* The first nine months of 2009 included a $4.4 million non-cash charge related to changes in values of warrants.
**The first nine months of 2008 included $11.7 million in non-cash equity compensation expenses not present in 2009.
Adjusted Net Income and EPS are non-GAAP and utilized to show operating numbers.
2009 Third Quarter Financial Results
Net revenues for the third quarter ended September 30, 2009 increased 41.0% to $63.3 million as compared to $44.9 million for the third quarter in 2008. Revenue growth was driven by demand across its product lines, including a significant increase in both wastewater treatment and anti-oxidation systems and coatings sales. Specifically, the Company recorded $33.3 million in desulphurization revenues, a decrease of 11.8% from the third quarter of 2008, $15.1 million in wastewater treatment system sales, an increase of 241.9% from the third quarter of 2008, and $13.8 million in anti-oxidation equipment and coatings, an over 8-fold increase compared to the same year ago period. The Company recorded $1.1 million in machining service revenues.
Cost of sales for the third quarter of 2009 was $37.2 million as compared to $24.3 million in the same period of 2008, an increase of 52.9%. Gross profit was $26.1 million in the third quarter of 2009, a 27.1% increase from $20.6 million for the same period in 2008, representing gross margins of approximately 41.3% and 45.8%, respectively. The 4.5% variance in gross margins was mainly attributable to outsourcing, which has enabled the Company to continue growing its revenue base without significantly expanding its facility.
Total operating expenses for the third quarter of 2009 were $6.6 million, a 38.7% decrease from $10.7 million reported during the same period in 2008. The third quarter of 2008 included a non-cash stock compensation expense of $5.8 million related to a “Make Good Provision” relating to a private placement of the Company’s Common Stock in 2007. Eliminating this expense, operating expenses would have increased by 35.1%, which was primarily the result of $2.4 million in commission expenses for new contracts. Operating income for the third quarter of 2009 and 2008 was $19.6 million and $9.9 million, respectively, representing operating margins of 30.9% for the third quarter of 2009 compared to the third quarter 2008 operating margin of 22.0%, or 35.0% when adjusted to eliminate the non-cash expense.
GAAP net income for the third quarter was $17.1 million, representing an increase of 73.3% as compared to $9.9 million reported in the same period in the prior year. Earnings per diluted share were $0.68 for the third quarter in 2009 as compared to $0.39 for the third quarter in 2008, which was based on 25.2 million shares outstanding. The Company did not incur any taxes during either period.
During the third quarter of 2009 the Company incurred a non-cash charge of $2.6 million for the change in the value of warrants. Adjusting for non-cash charges in each respective period, net income for the third quarter of 2009 and 2008 was $19.7 million and $15.7 million, with $0.78 and $0.62 in earnings per diluted share.
“The third quarter continued our momentum as we executed on our growth plan while making further improvements in all of our key financial metrics,” stated Mr. Zou Dejun, President and CEO of RINO International. “This was the first quarter we saw meaningful uptake by customers for our anti-oxidation systems. During the quarter we performed work on a total of 12 FGD desulphurization systems, 5 wastewater treatment systems and installed 7 anti-oxidation systems for a total of 23 customers. We are excited about our DXT desulphurization system which we believe will enable us to cement our position as the leader in this particular FGD application, while providing a strong conduit for growth during the next few years as adoption accelerates. In addition, our backlog as of September 30, 2009 was approximately $52.7 million, which represents 6 desulphurization, 4 wastewater treatment and 6 anti-oxidation projects. We believe our collective growth initiatives will continue to provide incremental and robust top-line and bottom line growth and we currently expect to surpass our previous revenue estimate of $176.5 million for 2009”.
2009 Nine Month Financial Results
For the first nine months of 2009 revenues increased 41.7% to $139.6 million from $98.5 million in the year ago period. FGD sales increased 18.5% to $89.1 million and represented 63.8% of total sales. Wastewater treatment equipment increased 150.1% to $31.6 million and represented 22.6% of sales. Anti-oxidation equipment and coatings increased 308.9% to $17.4 million, representing 12.5% of total sales while machining services were $1.6 million.
Cost of sales increased 51.7% to $83.4 million yielding gross profit of $56.3 million, an increase of 29.1% from $43.6 million reported in 2008. Gross margins were 40.3% compared to 44.2% during the first nine months of 2009 and 2008, respectively.
Operating expenses decreased 39.1% to $14.1 million during the first nine months of 2009 from $23.1 million in 2008, which included an $11.7 million non-cash equity compensation charge. Income from operations increased 106.2% to $42.2 million from $20.5 million with operating margins of 30.2% compared to 20.8%, or 32.6% excluding the charge.
GAAP Net income for the first nine months of 2009 increased 94.5% to $39.4 million from $20.3 million with corresponding diluted earnings per share of $1.57 compared to $0.81 in 2008 based on 25.1 million and 25.2 million diluted shares in each respective period. The Company incurred no income taxes in either period. During the first nine months of 2009 the Company incurred a non-cash charge of $4.4 million for the change in the value of warrants, with no associated charge in 2008. Adjusting for non-cash charges during each respective period, net income was $43.8 million and $31.9 million, yielding $1.74 and $1.27 in earnings per diluted share.
“Our business continues to be driven by a number of factors centered around government mandates stipulating that iron and steel manufacturers be equipped with desulphurization systems. The Chinese Ministry of Industry and Information Technology showed its commitment to support this initiative by publishing a formal plan on July 31, 2009 which prioritizes steel FGD installations, sets specific desulphurization guidelines and targets, while offering priority funding by both the central and local governments and further support for domestic based technology. This is the single most important regulatory event since our Company was formed and clears a path toward doubling the number of sinters to be equipped with FGD systems annually through 2011. We expect that growth from our FGD system installations, in addition to the large Sludge Treatment System for the Dalian Government, will drive further growth during 2010.”
Balance Sheet and Cash Flow Discussion
Cash and cash equivalents as of September 30, 2009 were $29.0 million, representing an increase of 47.0% as compared to $19.7 million as of December 31, 2008. Working capital on September 30, 2009 was $115.4 million for the third quarter of 2009, an increase of 62.8% from $70.9 million on December 31, 2008. Accounts receivable stood at $44.6 million, a 13.5% decrease from $51.5 million reported as of December 31, 2008. The Company reported $8.8 million in short term loans payable, maintained a current ratio of 4.7 to 1 and saw stockholder’s equity increase 65.2% to $110.5 million as of September 30, 2009 as compared to $66.9 million as of December 31, 2008.
For the nine months ended September 30, 2009, the Company generated $9.5 million in cash flow from operations, as compared to $10.0 million cash used in operation for the first nine months in 2008. The variance between cash flow and net income was mainly related to $34.7 million in advances for inventory purchases as the company prepares for several large project installations and $13.2 million in costs and estimated earnings surpassing billings for projects still underway.
Conference Call
The Company will host a conference call on November 13, 2009, at 8:30 a.m. ET. To attend the call, please use the dial information below. When prompted, ask for the “RINO International Call” and/or be prepared to provide the conference ID.
Date: November 13, 2009 Time: 8:30am ET Conference Line Dial-In (U.S.): +1-877-941-8416 International Dial-In: +1-480-629-9808 Conference ID: 4182665 Webcast link: http://viavid.net/dce.aspx?sid=00006CFF
Please dial in at least 10 minutes before the call to ensure timely participation. A playback will be available through November 20, 2009. To listen, please call +1-800-406-7325 within the United States or +1-303-590-3030 when calling internationally. Utilize the pass code 4182665 for the replay.
About RINO International Corporation
RINO International Corporation, through its direct and indirect subsidiaries, including Innomind Group Limited and Dalian Innomind Environment Engineering Co., Ltd., its contractually-controlled affiliate, Dalian RINO Environmental Engineering Science and Technology Co., Ltd. (“Dalian Rino”) and Dalian Rino’s wholly-owned subsidiaries, Dalian Rino Environmental Engineering Project Design Co., Ltd. and Dalian Rino Environmental Construction & Installation Project Co., Ltd., is a leading provider of environmental protection equipment for the iron and steel industry in China. Specifically, RINO designs, manufactures, installs and services proprietary and patented wastewater treatment, flue gas desulphurization equipment, and high temperature anti-oxidation systems, which are all designed to reduce either industrial pollution and/or improve energy utilization. RINO’s manufacturing facility maintains the ISO 9001 Quality Management System and ISO 14001 Environment Management System certifications, in addition to receiving numerous government and industry awards.
Additional information about the Company is available at the Company’s website: http://www.rinogroup.com .
Cautionary Statement Regarding Forward-Looking Information
Certain statement in this press release may contain forward-looking information about the Company. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “should,” “project,” “plan,” “seek,” “intend,” or “anticipate” or the negative thereof or comparable terminology, and statements which may include discussions of strategy, and statements about industry trends future performance, operations and products of each of the entities referred to above. Actual performance results may vary significantly from expectations and projections as a result of various factors, including, without limitation, the risks set forth “Risk Factors” contained in the Company’s Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. In addition, this press release contains certain Non-GAAP financial results. Management believes, given the nature of certain non-cash charges, the adjusted net income and EPS enables investors to understand the correct operating metrics of its business. Management does not intend, nor suggest that investors utilize, non-GAAP financial results to make investment decisions.
For more information, please contact: For the Company: Jenny Liu Tel: +86-411-8766-2700 Email: jennyliu@rinogroup.com Investors: Matt Hayden HC International, Inc. Tel: +1-561-245-5155 Email: matt.hayden@hcinternational.net FINANCIAL STATEMENTS FOLLOW RINO INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2009 AND DECEMBER 31, 2008 ASSETS September 30, December 31, 2009 2008 (Unaudited) CURRENT ASSETS Cash and cash equivalents $29,020,242 $19,741,982 Restricted cash -- 1,030,317 Notes receivable 717,363 2,157,957 Accounts receivable, trade, net of allowance for doubtful accounts of $342,749 and $0 as of September 30, 2009 and December 31, 2008, respectively 44,559,387 51,503,245 Costs and estimated earnings in excess of billings on uncompleted contracts 13,202,094 -- Inventories 1,793,396 1,203,448 Advances for inventory purchases 56,754,792 21,981,669 Other current assets and prepaid expenses 678,271 517,847 Total current assets 146,725,545 98,136,465 PROPERTY, PLANT AND EQUIPMENT, NET 12,516,348 13,197,119 OTHER ASSETS Prepaid expenses (non-current) 64,576 73,350 Advances for equipment and construction material purchases 5,550,966 5,550,966 Prepayment for land use right 799,965 458,292 Intangible assets, net 1,161,499 1,211,608 Total other assets 7,577,006 7,294,216 Total assets $166,818,899 $118,627,800 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $5,471,857 $5,816,714 Short-term loan 8,802,000 8,802,000 Billings in excess of costs and estimated earnings on uncompleted contracts 1,484,554 -- Customer deposits 3,712,082 3,609,407 Liquidated damages payable 20,147 2,598,289 Other payables and accrued liabilities 427,043 746,267 Notes payable 73,790 -- Due to a stockholder 308,182 596,023 Tax Payable 11,013,805 5,062,901 Total current liabilities 31,313,460 27,231,601 Warrant Liabilities 512,498 -- REDEEMABLE COMMON STOCK ($0.0001 par value, 5,464,357 shares issued with conditions for redemption outside the control of the company) 24,480,319 24,480,319 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Preferred Stock ($0.0001 par value, 50,000,000 shares authorized, none issued and outstanding) -- -- Common Stock ($0.0001 par value, 10,000,000,000 shares authorized, 25,330,769 shares and 25,040,000 shares issued and outstanding as of September 30, 2009 and December 31, 2008) 2,533 2,504 Additional paid-in capital 30,492,770 25,924,007 Retained earnings 63,271,930 28,570,948 Statutory reserves 10,491,526 6,196,478 Accumulated other comprehensive income 6,253,863 6,221,943 Total shareholders' equity 110,512,622 66,915,880 Total liabilities and shareholders' equity $166,818,899 $118,627,800 RINO INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008 (UNAUDITED) Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 REVENUES: Contracts $62,194,946 $43,575,844 $138,030,264 $92,060,717 Services 1,107,257 1,305,292 1,602,308 6,482,958 63,302,203 44,881,136 139,632,572 98,543,675 COST OF SALES Contracts 36,452,495 23,298,573 81,701,500 51,144,465 Services 531,440 848,959 1,124,270 3,341,128 Depreciation 185,201 165,889 555,528 486,145 37,169,136 24,313,421 83,381,298 54,971,738 GROSS PROFIT 26,133,067 20,567,715 56,251,274 43,571,937 OPERATING EXPENSES Selling, general and administrative expenses 6,615,171 4,849,778 14,111,637 11,182,374 Research and development (61,564) -- (31,749) 267,817 Stock compensation expense-shares placed in escrow -- 5,832,960 -- 11,665,920 TOTAL OPERATING EXPENSES 6,553,607 10,682,738 14,079,888 23,116,111 INCOME FROM OPERATIONS 19,579,460 9,884,977 42,171,386 20,455,826 OTHER INCOME (EXPENSE), NET Other (expense) income, net (3,144) 44,947 (8,923) 50,651 Change in fair value of warrants (2,592,201) -- (4,402,335) -- Interest income (expense), net 101,785 (72,810) (90,148) (241,650) Gain on liquidated damage settlement -- -- 1,746,120 -- TOTAL OTHER EXPENSES, NET (2,493,560) (27,863) (2,755,286) (190,999) INCOME BEFORE PROVISION FOR INCOME TAXES 17,085,900 9,857,114 39,416,100 20,264,827 PROVISION FOR INCOME TAXES -- -- -- -- NET INCOME 17,085,900 9,857,114 39,416,100 20,264,827 OTHER COMPREHENSIVE INCOME: Foreign currency translation adjustment 169,559 335,796 31,920 4,051,389 COMPREHENSIVE INCOME $17,255,459 $10,192,910 $39,448,020 $24,316,216 WEIGHTED AVERAGE NUMBER OF SHARES: Basic 25,204,199 25,000,000 25,104,972 25,000,000 Diluted 25,220,159 25,153,941 25,112,087 25,152,127 EARNINGS PER SHARE: Basic $0.68 $0.39 $1.57 $0.81 Diluted $0.68 $0.39 $1.57 $0.81 RINO INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008 (UNAUDITED) 2009 2008 CASH FLOWS FROM OPERATING ACTIVITIES Net income $39,416,100 $20,264,827 Adjusted to reconcile net income to cash used in operating activities: Depreciation 717,490 603,965 Amortization 50,072 48,972 Allowance for bad debt 342,495 -- Imputed interest 13,558 21,974 Amortization of long term prepaid expense 10,994 25,090 Stock compensation expense 28,324 11,665,920 Gain (expense) on liquidated damage settlement (1,746,120) 1,116,708 Change in fair value of warrants 4,402,335 -- Changes in operating assets and liabilities Notes receivable 1,439,514 (4,804,195) Accounts receivable 6,596,159 (29,979,156) Costs and estimated earnings in excess of billings on uncompleted contracts (13,192,194) 2,413,818 Inventories (589,505) (63,928) Advances for inventory purchase (34,747,048) (10,826,678) Other current assets and prepaid expenses (160,940) 39,658 Accounts payable (344,598) (851,537) Billings in excess of costs and estimated earnings on uncompleted contracts 1,483,440 110,250 Customer deposits 102,598 3,816,435 Other payables and accrued liabilities (318,983) 1,169,036 Tax payable 5,946,440 (4,739,308) Net cash provided by (used in) operating activities 9,450,131 (9,968,149) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property and equipment (37,232) (902,594) Advances for construction material and equipment purchases -- (3,231,748) Prepayment for land use right (341,417) -- Net cash used in investing activities (378,649) (4,134,342) CASH FLOWS FROM FINANCING ACTIVITIES Payment on due to shareholder (1,058,480) (1,785,305) Proceeds from shareholder advances 770,889 2,334,594 Decrease (increase) of restricted cash 1,030,317 (24,951) Increase in notes payable 73,735 -- Proceeds from short-term loan 29,360,000 7,168,500 Bank loan repaid (29,315,000) -- Payment to liquidated damage penalty (615,018) -- Net cash provided by financing activities 246,443 7,692,838 EFFECT OF EXCHANGE RATE ON CASH (39,665) 385,533 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 9,278,260 (6,024,120) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 19,741,982 7,390,631 CASH AND CASH EQUIVALENTS AT END OF PERIOD $29,020,242 $1,366,511 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Cash paid during the period for: Interest $632,816 $352,529 Income taxes $229,880 $5,384,128 Shares issuance for liquidated damage penalty settlement $217,004 $--
SOURCE RINO International Corp.
rue21, Inc. (RUE) Chief Executive Officer To Ring The NASDAQ Stock Market Opening Bell
What: Robert Fisch, Chief Executive Officer of rue21, Inc. will preside over the NASDAQ Opening Bell to celebrate the company's initial public offering on the NASDAQ Stock Market. rue21, Inc. will trade under the ticker symbol "RUE." Where: NASDAQ MarketSite - 4 Times Square - 43rd & Broadway - Broadcast Studio When: Friday, November 13th, 2009 at 9:15 - 9:30 a.m. ET Contacts: Joseph Teklits ICR, Inc (203) 682-8258 Joseph.Teklits@icrinc.com NASDAQ MarketSite: Robert Madden (646) 441-5045 Robert.Madden@NASDAQOMX.com
Feed Information:
The Opening Bell is available from 9:20 a.m. to 9:35 a.m. on Galaxy 19 C/15, downlink frequency 4000 vertical. The feed can also be found on Ascent fiber 1623. If you have any questions, please contact Robert Madden at (646) 441-5045.
Radio Feed:
An audio transmission of the Opening Bell is also available from 9:20 a.m. to 9:35 a.m. on uplink IA6 C band / transponder 24, downlink frequency 4180 horizontal. The feed can be found on Ascent fiber 1623 as well.
Facebook and Twitter:
For multimedia features such as exclusive content, photo postings, status updates and video of bell ceremonies please visit our Facebook page at: http://www.facebook.com/pages/NASDAQ-OMX/108167527653
For news tweets, please visit our Twitter page at: http://twitter.com/nasdaqomx
Webcast:
A live webcast of the NASDAQ Opening Bell will be available at: http://www.nasdaq.com/reference/marketsite_about.stm.
Photos:
To obtain a hi-resolution photograph of the Market Open, please go to http://www.nasdaq.com/reference/marketsite_events.stm and click on the market open of your choice.
About rue21, Inc.:
rue21 (Nasdaq:RUE) is a fast-growing specialty retailer offering the newest fashion trends for girls and guys at value prices. The Company operates over 500 stores in 43 states, and merchandise is designed to appeal to 11-to-17 year olds who aspire to be “21” and adults who want to look and feel “21.” rue21 offers its own exclusive brands such as rue21 etc!, Carbon, tarea and rueKicks, to create merchandise excitement and differentiation in its stores. Through viral marketing and an interactive website, www.rue21.com, the Company is building a rueCommunity with a loyal customer base that will drive its growth into the future. The Company and customer culture being created invokes one simple thought in the minds of most. Do you rue? I do!
About NASDAQ OMX:
The NASDAQ OMX Group, Inc. is the world’s largest exchange company. It delivers trading, exchange technology and public company services across six continents, with over 3,700 listed companies. NASDAQ OMX offers multiple capital raising solutions to companies around the globe, including its U.S. listings market, NASDAQ OMX Nordic, NASDAQ OMX Baltic, NASDAQ OMX First North, and the U.S. 144A sector. The company offers trading across multiple asset classes including equities, derivatives, debt, commodities, structured products and exchange-traded funds. NASDAQ OMX technology supports the operations of over 70 exchanges, clearing organizations and central securities depositories in more than 50 countries. NASDAQ OMX Nordic and NASDAQ OMX Baltic are not legal entities but describe the common offering from NASDAQ OMX exchanges in Helsinki, Copenhagen, Stockholm, Iceland, Tallinn, Riga, and Vilnius. For more information about NASDAQ OMX, visit http://www.nasdaqomx.com.
Hong Kong Highpower Technology (HPJ) Reports Third Quarter 2009 Financial Results
NEW YORK, NY and SHENZHEN, CHINA — (Marketwire) — 11/12/09 — Hong Kong Highpower Technology, Inc. (NYSE Amex: HPJ), a leading developer, manufacturer and marketer of nickel-metal hydride (Ni-MH) and lithium-ion (Li-ion) rechargeable batteries and related products, today announced financial results for the third quarter ended September 30, 2009.
Business Highlights
-- Earned net income of $0.18 per diluted share for third quarter 2009,
an 800% increase year-over-year, and 157% increase sequentially;
-- Generated gross margins of 25% on net sales of $21.1 million for third
quarter 2009, an 8% points increase year-over-year, and 5% points
improvement sequentially;
-- Gross profit up 49% year-over-year and 70% sequentially;
-- Debt-to-capital ratio remained healthy consistent with prior quarter;
-- Inventory reduced 36% from the year-ago quarter greatly decreasing
inventory carry exposure.
“Our business trends in the third quarter clearly show that the ill effects of the global recession on our business are fading,” said George Pan, Chairman and Chief Executive Officer of Hong Kong Highpower Technology. “We produced a substantial increase in both our net sales and gross profit over the second quarter, which demonstrates that we are poised to capture even greater rechargeable battery market share as the economy continues to strengthen due to our ongoing customer relationships and strong financial position.
“Recently, we also announced a significant new contract with Siemens Gigaset Communications to supply rechargeable batteries for cordless phones sold in Europe under the Gigaset brand. This contract represents a significant new ODM relationship for the Company.
“The Company’s lithium-ion battery products division, which was launched in 2008, continues to grow. At the end of the third quarter, average monthly production reached over 800,000 pieces, which is still well ahead of our initial expectations.
“As we head into the fourth quarter, we believe 2009 will be a much stronger year for us in terms of profitability and overall financial performance,” said Mr. Pan. “Our net income through the first nine months is already double of where it stood for the comparable time frame in 2008. This strong financial performance is mainly the result of the fading effects of global economic recession on Hong Kong Highpower Technology’s business and better raw material cost management.”
Third Quarter 2009 Financial Results
Net sales for the third quarter ended September 30, 2009 increased 2.8% to $21.1 million, compared to $20.5 million for the third quarter ended September 30, 2008. On a sequential basis, third quarter net sales increased by 36.3% compared to $15.4 million for the second quarter of 2009. The year-over-year increase was largely due to an increase in the number of battery units sold and was partially offset by a decrease in the average selling price of our battery units.
Gross profit for the third quarter ended September 30, 2009 increased 48.7% to $5.2 million, compared to $3.5 million for the third quarter ended September 30, 2008. On a sequential basis, third quarter gross profit increased 69.9%, compared to $3.1 million for the second quarter 2009. Gross margin was 24.8% for the third quarter ended September 30, 2009, compared to 17% for the third quarter ended September 30, 2008, and 19.9% for the second quarter 2009. The increase in our gross profit is primarily due to a decrease in the average per unit cost of goods sold during the three months ended September 30, 2009 as compared to same period in 2008.
Selling and distribution costs were $767,200 or 3.6% for the third quarter ended September 30, 2009, compared to $800,000 or 3.9% for the comparable period in 2008 and $580,000 or 3.8% for the second quarter 2009.
General and administrative expenses, including stock-based compensation, were $1.5 million or 7% of net sales for the third quarter ended September 30, 2009, compared to $1.9 million, or 9.4% of net sales for the third quarter 2008, and $1.0 million or 6.8% of net sales for the second quarter 2009.
During the three months ended September 30, 2009, the exchange rate of the Renminbi (“RMB”) to the U.S. Dollar (“USD”) only decreased approximately 0.03% from the level at the end of June 30, 2009. There were no obvious effects that resulted from the foreign current exchange rate.
The Company recorded a provision for income taxes of $529,200 for the third quarter ended September 30, 2009, compared with provisions for income taxes of $35,700 for the third quarter 2008 and $229,000 for the second quarter 2009.
Net income for the third quarter of 2009 was $2.4 million, or $0.18 per diluted share, based on 13.6 million weighted average shares outstanding. This compares with third quarter 2008 net income of $289,400, or $0.02 per diluted share, based on 13.6 million weighted average shares outstanding, and second quarter 2009 net income of $969,000, or $0.07 per diluted share, based on 13.8 million weighted average shares outstanding.
Balance Sheet
At September 30, 2009, Hong Kong Highpower Technology had cash and cash equivalents and restricted cash totaling $11.7 million, total assets of $52 million, working capital of $6.5 million and stockholders’ equity of $20.5 million. Bank credit facilities totaled $23.2 million at September 30, 2009, of which $16.7 million was available as unused credit.
Conference Call and Webcast
Management of Hong Kong Highpower Technology will host a conference call today, Thursday, November 12, 2009 at 8:00 a.m. Pacific time/11:00 a.m. Eastern time to discuss third quarter 2009 financial results and answer questions.
Individuals interested in participating in the conference call may do so by dialing 800-891-5765 from the U.S., or 702-696-4830 from outside the U.S. Those interested in listening to the conference call live via the Internet may do so by visiting the Investor Relations section of the Company’s Web site at www.haopengbattery.com or www.InvestorCalendar.com.
A telephone replay will be available for 48 hours following the conclusion of the call by dialing 800-642-1687 from the U.S., or 706-645-9291 from outside the U.S., and entering reservation code 40001543. A webcast replay will be available for one year.
About Hong Kong Highpower Technology, Inc.
Hong Kong Highpower Technology develops, manufactures and markets rechargeable nickel metal hydride (Ni-MH) and lithium-ion (Li-ion) batteries and related products for use in a variety of electronic devices. The majority of Hong Kong Highpower Technology’s products are distributed worldwide to markets in the United States, Europe, China, Hong Kong, Southeast Asia and Taiwan. For more information, visit www.haopengbattery.com.
To be added to the Company’s email distribution for future news releases, please send your request to HPJ@finprofiles.com. Company news can also be found at http://ir.haopengbattery.com/en/introduce028.html.
Media and Investor Inquiries: Henry H. Ngan Chief Financial Officer +1-917-887-0614 ir@highpowerbatteries.net Financial Profiles, Inc. Tricia Ross (310) 277-4711 HPJ@finprofiles.com
Forward-Looking Statement
This press release contains “forward-looking statements” within the meaning of the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995 that are not historical facts. These statements can be identified by the use of forward-looking terminology such as “believe,” “expect,” “may,” “will,” “should,” “project,” “plan,” “seek,” “intend,” or “anticipate” or the negative thereof or comparable terminology, and include discussions of strategy, and statements about industry trends and the Company’s future performance, operations and products. Such statements involve known and unknown risks, uncertainties and other factors that could cause the Company’s actual results to differ materially from the results expressed or implied by such statements. For a discussion of these and other risks and uncertainties see “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s public filings with the SEC. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. The Company has no obligation to update the forward-looking information contained in this press release.
– financial tables to follow –
HONG KONG HIGHPOWER TECHNOLOGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Stated in US Dollars)
Three months ended Nine months ended
September 30, September 30,
------------------------ ------------------------
2009 2008 2009 2008
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
$ $ $ $
Net sales 21,056,149 20,473,472 47,811,438 57,326,510
Cost of sales (15,835,110) (16,961,664) (37,120,495) (47,731,537)
----------- ----------- ----------- -----------
Gross profit 5,221,039 3,511,808 10,690,943 9,594,973
Depreciation (50,120) (49,792) (169,309) (130,448)
Selling and
distribution costs (767,194) (799,666) (1,879,001) (1,761,386)
General and
administrative costs,
including stock-based
compensation (1,464,392) (1,915,367) (3,613,654) (4,256,468)
Loss on exchange rate
difference (6,813) (159,310) (62,402) (994,985)
----------- ----------- ----------- -----------
Income from operations 2,932,520 587,673 4,966,577 2,451,686
Change in fair value of
currency forwards (7,483) - (117,106) 29,102
Change in fair value of
warrants - (204,750) - (276,000)
Other income 289,843 101,179 378,432 325,833
Interest expenses (199,125) (159,063) (279,622) (559,830)
Other expenses (52,878) - (223,963) -
----------- ----------- ----------- -----------
Income before taxes 2,962,877 325,039 4,724,318 1,970,791
Income taxes (529,201) (35,683) (919,020) (266,861)
----------- ----------- ----------- -----------
Net income for the
period 2,433,676 289,356 3,805,298 1,703,930
Other comprehensive
income
- Foreign currency
translation gain (99,446) 109,161 392,618 857,900
----------- ----------- ----------- -----------
Comprehensive income 2,334,230 398,517 4,197,916 2,561,830
=========== =========== =========== ===========
Earnings per share of
common stock
- Basic 0.18 0.02 0.28 0.13
=========== =========== =========== ===========
- Diluted 0.18 0.02 0.28 0.13
=========== =========== =========== ===========
Weighted average number
of common stock
- Basic 13,562,597 13,562,596 13,621,466 13,088,737
=========== =========== =========== ===========
- Dilutive 13,612,097 13,615,096 13,673,966 13,108,644
=========== =========== =========== ===========
HONG KONG HIGHPOWER TECHNOLOGY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Stated in US Dollars)
As of
---------------------------
September 30, December 31,
2009 2008
(Unaudited) (Audited)
$ $
ASSETS
Current Assets:
Cash and cash equivalents 7,203,175 4,175,780
Restricted cash 4,552,798 4,845,478
Accounts receivable 11,260,286 8,765,593
Notes receivable 400,876 429,815
Prepaid expenses and other receivables 4,191,720 1,732,709
Deferred charges - Stock-based compensation - 216,667
Inventories 10,437,454 11,208,697
------------- -------------
Total Current Assets 38,046,309 31,374,739
Deferred tax assets 137,400 104,556
Plant and equipment, net 9,962,416 7,778,477
Leasehold land, net 3,002,530 3,050,510
Intangible asset, net 862,500 900,000
Currency forward - 116,157
------------- -------------
TOTAL ASSETS 52,011,155 43,324,439
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities:
Non-trading foreign currency derivatives
liabilities 5,335 293,830
Accounts payable 15,152,492 8,306,123
Other payables and accrued liabilities 9,067,162 3,139,275
Income taxes payable 812,688 476,330
Bank borrowings 6,495,909 14,829,228
------------- -------------
Total Current Liabilities 31,533,586 27,044,786
------------- -------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock
Par value: US$0.0001
Authorized: 10,000,000 shares
Issued and outstanding: none
Common stock
Par value : US$0.0001
Authorized: 100,000,000 shares
Issued and outstanding: 2009 - 13,562,597
shares (2008 - 13,562,596 shares) 1,356 1,356
Additional paid-in capital 5,048,194 5,048,194
Accumulated other comprehensive income 1,987,709 1,595,091
Retained earnings 13,440,310 9,635,012
------------- -------------
TOTAL STOCKHOLDERS' EQUITY 20,477,569 16,279,653
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 52,011,155 43,324,439
Tri-Tech Holding Inc. (TRIT) Q3 Revenue Up 131% to $4.9M; Net Income Up 112% to $1.1M
BEIJING, Nov. 12, 2009 (PRNewswire-Asia-FirstCall) — Tri-Tech Holding Inc. (Nasdaq: TRIT), a premier Chinese company that engineers, manages and monitors China’s municipal sewer systems, natural waterways and resources, announced today that revenue for the third quarter ended September 30, 2009 increased 131% to $4.9 million from $2.1 million in the third quarter of 2008. Diluted earnings per share for the quarter were $0.27 based on net income of $1.1 million. This compares with net income of $506,000 or $0.14 diluted EPS a year ago.
Third Quarter 2009 Highlights -- Revenue for Q3 2009 increased 131% to $4.9 million from $2.1 million in Q3 2008. -- Gross profit (exclusive of depreciation and amortization) increased 112% to $1.9 million for Q3 2009 from $0.9 million in Q3 2008. -- Q3 2009 gross margins decreased slightly at 39.1%, vs. 42.6% for Q3 2008. -- Income from operations increased 150% to $1.3 million from $536,000 in Q3 2008. -- Net income increased 112% to $1.1 million from $506,000 in Q3 2008. -- Diluted earnings per share increased to $0.27, from $0.14 in Q3 2008. -- Weighted average number of diluted shares outstanding was 3.95 million as of September 30, 2009, compared to 3.56 million as of September 30, 2008. -- Completed an initial public offering of 1,700,000 ordinary shares at a price of $6.75 per share, traded on NASDAQ Capital Market on September 10, 2009. -- Awarded $960,000 in Mountain Torrent Forecasting contracts covering eight projects in four provinces. -- Awarded $1.6 million Municipal Sewage Treatment contract in Kuancheng County of Hebei Province.
Third Quarter 2009 Financial Performance
Total revenue was $4.9 million in the quarter ended September 30, 2009, a 131% increase from $2.1 million in the quarter ended September 30, 2008. The increase was mostly because of increased sales of system integration services in the wastewater and tail gas treatment segment, which generated revenue of $3.8 million, or 77.4% of revenues in Q3 2009 compared to $1.2 million, or 58% of revenues in Q3 2008. Revenue from Tri-Tech’s other business segment — water resources management — was approximately $1.1 million in Q3 2009, accounting for 22.6% of total quarter revenues.
Net income in the quarter increased to $1.1 million or $0.27 per diluted share, compared to net income of $506,000 or $0.14 per diluted share in the quarter ended September 30, 2008.
Gross profit (exclusive of depreciation and amortization) was $1.9 million in the quarter, a 112% increase from $0.9 million a year ago. This strong increase was primarily due to an increase in the number and size of contractual engagements as a result of the growth of its client base and improvement of its project execution capabilities.
Gross margin (exclusive of depreciation and amortization) was 39.1% compared to 42.6% in the quarter ended September 30, 2008. This decrease was due to relatively higher costs of the hardware products compared to system integration and software products. Gross margins in the wastewater and tail gas business and water resources management segments were 39.2% and 38.7% respectively.
Operating income was $1.3 million, a 150% increase from $536,000 in the quarter ended September 30, 2008. Operating margin was 27.3%, compared to 25.2% in the three months ended September 30 2008.
As a certified software hi-tech enterprise, Tri-tech received a partial tax rebate of $26,275 from the Chinese government for value added tax (VAT) paid on sold software. This partial rebate was classified as other income.
Liquidity and Capital Resources
The cash balance following the IPO was approximately $10.3 million. As of September 30, 2009, the Company had long-term debt of $69,000 and short-term debt of $695,000. The Company had working capital of $17.4 million. Stockholders’ equity totaled $18.3 million compared to $5.8 million as of September 30, 2008. Net cash provided in financing activities totaled $10.5 million.
Initial Public Offering
On September 10, 2009, Tri-Tech completed an initial public offering of 1,700,000 ordinary shares at a price of $6.75 per share. Net proceeds from the initial public offering, after deducting underwriting discounts, commissions and offering expenses, totaled $10 million.
Nine months 2009 Financial Performance
For the first nine months of 2009, revenue was $10.9 million, an increase of 96.5% over $5.6 million for the comparable period last year. Net income for the first nine months was up 97.3% at $2.5 million compared to $1.3 million for the first nine months of 2008. Diluted EPS was $0.68 compared to $0.36 for the first nine months of 2008.
Warren Zhao, Tri-Tech’s Chief Executive Officer, said, “We are pleased with our Q3 2009 financial results and our first financial report as a public company. We believe our over triple digit growth in Q3 revenue and our operational performance demonstrated the strength of our business model and our competitive position in enhancing water quality and people’s health in China. Several factors contributed to our strong performance including our patented technology, the increasing efforts of our sales force and growth of our customer base. We feel confident that our water resources management business and wastewater and tail gas treatment businesses will continue their robust growth through the remainder of 2009.
“Our business in water resources, flood control and mitigation, water quality monitoring and assessment, municipal water and wastewater management, water reuse, and odor control are poised to benefit from China’s massive ongoing investments in infrastructure. Government investment in the water resources sector last year was up over 54% and is expected to increase $11.7 billion in 2009 and $45 billion over the next three years.
“We are excited to move forward into the last quarter of 2009 and the year 2010 in a strong and flexible financial position. We expect to take advantage of long-term opportunities driven by the urgent need for water treatment projects for commercial, industrial and residential uses and the solid support from the government for water resources projects. We intend to use the proceeds from the IPO to reinforce our competitive position. We plan to undertake new projects in municipal projects, and to focus our research and development on improved water treatment systems to maximize water disposal capacity and disposal rates at a lower cost.
“We are currently pursuing over 100 smaller river basin flood monitoring and forecasting systems and groundwater monitoring systems for over 100 counties across the country with a market potential of approximately $145 million. Through local distributors and partnerships, we also expect to promote our proprietary products targeting the water monitoring and dispatching systems of the Northward Rerouting of Southern River engineering project with a market potential of approximately $43.5 million.
“We expect an increase in sales associated with the South-North Water Transfer Project with dozens of major urban water supply tasks and six nation-wide projects of flood forecasting and hydrological monitoring proposed by the Ministry of Water Resources.
“Based on multiple contracts for sewage treatment plants won in Hebei Province recently, we will continue to target our wastewater treatment business in the Tianjin area and Hebei Province. Within the next few years, Tianjin Binhai New Area plans to construct over 40 large-scale pumping stations and over 30 sewage treatment plants with a total market potential of approximately $8.7 billion. Hebei Province plans to construct over 50 sewage and grey water reuse treatment plants in the next two years with total spending of approximately US$ 1.23 billion.
“We will also actively pursue opportunities in the industrial wastewater and process tail gas treatment market in the petrochemical industry, such as the SINOPEC Yanshan Plant, the Petro China Jilin Plant, the SINOPEC Anqing Plant, and Dalian Petro China Plant. Currently almost all newly designed sewage treatment plants have odorous gases containment and control requirements. As such, we expect an increase in sales of our proprietary biofiltration odor control systems,” Zhao said.
Conference Call
Tri-Tech CEO Warren Zhao, President Phil Fan and CFO Peter Dong will host a conference call at 10:00 AM Eastern Time tomorrow November 13, 2009 (11:00 PM Beijing/Hong Kong Time on November 13) to review the company’s financial results and respond to questions and comments.
To participate, call U.S. Toll Free Number 1-877-941-4775 approximately 10 minutes before the call. International callers, please dial 1-480-629-9761. The conference ID number is 4182163. A live webcast of the call will be available at http://viavid.net/dce.aspx?sid=00006CEE . An MP3 file will be available approximately one hour after the call and a transcript within 48 hours after the call. These will be archived for 90 days via http://www.tri-tech.cn and http://www.hawkassociates.com .
--FINANCIAL TABLES-- TRI-TECH HOLDING INC. CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME (Unaudited) For the Nine Months Quarter Ended ended September 30, September 30, 2009 2008 2009 2008 USD USD USD USD Revenues: System integration 7,523,762 4,708,939 4,145,404 1,753,264 Hardware products: 1,878,048 64,489 483,907 29,112 Software products revenues: 1,503,359 777,938 281,522 340,122 Total revenues 10,905,169 5,551,366 4,910,833 2,122,498 Cost of revenues: (exclusive of depreciation and amortization shown separately below) System integration 4,907,767 3,161,601 2,552,799 1,202,537 Hardware products 1,586,613 35,492 437,290 15,020 Cost of software 42,064 3,935 -- 189 Total cost of revenues(exclusive of depreciation and amortization shown separately below) 6,536,444 3,201,028 2,990,089 1,217,746 Operating expenses: Depreciation and amortization expenses 75,449 59,722 30,049 20,705 Other operating expenses 1,370,115 1,015,065 550,498 348,233 Total operating expenses 1,445,564 1,074,787 580,547 368,938 Income from operations 2,923,162 1,275,551 1,340,198 535,813 Other income (expenses): Other expense (4,694) (1,291) (3,542) 223 Interest income 25,126 16,544 24,291 865 Interest expense (4,173) (2,389) (514) (1,462) Tax rebates 49,042 65,243 26,275 356 Total other income (expenses), net 65,301 78,108 46,511 (19) Income before provision for income taxes and noncontrolling interests income 2,988,463 1,353,659 1,386,709 535,795 Provision for income taxes 450,466 60,476 314,371 20,276 Net income 2,537,997 1,293,183 1,072,338 515,519 Noncontrolling Interests Income 12,452 13,525 (1,273) 9,078 Net income attributable to Tri-Tech Holding Inc 2,525,545 1,279,658 1,073,611 506,441 Other comprehensive income Foreign currency Translation adjustment 67,115 306,542 50,372 83,417 Comprehensive income 2,605,112 1,599,725 1,122,710 598,936 Comprehensive income attributable to noncontrolling interests 13,158 24,206 (508) 11,580 Comprehensive income attributable to Tri-Tech Holding Inc. 2,591,954 1,575,519 1,123,218 587,356 Net income attributable to Tri-Tech Holding Inc. per share: Basic 0.69 0.36 0.27 0.14 Diluted 0.68 0.36 0.27 0.14 Shares used in computation: Basic 3,679,542 3,555,000 3,924,565 3,555,000 Diluted 3,689,604 3,555,000 3,954,422 3,555,000 TRI-TECH HOLDING INC. CONSOLIDATED BALANCE SHEETS September 30, December 31, 2009 2008 (Unaudited) (Restated) ASSETS Current Assets Cash $10,306,076 $732,418 Accounts receivable, net of allowance for doubtful accounts of $51,285 and $62,286 as of September 30, 2009 and December 31, 2008, respectively 4,125,163 3,105,859 Unbilled revenue 4,213,095 1,429,846 Notes receivable 594,523 7,316 Other receivables 327,531 166,395 Inventories 1,651,819 1,466,468 Deposits on projects 580,161 266,973 Deferred income taxes -- -- Prepayments to suppliers and subcontractors 364,501 567,346 Total current assets 22,162,869 7,742,621 Plant and equipment, net 325,148 174,128 Proprietary technology, net 820,186 857,475 Total assets $23,308,203 $8,774,224 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable and cost accrual on projects $2,844,743 $1,589,103 Commercial paper and other short-term notes payable Non-related parties 695,370 271,041 Related party -- 14,631 Customer deposits 350,017 436,372 Billings in excess of revenue 108,275 30,639 Other payables 45,946 81,721 Accrued liabilities 52,978 84,660 Deferred income taxes 327,257 83,643 Income taxes payable 181,249 141,818 Other taxes payable 138,145 90,908 Total current liabilities 4,743,980 2,824,536 Long-term liabilities 69,069 -- Total liabilities 4,813,049 2,824,536 Shareholders' equity Tri-Tech Holding Inc. shareholders' equity Common stock (30,000,000 shares authorized and $0.001 par value, 5,255,000 and 3,555000 issued as of September 30, 2009 and December 31, 2008, 340,000 shares issued were held in escrow. See note 11 for more discussions.) 5,255 3,555 Additional paid-in-capital 12,852,713 2,914,058 Statutory reserves 50,655 50,655 Retained earnings 5,008,118 2,482,573 Accumulated other comprehensive income 427,737 361,328 Total Tri-Tech Holding Inc. shareholders' equity 18,344,478 5,812,169 Noncontrolling Interests 150,676 137,519 Total shareholders' equity 18,495,154 5,949,688 Total liabilities and shareholders' equity $23,308,203 $8,774,224 TRI-TECH HOLDING INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) For the Nine Months ended September 30, 2009 2008 USD USD Cash flows from operating activities: Net income 2,537,997 1,293,183 Adjustments to reconcile net income to cash: Depreciation 37,826 27,445 Amortization 38,116 72,011 Allowance for doubtful accounts (11,047) 26,921 Deferred income taxes 251,765 11,408 Changes in operating assets and liabilities: Accounts receivable (1,005,397) (1,308,486) Unbilled revenue (2,780,854) 329,785 Other receivables (494,253) (178,636) Inventories (184,068) 83,927 Prepayments and deferred expenses 99,301 (149,336) Accounts payable 1,190,555 99,485 Customer deposits (80,481) 328,867 Billings in excess of revenue 93,774 -- Other payables (35,826) 72,891 Accrued liabilities (31,738) 56,225 Taxes payable 86,438 (36,158) Net cash provided by operating (287,892) 729,533 activities Cash flows from investing activities: Loan to the other parties (586,944) -- Additions to equipment (188,778) 26,103 Net cash provided by investing activities (775,722) 26,103 Cash flows from financing activities: Common stock 10,038,847 -- Borrow money from third parties 522,234 459,322 Repayments to third parties of advances (43,911) (76,372) Repayment from a related party of an advance -- -- Net cash provided by (used in) financing activities 10,517,170 382,950 Effect of exchange rate changes on cash and cash equivalents 120,102 101,827 Net increase in cash 9,573,658 1,240,413 Cash, beginning of year 732,418 367,713 Cash, end of period 10,306,076 1,608,126 Supplemental Data: Income taxes paid 17,496 -- Interest paid on debt 4,173 2,388
About Tri-Tech Holding Inc.
Tri-Tech designs customized sewage treatment and odor control systems for China’s municipalities and its larger cities. These systems combine software, information management systems, resource planning and local and distant networking hardware that includes sensors, control systems, programmable logic controllers, supervisory control and data acquisition systems. The company also designs systems that track natural waterway levels for drought control, monitor groundwater quality and assist the government in managing its water resources. Tri-Tech owns seven software copyrights and two technological patents and employs 108 people. Please visit http://www.Tri-Tech.cn for more information.
An online investor kit including a company profile, press releases, current price quotes, stock charts and other valuable information for investors is available at http://www.hawkassociates.com/profile/trit.cfm . To subscribe to future releases via e-mail alert, visit http://www.hawkassociates.com/about/alert/ .
Tri-Tech Holding Inc. has based these forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the company with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.
Cyanotech Corp. (CYAN) Reports Financial Results for the Second Quarter of Fiscal 2010
Nov. 12, 2009 (Business Wire) — Cyanotech Corporation (Nasdaq Capital Market: CYAN), a world leader in microalgae-based, high-value nutrition and health products, today announced financial results for the second quarter and first six months of fiscal 2010, ended September 30, 2009.
Second Quarter Fiscal 2010
Revenues for the second quarter of fiscal 2010 increased 20% to $3,925,000, compared to revenues of $3,274,000 for the second quarter of fiscal 2009. Gross profit was $1,762,000, with gross profit margin of 45%, in the current quarter compared to a gross profit of $1,378,000 and gross profit margin of 42% reported for the same quarter in 2009. Net income increased 267% to $599,000, or $0.11 per diluted share, compared to $163,000, or $0.03 per diluted share for the second quarter of fiscal 2009.
Cash and cash equivalents were $1,100,000 at September 30, 2009 compared to the March 31, 2009 balance of $977,000. Working capital increased to $4,648,000 at September 30, 2009 compared to $3,892,000 at March 31, 2009.
“These results affirm the company’s strategy of focusing on and building sound business fundamentals throughout the organization,” said Andrew H. Jacobson, President and CEO. “Improved production levels increased inventory, allowing better customer service. Continued cost containment delivered margin growth. Sustained high quality continued our nutritional leadership and our dedicated employees made it all possible.”
Sales of both of Cyanotech’s core products, Spirulina Pacifica® and BioAstin® Natural Astaxanthin, grew during the second quarter. The Company again delivered margin growth, resulting in higher income from the increased sales.
“We are looking forward to the complete roll out of our new Nutrex branding in the second half of 2010 and the introduction of a number of innovative products featuring Hawaiian Spirulina Pacifica® and BioAstin® Natural Astaxanthin,” concluded Mr. Jacobson.
First Six Months Fiscal 2010
Revenues for the first six months of fiscal 2010 increased 14% to $7,946,000, compared to revenues of $6,975,000 for the first six months of fiscal 2009. Gross profit was $3,495,000, with gross profit margin of 44%, compared to a gross profit of $2,682,000 and gross profit margin of 38% reported for the same period in 2009. Net income increased 133% to $1,012,000, or $0.19 per diluted share, compared to $434,000, or $0.08 per diluted share for the first six months of fiscal 2009.
About Cyanotech — Cyanotech Corporation, a world leader in microalgae technology, produces BioAstin® Natural Astaxanthin and Hawaiian Spirulina Pacifica® — all natural, functional nutrients that leverage our experience and reputation for quality, building nutritional brands which promote health and well-being. Cyanotech’s Spirulina products offer complete nutrition, and augment energy and immune response. They are FDA reviewed and accepted as Generally Recognized as Safe (GRAS) for use in food products. BioAstin’s superior antioxidant activity and ability to support and maintain a natural anti-inflammatory response enhance skin, muscle and joint health. All Cyanotech products are produced from microalgae grown at its 90-acre facility in Kona, Hawaii using patented and proprietary technology. Cyanotech distributes to nutritional supplement, nutraceutical and cosmeceutical manufacturers and marketers in more than 40 countries worldwide. Cyanotech was the first microalgae company in the world to obtain quality management standards ISO 9001:2000 certification and is GMP-certified by the Natural Products AssociationTM. Visit www.cyanotech.com for more information.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995
Except for statements of historical fact, the statements in this press release are forward-looking. Such statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include, but are not limited to, general economic conditions, forecasts of sales in future periods, changes in sales levels to our largest customers, weather patterns, production problems caused by contamination, risks associated with the acceptance of new products, competition, foreign exchange fluctuations, government regulation, and other factors more fully detailed in the Company’s recent Form 10-Q and annual Form 10-K filings with the Securities and Exchange Commission.
(Financial Tables Follow: The following tables do not contain footnotes or other information contained in the Company’s Form 10-Q for the period ended September 30, 2010. As such the following Financial Tables are provided only as a guide and other factors are more fully detailed in the Company’s Form 10-Q and annual Form 10-K filings with the Securities and Exchange Commission.)
| CYANOTECH CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS (Dollars in thousands except par value and number of shares) (Unaudited) |
||||||||
| September 30, | March 31, | |||||||
| 2009 | 2009 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 1,100 | $ | 977 | ||||
| Accounts receivable, net of allowance for doubtful accounts of $11 at September 30, 2009 and $14 at March 31, 2009 | 1,830 | 1,785 | ||||||
| Inventories | 3,521 | 3,124 | ||||||
| Prepaid expenses and other | 194 | 110 | ||||||
| Total current assets | 6,645 | 5,996 | ||||||
| Equipment and leasehold improvements, net | 4,583 | 4,316 | ||||||
| Other assets | 456 | 475 | ||||||
| Total assets | $ | 11,684 | $ | 10,787 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Current maturities of long-term debt | $ | 471 | $ | 620 | ||||
| Accounts payable | 773 | 1,040 | ||||||
| Accrued expenses | 753 | 444 | ||||||
| Total current liabilities | 1,997 | 2,104 | ||||||
| Long-term debt, less current maturities | 752 | 909 | ||||||
| Total liabilities | 2,749 | 3,013 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Common stock of $0.02 par value, shares authorized 7,500,000; 5,249,270 shares issued and outstanding at September 30, 2009 and 5,245,770 at March 31, 2009 | 105 | 105 | ||||||
| Additional paid-in capital | 27,737 | 27,590 | ||||||
| Accumulated deficit | (18,907 | ) | (19,921 | ) | ||||
| Total stockholders’ equity | 8,935 | 7,774 | ||||||
| Total liabilities and stockholders’ equity | $ | 11,684 | $ | 10,787 | ||||
| CYANOTECH CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (Dollars in thousands, except per share amounts) (Unaudited) |
||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
| NET SALES | $ | 3,925 | $ | 3,274 | $ | 7,946 | $ | 6,975 | ||||||||
| COST OF PRODUCT SALES | 2,163 | 1,896 | 4,451 | 4,293 | ||||||||||||
| Gross profit | 1,762 | 1,378 | 3,495 | 2,682 | ||||||||||||
| OPERATING EXPENSES: | ||||||||||||||||
| General and administrative | 778 | 864 | 1,674 | 1,573 | ||||||||||||
| Sales and marketing | 303 | 255 | 624 | 522 | ||||||||||||
| Research and development | 42 | 54 | 123 | 90 | ||||||||||||
| Total operating expenses | 1,123 | 1,173 | 2,421 | 2,185 | ||||||||||||
| Income from operations | 639 | 205 | 1,074 | 497 | ||||||||||||
| OTHER INCOME (EXPENSE): | ||||||||||||||||
| Interest expense, net | (28 | ) | (42 | ) | (57 | ) | (84 | ) | ||||||||
| Other income, net | — | — | 17 | 10 | ||||||||||||
| Total other expense, net | (28 | ) | (42 | ) | (40 | ) | (74 | ) | ||||||||
| Income before provision (benefit) for income taxes | 611 | 163 | 1,034 | 423 | ||||||||||||
| PROVISION (BENEFIT) FOR INCOME TAXES | 12 | — | 22 | (11 | ) | |||||||||||
| NET INCOME | $ | 599 | $ | 163 | $ | 1,012 | $ | 434 | ||||||||
| NET INCOME PER SHARE: | ||||||||||||||||
| Basic | $ | .11 | $ | .03 | $ | .19 | $ | .08 | ||||||||
| Diluted | $ | .11 | $ | .03 | $ | .19 | $ | .08 | ||||||||
| SHARES USED IN CALCULATION OF NET INCOME PER SHARE: | ||||||||||||||||
| Basic | 5,247 | 5,242 | 5,246 | 5,242 | ||||||||||||
| Diluted | 5,308 | 5,242 | 5,300 | 5,242 | ||||||||||||
Kandi Technologies, Corp. (KNDI) Announces First Electric Car Sales in China
JINHUA, CHINA — (Marketwire) — 11/12/09 — Kandi Technologies, Corp. (NASDAQ: KNDI), an established China-based leader in the design and manufacture of all terrain recreational vehicles and developer of the Kandi “COCO,” a battery powered two-seater low-speed vehicle for casual driving, announced today that pursuant to the previously announced letter of intent it signed in July with China Post in Jinhua City, it has completed the sale of 30 modified, electric COCO hardtops to the Postal Service there. These are the Company’s first sales of its all-electric COCO super mini car in China.
A Milestone Event
“This is a milestone event for Kandi,” stated Mr. Xiaoming Hu, Kandi’s Chairman and CEO, “representing the start of what we see could be a significant ramping up of COCO electric car sales in China to the Postal Service nationwide. They as well as other public services such as sanitation and taxis are being strongly encouraged by government programs to update their fleets to reduce oil and gas consumption and help clean up the environment.”
Template For Future Electric China Postal Services Sales
The Company said the COCOs sold to Jinhua City China Post, with a selling price of 51,800 RMB (US$7,587.63) per vehicle, were modified to meet the particular needs and specifications of the Postal Service. Specifically, the Company pointed to changes in the interior of the vehicle such as a larger trunk and elimination of the passenger seat to permit increased storage space. Otherwise, the vehicle is a “standard” all-electric COCO hardtop, running on two twelve volt batteries that are fully rechargeable in six hours and permit the super mini to travel distances up to 80 miles at speeds up to 25 miles per hour.
Significant Market Opportunity For Kandi
The Company said it believes that with these modifications the electric COCO will meet and exceed the needs of the China Postal Services throughout the country which it estimates currently at more than 300,000 outdated gas powered small trucks and bicycles that will be eligible for replacement under direct purchase grants being developed by the government to encourage the use of “new energy” vehicles.
“We are actively pursuing Postal Service sales with a particular focus initially in our home province of Zhejiang and neighboring cities where we believe we have a leg up on potential competition,” Mr. Hu said, adding, “in any case, the very substantial national public service opportunity provides lots of room for growth for Kandi as well as other potential manufacturers of electric or other alternative fuel cars.”
About the Company
In 2008, Kandi Technologies, Corp. (NASDAQ: KNDI) generated nearly $41 million in sales and profits of about $5 million, principally from its core All Terrain Recreational Vehicle (ATRV) businesses. The Company ranks as one of the largest manufacturers and exporters of go-karts in China, making it a world leader in the production of this popular recreational vehicle. It also ranks among the leading manufacturers in China of all terrain vehicles (ATVs), and specialized utility vehicles (UTVs), especially for agricultural purposes. Recently, it introduced a second generation high mileage, two seater three-wheeled motorcycle. A major company focus also has been on the manufacture and sales of a highly economical, beautifully designed, all-electric super mini car — the COCO — for neighborhood driving and commuting. Kandi believes that battery powered, electric super minis will become the Company’s largest revenue and profit generator. While nearly all Kandi products have been exported, including more than 65% to the U.S., the Company is intensifying efforts to shift 50% of its sales to China where markets have continued to be strong.
The Company’s products can be viewed at http://www.kandivehicle.com. Its corporate/ir website is http://www.chinakandi.com.
Information Regarding Forward-Looking Statements
Except for historical information contained herein, the statements in this Press Release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, product demand, market competition, and risks inherent in our operations. These and other risks are described in our filings with the Securities and Exchange Commission.
SMART Modular Technologies (SMOD) Raises First Quarter Fiscal Year 2010 Guidance
NEWARK, CA — (Marketwire) — 11/11/09 — SMART Modular Technologies (WWH), Inc. (“SMART” or the “Company”) (NASDAQ: SMOD), a leading independent manufacturer of memory modules, solid state storage products including SSDs, embedded computing subsystems, and display products, today announced that it is raising its guidance for the first quarter of fiscal 2010 based on the Company’s preliminary review of its anticipated financial performance.
The Company expects to report GAAP diluted net income per share in the range of $0.04 to $0.06 for the first quarter of fiscal 2010, substantially exceeding its previous guidance of ($0.01) to $0.01 per share announced on October 1, 2009. Non-GAAP diluted net income per share is expected to be in the range of $0.06 to $0.08, a substantial increase to the previous guidance provided by the Company of $0.02 to $0.04.
The Company expects to report net sales in the range of $110 to $120 million, more than 10% higher than the previous guidance of $98 to $105 million. Gross profit is expected to be in the range of $24 to $26 million, approximately 20% higher than the previous guidance of $20 to $22 million.
The improved guidance is primarily driven by growth in end user demand, particularly in the PC and enterprise markets.
Please refer to the Non-GAAP Information section and the “Reconciliation of Q1 FY2010 Guidance for Non-GAAP Financial Measures” table below for further detail.
No conference call will be held in conjunction with this revised guidance. Additional information for the first quarter of fiscal 2010 will be available when SMART reports its quarterly financial results in December.
Forward-Looking Statements
Statements contained in this press release that are not statements of historical fact, including any statements that use the words “will,” “believes,” “anticipates,” “estimates,” “expects,” “projects,” “intends” or similar words that describe the Company’s or its management’s future expectations, plans, objectives, or goals, are “forward-looking statements” and are made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. From time to time, we also may provide oral or written forward-looking statements in other materials we release to the public. These forward-looking statements include projections and expectations regarding the Company’s revenues and financial performance, benefits associated with operational efficiencies, the DRAM market, new product introductions, and customer demand for products.
Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to be materially different from the historical results and/or from any future results or outcomes expressed or implied by such forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, the post-closing integration of the businesses and product lines of SMART and Adtron, production or manufacturing difficulties, competitive factors, new products and technological changes, difficulties with or delays in the introduction of new products, fluctuations in product prices and raw material costs and availability, dependence upon third-party vendors, customer demand (particularly from key customers), changes in industry standards or release plans, fluctuations in the quarterly effective tax rate, possible increases in previously estimated restructuring charges, lower than anticipated savings from restructuring, possible future restructuring plans, higher anticipated costs from increasing capacity, changes in foreign currency exchange rates and other risks detailed in the Company’s periodic report filings with the Securities and Exchange Commission including the Company’s recently filed Annual Report on Form 10-K for the fiscal year ended August 28, 2009. Such risk factors as outlined in these reports may not constitute all factors that could cause actual results to differ materially from those discussed in any forward-looking statement. The Company operates in a continually changing business environment and new factors emerge from time to time. The Company cannot predict such factors, nor can it assess the impact, if any, from such factors on the Company or its results. Accordingly, forward-looking statements should not be relied upon as a prediction of actual results. Investors are cautioned not to place undue reliance on any forward-looking statements. The Company is not obligated to revise or update any forward-looking statements in order to reflect events or circumstances that may arise or be discovered after the date of this press release.
About SMART
SMART is a leading independent designer, manufacturer and supplier of electronic subsystems to original equipment manufacturers, or OEMs. SMART offers more than 500 standard and custom products to OEMs engaged in the computer, industrial, networking, gaming, telecommunications and embedded application markets. Taking innovations from the design stage through manufacturing and delivery, SMART has developed a comprehensive memory product line that includes DRAM, SRAM, and Flash memory in various form factors. SMART also offers high performance, high capacity SSDs for enterprise, defense/aerospace, industrial automation, medical, and transportation markets. SMART’s Display Products Group designs, manufactures, and sells thin film transistors (TFT) liquid crystal display (LCD) solutions to customers developing casino gaming systems as well as embedded applications such as kiosk, ATM, point-of-service, and industrial control systems. SMART’s presence in the U.S., Europe, Asia, and Latin America enables it to provide its customers with proven expertise in international logistics, asset management, and supply-chain management worldwide. See www.smartm.com for more information.
Non-GAAP Information
Certain non-GAAP financial measures are included in this press release, including non-GAAP net income and non-GAAP net income per diluted share. Non-GAAP financial results do not include stock-based compensation expense and other infrequent or unusual items. These non-GAAP financial measures are provided to enhance the user’s overall understanding of our financial performance. By excluding these charges, as well as the related tax effects, our non-GAAP results provide information to management and investors that is useful in assessing SMART’s core operating performance and in evaluating and comparing our results of operations on a consistent basis from period to period. These non-GAAP financial measures are also used by management to evaluate financial results and to plan and forecast future periods. The presentation of this additional information is not meant to be a substitute for the corresponding financial measures prepared in accordance with generally accepted accounting principles. In addition, these measures may not be used similarly by other companies and therefore may not be comparable between companies. Investors are encouraged to review the reconciliations of GAAP to non-GAAP financial measures, which are included below.
Reconciliation of Q1 FY2010 Guidance for Non-GAAP Financial Measures
(In millions, except per share data; unaudited)
Three Months Ending November 27, 2009
-----------------------------------------------
Non-GAAP Range GAAP Range of
of Estimates Estimates
-------------- --------------
From To Adjustments From To
------ ------ ----------- ------ ------
Net income $ 3.6 $ 4.9 $ 0.9 (a) $ 2.7 $ 4.0
====== ====== ====== ======
Net income per diluted
share $ 0.06 $ 0.08 $ 0.04 $ 0.06
====== ====== ====== ======
Shares used in computing
net income per diluted
share 64.0 64.0 64.0 64.0
====== ====== ====== ======
(a) Reflects an estimated $1.7 million adjustment for stock-based
compensation expense, offset by a $0.8 million net gain on the
repurchase and retirement of a portion of long-term debt.
Emerson Radio Corp. (MSN) Reports Fiscal 2010 Second Quarter Results
PARSIPPANY, NJ — (Marketwire) — 11/11/09 — Emerson Radio Corp. (NYSE Amex: MSN) today reported financial results for its second quarter and six months ended September 30, 2009.
While net revenues for the second quarter of fiscal 2010 decreased $1.7 million, or 3.3%, to $51.8 million as compared to net revenues in the second quarter of fiscal 2009 of $53.5 million, net revenues for the fiscal year 2010 to date were $107.4 million, an increase of $10.0 million, or 10.3%, compared to net revenues of $97.4 million in the same period of fiscal 2009. The increase in net revenues for year to date fiscal 2010 was due to higher sales in the home appliances category, partially offset by lower sales in the Company’s audio and themed categories, and lower revenue earned from licensing activities.
Operating income for the second quarter of fiscal 2010 was $3.4 million compared to $0.2 million for the second quarter of fiscal 2009, an increase of $3.2 million. Operating income for the fiscal year 2010 to date was $4.8 million, an increase of $4.2 million over operating income of $0.6 million for the same period of fiscal 2009. The increase in fiscal year to date operating income is driven by the Company’s efforts to manage costs while growing net revenue, as reflected in a nearly 20% reduction in year-over-year SG&A expenses, coupled with a 10.3% increase in year-over-year net revenue.
Net income from continuing operations for the second quarter of fiscal 2010 was $3.2 million or $0.12 per diluted share compared to $0.2 million for the second quarter of fiscal 2009 or $0.01 per diluted share. Net income from continuing operations for fiscal year 2010 to date was $4.4 million or $0.16 per diluted share compared to a net loss from continuing operations of $61,000 for the same period in fiscal 2009.
After considering the impact of discontinued operations, net income for the second quarter of fiscal 2010 was $3.2 million, or $0.12 per diluted share, compared to net income of $26,000 for the second quarter of fiscal 2009. After considering the impact of discontinued operations, net income for fiscal year 2010 to date was $4.3 million, or $0.16 per diluted share, compared to a net loss of $0.2 million or $0.01 per diluted share for the same period in fiscal 2009.
“Through the second quarter the Company continued to focus on reducing its cost structure while growing sales of its home appliance products resulting in operating income of $4.8 million for fiscal year 2010 to date,” said Greenfield Pitts, Executive Vice President and Chief Financial Officer of Emerson Radio. “While the Company is pleased with its results to date this fiscal year, it continues to focus on building sales of its home appliance products and exploring opportunities to leverage its portfolio of well known consumer brands through strategic licensing agreements without losing the discipline that has been built around its cost management efforts.”
About Emerson Radio Corp.
Emerson Radio Corporation (NYSE Amex: MSN), founded in 1948, is headquartered in Parsippany, N.J. The Company designs, sources, imports and markets a variety of home appliance and consumer electronic products, and licenses its trademarks to others on a worldwide basis for a variety of products. For more information, please visit Emerson Radio’s Web site at www.emersonradio.com.
Forward-Looking Statements
This release contains “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management’s current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual results could differ materially from those contained in the forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, including the risk factors detailed in the Company’s reports as filed with the Securities and Exchange Commission. The Company assumes no obligation to update the information contained in this news release.
Emerson Radio Corp. and Subsidiaries
Consolidated Statement of Operations
(Unaudited)
(in thousands, except per share data)
Three months ended Six months ended
September 30, September 30,
2008
2009 RESTATED * 2009 * 2008 *
---------- --------- --------- ---------
Net revenues:
Net revenues $ 51,774 $ 53,529 $ 107,373 $ 97,356
Net revenues-related party - 2 - 15
---------- --------- --------- ---------
51,774 53,531 107,373 97,371
---------- --------- --------- ---------
Costs and expenses:
Cost of sales 43,701 47,024 93,304 84,822
Other operating costs and
expenses 1,077 1,586 1,855 2,711
Selling, general &
administrative expenses 3,643 4,733 7,432 9,262
---------- --------- --------- ---------
48,421 53,343 102,591 96,795
---------- --------- --------- ---------
---------- --------- --------- ---------
Operating income 3,353 188 4,782 576
Interest income, net 12 63 22 206
Unrealized holding (losses) on
trading securities - (52) - (21)
Realized gains on trading
securities - 301 - 532
---------- --------- --------- ---------
Income from continuing
operations before income taxes 3,365 500 4,804 1,293
Provision for income taxes 144 349 422 1,354
---------- --------- --------- ---------
Income (loss) from continuing
operations 3,221 151 4,382 (61)
Loss from discontinued
operations, net of tax benefit - (125) (55) (181)
---------- --------- --------- ---------
Net income (loss) $ 3,221 $ 26 $ 4,327 $ (242)
========== ========= ========= =========
Basic net income (loss) per
share
Continuing operations $ 0.12 $ 0.01 $ 0.16 $ -
Discontinued operations - (0.01) - (0.01)
---------- --------- --------- ---------
$ 0.12 $ - $ 0.16 $ (0.01)
========== ========= ========= =========
Diluted net income (loss) per
share
Continuing operations $ 0.12 $ 0.01 $ 0.16 $ -
Discontinued operations - (0.01) - (0.01)
---------- --------- --------- ---------
$ 0.12 $ - $ 0.16 $ (0.01)
========== ========= ========= =========
Weighted average shares
outstanding:
Basic and Diluted 27,130 27,130 27,130 27,130
* The results of operations for three months ended September 30, 2008 have
been restated as set forth in the Company's amended quarterly report on
Form 10-Q/A for the same period on file with the Securities and Exchange
Commission. Additionally, as a result of the Company's sale of its
membership in the ASI joint venture in April 2009, the results of
operations of the Company's membership interest in the ASI joint venture
have been presented as discontinued operations for all periods presented.
Emerson Radio Corp. and Subsidiaries
Consolidated Balance Sheet
(in thousands)
September 30, March 31,
2009 2009
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 28,997 $ 22,518
Restricted cash 2 3,025
Accounts receivable, net 18,733 15,970
Other receivables 1,447 1,587
Due from affiliates 11 78
Inventory, net 22,255 20,691
Prepaid expenses and other current assets 1,480 2,190
Deferred tax assets 4,648 4,872
------------- -------------
Total current assets 77,573 70,931
Property, plant, and equipment, net 1,074 1,139
Trademarks and other intangible assets, net 1,667 255
Due from affiliates 185 114
Investments in marketable securities 6,031 6,031
Deferred tax assets 7,200 7,102
Other assets 312 472
------------- -------------
Total assets 94,042 86,044
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short term borrowings 5,668 5,733
Current maturities of long-term borrowings 68 85
Accts payable and other current liabilities 22,541 18,929
Due to affiliates 41 66
Accrued sales returns 1,236 1,130
Income taxes payable 148 155
------------- -------------
Total current liabilities 29,702 26,098
Long-term borrowings 43 59
Deferred tax liabilities 103 87
Shareholders equity 64,194 59,800
------------- -------------
Total liabilities and shareholders'
equity $ 94,042 $ 86,044
============= =============
Sypris Electronics (SYPR) Awarded Multi-Year, $200 Million IDIQ Contract from the U.S. Department of Defense
Nov. 11, 2009 (Business Wire) — Sypris Electronics, LLC, a subsidiary of Sypris Solutions, Inc. (Nasdaq/NM: SYPR), announced today that it has been awarded an Indefinite Delivery Indefinite Quantity (IDIQ) contract from the United States Department of Defense (DoD) for its RASKL® (KIK-30) electronic key fill device. This contract is in support of the DoD’s modernization effort to replace the aging KYK-13 key fill device. The product was designed and will be produced at the Sypris Electronics facility located in Tampa, Florida.
The RASKL IDIQ contract is for a five-year period with a not-to-exceed value of $200 million. The IDIQ contract is the U.S. Government’s vehicle for its Services and Agencies to order the RASKL and product ancillaries.
The Really Simple Key Loader, or RASKL, is a modernized electronic key fill product used for loading keying data into secure communication equipments. Due to the demanding, tactical environments for which the product was designed, RASKL is fully ruggedized, small, lightweight, requires no formal training and implements a one-button “key squirt” process for simplified loading operations. The RASKL holds up to 40 modern electronic keys and is depot repairable.
“Sypris Electronics is a strategic partner and key contractor with the Department of Defense in support of their security initiatives and modernization efforts,” said John Walsh, President of Sypris Electronics. “This contract award further demonstrates our position as a leading provider of information assurance solutions to the U.S. Government.”
Sypris Electronics is a world-class, integrated systems solutions provider. Our ruggedized electronic products, advanced engineering services and complete electronic manufacturing capabilities are aligned to provide our customers the best people, practices and technologies to continually exceed expectations. We consistently promote an agile, innovative culture by strategically partnering with leading-edge technology companies, agencies and universities. With over 40 years of experience, Sypris Electronics is proud to develop, manufacture and integrate leading technologies into mission critical electronics systems that secure America’s interest. Visit www.sypriselectronics.com for additional company information.
China Housing & Land Development Inc. (CHLN) Announces Third Quarter 2009 Financial Results
XI’AN, China, Nov. 11, 2009 (PRNewswire-Asia-FirstCall) — China Housing & Land Development, Inc., (“China Housing” or the “Company”, Nasdaq: CHLN) today announced its unaudited financial results for the third quarter ended September 30, 2009.
Highlights for the Third Quarter 2009:
-- Total revenues increased 215% to $23.8 million compared to $7.5 million
in the third quarter of 2008, and increased 5.3% sequentially from
$22.6 million in the second quarter of 2009.
-- Total gross floor area ("GFA") sales were 32,436 sq. meters, compared
to 11,069 sq. meters in the third quarter of 2008 and 31,141 sq. meters
in the second quarter of 2009.
-- Gross profit increased 403% to $7.4 million compared to $1.5 million in
the third quarter of 2008. Third quarter gross margin increased to
31.2% compared to 19.5% in the third quarter of 2008.
-- SG&A expenses as a percentage of total revenue declined to 10.5% from
21.1% in the third quarter of 2008.
-- Operating income was $4.0 million, compared to a net loss of ($3.2
million) in the third quarter of 2008 and income of $5.1 million in the
second quarter of 2009.
-- Net income increased 779% to $12.7 million, compared to $1.4 million in
the third quarter of 2008 and a net loss of ($10.0 million) in the
second quarter of 2009. Third quarter net income included a $5.7
million, or $0.17 per share non-cash gain associated with the
revaluation of derivatives and warrants. Excluding this gain, non-GAAP
net income would have been $7.2 million.
-- Basic and diluted net income per share attributable to ordinary
shareholders was $0.41 and $0.24, compared to basic and diluted
earnings per share of $0.05 and $0.04 in the third quarter of 2008 and
diluted loss per share of ($0.32) in the second quarter of 2009.
Mr. Pingji Lu, China Housing’s Chairman commented, “We are pleased with our results for the third quarter as we continued to see stabilized sales trends and higher average selling prices, most notably with our two major projects-JunJing II Phase One and Two. With 91% of units sold and 82% of available GFA sold, we have pre-sold most of JunJing II Phase One’s available residential units in just over one year. Pre-sales of JunJing II Phase Two commenced in the third quarter and thus far, the average selling price per sq. meter has exceeded Phase One due to Phase Two’s enhanced design layout. Additionally, we are off to a good start with our Puhua Phase One project with initial sales that have exceeded our original expectations. This is our first project within our Baqiao new development zone and we believe our success with this project can further enhance our reputation in Xi’an and the surrounding region. The overall real estate market sentiment in Xi’an has improved each quarter since the beginning of this year and we are particularly satisfied with our 12.9% increase in ASPs from last quarter. We remain focused on providing a steady pipeline of quality, state-of-the-art residential housing and commercial units to meet the rising demand in the marketplace.”
For the quarter ended September 30, 2009, the Company’s revenues were $23.8 million, representing an increase of 215.3% from $7.5 million as compared to the same period of 2008 and a sequential increase of 5.3% from $22.6 million as compared to the 2nd quarter of 2009. The increase primarily stems from the JunJing II Phase One and Two projects under construction.
Total gross floor area sold was 32,436 sq. meters, compared to 11,069 sq. meters in the third quarter of 2008 and 31,141 sq. meters in the second quarter of 2009. Average selling price per square meter increased to RMB 5,001 from RMB 4,430 in the second quarter, reflecting increased stability in Xi’an’s real estate market and the Company’s ability to target its residential units toward working professionals in the region.
Gross profit for the third quarter of 2009 was $7.4 million, up 403% from $1.5 million in the same period of 2008 and up 2.9% sequentially from $7.2 million in the second quarter of 2009. The gross profit margin for the third quarter was 31.2%, compared to 19.5% in the same period of 2008. The increase in gross margin reflects an improvement in market conditions.
Selling, general and administrative (“SG&A”) expenses were $2.5 million for the third quarter of 2009, compared to $1.6 million for the third quarter of 2008 and $1.9 million for the second quarter of 2009. The increase in SG&A expense was due primarily to marketing expenses associated with Tsining JunJing II Phase One and Phase Two as well as administrative and marketing expenses related to the Puhua project. As a percentage of total revenue, SG&A expenses declined year-over-year to 10.5% compared to 21.1% in the third quarter of 2008 and was comparable to 8.6% in the second quarter of 2009.
Operating income increased to $4.0 million compared to an operating loss of ($3.2 million) in the third quarter of 2008 and $5.1 million in the second quarter of 2009.
Net income for the third quarter of 2009 increased 779% to $12.7 million, or $0.41 per basic share and $0.24 per diluted share, compared to $1.4 million, or $0.05 per basic share and $0.04 per diluted share, in the third quarter of 2008 and net loss of ($10.0 million), or ($0.32) per diluted share, in the second quarter of 2009. Adjusted net income excluding a $5.7 million non-cash gain associated with the revaluation of derivatives and warrants, was $7.2 million, or $0.06 per diluted share.
As of September 30, 2009, China Housing reported $19.1 million in cash, compared to $10.1 million as of June 30, 2009 and $37.4 million on December 31, 2008. Total debt was $52.6 million, compared to $48.5 million as of June 30, 2009 and $59.2 million on December 31, 2008, as the Company repaid a portion of its $147 million revolving credit line. Net debt as a percent of total capital was 21.4% at the end of the third quarter of 2009, compared to 15.6% at the end of 2008.
Sequential Quarterly Revenue Breakout Comparison Q3 2009 Q2 2009 Revenue Revenue Project Recognized GFA Sold ASP Recognized GFA Sold ASP ($) (m2) (Rmb) ($) (m2) (Rmb) Projects Under Construction JunJing II Phase One 12,130,788 6,801 4,845 20,020,886 28,367 4,358 JunJing II Phase Two 8,804,441 23,606 4,957 960,176 2,456 5,283 Projects Completed Tsining-24G 1,588,845 1507 7,199 1,018,023 630 11,038 JunJing I (88,081) (166) 3,621 (1,018,606) (788) 8,825 Additional Projects 292,289 688 2,902 200,460 476 2,873 Other Income 1,065,363 -- -- 1,420,979 -- -- Total 23,793,645 32,436 5,001 22,601,919 31,141 4,430 Q-o-Q change 5.3% 4.2% 12.9%
2009 Outlook
Fourth quarter 2009 GFA sales are expected to range from 46,000 to 48,000 square meters, compared to 32,046 sq. meters in the third quarter of 2009, and contract sales in fourth quarter are expected to reach US$32 million to US$34 million. The Company is reporting contract sale estimates which are not subject to percentage of completion alterations in contrast to revenues.
For the full year 2009, total GFA sales are expected to range from 130,000 to 132,000 square meters, compared to 64,167 square meters in 2008. Total contract sales in 2009 are expected to reach US$86 million to US$88 million.
Mr. Lu concluded, “In addition to our current projects under development, we have several new construction projects that can position us for solid growth in the years to come. As of the end of September, we have approximately 272 thousand sq. meters of unsold GFA from our existing projects, primarily JunJing II Phase One, Phase Two and Puhua Phase One. We also have an additional three projects under planning (JunJing III, Park Plaza and Golden Bay). Our balance sheet remains healthy and we will continue to selectively explore new projects both in Xi’an and potentially in other surrounding tier 2 cities in northwest China as the real estate market continues to move off its lows of the past year. We are encouraged by our opportunities as we build a sustainable platform for growth.”
Conference Call Information
China Housing’s management will host an earnings conference call on November 11, 2009 at 8:30 a.m. U.S. Eastern Time. Listeners may access the call by dialing 1-719-325-2115. To listen to the live webcast of the event, please go to http://www.viavid.net . Listeners may access the call replay, which will be available through November 18, by dialing 1-719-457-0820; passcode: 5491295.
About China Housing & Land Development, Inc.
Based in Xi’an, the capital city of China’s Shaanxi province, China Housing & Land Development, Inc., is a leading developer of residential and commercial properties in northwest China. China Housing has been engaged in land acquisition, development, and management, including the sales of residential and commercial real estate properties through its wholly-owned subsidiary in China, since 1992.
China Housing & Land Development is the first and only Chinese real estate development company traded on NASDAQ. The Company’s news releases, project information, photographs, and more are available on the internet at http://www.chldinc.com .
Safe Harbor
This news release may contain forward-looking information about China Housing & Land Development, Inc. which is covered under the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward-looking terminology such as believe, expect, may, will, should, project, plan, seek, intend, or anticipate or the negative thereof or comparable terminology, and include discussions of strategy, and statements about industry trends and China Housing & Land Development’s future performance, operations, and products.
Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Actual performance results may vary significantly from expectations and projections. Further information regarding this and other risk factors are contained in China Housing’s public filings with the U.S. Securities and Exchange Commission.
All information provided in this news release and in any attachments are as of the date of the release, and the companies do not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.
Notes to Unaudited Financial Information
This release contains unaudited financial information which is subject to year end audit adjustments. In addition, we are in the process of conducting further evaluations of our internal control over financial reporting for compliance with the requirements of Section 404 under the Sarbanes-Oxley Act. We make no representation of management’s assessment regarding internal control over financial reporting or include an attestation report of the Company’s independent auditors due to a transition period established by rules of the Securities and Exchange Commission for newly public companies. Adjustments to the financial statements may be identified when the audit work is completed, which could result in significant differences between our audited financial statements and this unaudited financial information.
(Financial Tables to Follow) CHINA HOUSING & LAND DEVELOPMENT, INC. AND SUBSIDIARIES Interim Condensed Consolidated Balance Sheets As of September 30, 2009 and December 31, 2008 (unaudited) September 30, December 31, 2009 2008 ASSETS Cash $ 19,089,130 $ 37,425,340 Cash - restricted 694,334 805,012 Accounts receivable, net of allowance for doubtful accounts of $1,002,074 and $1,278,156, respectively 5,877,162 813,122 Other receivables and prepaid expenses, net 1,518,719 446,497 Notes receivable, net 274,399 811,695 Prepaid other taxes 1,300,432 545,979 Real estate held for development or sale 108,220,307 60,650,011 Property and equipment, net 12,868,210 12,391,501 Asset held for sale 14,300,936 14,308,691 Advance to suppliers 863,478 704,275 Deposits on land use rights 28,432,993 47,333,287 Intangible assets, net 41,654,421 46,043,660 Goodwill 816,433 -- Deferred selling costs 344,354 -- Deferred financing costs 506,245 622,118 Total assets 236,761,553 222,901,188 LIABILITIES Accounts payable $ 18,638,322 $ 10,525,158 Advances from customers 9,252,447 9,264,385 Accrued expenses 4,838,168 3,539,842 Accrued security registration expenses -- 613,483 Payable to acquisition of businesses 6,342,865 8,429,889 Income taxes payable 6,554,658 8,078,709 Other payables 4,398,464 5,183,251 Loans from employees 2,195,218 1,517,039 Loans payable 29,591,867 35,617,442 Deferred tax liability 11,504,676 11,510,915 Warrants liability 4,721,294 1,117,143 Fair value of embedded derivatives 3,777,670 760,398 Convertible debt 14,511,239 13,621,934 Total liabilities 116,326,888 109,779,588 SHAREHOLDERS' EQUITY Common stock: $.001 par value, Authorized 100,000,000 shares issued and outstanding 31,270,679 and 30,893,757, respectively 31,270 30,894 Additional paid in capital 33,062,320 31,390,750 Common stock subscribed 2,487,777 -- Statutory reserves 3,696,038 3,541,226 Retained earnings 42,171,440 38,651,579 Accumulated other comprehensive income 10,155,625 10,397,801 Total China Housing & Land Development, Inc. shareholders' equity 91,604,470 84,012,250 Non-controlling interest 28,830,195 29,109,350 Total shareholders' equity 120,434,665 113,121,600 Total liabilities and shareholders' equity $236,761,553 $222,901,188 CHINA HOUSING & LAND DEVELOPMENT, INC. AND SUBSIDIARIES Interim Condensed Consolidated Statements of Income and Other Comprehensive Income For The Three and Nine Months Ended September 30, 2009 and 2008 (Unaudited) 3 Months 3 Months 9 Months 9 Months September 30, September 30, September 30, September 30, 2009 2008 2009 2008 REVENUES Sale of properties $22,728,282 $7,475,692 $56,835,091 $25,054,867 Other income 1,065,363 70,070 3,405,156 482,022 Total revenues 23,793,645 7,545,762 60,240,247 25,536,889 COSTS AND EXPENSES Cost of properties and land 16,374,170 6,071,599 41,266,855 19,691,432 Selling, general, and administrative expenses 2,501,688 1,594,514 5,853,458 4,161,865 Stock based compensation 87,777 3,000,000 87,777 3,000,000 Security registration expenses 579,775 -- 1,786,517 -- Other expenses 284,044 60,848 474,167 76,758 Interest expense 417,809 638,228 1,202,786 1,736,344 Accretion expense on convertible debt 311,319 266,541 889,305 691,782 Change in fair value of embedded derivatives (2,695,306) (2,101,825) 3,017,272 (2,556,313) Change in fair value of warrants (3,042,752) (2,939,563) 4,012,736 (3,895,615) Foreign exchange loss -- (103,344) -- -- Total costs and expenses 14,818,524 6,486,998 58,590,873 22,906,253 Income before provision for income taxes 8,975,121 1,058,764 1,649,374 2,630,636 Recovery of income taxes (3,652,886) (388,308) (1,591,331) -- NET INCOME 12,628,007 1,447,072 3,240,705 2,630,636 Less: net loss attributable to non-controlling interest (86,121) -- (279,155) -- Net income attributable to China Housing & Land Development, Inc. 12,714,128 1,447,072 3,519,860 2,630,636 OTHER COMPREHENSIVE INCOME (LOSS) Gain (loss) in foreign exchange 69,244 911,996 (242,176) 6,176,248 COMPREHENSIVE INCOME $12,783,372 $2,359,068 $3,277,684 $8,806,884 WEIGHTED AVERAGE SHARES OUTSTANDING Basic 31,134,137 30,877,453 30,987,760 30,389,712 Diluted 32,972,253 30,882,483 30,996,953 30,436,461 NET INCOME PER SHARE Basic $0.41 $0.05 $0.11 $0.09 Diluted $0.24 $0.04 $0.11 $0.07 CHINA HOUSING & LAND DEVELOPMENT INC. AND SUBSIDIARIES Interim Condensed Consolidated Statements of Cash Flows For The Nine Months Ended September 30, 2009 and 2008 (Unaudited) September 30, September 30, 2009 2008 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 3,240,705 $ 2,630,636 Adjustments to reconcile net income to cash provided by (used in) operating activities: Bad debt expense 80,713 -- Depreciation 471,788 233,915 Exchange gain -- (103,344) Loss on disposal of fixed assets and inventory 50,501 15,088 Amortization of stock issued for investor relations fees -- 107,987 Stock-based compensation 87,777 3,000,000 Security registration expenses settled with common stock to be issued 1,786,517 -- Change in fair value of warrants 4,012,736 (3,895,615) Change in fair value of embedded derivatives 3,017,272 (2,556,313) Accretion expense on convertible debt 889,305 691,782 Non-cash proceeds from sale of properties (31,673) (2,904,172) (Increase) decrease in assets: Accounts receivable (4,702,750) (1,444,437) Prepaid other taxes (803,561) -- Real estate held for development or sale (35,859,057) (16,437,686) Advances to suppliers (159,660) 486,434 Refund (deposit) on land use rights 11,534,025 (4,386,535) Other receivable and deferred charges 234,834 24,339 Deferred selling costs (344,134) -- Deferred financing costs 155,873 162,269 Increase (decrease) in liabilities: Accounts payable 8,103,243 2,852,863 Advances from customers (135,544) 5,981,215 Accrued expenses 1,165,695 740,465 Other payables (1,941,379) 40,646 Income taxes payable (1,621,435) (123,908) Net cash used in operating activities (10,808,209) (14,884,371) CASH FLOWS FROM INVESTING ACTIVITIES: Change in restricted cash 110,130 (755,376) Purchase of buildings, equipment and automobiles (587,595) (868,817) Notes receivable collected 212,140 139,327 Cash acquired in business combinations 519,309 -- Proceeds from sale of property and equipment 194,006 867,806 Net cash provided by (used in) investing activities 447,990 (617,060) CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from issuance of convertible debt -- 19,230,370 Loans from bank 12,444,063 32,213,727 Repayments of loans payable (18,447,426) (20,044,097) Loans from or repayment to employees, net 678,545 (990,087) Repayment of payables for acquisition of businesses (3,841,072) (3,656,905) Proceeds from exercise of warrants 1,184,662 -- Proceeds from issuance of common stock and warrants -- 8,415 Net cash (used in) provided by financing activities (7,981,228) 26,761,423 (DECREASE)/INCREASE IN CASH (18,341,447) 11,259,992 Effects on foreign currency exchange 5,237 773,037 CASH, beginning of period 37,425,340 2,351,015 CASH, end of period $ 19,089,130 $ 14,384,044
CEL-SCI (CVM) Collaborators Present Data Suggesting That LEAPS Technology Has Ability to Modify Immune Response
VIENNA, Va., Nov. 9 /PRNewswire-FirstCall/ — CEL-SCI Corporation (NYSE Amex: CVM) announced today that Dr. Kenneth S. Rosenthal, Professor of Immunology and Microbiology of Northeastern Ohio Universities College of Medicine and Pharmacy, reported on work conducted in collaboration with scientists at the Cleveland Clinic and CEL-SCI on CEL-SCI’s LEAPS vaccine technology. The data was presented at the 7th GTCbio Vaccine: “All Things Considered” Conference in Crystal City, Virginia.
Working with LEAPS vaccines for herpes simplex virus, HIV, rheumatoid arthritis and most recently, H1N1 influenza, the scientists’ studies show that LEAPS peptide immunogens can convert precursor cells from mouse or humans to become dendritic cells (DC), the cell that directs the subsequent immune response. These DCs produce interleukin 12 (IL12p70), but without production of the pro-inflammatory cytokines that promote symptoms of a cytokine storm, such as tumor necrosis factor alpha or interleukin 1. Immunization with a LEAPS-immunogen for herpes simplex virus activates a protective T cell immune response against the virus in mice while a LEAPS-immunogen for treatment of rheumatoid arthritis (CEL-2000) reduces the production of the pro-inflammatory cytokines to block the progression of disease in mouse models of rheumatoid arthritis.
Dr. Rosenthal commented, “LEAPS immunogens are unique in their ability to simultaneously produce and activate a specific type of dendritic cell that can turn on or modulate antigen specific T cell responses without generating the pro-inflammatory cytokines associated with cytokine storm. The ability to activate the desired immune response should make LEAPS immunogens inherently safe vaccines. Finding of similar results for mouse and human cells in our laboratory studies adds confidence that the effects in the body will be the same in mice and man. ”
Geert Kersten, CEO of CEL-SCI Corporation said: “We feel that this new data is encouraging and supportive of our H1N1 treatment for hospitalized patients where the goal is to produce a specific anti H1N1 immune response that will steer the immune system towards protection and away from a cytokine storm which may be responsible for many patients’ deaths.”
CEL-SCI’s L.E.A.P.S.(TM) (Ligand Epitope Antigen Presentation System) technology allows the Company to direct an immune response against specific disease epitopes. In the case of CEL-SCI’s investigational LEAPS-H1N1 treatment, this involves non-changing regions of H1N1 Pandemic Flu, Avian Flu (H5N1), and the Spanish Flu. This is intended to enable stimulation of the specifically-needed immune responses, while avoiding the administration of regions of H1N1, and other viruses, which may exacerbate the problem of cytokine storm, which CEL-SCI scientists believe may be involved in the death of some H1N1 patients.
The concept behind the L.E.A.P.S. technology is to directly mimic cell/cell interactions on the T-cell surface with synthetic peptides. The L.E.A.P.S. constructs containing the antigenic disease epitope linked to a Immune / T-cell binding ligand (I/TCBL) can be manufactured by peptide synthesis or by covalently linking the two peptides. Depending upon the type of L.E.A.P.S. construct and I/TCBL used, CEL-SCI is able to direct the outcome of the immune response towards the development of T-cell function with primarily effector T-cell functions (T Lymphocyte; helper/effector T lymphocyte, type 1 or 2 [Th1 or Th2], cytotoxic [Tc] or suppressor [Ts]). Therefore, it would appear that the L.E.A.P.S. construct represents a chimeric peptide with bi-functional behavior.
CEL-SCI Corporation is developing products that empower immune defenses. Its lead product is Multikine® which is being readied for a global Phase III trial in advanced primary head and neck cancer. CEL-SCI is also developing a treatment for hospitalized H1N1 patients using it’s L.E.A.P.S. technology platform, and expects to soon finish the validation of it’s state-of-the-art manufacturing facility in Maryland.
For more information, please visit www.cel-sci.com
When used in this report, the words “intends,” “believes,” “anticipated” and “expects” and similar expressions are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties which could cause actual results to differ materially from those projected. Factors that could cause or contribute to such differences include, lack of regulatory clearance to proceed with clinical trials, an inability to duplicate the clinical results demonstrated in clinical studies that have been completed or that are initiated in the future, timely development of any potential products that can be shown to be safe and effective, unwillingness of regulatory authorities to engage in further regulatory dialogue, receiving necessary regulatory approvals, difficulties in manufacturing any of the Company’s potential products, inability to raise the necessary capital, and the risk factors set forth from time to time in CEL-SCI Corporation’s SEC filings, including but not limited to its report on Form 10- K/A for the year ended September 30, 2008. The Company undertakes no obligation to publicly release the result of any revision to these forward-looking statements which may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
SOURCE CEL-SCI Corporation
Merrimac (MRM) Announces Third Quarter 2009 Results — Record Bookings, Backlog and Strong Earnings
Nov. 9, 2009 (PR Newswire) — WEST CALDWELL, N.J., Nov. 9 /PRNewswire-FirstCall/ — Merrimac Industries, Inc. (Amex: MRM), a leader in the design and manufacture of RF Microwave components, subsystem assemblies and micro-multifunction modules (MMFM®), today announced its results for the third quarter of 2009.
Third Quarter and First Nine Months of 2009 Financial Highlights
-- Third quarter of 2009 record bookings were $12,522,000 resulting in a record backlog of $24,789,000 as of October 3, 2009. -- Net sales for the third quarter of fiscal year 2009 decreased slightly 0.7% or $57,000 to $8,271,000, compared to the third quarter of 2008 net sales of $8,328,000. Net sales for the first nine months of 2009 increased 11.1% or $2,391,000 to $23,967,000 compared to $21,576,000 for the first nine months of 2008. -- Gross profit for the third quarter of 2009 increased 32.9% or $990,000 to $3,995,000 compared to $3,005,000 for the third quarter of 2008. Gross profit for the first nine months of 2009 increased 41.1% or $3,127,000 to $10,744,000 from $7,617,000 in the first nine months of 2008. -- Gross profit percentage for the third quarter of 2009 increased to 48.3% compared to 36.1% for the third quarter of 2008 and gross profit percentage for the first nine months of 2009 was 44.8% compared to 35.3% for the first nine months of 2008. -- Operating income for the third quarter and first nine months of 2009 was $1,443,000 and $3,344,000, respectively, compared to an operating income of $501,000 for the third quarter of 2008 and an operating loss of $229,000 in the first nine months of 2008. -- Net income for the third quarter and first nine months of 2009 was $931,000 and $2,506,000, respectively, compared to a net income of $463,000 for the third quarter of 2008 and a net loss of $432,000 in the first nine months of 2008. -- Net income per share, basic and diluted, for the third quarter of 2009 was $0.31 compared to net income per share, basic and diluted, of $0.16 for the third quarter of 2008. For the first nine months of 2009 net income per share, basic and diluted, was $0.84, compared to a net loss per share, basic and diluted, of $0.15 for the first nine months of 2008.
Chairman and CEO Mason N. Carter commented, “In every respect our third quarter and nine months performance reflects the strength of our focused business model. Record orders, backlog and outstanding operating performance are a confirmation of our committed teams in New Jersey and Costa Rica. Our overall business performance is meeting or exceeding every internal target and bodes well for a strong finish to 2009.”
Third Quarter and First Nine Months of 2009 Results
Net sales.
Net sales in the third quarter of 2009 were relatively flat compared to the third quarter of 2008. Net sales decreased $57,000 or 0.7% to $8,271,000, from the third quarter of 2008 net sales of $8,328,000. Net sales for the first nine months of 2009, increased $2,391,000 or 11.1% to $23,967,000 compared to $21,576,000 for the first nine months of 2008. The increase in net sales for the first nine months of 2009 is primarily due to our focused strategy concentrating on aerospace and defense markets. This strategy has resulted in more orders from our key aerospace and defense customers including increased sales of Multi-Mix® products to defense industry related customers.
Cost of sales and gross profit.
Gross profit and gross profit percentage increased for both the third quarter and first nine months of 2009 compared to the same periods in 2008. Gross profit for the third quarter of 2009 increased $990,000 or 32.9%, to $3,995,000 compared to $3,005,000 for the third quarter of 2008. Gross profit percentage for the third quarter of 2009 was 48.3% compared to 36.1% for the third quarter of 2008. Gross profit for the first nine months of 2009 increased 41.1% or $3,127,000 to $10,744,000 from $7,617,000 in the first nine months of 2008. Gross profit percentage for the first nine months of 2009 was 44.8% compared to 35.3% for the first nine months of 2008.
The increase in consolidated gross profit in the third quarter was due to the increase in gross profit percentage. The improved gross profit percentage in the third quarter of 2009 compared to 2008 was primarily due to several orders that shipped in third quarter of 2009 with above average gross profit margins while the same quarter last year had four large orders that shipped with very low gross profit margins. The increase in consolidated gross profit in the first nine months of 2009 compared to the same periods in 2008 was due to the combination of improved gross profit percentage and an increase in net sales. The increase in net sales also had a favorable impact on our gross profit percentage in the third quarter and first nine months of 2009, allowing us to better absorb fixed manufacturing costs.
Selling, general and administrative expenses.
Selling, general and administrative expenses were $2,451,000 for the third quarter of 2009, an increase of $52,000 or 2.2%, compared to $2,398,000 in the third quarter of 2008. The increase in expenses for the third quarter of 2009 was primarily due to an increase in commissions that was offset in part by the restructuring charges incurred in the third quarter of 2008 that did not recur in 2009. When expressed as a percentage of net sales, selling, general and administrative expenses increased from 28.8% of sales in the third quarter of 2008 to 29.6% of sales in the third quarter of 2009. For the first nine months of 2009, selling, general and administrative expenses were $7,122,000 compared to $6,994,000 in the first nine months of 2008 an increase of $129,000 or 1.8%. The increase in such expenses for the first nine months of 2009 was primarily due to higher professional fees and commissions that were largely offset by decreases in selling, marketing and proposal expenses. When expressed as a percentage of net sales, selling, general and administrative expenses decreased from 32.4% of sales in the first nine months of 2008 to 29.7% of sales in the first nine months of 2009.
Operating income (loss).
Operating income for the third quarter and first nine months of 2009 was $1,443,000 and $3,344,000, respectively, compared to an operating income of $501,000 for the third quarter of 2008 and an operating loss of $229,000 in the first nine months of 2008. The improvement in operating income for the third quarter 2009 was primarily due to the improved gross profit resulting from increased gross profit percentages. The improvement in operating income for the first nine months of 2009 was due to a combination of improved gross profit, resulting from the increase in net sales and improved gross profit percentages, and the decrease in research and development costs compared to the first nine months of 2008.
Income taxes.
Provision for income tax expense was $443,000 and $686,000 in the third quarter and first nine months of 2009 compared to $10,000 in each of the third quarter and first nine months of 2008. The provision for income taxes in the third quarter and first nine months of 2009 is based on the expectation that we will fully utilize our net operating loss carryforwards in 2009.
Discontinued operations.
Income from discontinued operations was $0 and $51,000 in the third quarter and first nine months of 2009, respectively, compared to a loss from discontinued operations of $11,000 and $66,000 in the third quarter and first nine months of 2008, respectively.
Net income (loss).
Net income for the third quarter and first nine months of 2009 was $931,000 and $2,506,000, respectively, compared to a net income of $463,000 for the third quarter of 2008 and a net loss of $432,000 in the first nine months of 2008. Net income per share, basic and diluted for the third quarter of 2009 was $0.31 compared to net income per share, basic and diluted of $0.16 for the third quarter of 2008. For the first nine months of 2009 net income per share basic and diluted was $0.84, compared to a net loss per share, basic and diluted, of $0.15 for the first nine months of 2008.
Investors are invited to participate in the financial results conference call on Tuesday, November 10, 2009 at 4:15 p.m. (Eastern) by dialing 1-888-481-2844 (for International callers: 1-719-325-2201) five minutes prior to the scheduled start time, and reference the Merrimac Industries 3rd Quarter 2009 Financial Results conference call or passcode number 3742041. For those unable to participate, a replay will be available for seven days by dialing 1-888-203-1112, or 1-719-457-0820 for international callers, passcode number 3742041.
This conference call will also be broadcast live over the Internet by logging on to the web at this address:
http://www.videonewswire.com/event.asp?id=63835
Should you be unable to participate during the live webcast, a link to the archived webcast will be posted on the Merrimac Industries, Inc. website http://www.merrimacind.com.
About Merrimac
Merrimac Industries, Inc. is a leader in the design and manufacture of RF Microwave signal processing components, subsystem assemblies, and Multi-Mix® micro-multifunction modules (MMFM®), for the worldwide Defense, Satellite Communications (Satcom), Commercial Wireless and Homeland Security market segments. Merrimac is focused on providing Total Integrated Packaging Solutions® with Multi-Mix® Microtechnology, a leading edge competency providing value to our customers through miniaturization and integration. Multi-Mix® MMFM® provides a patented and novel packaging technology that employs a platform modular architecture strategy that incorporates embedded semiconductor devices, MMICs, resistors, passive circuit elements and plated-through via holes to form a three-dimensional integrated module used in High Power, High Frequency and High Performance mission-critical applications. Merrimac Industries facilities are registered under ISO 9001:2000, an internationally developed set of quality criteria for manufacturing operations.
Merrimac Industries, Inc. has facilities located in West Caldwell, NJ and San Jose, Costa Rica and has approximately 210 co-workers dedicated to the design and manufacture of signal processing components, gold plating of high-frequency microstrip and bonded stripline Teflon (PTFE) circuits and subsystems providing Total Integrated Packaging Solutions® for wireless applications. Merrimac (MRM) is listed on the American Stock Exchange. Multi-Mix®, Multi-Mix PICO®, MMFM®, System In A Package®, SIP® and Total Integrated Packaging Solutions® are registered trademarks of Merrimac Industries, Inc. For more information about Merrimac Industries, Inc. please visit our website http://www.merrimacind.com.
This press release contains statements relating to future results of the Company (including certain projections and business trends) that are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties. These risks and uncertainties include, but are not limited to: risks associated with demand for and market acceptance of existing and newly developed products as to which the Company has made significant investments, particularly its Multi-Mix® products; risks associated with adequate capacity to obtain raw materials and reduced control over delivery schedules and costs due to reliance on sole source or limited suppliers; slower than anticipated penetration into the satellite communications, defense and wireless markets; failure of our Original Equipment Manufacturer or OEM customers to successfully incorporate our products into their systems; changes in product mix resulting in unexpected engineering and research and development costs; delays and increased costs in product development, engineering and production; reliance on a small number of significant customers; the emergence of new or stronger competitors as a result of consolidation movements in the market; the timing and market acceptance of our or our OEM customers’ new or enhanced products; general economic and industry conditions; the ability to protect proprietary information and technology; competitive products and pricing pressures; our ability and the ability of our OEM customers to keep pace with the rapid technological changes and short product life cycles in our industry and gain market acceptance for new products and technologies; risks relating to governmental regulatory actions in communications and defense programs; and inventory risks due to technological innovation and product obsolescence, as well as other risks and uncertainties as are detailed from time to time in the Company’s Securities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
MERRIMAC INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Quarters Ended Nine Months Ended -------------- ----------------- October 3, September 27, October 3, September 27, 2009 2008 2009 2008 ---- ---- ---- ---- (Restated) (Restated) Net sales $8,271,178 $8,327,790 $23,966,766 $21,575,742 ---------- ---------- ----------- ----------- Costs and expenses: Cost of sales 4,276,310 5,323,091 13,222,933 13,958,812 Selling, general and administrative 2,450,671 2,398,255 7,122,290 6,993,520 Research and development 101,665 105,114 318,187 852,513 Gain on sale of asset - - (40,579) - ---------- ---------- ----------- ----------- 6,828,646 7,826,460 20,622,831 21,804,845 ---------- ---------- ----------- ----------- Operating income (loss) 1,442,532 501,330 3,343,935 (229,103) Interest and other expense, net (68,210) (17,336) (202,252) (126,516) ---------- ---------- ----------- ----------- Income (loss) from continuing operations before income taxes 1,374,322 483,994 3,141,683 (355,619) Provision for income taxes 443,279 10,000 686,014 10,000 ---------- ---------- ----------- ----------- Income (loss) from continuing operations 931,043 473,994 2,455,669 (365,619) Income (loss) from discontinued operations, net of income taxes - (10,956) 50,505 (65,992) ---------- ---------- ----------- ----------- Net income (loss) $ 931,043 $ 463,038 $ 2,506,174 $ (431,611) ========== ========== =========== =========== Income (loss) per common share from continuing operations - basic $ 0.31 $ 0.16 $ 0.83 $ (0.13) Income (loss) per common share from discontinued operations - basic $ - $ - $ 0.01 $ (0.02) ---------- ---------- ----------- ----------- Net income (loss) per common share - basic $ 0.31 $ 0.16 $ 0.84 $ (0.15) ========== ========== =========== =========== Income (loss) per common share from continuing operations - diluted $ 0.31 $ 0.16 $ 0.82 $ (0.13) Income (loss) per common share from discontinued operations - diluted $ - $ - $ 0.02 $ (0.02) ---------- ---------- ----------- ----------- Net income (loss) per common share - diluted $ 0.31 $ 0.16 $ 0.84 $ (0.15) ========== ========== =========== =========== Weighted average number of shares outstanding-basic 2,986,022 2,948,037 2,966,501 2,940,112 Weighted average number of shares outstanding -diluted 3,013,986 2,965,537 3,000,131 2,940,112 MERRIMAC INDUSTRIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS October 3, January 3, 2009 2009 ---- ---- (UNAUDITED) (NOTE 1) ASSETS Current assets: Cash and cash equivalents $ 3,219,940 $ 1,191,768 Accounts receivable, net allowance for doubtful accounts of $30,000 7,559,992 5,765,575 Inventories, net 5,604,220 4,899,706 Other current assets 840,012 542,320 Costs and estimated earnings in excess of billings on uncompleted contracts 3,249,726 1,880,338 ----------- ----------- Total current assets 20,473,890 14,279,707 ----------- ----------- Property, plant and equipment 38,179,022 37,765,928 Less accumulated depreciation and amortization 30,433,635 28,556,441 ----------- ----------- Property, plant and equipment, net 7,745,387 9,209,487 Other assets 437,398 543,217 ----------- ----------- Total assets $28,656,675 $24,032,411 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 291,667 $ 291,667 Accounts payable 700,737 794,351 Accrued liabilities 1,704,998 1,432,124 Customer deposits 2,137,761 654,133 Income taxes payable 213,565 17,448 ----------- ----------- Total current liabilities 5,048,728 3,189,723 Long-term debt, net of current portion 2,306,945 2,611,111 Deferred liabilities 50,621 64,254 ----------- ----------- Total liabilities 7,406,294 5,865,088 ----------- ----------- Commitments and contingencies Stockholders' equity: Preferred stock, par value $.01 per share: Authorized: 1,000,000 shares No shares issued - - Common stock, par value $.01 per share: 20,000,000 shares authorized; 3,355,361 and 3,315,229 shares issued; and 2,992,456 and 2,952,324 shares outstanding, respectively 33,554 33,153 Additional paid-in capital 20,956,407 20,379,924 Retained earnings 3,382,584 876,410 ----------- ----------- 24,372,545 21,289,487 Less treasury stock, at cost - 362,905 shares at October 3, 2009 and January 3, 2009 (3,122,164) (3,122,164) ----------- ----------- Total stockholders' equity 21,250,381 18,167,323 ----------- ----------- Total liabilities and stockholders' equity $28,656,675 $24,032,411 =========== =========== Contact: Mason N. Carter, Chairman & CEO 973-575-1300, ext. 1202 mnc@merrimacind.com
Presstek (PRST) Announces Third Quarter 2009 Financial Results
GREENWICH, CT — (Marketwire) — 11/09/09 — In the news release, “Presstek Announces Third Quarter 2009 Financial Results,” issued earlier today by Presstek, Inc. (NASDAQ: PRST), we are advised by the company that the table titled “CONTINUING OPERATIONS SUPPLEMENTAL FINANCIAL INFORMATION” included a number of incorrect figures as originally issued. Complete corrected text follows.
Presstek Announces Third Quarter 2009 Financial Results
Improved Sequential Operating Results, Excluding $3.7 Million of Non-Routine Inventory and Restructuring Charges; New Credit Facility Expected to Be in Place by December 15; Reaffirming Positive EBITDA Expected in Q4
GREENWICH, CT — November 9, 2009 — Presstek, Inc. (NASDAQ: PRST), a leading manufacturer and marketer of digital offset printing business solutions, today reported financial and operating results for the third quarter ended October 3, 2009. The Company reported total revenue of $33.0 million in the third quarter of 2009, compared with $48.5 million in the third quarter of 2008, a decline of $15.5 million, or approximately 32 percent. During the third quarter of 2009, the Company incurred a loss from continuing operations of $6.6 million, or $0.18 per share, including (on a pre-tax basis) a largely non-cash inventory-related charge of $2.7 million and a restructuring charge of $1.0 million related to the $10 million cost reduction program announced in the second quarter of 2009. Excluding pre-tax non-routine charges of $3.7 million in the third quarter of 2009 and $0.4 million in the third quarter of 2008, the loss from continuing operations would have been $3.0 million, or $0.08 per share, in the third quarter of 2009, compared with income from continuing operations of $1.0 million, or $0.03 per share, in the third quarter of 2008. (See “Information Regarding Non-GAAP Measures”)
Results from continuing operations exclude the Company’s Lasertel subsidiary, which is currently being marketed for sale and is recorded in discontinued operations. The Company expects to reach an agreement for the sale of its Lasertel subsidiary in the fourth quarter of 2009 with a closing anticipated in the first quarter of 2010. Lasertel’s results improved during the third quarter of 2009 with income from operations, net of tax, of $0.7 million, compared with a loss from operations, net of tax, of $0.4 million in the same period last year.
“Although revenues for the quarter continue to be impacted by the global economic recession, sequential quarterly revenues have stabilized and we anticipate that revenue will begin to grow,” said Presstek Chairman, President and Chief Executive Officer, Jeff Jacobson. “We have successfully reduced expenses and managed cash, while staying focused on our strategic initiatives of expanding our product portfolio and distribution channels. During the third quarter, we debuted and sold our first 52DI with aqueous coating capability to Quad/Graphics, the largest privately held printer in the world, and have already accepted several additional customer orders. We also introduced Aeon, our first long-run, non-preheat thermal CTP plate, which will be available by the end of this year. In addition, we have made tremendous progress expanding our distribution channels to nearly 60 distributor locations in our Europe, Africa, Middle East and Asia Pacific regions.”
Third Quarter 2009 Financial Results
Total revenue in the third quarter of 2009 was $33.0 million, compared with $48.5 million in the third quarter of 2008.
?Equipment revenue declined 76 percent to $3.6 million in the third
quarter of 2009, compared with $15.2 million for the same period last year.
Sales of equipment have been negatively impacted by the global economic
recession that has caused credit markets to tighten and customers to delay
major capital investment decisions.
?Consumables revenue totaled $22.2 million in the third quarter of 2009,
compared with $25.1 million for the same period last year. The decline in
consumables revenue was primarily related to lower industry print volume,
as well as lower sales in the Company's "traditional" portfolio of
consumables products as customers continue to migrate from analog to
digital solutions. However, sequential quarterly revenue increased $1.0
million, or 4.9 percent.
?Service revenue declined approximately 12 percent to $7.2 million in the
third quarter of 2009 primarily due to a decrease in the level of
traditional equipment service and lower print volume.
Third quarter 2009 margin was impacted by an abnormally large inventory charge of $2.7 million to Cost of Goods Sold that lowered gross margin to 23.3 percent, compared with 34.7 percent in the third quarter of 2008. Excluding this unusual charge, gross margin in the third quarter of 2009 would have been 31.5 percent. This charge, which is mostly non-cash, was driven in large part by lower production volume levels in Presstek’s equipment manufacturing plant and the impact of a change in certain product strategies. In addition, during the quarter, Presstek refined the calculations and assumptions used to determine the allocation of manufacturing spending between period costs and capitalized variances. The Company is evaluating the need for actions to further enhance its manufacturing cost efficiencies.
Third quarter 2009 operating expenses declined to $13.9 million, reflecting a year-over-year improvement of $0.8 million, or 5.7 percent. Lower expenses resulted primarily from cost reduction activities. During the second quarter of 2009, the Company implemented a cost reduction program that is substantially complete and is expected to result in annualized savings of approximately $10 million. A restructuring charge of $1.0 million related to the program was recorded in the third quarter of 2009. Excluding the impact of restructuring charges in both periods, third quarter 2009 operating expenses were down $1.5 million, or 11 percent, compared with the same period last year.
“During the last two years, we have implemented business improvement initiatives that have resulted in gross profit and operating expense improvements of approximately $40 million,” said Presstek Executive Vice President and Chief Financial Officer, Jeff Cook. “With the vast majority of the cost cutting initiatives complete, we have a cost structure that is appropriately aligned with our revenue base. I am optimistic that our lean cost structure combined with the positive sales prospects we are seeing will lead to positive EBITDA in the fourth quarter of 2009.”
Interest expense increased to $0.5 million in the third quarter of 2009, compared with $0.1 million in the third quarter of 2008. The increase is due to higher interest rates and a $250,000 fee associated with a modification of the Company’s credit agreement. The Company is in discussions concerning a new credit facility and expects to have an arrangement in place on or prior to December 15, 2009 sufficient to repay the Company’s outstanding indebtedness and provide for continuing operations.
The Company’s third quarter 2009 debt net of cash totaled $16.2 million, compared with $13.3 million in the third quarter of 2008. Debt net of cash is down 56 percent from its high of $37.0 million in March 2007.
“With the anticipated continued impact of the economy on our financial results, we had previously indicated that, excluding non-routine charges in both quarters, our third quarter operating loss would be in line with our second quarter loss of $3.6 million. In addition, we would be incurring costs related to Print 09, North America’s largest printing trade show held during the third quarter,” added Jacobson. “I am encouraged that with a third quarter operating loss of $2.4 million, absent non-routine charges, the business performed better than expected. With the talented and dedicated employees we have and the steps we have taken to ensure that we are well positioned to thrive once the economy turns around, I am confident of the Company’s future success.”
Information Regarding Non-GAAP Measures
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, the Company provides non-GAAP financial measures, including income (loss) from continuing operations, excluding non-routine charges; operating income (loss), excluding non-routine charges; gross margin, excluding non-routine charges; operating expenses, excluding the impact of restructuring charges; EBITDA from continuing operations; cash earnings from continuing operations, excluding non-routine charges; working capital, excluding short-term debt; debt net of cash and other GAAP measures adjusted for certain charges, which the Company believes are useful to help investors better understand its past financial performance and prospects for the future. A full reconciliation of GAAP to non-GAAP measures is provided in the financial tables below. Supplemental financial information has been provided with this release to provide additional details on the Company’s performance.
Conference Call and Webcast Information
Management will discuss Presstek’s third quarter 2009 results in a conference call on Monday, November 9, 2009 at 10:30 a.m. Eastern Time. Conference call information is below:
Conference Call Access: Domestic Dial In: (888) 396-2386 International Dial In: (617) 847-8712 Passcode: 14582468
In addition, for those unable to participate at the time of the call, a rebroadcast will be available following the call from Monday, November 9, 2009 at 1:30 PM Eastern Time until Friday, November 16, 2009 Eastern Time at Midnight.
Rebroadcast Access: Domestic Dial In: 888-286-8010 International Dial In: 617-801-6888 Passcode: 30398536
An archived webcast of this conference call will also be available on the “Investor Events Calendar” page of the Company’s web site, www.presstek.com.
About Presstek
Presstek, Inc. is a leading manufacturer and marketer of high tech digital imaging solutions to the graphic arts and laser imaging markets. Presstek’s patented DI®, CTP and plate products provide a streamlined workflow in a chemistry-free environment, thereby reducing printing cycle time and lowering production costs. Presstek solutions are designed to make it easier for printers to cost effectively meet increasing customer demand for high-quality, shorter print runs and faster turnaround while providing improved profit margins. Presstek subsidiary, Lasertel, Inc., manufactures semiconductor laser diodes for Presstek’s and external customers’ applications. For more information visit www.presstek.com, or call 603-595-7000 or email: info@presstek.com. DI is a registered trademark of Presstek, Inc.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995:
Certain statements contained in this News Release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding expected revenue, gross margins, operating income (loss), EBITDA, asset impairments, expectations concerning the level of costs, the level of customer demand, the results of the Company’s cost reduction measures, the Company’s expectation concerning the sale of its Lasertel subsidiary, the ability of the Company to achieve its stated objectives, and the Company’s expectations concerning its ability to obtain a new credit facility. Such forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to: the severity and length of the current economic downturn, the impact of the economic downturn on the availability of credit for the Company’s customers, the ability of the Company to continue to have access to its revolving credit facility, the ability of the Company to obtain an adequate credit facility to replace its current credit facility and provide for operations, the Company’s ability to successfully market its Lasertel subsidiary for sale, market acceptance of and demand for the Company’s products and resulting revenue, the ability of the Company to successfully expand into new territories, the ability of the Company to meet its stated financial and operational objectives, the Company’s dependence on its partners (both manufacturing and distribution), the results of the pending formal investigation by the Securities and Exchange Commission and the impact of any civil penalty on the Company, the ability of the Company’s insurer to fund certain costs associated with the SEC investigation, and other risks and uncertainties detailed in the Company’s 2008 Annual Report on Form 10-K and the Company’s other reports on file with the Securities and Exchange Commission. The words “looking forward,” “looking ahead,” “believe(s),” “should,” “may,” “expect(s),” “anticipate(s),” “project(s),” “likely,” “opportunity,” expressions of optimism concerning future events or results, and similar expressions, among others, identify forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. The Company undertakes no obligation to update any forward-looking statements contained in this news release.
PRESSTEK, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per-share data)
(Unaudited)
Three months ended Nine months ended
October September October September
3, 27, 3, 27,
2009 2008 2009 2008
--------- --------- --------- ---------
Revenue
Equipment $ 3,627 $ 15,235 $ 13,827 $ 42,957
Consumables 22,150 25,053 65,170 81,807
Service and parts 7,229 8,246 21,979 26,170
--------- --------- --------- ---------
Total revenue 33,006 48,534 100,976 150,934
--------- --------- --------- ---------
Cost of revenue
Equipment 8,152 12,937 18,015 37,207
Consumables 11,982 12,652 35,603 41,452
Service and parts 5,172 6,096 16,528 19,561
--------- --------- --------- ---------
Total cost of revenue 25,306 31,685 70,146 98,220
--------- --------- --------- ---------
Gross profit 7,700 16,849 30,830 52,714
--------- --------- --------- ---------
Operating expenses
Research and development 1,379 1,059 3,803 3,697
Sales, marketing and customer
support 6,276 7,088 19,525 22,411
General and administrative 4,946 5,932 17,239 18,321
Amortization of intangible
assets 225 258 712 823
Restructuring and other
charges 1,040 374 1,162 1,569
Goodwill impairment - - 19,114 -
--------- --------- --------- ---------
Total operating expenses 13,866 14,711 61,555 46,821
--------- --------- --------- ---------
Income (loss) from operations (6,166) 2,138 (30,725) 5,893
Interest and other expense, net (745) (359) (531) (646)
--------- --------- --------- ---------
Income (loss) from continuing
operations before income taxes (6,911) 1,779 (31,256) 5,247
Provision for income taxes (264) 1,153 16,366 2,731
--------- --------- --------- ---------
Income (loss) from continuing
operations (6,647) 626 (47,622) 2,516
Income (loss) from discontinued
operations, net of income
taxes $ 706 $ (431) $ (959) $ (1,536)
--------- --------- --------- ---------
Net income (loss) $ (5,941) $ 195 $ (48,581) $ 980
========= ========= ========= =========
Earnings (loss) per share -
basic
Income (loss) from continuing
operations $ (0.18) $ 0.02 $ (1.30) $ 0.07
Income (loss) from
discontinued operations 0.02 (0.01) (0.02) (0.04)
--------- --------- --------- ---------
$ (0.16) $ 0.01 $ (1.32) $ 0.03
========= ========= ========= =========
Earnings (loss) per share -
diluted
Income (loss) from continuing
operations $ (0.18) $ 0.02 $ (1.30) $ 0.07
Income (loss) from
discontinued operations 0.02 (0.01) (0.02) (0.04)
--------- --------- --------- ---------
$ (0.16) $ 0.01 $ (1.32) $ 0.03
========= ========= ========= =========
Weighted average shares
outstanding
Weighted average shares
outstanding - basic 36,638 36,603 36,668 36,586
Dilutive effect of stock
options - 13 - 12
--------- --------- --------- ---------
Weighed average shares
outstanding - diluted 36,638 36,616 36,668 36,598
========= ========= ========= =========
PRESSTEK, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
(Unaudited)
October 3, January 3,
2009 2009
--------- ---------
ASSETS
Current assets
Cash and cash equivalents $ 7,220 $ 4,738
Accounts receivable, net 24,609 30,759
Inventories 33,134 37,607
Assets of discontinued operations 14,743 13,330
Deferred income taxes 503 7,066
Other current assets 2,693 4,095
--------- ---------
Total current assets 82,902 97,595
Property, plant and equipment, net 24,744 25,530
Goodwill - 19,114
Intangible assets, net 4,190 4,174
Deferred income taxes 739 10,494
Other noncurrent assets 497 606
--------- ---------
Total assets $ 113,072 $ 157,513
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt and capital lease
obligation $ 834 $ 4,074
Line of credit 22,612 12,415
Accounts payable 10,189 12,060
Accrued expenses 9,286 13,261
Deferred revenue 6,818 7,300
Liabilities of discontinued operations 5,801 5,702
--------- ---------
Total current liabilities 55,540 54,812
Other long-term liabilities 151 170
--------- ---------
Total liabilities 55,691 54,982
--------- ---------
Stockholders' equity
Preferred stock - -
Common stock 368 366
Additional paid-in capital 119,604 117,985
Accumulated other comprehensive loss (4,144) (5,954)
Accumulated deficit (58,447) (9,866)
--------- ---------
Total stockholders' equity 57,381 102,531
--------- ---------
Total liabilities and stockholders' equity $ 113,072 $ 157,513
========= =========
PRESSTEK, INC.
CONTINUING OPERATIONS SUPPLEMENTAL FINANCIAL INFORMATION
$000's
(Unaudited)
Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009
-------- -------- --------- ---------- ----------
Key Units
DI Presses
(Excludes QMDI) 37 25 13 11 12
CtP Platesetters
(Excludes DPM) 36 35 24 21 15
Revenue - Growth
Portfolio
DI Presses
(Excludes QMDI) 12,867 7,528 3,521 3,732 2,923
Presstek Branded
DI Plates 4,653 4,661 4,025 4,301 4,318
-------- -------- --------- ---------- ----------
Total DI Revenue 17,520 12,189 7,546 8,033 7,241
Presstek CtP
Platesetters
(Excludes DPM) 2,228 2,039 1,109 1,505 1,081
Chemistry Free CtP
Plates 4,064 4,402 3,426 3,678 3,745
-------- -------- --------- ---------- ----------
Total CtP Revenue 6,292 6,441 4,535 5,183 4,826
Service Transfer (976) (1,176) (601) (603) (596)
Service Revenue 2,804 3,002 2,723 2,588 2,603
-------- -------- --------- ---------- ----------
Total Revenue -
Growth Portfolio 25,640 20,456 14,203 15,201 14,074
======== ======== ========= ========== ==========
Revenue - Traditional
Portfolio
QMDI Platform 3,456 3,417 2,962 2,987 3,056
Polyester CtP
Platform 4,077 3,601 3,575 3,178 3,228
Other DI Plates 2,059 1,693 1,295 1,128 1,438
Conventional/Other 7,943 7,916 7,775 6,608 6,772
-------- -------- --------- ---------- ----------
Total Product
Revenue -
Traditional 17,535 16,627 15,607 13,901 14,494
Service Transfer (85) (102) (190) (190) (188)
Service Revenue -
Traditional 5,444 5,336 4,840 4,598 4,626
-------- -------- --------- ---------- ----------
Total Revenue -
Traditional
Portfolio 22,894 21,861 20,257 18,309 18,932
======== ======== ========= ========== ==========
-------- -------- --------- ---------- ----------
Total Revenue 48,534 42,318 34,460 33,510 33,006
======== ======== ========= ========== ==========
Product Revenue
Components %
Growth 52.8% 48.3% 41.2% 45.4% 42.6%
Traditional 47.2% 51.7% 58.8% 54.6% 57.4%
Geographic Revenues
(Origination)
North America 35,244 32,374 26,715 26,076 26,810
Europe 13,290 9,944 7,745 7,434 6,196
-------- -------- --------- ---------- ----------
Consolidated 48,534 42,318 34,460 33,510 33,006
======== ======== ========= ========== ==========
Gross Margin
Presstek
Equipment 15.1% 11.7% 5.9% 0.9% -124.8%
Consumables 49.5% 51.2% 46.7% 43.5% 45.9%
Service 26.1% 29.7% 20.8% 25.3% 28.5%
-------- -------- --------- ---------- ----------
Consolidated 34.7% 37.9% 35.1% 32.9% 23.3%
======== ======== ========= ========== ==========
Operating Expense
(Excluding Special
Charges) (A) $ 14,337 $ 16,409 $ 13,851 $ 14,602 $ 12,826
Profitability
Net income (loss) $ 195 $ (456) $ (1,191) $ (41,449) $ (5,941)
Add back: Loss
from discontinued
operations 431 1,070 85 1,580 (706)
-------- -------- --------- ---------- ----------
Net income (loss)
from continuing
operations 626 614 (1,106) (39,869) (6,647)
Add back:
Interest 147 121 56 110 491
Other (income)
expense 212 (1,705) (516) 136 254
Tax charge
(benefit) 1,153 49 (275) 16,905 (264)
Impairment /
Other charges - - - 19,114 2,700
Non cash portion
of equity
compensation
(2006 forward
123R related) 498 482 457 505 389
Restructuring
and Other
charges 374 539 84 38 1,040
-------- -------- --------- ---------- ----------
Operating income
(loss) from
continuing
operations 3,010 100 (1,300) (3,061) (2,037)
Add back:
Depreciation
and
amortization 1,379 1,172 1,191 1,150 1,231
Other income
(expense) (212) 1,705 516 (136) (745)
-------- -------- --------- ---------- ----------
EBITDA From
Continuing
Operations (A) $ 4,177 $ 2,977 $ 407 $ (2,047) $ (1,551)
======== ======== ========= ========== ==========
Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009
-------- -------- --------- ---------- ----------
Cash Earnings From
Continuing
Operations
Income (loss) from
continuing
operations 626 614 (1,106) (39,869) (6,647)
Add back:
Restructuring
and Other
charges 374 539 84 38 1,040
Impairment /
Other charges - - - 19,114 2,700
Depreciation
and
amortization 1,379 1,172 1,191 1,150 1,231
Non cash portion
of equity
compensation
(2006 forward
123R related) 498 482 457 505 389
Non cash portion
of taxes 749 36 (454) 17,071 (299)
-------- -------- --------- ---------- ----------
Cash Earnings
From
Continuing
Operations (A) 3,626 2,843 172 (1,991) (1,586)
======== ======== ========= ========== ==========
Working Capital
Current assets
(excluding net
assets of
discontinued
operations) $ 93,152 $ 84,263 $ 83,850 $ 73,994 $ 68,159
-------- -------- --------- ---------- ----------
Current
liabilities
Short-term debt 15,130 16,489 14,941 17,592 23,446
All other current
liabilities 37,163 32,575 33,847 31,345 26,293
-------- -------- --------- ---------- ----------
Current
liabilities 52,293 49,064 48,788 48,937 49,739
-------- -------- --------- ---------- ----------
Working capital 40,859 35,199 35,062 25,057 18,420
Add back
short-term debt 15,130 16,489 14,941 17,592 23,446
-------- -------- --------- ---------- ----------
Working capital,
excluding
short-term
debt (A) $ 55,989 $ 51,688 $ 50,003 $ 42,649 $ 41,866
======== ======== ========= ========== ==========
Debt net of cash (A)
Calculation of
total debt:
Current portion
of long-term
debt $ 3,240 $ 4,074 $ 2,454 $ 1,644 $ 834
Line of credit 11,890 12,415 12,487 15,948 22,612
Long-term debt,
net of current
portion 834 - - - -
-------- -------- --------- ---------- ----------
Total debt 15,964 16,489 14,941 17,592 23,446
Cash 2,634 4,738 5,262 4,453 7,220
-------- -------- --------- ---------- ----------
Debt net of
cash $ 13,330 $ 11,751 $ 9,679 $ 13,139 $ 16,226
======== ======== ========= ========== ==========
Days Sales
Outstanding 60 69 74 69 66
Days Inventory
Outstanding 87 87 100 105 99
Capital Expenditures $ 437 $ 831 $ 180 $ 238 $ 257
Employees 622 608 612 608 553
A. Operating expenses, excluding special charges and EBITDA from continuing operations [earnings before interest, taxes, depreciation, amortization and restructuring and merger-related charges (credits)]; Working capital, excluding short-term debt; Debt net of cash; and Cash earning from continuing operations are not measures of performance under accounting principles generally accepted in the United States of America (“GAAP”) and should not be considered alternatives for, or in isolation from, the financial information prepared and presented in accordance with GAAP. Presstek’s management believes that EBITDA provides meaningful supplemental information regarding Presstek’s current financial performance and prospects for the future. Presstek’s management believes that Cash earnings from continuing operations provide meaningful supplemental information regarding Presstek’s current financial performance and prospects for the future. Presstek’s management believes that Working capital, excluding short-term debt, provides meaningful supplemental information regarding Presstek’s ability to meet its current liability obligations. Presstek’s management believes that Debt net of cash provides meaningful information on Presstek’s debt relative to its cash position. Presstek believes that both management and investors benefit from referring to these non-GAAP measures in assessing the performance of Presstek’s ongoing operations and liquidity, and when planning and forecasting future periods. These non-GAAP measures also facilitate management’s internal comparisons to Presstek’s historical operating results and liquidity. Our presentations of these measures, however, may not be comparable to similarly titled measures used by other companies. Reconciliations of these measures to GAAP are included in the tables above.
** Certain amounts may be subject to reclassification to conform to current presentation.
Reconciliation of GAAP amounts to Non-GAAP amounts
(Dollar amounts in thousands)
Three months ended Three months ended
October 3, 2009 September 27, 2008
---------------------------- ----------------------------
GAAP Adjust- Non-GAAP GAAP Adjust- Non-GAAP
amounts ments amounts amounts ments amounts
-------- --------- -------- -------- -------- --------
Revenue $ 33,006 $ - $ 33,006 $ 48,534 $ - $ 48,534
Gross profit 7,700 2,700 10,400 16,849 - 16,849
23.3% 31.5% 34.7% 34.7%
Operating
expenses 13,866 1,040 12,826 14,711 374 14,337
Operating
income (6,166) 3,740 (2,426) 2,138 374 2,512
Income before
income taxes (6,911) 3,740 (3,171) 1,779 374 2,153
Provision for
income taxes (264) 127 (137) 1,153 (34) 1,119
Income (loss)
from
continuing
operations (6,647) 3,613 (3,034) 626 408 1,034
Loss from
discontinued
operations,
net of income
taxes 706 706 (431) (431)
Net income (5,941) (2,328) 195 603
Earnings (loss)
per share from
continuing
operations $ (0.18) $ 0.10 $ (0.08) $ 0.02 $ 0.01 $ 0.03
Three months ended Three months ended
October 3, 2009 July 4, 2009
---------------------------- ----------------------------
GAAP Adjust- Non-GAAP GAAP Adjust- Non-GAAP
amounts ments amounts amounts ments amounts
-------- --------- -------- -------- --------- --------
Revenue $ 33,006 $ - $ 33,006 $ 33,510 $ - $ 33,510
Gross profit 7,700 2,700 10,400 11,036 - 11,036
Operating
expenses 13,866 1,040 12,826 33,754 19,152 14,602
Operating loss
excluding
non-routine
charges (6,166) 3,740 (2,426) (22,718) 19,152 (3,566)
Adjustments represent non-routine charges for non-cash inventory
write-downs and restructuring charges in Q309, restructuring charges in
Q308, goodwill impairment and restructuring charges in Q209.
eOn Communications (EONC) Reports Strong Fourth Quarter and Total Year Revenue with Fourth Quarter Profitability
SAN JOSE, Calif., Nov. 9 /PRNewswire-FirstCall/ — eOn Communications Corporation((TM)) (Nasdaq: EONC) (the “Company”), a leading provider of telecommunications solutions, today reported fourth quarter and fiscal year ended July 31, 2009 results.
Fourth quarter revenue increased 217% to $5,089,000 from $1,604,000 in the fourth quarter of last year and increased 106% compared to revenues of $2,465,000 in the third quarter of this year. Net income for the quarter was $111,000 or $0.04 per common share compared to a net loss of $338,000 or $0.12 per common share in the quarter ended July 31, 2008. Included in the net income for the quarter was $480,000 of imputed interest expense due to the amortization of the difference between the face value of the contingent obligation to the former Cortelco shareholders and the discounted present value of the note payable recorded on the balance sheet. Net income for the quarter excluding the impact of the imputed interest expense was $591,000 or $0.22 per common share.
Total year revenue increased 52% to $10,645,000 from $6,994,000 in fiscal year 2008. Net loss for the fiscal year ended July 31, 2009 was $339,000 or $0.12 per common share compared to net loss of $3,452,000 or $1.27 per common share for the fiscal year ended July 31, 2008. Net income for the year excluding the impact of the imputed interest expense was $141,000 or $0.05 per common share.
eOn’s operating results for the quarter ended July 31, 2009 represent the second consecutive profitable quarter. Financial results for the current fiscal year include net income of $430,000 of Cortelco Systems Holding Corp., which was acquired on April 1, 2009.
Cash, cash equivalents and marketable securities increased 18% to $3,010,000 from $2,545,000 as of July 31, 2008.
“I would like to thank everyone in the organization for their continued efforts to return eOn Communications to profitability,” commented Mr. David S. Lee, Chairman of eOn’s Board of Directors. “For the fourth quarter of 2009 all divisions (eOn US, Cortelco and eOn China) were profitable resulting in net earnings per share of $0.22 before imputed interest expense. With our recent reorganization and merger with Cortelco, I feel that the company is now positioned to achieve positive results going forward.”
The Company also today announces that its Annual Shareholder Meeting will be held at 2:00 PM on December 8, 2009 at the Company’s offices in San Jose, CA. Shareholders of record as of November 6, 2009 will be entitled to vote at the Annual Meeting.
About eOn Communications
eOn Communications Corporation((TM)) is a global provider of innovative communications solutions. Backed by over 20 years of telecommunications engineering expertise, our solutions enable our customers to easily leverage advanced technologies in order to communicate more effectively. To find out more information about eOn Communications and its solutions, visit the World Wide Web at www.eoncommunications.com, or call 800-955-5321.
Note:
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties, including technical and competitive factors, which could cause the Company’s results and the timing of certain events to differ materially from those discussed in the forward-looking statements. Such risks are detailed in eOn Communications Corporation’s most recent Form 10-Q filing with the Securities and Exchange Commission.
eOn Communications Corporation, the mark eOn, and eQueue are trademarks of eOn Communications Corporation.
eOn Communications Corporation Condensed Consolidated Statements of Operations (Dollars in thousands, except per share data) Unaudited For the Years Ended July 31, --------------- 2009 2008 ---- ---- REVENUE Third party revenue $10,355 $6,646 Related party revenue 290 348 --- --- Net revenue 10,645 6,994 COST OF REVENUE Third party cost of revenue 5,659 2,832 Related party cost of revenue 204 323 --- --- Cost of revenue 5,863 3,155 ----- ----- Gross profit 4,782 3,839 OPERATING EXPENSE Selling, general and administrative (including $243 and $210 of related party management fees, respectively) 3,633 3,893 Research and development 926 2,641 Other expense,net 120 283 --- --- Total operating expense 4,679 6,817 ----- ----- Income (loss) from continuing operations 103 (2,978) Interest (expense) income (466) 117 Equity earnings of unconsolidated equity investee 29 - --- --- Loss from continuing operations before income taxes (334) (2,861) Income tax expense (5) - --- --- Loss from continuing operations after income taxes (339) (2,861) DISCONTINUED OPERATIONS Loss from discontinued operations - (604) Gain on disposal of discontinued operations, net of tax of $0 - 13 --- --- Loss from discontinued operations - (591) --- --- Net loss $(339) $(3,452) ===== ======= Weighted average shares outstanding Basic and diluted 2,735 2,725 Basic and diluted loss per share: From continuing operations $(0.12) $(1.05) From discontinued operations, net of tax - (0.22) --- ---- Basic and diluted net loss per share $(0.12) $(1.27) ====== ====== eOn Communications Corporation Condensed Consolidated Balance Sheets (Dollars in thousands, except share and per share amounts) As of July 31, -------------- 2009 2008 ---- ---- ASSETS Current assets: Cash and cash equivalents $3,010 $1,545 Marketable securities - 1,000 Trade accounts receivable, net of allowance of $332 and $680, respectively 2,943 932 Trade accounts receivable - related party 228 84 Inventories 5,032 2,501 Deferred income taxes 270 - Prepaid and other current assets 242 177 --- --- Total current assets 11,725 6,239 Property and equipment, net 209 176 Intangibles, net 410 251 Investments 1,136 900 Investment in unconsolidated equity investee 140 - Other non-current assets - 88 --- --- Total assets $13,620 $7,654 ======= ====== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Trade accounts payable $1,127 $214 Trade accounts payable - related party 11 126 Notes payable, related party 1,157 138 Accrued expenses and other 1,628 1,145 ----- ----- Total current liabilities 3,923 1,623 Note payable, related party, net of current portion 3,891 - ----- --- Total liabilities 7,814 1,623 ----- ----- Commitments and contingencies Stockholders' equity: Preferred stock, $0.001 par value, (10,000,000 shares authorized, no shares issued and outstanding) - - Common stock, $0.005 par value (10,000,000 shares authorized, 2,873,992 and 2,869,608 shares issued, respectively) 14 14 Additional paid-in capital 56,048 55,931 Treasury stock, at cost (139,580 shares) (1,503) (1,502) Accumulated deficit (48,856) (48,517) Accumulated other comprehensive income 103 105 --- --- Total stockholders' equity 5,806 6,031 ----- ----- Total liabilities and stockholders' equity $13,620 $7,654
DUSA Pharmaceuticals Reports Third Quarter 2009 Corporate Highlights and Financial Results
Nov. 6, 2009 (PR Newswire) — WILMINGTON, Mass., Nov. 6 /PRNewswire-FirstCall/ — DUSA Pharmaceuticals, Inc.® (Nasdaq GM: DUSA), a dermatology company that is developing and marketing Levulan® Photodynamic Therapy (PDT) and other products focused on patients with common skin conditions, reported today its corporate highlights and financial results for the third quarter ended September 30, 2009.
Third quarter and year-to-date financial highlights include:
— Domestic PDT revenues totaled $6.2 million for the third quarter of2009, representing a $1.5 million, or 32%, improvement as compared tothe third quarter of 2008. Year-to-date 2009 domestic PDT revenuestotaled $18.7 million, representing a $3.8 million, or 25%, improvementyear over year.– Domestic Kerastick® revenues totaled $5.8 million for the third quarterof 2009, representing a $1.4 million, or 32%, improvement as compared tothe third quarter of 2008. Year-to-date 2009 domestic Kerastick®revenues totaled $17.1 million, representing a $3.4 million, or 25%,improvement year over year.– Domestic BLU-U® revenues totaled $0.5 million for the third quarter of2009, representing a $0.1 million, or 22%, improvement as compared tothe third quarter of 2008. Year-to-date 2009 domestic BLU-U® revenuestotaled $1.6 million, representing a $0.4 million, or 32%, improvementyear over year.– Kerastick® gross margins for the third quarter of 2009 reached a recordhigh of 86%.– Non-GAAP loss for the third quarter of 2009 improved 86% year over year,and narrowed to $0.2 million.
Management Comments:
“We are excited to report the improvement in many of our key financial indicators this quarter,” stated Robert Doman, President and CEO. “The combination of strong top line PDT revenue growth, the achievement of record Kerastick margins, and reductions in our overall spending drove our non-GAAP loss to a record low point.”
“We experienced significant growth in Kerastick revenue during the third quarter. This is due in part to solid execution by the sales and marketing team and a 33% increase in BLU-U volume year-to-date. This represents the 16th consecutive quarter of year over year domestic Kerastick growth.”
“In October, we announced an important milestone in the Company’s history, having surpassed cumulative Kerastick sales of one million units. The achievement of this milestone demonstrates the relevance that PDT is gaining in the medical dermatology community,” continued Doman.
“For the remainder of the year, we will focus our efforts on further capitalizing on the significant growth potential that exists for Levulan PDT in the treatment of actinic keratoses (AKs),” concluded Doman.
Third Quarter 2009 Financial Results:
Total product revenues were $6.9 million in the third quarter of 2009, up 21% from $5.7 million in the third quarter of 2008. PDT revenues totaled $6.7 million, up $1.5 million, or 30%, from $5.2 million for the comparable 2008 period. The increase in PDT revenues was attributable to a 32% increase in Kerastick® revenues and a 7% increase in BLU-U® revenues. The Kerastick® revenue improvement was driven by a 20% increase in our domestic Kerastick® volume and an overall 10% increase in our average selling price. Kerastick® sales volumes increased to 53,622 in the third quarter of 2009 from 44,668 units sold in the third quarter of 2008. Domestic Kerastick® sales volumes increased by 7,938 units, or 20%, and were supplemented by a 1,016 unit increase in our international sales volumes. The BLU-U® revenue increase was driven by a 4% increase in sales volume. There were 59 units sold during the quarter, as compared to the prior year quarterly total of 57 units. Non-PDT revenues totaled $0.2 million versus $0.6 million for the comparable 2008 period. Non-PDT revenues were adversely impacted by the absence of Nicomide® royalty revenues in 2009. DUSA has not received the installment payments due under its exclusive Nicomide® patent license agreement with River’s Edge since June 2009. The Company is currently evaluating its options to collect the amounts due from River’s Edge.
DUSA’s net loss on a GAAP basis for the third quarter of 2009 was ($0.4) million, or ($0.02) per common share, compared to a net loss of ($2.8) million, or ($0.12) per common share, in the third quarter of 2008.
DUSA’s non-GAAP net loss for the third quarter of 2009, after adjustments for stock-based compensation expense, consideration provided to the former Sirius shareholders, and the non-cash change in fair value of warrants, was ($0.2) million, or ($0.01) per common share, compared to a net loss of ($1.6) million, or ($0.07) per common share, in the prior year period. The decrease in the Company’s net loss was primarily the result of the year over year increase in our PDT revenues and lower operating costs due to the absence of spending on our Phase IIb acne clinical trial which concluded in 2008.
Please refer to the section entitled “Use of Non-GAAP Financial Measures” and the accompanying financial table included at the end of this release for a reconciliation of GAAP to non-GAAP results for the three and nine month periods ending September 30, 2008 and 2009, respectively.
Year-to-Date 2009 Financial Results:
Total product revenues for the nine month period ended September 30, 2009 were $21.0 million, down 3% from $21.8 million in comparable prior year period. PDT revenues totaled $19.8 million, up $3.4 million, or 21% from $16.4 million for the comparable 2008 period. The increase in PDT revenues was attributable to a 20% increase in Kerastick® revenues and a 26% increase in BLU-U® revenues. The Kerastick® revenue improvement was driven by a 13% increase in our domestic Kerastick® volume and an overall 13% increase in our average selling price. Kerastick® sales volumes increased to 155,384 in 2009 from 145,256 units sold in 2008. Domestic Kerastick® sales volumes increased by 15,966 units, or 13%, and were partially offset by a 5,838 unit decrease in our international sales volumes. The BLU-U® revenue increase was driven by a 29% increase in sales volume. There were 198 units sold during in 2009, representing a 44 unit increase over the prior year total of 154 units. Non-PDT revenues totaled $1.2 million versus $5.4 million for the comparable 2008 period. Non-PDT revenues were adversely impacted by the absence of Nicomide® sales in 2009. In response to discussions with the Food and Drug Administration (FDA) regarding our marketing of certain products considered by the FDA to be marketed unapproved drugs, the Company stopped shipping Nicomide® into the wholesale channel in June of 2008.
DUSA’s net loss on a GAAP basis for the nine months ended September 30, 2009 was ($2.9) million or ($0.12) per common share, compared to a net loss of ($4.3) million or ($0.18) per common share in 2008.
DUSA’s non-GAAP net loss, after adjustments for stock-based compensation expense, a milestone payment made related to the Sirius acquisition, consideration provided to the former Sirius shareholders, and the non-cash change in fair value of warrants, for the nine months ending September 30, 2009 was ($1.9) million, or ($0.08) per common share, in 2009, compared to ($2.5) million, or ($0.10) per common share, in 2008. The decrease in our net loss was primarily the result of the year over year decrease in our operating costs due mainly to the absence of spending on our Phase IIb acne clinical trial which concluded in 2008, and a Prescription Drug User Fee Act (PDUFA) charge accrued in the prior year period.
As of September 30, 2009, total cash, cash equivalents, and marketable securities were $15.0 million, compared to $18.9 million at December 31, 2008.
Other Updates:
— Solid Organ Transplant Recipients Clinical Development.– In May 2009, the Company announced the initiation of its Phase IIclinical trial that is examining the safety and efficacy of PDT forthe treatment of broad area AKs and the prevention of squamous cellcarcinomas in high risk chronically immunosuppressed solid organtransplant recipients. All seven clinical sites have been initiatedand trial enrollment is currently underway.– In May 2008, DUSA filed an Orphan Drug Designation application withthe FDA with respect to the prevention of cancer occurrence in thesepatients. The Company received initial correspondence that theapplication was not granted on the basis that the agency believesthat the prevalence of the target population with the disease stateis greater than 200,000, which is the maximum number of patientsallowed under the Orphan Drug legislation. During the third quarterof 2009, DUSA met with the FDA to clarify and explain in more detailour rationale for the application and, based on that meeting, theagency has invited us to submit an amendment to our application forfurther evaluation. DUSA is in the process of drafting the amendmentand expects to submit it to the FDA later this month.
— BLU-U® Claims Expansion.– In May 2009, the Company filed a 510(k) application with the FDA toexpand the allowed claims on BLU-U® to include severe acne. Thefiling was based on the results of our Phase IIb clinical trial. Wereceived a response to our application from the FDA in June 2009.The agency requested additional information in order to complete itsreview of our application, including supplementary clinical data insupport of our claims. Based on the FDA’s requests and theanticipated costs of additional clinical trials, the Company hasdecided not to pursue the 510(k) application for an expansion of theBLU-U® claims at this time.
Revenues Table, Condensed Consolidated Balance Sheets, Condensed Consolidated Statement of Operations and GAAP to Non-GAAP reconciliation follow:
Revenues for the three month and nine month periods were comprised of the following:
Three-months ended Nine-months endedSeptember 30, September 30,2009 2008 2009 2008(Unaudited) (Unaudited) (Unaudited) (Unaudited)PDT Drug & Device Product RevenuesKerastick(R) Product Revenues:United States $5,790,000 $4,374,000 $17,096,000 $13,720,000Canada 162,000 72,000 404,000 449,000Korea 201,000 186,000 498,000 710,000Other 91,000 99,000 261,000 289,000Subtotal Kerastick(R)Product Revenues 6,244,000 4,731,000 18,259,000 15,168,000BLU-U(R) Product Revenues:United States 456,000 376,000 1,577,000 1,198,000Korea – 50,000 – 50,000Subtotal BLU-U(R)Product Revenues 456,000 426,000 1,577,000 1,248,000Total PDT Drug & DeviceProduct Revenues 6,700,000 5,157,000 19,836,000 16,416,000Total Non-PDT ProductRevenues 230,000 569,000 1,198,000 5,352,000TOTAL PRODUCT REVENUES $6,930,000 $5,726,000 $21,034,000 $21,768,000
DUSA Pharmaceuticals, Inc.Condensed Consolidated Balance SheetsSeptember 30, December 31,2009 2008(Unaudited)————————–ASSETSCURRENT ASSETSCash and cash equivalents $5,016,994 $3,880,673Marketable securities 10,012,948 15,002,830Accounts receivable, net 2,519,214 2,367,803Inventory 2,336,167 2,812,825Prepaid and other current assets 1,647,408 1,873,801——— ———TOTAL CURRENT ASSETS 21,532,731 25,937,932Restricted cash 174,170 173,844Property, plant and equipment, net 1,721,488 1,937,978Deferred charges and other assets 68,099 160,700—— ——-TOTAL ASSETS $23,496,488 $28,210,454=========== ===========LIABILITIES AND SHAREHOLDERS’ EQUITYCURRENT LIABILITIESAccounts payable $188,417 $305,734Accrued compensation 889,230 1,515,912Other accrued expenses 2,343,822 3,226,571Deferred revenue 1,045,505 611,602——— ——-TOTAL CURRENT LIABILITIES 4,466,974 5,659,819Deferred revenues 3,061,700 4,157,305Warrant liability 474,137 436,458Other liabilities 133,544 244,673——- ——-TOTAL LIABILITIES 8,136,355 10,498,255SHAREHOLDERS’ EQUITYCapital stockAuthorized: 100,000,000 shares;40,000,000 shares designated ascommon stock, no par, and60,000,000 shares issuable inseries or classes; and 40,000junior Series A preferred shares.Issued and outstanding: 24,108,908and 24,089,452 shares of commonstock, no par, at September 30,2009 and December 31, 2008,respectively 151,683,399 151,663,943Additional paid-in capital 8,122,801 7,514,900Accumulated deficit (144,725,805) (141,850,925)Accumulated other comprehensive loss 279,738 384,281TOTAL SHAREHOLDERS’ EQUITY 15,360,133 17,712,199———- ———-TOTAL LIABILITIES AND SHAREHOLDERS’EQUITY $23,496,488 $28,210,454=========== ===========
DUSA Pharmaceuticals, Inc.Consolidated Statement of OperationsThree-months ended Nine-months endedSeptember 30, September 30,2009 2008 2009 2008(Unaudited) (Unaudited) (Unaudited) (Unaudited)Product revenues $6,930,110 $5,726,071 $21,033,920 $21,767,810Cost of product revenuesand royalties 1,594,692 1,462,028 4,973,782 4,950,039Gross margin 5,335,418 4,264,043 16,060,138 16,817,771Operating costs:Research and development 963,245 1,487,816 3,225,049 5,049,327Marketing and sales 3,013,351 2,967,431 9,460,766 9,520,865General andadministrative 1,877,928 1,911,028 6,360,325 6,603,989Impairment charge forcontingentconsideration – 1,500,000 – 1,500,000Settlements, net – 650 75,000 (282,775)Total operating costs 5,854,524 7,866,925 19,121,140 22,391,406Loss from operations (519,106) (3,602,882) (3,061,002) (5,573,635)Other income:Other income, net 79,815 114,260 223,801 538,212Gain/(loss) on change infair value of warrants 24,051 651,767 (37,679) 775,636Net loss $(415,240) $(2,836,855) $(2,874,880) $(4,259,787)Basic and diluted netloss per common share $(0.02) $(0.12) $(0.12) $(0.18)Weighted average numberof common shares 24,108,908 24,078,610 24,099,786 24,078,546
Use of Non-GAAP Financial Measures
In addition to reporting financial results in accordance with GAAP, DUSA has provided in the table below non-GAAP financial measures adjusted to exclude stock-based compensation expense, consideration provided to the former Sirius shareholders, and the non-cash change in fair value of warrants. The Company believes that this presentation is useful to help investors better understand DUSA’s financial performance, competitive position and prospects for the future. Management believes that these non-GAAP financial measures assist in providing a more complete understanding of the Company’s underlying operational results and trends, and in allowing for a more comparable presentation of results. Management uses these measures along with their corresponding GAAP financial measures to help manage the Company’s business and to help evaluate DUSA’s performance compared to the marketplace. However, the presentation of non-GAAP financial measures is not meant to be considered in isolation or as superior to or as a substitute for financial information provided in accordance with GAAP. The non-GAAP financial measures used by the Company may be calculated differently from, and, therefore, may not be comparable to, similarly titled measures used by other companies.
Investors are encouraged to review the reconciliations of these non-GAAP financial measures to the comparable GAAP results, contained in the table below.
Three-months ended Nine-months endedSeptember 30, September 30,2009 2008 2009 2008(Unaudited) (Unaudited) (Unaudited) (Unaudited)GAAP net loss $(415,240) $(2,836,855) $(2,874,880) $(4,259,787)Stock-basedcompensation (a) 207,178 353,262 631,770 1,042,812Payment onacquisition (b) – 1,500,000 – 1,500,000Consideration to formerSirius shareholders (c) 5,000 – 310,000 -Change in fair valueof warrants (d) (24,051) (651,767) 37,679 (775,636)Non-GAAP adjustednet loss $(227,113) $(1,635,360) $(1,895,431) $(2,492,611)Non-GAAP basic anddiluted net lossper common share $(0.01) $(0.07) $(0.08) $(0.10)Weighted averagenumber of commonshares 24,108,908 24,078,610 24,099,786 24,078,546(a) Stock-based compensation expense resulting from the applicationof SFAS 123(R).(b) Milestone payment related to Sirius Laboratories acquisition.(c) Payment of $100,000 and accrual of $210,000 related to the release,consent and the third amendment to the merger agreement between DUSAand the former Sirius shareholders.(d) Non-cash gain/loss on change in fair value of warrants.
Conference Call Details and Dial-in Information
In conjunction with this announcement, DUSA will host a conference call
today:
Friday, November 6th – 8:30 a.m. EasternIf calling from the U.S. or Canada use the following toll-free number:800.647.4314Password – DUSAFor international callers use 502.498.8422Password – DUSAA recorded replay of the call will be available approximately 15minutes following the callU.S. or Canada callers use 877.863.0350International callers use 858.244.1268
The call will be accessible on our web site approximately six hours following the call at www.dusapharma.com.
About DUSA Pharmaceuticals
DUSA Pharmaceuticals, Inc. is an integrated dermatology pharmaceutical company focused primarily on the development and marketing of its Levulan® PDT technology platform, and complementary dermatology products. Levulan® PDT is currently approved for the treatment of Grade 1 and 2 actinic keratoses of the face and scalp. DUSA also markets other dermatology products, including ClindaReach®. DUSA is researching the use of broad area Levulan® PDT to treat AKs and prevent squamous cell carcinomas in immunosuppressed solid organ transplant recipients and is supporting research related to oral leukoplakia in collaboration with the National Institutes of Health. DUSA is based in Wilmington, Mass. Please visit our web site at www.dusapharma.com.
Except for historical information, this news release contains certain forward-looking statements that represent our current expectations and beliefs concerning future events, and involve certain known and unknown risk and uncertainties. These forward-looking statements relate to Levulan’s growth potential, expectations for filing an amendment to a regulatory application, and management’s beliefs concerning non-GAAP financial measures. These forward-looking statements are further qualified by important factors that could cause actual results to differ materially from future results, performance or achievements expressed or implied by those in the forward-looking statements made in this release. These factors include, without limitation, actions by health regulatory authorities, changing economic conditions, launch of competitive products, the status of our patent portfolio, reliance on third parties, sufficient funding, and other risks and uncertainties identified in DUSA’s Form 10-K for the year ended December 31, 2008.
CEL-SCI (CVM) to Conduct First Clinical Study of Investigational LEAPS-H1N1 Treatment
VIENNA, Va., Nov. 6 /PRNewswire/ — CEL-SCI Corporation (NYSE Amex: CVM), a developer of vaccines and therapeutics for the prevention and treatment of infectious diseases and a late-stage oncology company, announced today that an Institutional Review Board of The Johns Hopkins University School of Medicine (Johns Hopkins) has given clearance for the Company’s first clinical study to proceed. As a result, Johns Hopkins will host the study, which will be led by Principal Investigator Jonathan M. Zenilman, MD, Professor of Medicine, Johns Hopkins School of Medicine and Chief of Infectious Diseases Division, Johns Hopkins Bayview Medical Center. As previously announced, this initial study will involve taking blood from hospitalized, laboratory-confirmed H1N1 patients and activating their cells with the LEAPS H1N1 investigational therapy in order to assess the cells’ response as the basis for the planned future treatment of this patient population under a next-stage clinical trial protocol.
In September, the Company announced that the FDA had indicated that the Company could commence this study. In order for FDA to fully consider a next-stage clinical trial to evaluate LEAPS-H1N1 treatment of hospitalized patients with laboratory-confirmed H1N1 Pandemic Flu under an Exploratory IND, FDA has asked CEL-SCI to submit a detailed follow-up regulatory filing with extensive additional data.
“We are pleased that such a prestigious medical center has given clearance to proceed with this first study of our LEAPS-H1N1 treatment,” said Geert Kersten, CEL-SCI’s Chief Executive Officer. “Given the nature and severity of the virus, we are working diligently with our CRO and Johns Hopkins, and actively preparing submissions to the FDA, to support the fastest and most effective way to conduct clinical trials going forward for this unique investigational treatment.”
The initiation of CEL-SCI’s rapidly-accelerated LEAPS-H1N1 clinical development program builds on CEL-SCI’s pioneering work with its LEAPS technology in the context of H1N1. CEL-SCI’s L.E.A.P.S.(TM) (Ligand Epitope Antigen Presentation System) technology allows the Company to direct an immune response against specific disease epitopes. In the case of CEL-SCI’s investigational LEAPS-H1N1 treatment, this involves non-changing regions of H1N1 Pandemic Flu, Avian Flu (H5N1), and the Spanish Flu. This is intended to enable stimulation of the specifically-needed immune responses, while avoiding the administration of regions of H1N1, and other viruses, which may exacerbate the problem of cytokine storm, which CEL-SCI scientists believe may be involved in the death of some H1N1 patients.
L.E.A.P.S. technology is a novel T-cell modulation platform technology that enables CEL-SCI to design and synthesize, non-recombinantly, proprietary immunogens. The L.E.A.P.S. technology combines a small peptide that activates the immune system with a small peptide from a disease-related protein, such as the H1N1 hemagglutinin molecule, to make an investigational product that induces defined immune responses. Each L.E.A.P.S. construct is composed of a T cell binding ligand (TCBL) which previously has demonstrated the ability to induce and elicit protective immunity and antigen-specific antibody production in animal models. Thus, extensive animal studies conducted to date indicate that any disease for which an antigenic sequence has been identified, such as infectious, parasitic, malignant or autoimmune diseases and allergies, are potential therapeutic or preventive sites for the application of L.E.A.P.S. technology.
About CEL-SCI Corporation
CEL-SCI Corporation is developing products that empower immune defenses. Its lead product is Multikine® which is being readied for a global Phase III trial in advanced primary head and neck cancer. CEL-SCI is also developing an immunotherapy to prevent and treat swine and other influenzas using its L.E.A.P.S. technology platform and expects to soon finish the validation of its state-of-the-art facility in Maryland which it expects to utilize to launch aseptic filling for stem cell produced therapies and other biological products. The Company has operations in Vienna, Virginia, and Baltimore, Maryland.
For more information, please visit www.cel-sci.com.
When used in this report, the words “intends,” “believes,” “anticipated” and “expects” and similar expressions are intended to identify forward-looking statements. Such statements are subject to risks and uncertainties which could cause actual results to differ materially from those projected. Factors that could cause or contribute to such differences include, lack of regulatory clearance to proceed with clinical trials, an inability to duplicate the clinical results demonstrated in clinical studies that have been completed or that are initiated in the future, timely development of any potential products that can be shown to be safe and effective, unwillingness of regulatory authorities to engage in further regulatory dialogue, receiving necessary regulatory approvals, difficulties in manufacturing any of the Company’s potential products, inability to raise the necessary capital, and the risk factors set forth from time to time in CEL-SCI Corporation’s SEC filings, including but not limited to its report on Form 10- K/A for the year ended September 30, 2008. The Company undertakes no obligation to publicly release the result of any revision to these forward-looking statements which may be made to reflect the events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
EXL (EXLS) Reports 2009 Third Quarter Results
Nov. 6, 2009 (PR Newswire) — NEW YORK, Nov. 6 /PRNewswire-FirstCall/ — ExlService Holdings, Inc. (Nasdaq: EXLS), a leading provider of outsourcing and transformation services, today announced its financial results for the quarter ended September 30, 2009.
Rohit Kapoor, President and CEO, commented: “We experienced strong revenue growth this quarter and continued momentum in the market place. Our results reflect the investments and efforts that we have directed to execution and client centricity. In our outsourcing business, our team ensured a smooth ramp-up and efficient employee on-boarding for our recently acquired clients. In transformation services, we expanded our existing client relationships while increasing the annuity-based percentage of the business.
We are also pleased to announce a new eight-year agreement to service the back-office operations of American Express Business Travel and the associated acquisition of American Express’ Global Travel Service Center operations in Gurgaon, India. We estimate achieving more than $160 million in revenues over the life of the contract. Through this transaction, we will deepen our relationship with one of our key clients as well as expand our capability set in analytics, exception processing, and transaction processing. This acquisition also adds an experienced management team and an additional delivery center to EXL. We expect the transaction to close first quarter next year.”
Vishal Chhibbar, CFO, commented: “The investments we made in expanding our delivery infrastructure in the first half of this year are paying off. Sequential revenue growth was 13.7% quarter on quarter. We delivered outsourcing revenues of $37.7 million and transformation revenues of $10.5 million. We generated $9.7 million in operating cash flows and ended the quarter with a cash balance of $117.5 million versus $114.3 million last quarter. Adjusted operating margin for the quarter increased to 14.8% due to higher utilization of our physical infrastructure and people as well as strong execution across business lines. We are pleased to increase our calendar year 2009 guidance for revenue to $178.0 million – $180.0 million from $170.0 million – $175.0 million and our adjusted operating margin to 13.0% – 13.5% from 10.0% – 12.0%.”
Financial Highlights
Financial highlights are based on continuing operations of the Company and exclude the sale of the Pune assets providing services to Aviva under the BOT arrangement, which is treated as a discontinued operation as of the third quarter of 2008. Reconciliations of adjusted financial measures to GAAP are included at the end of this release.
— Revenues for the quarter ended September 30, 2009 were $48.2 millioncompared to $46.6 million for the quarter ended September 30, 2008 and$42.4 million for the quarter ended June 30, 2009. Revenues attributableto outsourcing services for the quarter ended September 30, 2009 were$37.7 million compared to $34.5 million in the quarter ended September30, 2008 and $34.5 million in the quarter ended June 30, 2009.Transformation services revenues for the quarter ended September 30,2009 were $10.5 million compared to $12.0 million in the quarter endedSeptember 30, 2008 and $7.9 million in the quarter ended June 30, 2009.
— Gross margin for the quarter ended September 30, 2009 was 40.2% comparedto 39.8% for the quarter ended September 30, 2008 and 39.1% for thequarter ended June 30, 2009. Gross margin for outsourcing services was41.0% for the quarter ended September 30, 2009 compared to 41.9% for thequarter ended June 30, 2009. Transformation services gross margin was37.5% for the quarter ended September 30, 2009 compared to 26.8% for thequarter ended June 30, 2009.
— Operating margin for the quarter ended September 30, 2009 was 10.7%compared to 11.3% for the quarter ended September 30, 2008 and 6.6% forthe quarter ended June 30, 2009; adjusted operating margin for thequarter ended September 30, 2009, excluding the impact of stock-basedcompensation expense and amortization of intangibles, was 14.8% comparedto 14.7% for the quarter ended September 30, 2008 and 11.3% for thequarter ended June 30, 2009.
— Diluted earnings per share to common stockholders for the quarter endedSeptember 30, 2009 were $0.14 compared to $0.01 for the quarter endedSeptember 30, 2008 and $0.04 for the quarter ended June 30, 2009.
Business Announcements
— Signed eight-year agreement with American Express to provide businessprocess services in conjunction with the acquisition of AmericanExpress’ Global Travel Service Center operations in Gurgaon, India. Thepurchase price for this transaction will be approximately $30.0 millionnet of working capital adjustments at closing.
— Awarded a five-year outsourcing contract with a global P&C andreinsurance company to provide business process services from both ourIndia facilities and our new Romanian facility currently in development.
— Increased annuity-based transformation revenues to comprise ofapproximately one-third of total transformation.
— Reduced days sales outstanding in the third quarter of 2009 to 59 daysfrom 68 days in the second quarter of 2009 and 76 days in the thirdquarter of 2008.
— Experienced quarterly attrition in the third quarter of 22.0% forbillable employees compared to 22.0% in the second quarter 2009 and37.3% for the third quarter of 2008.
2009 Outlook
The Company is increasing its guidance for calendar year 2009:
— Revenues of $178.0 million to $180.0 million from $170.0 million to$175.0 million.
— Adjusted operating margin, excluding the impact of stock-basedcompensation expense and amortization of intangibles, of 13.0% and 13.5%from 10.0% and 12.0%.
Conference Call
EXL will host a conference call on Friday, November 6, at 8:00 a.m. (ET) to discuss the company’s quarterly results and operating performance. The conference call will be available live via the internet by accessing the investor relations section of EXL’s website at www.exlservice.com, where the accompanying presentation and an investor factsheet can also be accessed. Please go to the website at least fifteen minutes prior to the call to register, download and install any necessary audio software.
To listen to the conference call via phone, please dial 1-800-884-5695 or 1-617-786-2960 and enter “73278987.” For those who cannot access the live broadcast, a replay will be available by dialing 1-888-286-8010 or 1-617-801-6888 and entering “85132426” from two hours after the end of the call until 11:59 p.m. (ET) on November 13, 2009. The replay will also be available on the EXL website (www.exlservice.com).
EXL will host its First Annual Investor Day on Friday, November 6, 2009 at 9:30 a.m. (ET) in New York City at the NASDAQ MarketSite in Times Square. To listen to the investor day events via phone, please dial 1-888-452-4007 or 1-719-325-2481 and reference “EXLService Investor Day 2009.” The event will also be made available via live audio webcast on the investor relations section of EXL’s website at www.exlservice.com. Slides will be made available. For those who cannot access the live broadcast, an archived webcast of the presentations will be available on the EXL website (www.exlservice.com) after the end of the event.
About ExlService Holdings, Inc.
ExlService Holdings, Inc. (Nasdaq: EXLS) is a leading provider of outsourcing and transformation services. EXL’s outsourcing services include a full spectrum of business process outsourcing services from offshore delivery centers requiring ongoing process management skills. Transformation services enable continuous improvement of client processes by bringing together EXL’s capabilities in decision analytics, risk and financial management and operations and process excellence services. Headquartered in New York, EXL primarily serves the needs of Global 1000 companies in the insurance, utilities, financial services and transportation and logistics sectors. Find additional information about EXL at www.exlservice.com.
This press release contains forward-looking statements. You should not place undue reliance on those statements because they are subject to numerous uncertainties and factors relating to the Company’s operations and business environment, all of which are difficult to predict and many of which are beyond the Company’s control. Forward-looking statements include information concerning the Company’s possible or assumed future results of operations, including descriptions of its business strategy. These statements may include words such as “may,” “will,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. These statements are based on assumptions that we have made in light of management’s experience in the industry as well as its perceptions of historical trends, current conditions, expected future developments and other factors it believes are appropriate under the circumstances. You should understand that these statements are not guarantees of performance or results. They involve known and unknown risks, uncertainties and assumptions. Although the Company believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect the Company’s actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. These factors are discussed in more details in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2008. These risks could cause actual results to differ materially from those implied by forward-looking statements in this release.
You should keep in mind that any forward-looking statement made herein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come up from time to time, and it is impossible to predict these events or how they may affect the Company. The Company has no obligation to update any forward-looking statements after the date hereof, except as required by federal securities laws.
EXLSERVICE HOLDINGS, INC.CONSOLIDATED STATEMENTS OF INCOME(Unaudited)(In thousands, except share and per share amounts)Three months ended Nine months endedSeptember 30, September 30,————- ————-2009 2008 2009 2008—- —- —- —-Revenues $48,186 $46,573 $131,557 $138,019Cost of revenues(exclusive ofdepreciation andamortization) 28,803 28,046 78,986 86,902—— —— —— ——Gross profit 19,383 18,527 52,571 51,117—— —— —— ——Operating expenses:General andadministrativeexpenses 7,770 7,349 22,137 24,193Selling and marketingexpenses 3,516 3,081 10,040 8,366Depreciation andamortization 2,918 2,832 8,137 8,302—– —– —– —–Total operating expenses 14,204 13,262 40,314 40,861—— —— —— ——Income from continuingoperations 5,179 5,265 12,257 10,256Other income/(expense):Foreign exchangegain/(loss) (1,995) (6,637) (5,014) (5,847)Interest and otherincome, net 269 1,157 856 2,294— —– — —–Income/(loss) fromcontinuing operationsbefore income taxes 3,453 (215) 8,099 6,703Income tax provision/(benefit) (541) (589) (169) (984)—- —- —- —-Income from continuingoperations 3,994 374 8,268 7,687Income/(loss) fromdiscontinued operations,net of taxes – (1,449) (139) 3,302- —— —- —–Net income/(loss) tocommon stockholders $3,994 $(1,075) $8,129 $10,989====== ======= ====== =======Earnings/(loss) per share(a):BasicContinuing operations $0.14 $0.01 $0.29 $0.27Discontinued operations – (0.05) – 0.11- —– – —-$0.14 $(0.04) $0.28 $0.38===== ====== ===== =====Diluted:Continuing operations $0.14 $0.01 $0.28 $0.26Discontinued operations – (0.05) – 0.11- —– – —-$0.14 $(0.04) $0.28 $0.38===== ====== ===== =====Weighted-average numberof shares used incomputing earningsper share:Basic 28,930,344 28,846,137 28,893,515 28,801,102Diluted 29,368,390 29,127,304 29,202,856 29,257,254(a) Per share amounts may not foot due to rounding.EXLSERVICE HOLDINGS, INC.CONSOLIDATED BALANCE SHEETS(Unaudited)(In thousands, except share and per share amounts)September 30, December 31,2009 2008—- —-AssetsCurrent assets:Cash and cash equivalents $117,510 $112,174Short-term investments 816 153Restricted cash 1,311 203Accounts receivable, net of allowancefor doubtful accounts of $259 atSeptember 30, 2009 and $128 atDecember 31, 2008 31,578 33,714Deferred tax assets 4,490 3,401Advance income-tax, net 101 2,033Prepaid expenses and other current assets 3,546 6,199—– —–Total current assets 159,352 157,877——- ——-Fixed assets, net of accumulateddepreciation of $35,787 atSeptember 30, 2009 and $27,727 atDecember 31, 2008 22,702 24,518Goodwill 19,595 17,557Intangible assets 710 -Restricted cash 3,744 281Deferred tax assets, net 7,735 3,047Other assets 10,500 8,689—— —–Total assets $224,338 $211,969======== ========Liabilities and Stockholders’ EquityCurrent liabilities:Accounts payable $2,254 $3,371Deferred revenue 3,379 2,961Accrued employee cost 12,176 14,725Accrued expenses and other currentliabilities 12,157 18,011—— ——Total current liabilities 29,966 39,068—— ——Non-current liabilities 3,433 1,569—– —–Total liabilities 33,399 40,637—— ——Commitments and contingenciesPreferred stock, $0.001 par value;15,000,000 shares authorized, none issued – -Stockholders’ equity:Common stock, $0.001 par value;100,000,000 shares authorized,29,179,013 shares issued and outstandingas of September 30, 2009 and 29,054,145shares issued and outstanding as ofDecember 31, 2008 29 29Additional paid-in capital 122,308 116,676Retained earnings 78,150 70,021Accumulated other comprehensive loss (8,572) (14,491)—— ——-191,915 172,235——- ——-Less: 247,030 shares as of September 30,2009 and 237,080 shares as ofDecember 31, 2008, held intreasury, at cost (976) (903)—- —-Total stockholders’ equity 190,939 171,332——- ——-Total liabilities and stockholders’ equity $224,338 $211,969======== ========
EXLSERVICE HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Reconciliation of Adjusted Financial Measures to GAAP Measures
In addition to its reported operating results in accordance with U.S. generally accepted accounting principles (GAAP), EXL has included in this release adjusted financial measures that the Securities and Exchange Commission defines as “non-GAAP financial measures.” Management believes that these adjusted financial measures, when read in conjunction with the Company’s reported results, can provide useful supplemental information for investors analyzing period to period comparisons of the Company’s results because the adjustments eliminate the impact of the following two items which do not directly link to the Company’s ongoing performance: (i) stock compensation and (ii) expenses associated with the amortization of acquisition-related intangibles. The Company also believes that it is unreasonably difficult to provide its financial outlook in accordance with GAAP for a number of reasons including, without limitation, the Company’s inability to predict its future stock-based compensation expense under SFAS 123R and the amortization of intangibles associated with further acquisitions. The adjusted financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations from those financial statements should be carefully evaluated.
The following table shows the reconciliation of these adjusted financial measures from GAAP measures for the three month periods ended September 30, 2009, September 30, 2008 and June 30, 2009:
(Amounts in thousands)
Ocean Power Technologies (OPTT) Project Wins A $66.5m Award from Australian Federal Government
Nov. 6, 2009 (Business Wire) — Ocean Power Technologies (Australasia) Pty Ltd (“OPTA”), a subsidiary of Ocean Power Technologies, Inc. (NASDAQ:OPTT)(LSE:OPT) (“OPT”) is pleased to announce that, in partnership with Leighton Contractors Pty Ltd (“Leighton”), it has received a A$66.46 million grant from the Federal Government of Australia to build a 19 MW wave power project off the coast of Victoria, Australia.
The award is one of four renewable energy projects approved by the Federal Government after considering over 30 applications, and is the sole wave energy venture.
The Government funding will be used by OPTA and Leighton to advance the construction of a wave power station to be built in three phases off the coast of Victoria near the city of Portland, with a total expected capacity of 19 MW – sufficient to fulfill the energy needs of approximately 10,000 homes. The project is to be developed by a special purpose company, Victorian Wave Partners Pty Ltd, that was formed by OPTA and Leighton following the signing of an agreement (as announced December 19, 2008) to collaborate in pursuing wave power projects off the east and south coasts of Australia. It is expected that work will begin on the project by the second quarter of calendar year 2010.
Dr. George W. Taylor, founder and Executive Chairman of OPT, and Chief Executive of OPTA, said: “We are delighted to have received this vote of confidence from the Australian Federal Government, which has taken a bold step to spur adoption of renewables and wave energy in particular. Our Victoria, Australia project is expected to be one of the first utility-scale wave energy projects globally, and the latest example of OPT’s lead in turning wave energy technology into a commercial reality worldwide.” Taylor, who was born and educated in Australia, continued, “We are delighted to have this opportunity to use OPT’s PowerBuoy® technology in Australia.”
The award was announced by the Australian Resources & Energy Minister, Martin Ferguson, under the Renewable Energy Demonstration Program (REDP), which has awarded funding totaling A$235 million to four renewable energy projects, aimed at meeting the Government’s target of generating 20% of the country’s energy needs from renewable sources by 2020.
The grant is conditional on the signing of a Funding Deed stipulating the conditions for the grant, which includes funding milestones. Victorian Wave Partners will be required to seek additional funding to enable the completion of the 19 MW wave power station.
Forward-Looking Statements
This release may contain “forward-looking statements” that are within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the Company’s current expectations about its future plans and performance, including statements concerning the impact of marketing strategies, new product introductions and innovation, deliveries of product, sales, earnings and margins. These forward-looking statements rely on a number of assumptions and estimates which could be inaccurate and which are subject to risks and uncertainties. Actual results could vary materially from those anticipated or expressed in any forward-looking statement made by the Company. Please refer to the Company’s most recent Form 10-K for a further discussion of these risks and uncertainties. The Company disclaims any obligation or intent to update the forward-looking statements in order to reflect events or circumstances after the date of this release.
About Ocean Power Technologies
Ocean Power Technologies, Inc. (Nasdaq: OPTT and London Stock Exchange AIM: OPT) is a pioneer in wave-energy technology that harnesses ocean wave resources to generate reliable, clean and environmentally-beneficial electricity. OPT has a strong track record in the advancement of wave energy and participates in a $150 billion annual power generation equipment market. The Company’s proprietary PowerBuoy® system is based on modular, ocean-going buoys that capture and convert predictable wave energy into low-cost, clean electricity. The Company is widely recognized as a leading developer of on-grid and autonomous wave-energy generation systems, benefiting from over a decade of in-ocean experience. OPT’s technology and systems are insured by Lloyds Underwriters of London. OPT is headquartered in Pennington, New Jersey with offices in Warwick, UK. More information can be found at www.oceanpowertechnologies.com.
About Leighton Holdings Limited
Leighton Holdings Limited is the parent company of Australia’s largest project development and contracting group. Founded in Victoria in 1949, the organization has grown from a small, privately owned civil engineering firm into a dynamic group that includes Thiess, John Holland, Leighton Properties, Leighton Contractors, Leighton International and Leighton Asia. With 37,000 employees, the Group’s operations are throughout the Asia-Pacific region on projects in Australia, New Zealand, Hong Kong, Indonesia, Malaysia, Singapore, the Philippines, Thailand, Vietnam, China, Taiwan, Sri Lanka, Macau, India and the Gulf Region. Leighton Holdings is listed on the Australian Stock Exchange (ASX:LEI) and has its head office in Sydney. Leighton Contractors is committed to becoming a leader in the renewable energy sector and has been involved in a number of sustainable energy projects in recent years, including the design and construction of numerous wind farms, biofuel projects and clean power stations throughout Australia.
Agilysys (AGYS) Reports Unaudited Fiscal 2010 Second-Quarter and First-Half Results
Nov. 4, 2009 (PR Newswire) — CLEVELAND, Nov. 4 /PRNewswire-FirstCall/ —
— Quarterly Net Income from Continuing Operations Improves Sharply to $2.9Million, or $0.12 Per Diluted Share, on 9% Lower Revenue– Revenue Increases 20% Sequentially– Debt Free With $48.2 Million Cash on Hand at Sept. 30 vs $36.2 Millionat Fiscal Year-End
Agilysys, Inc. (Nasdaq: AGYS), a leading provider of innovative IT solutions, today announced unaudited financial results for the fiscal 2010 second quarter and first half ended September 30, 2009.
(Logo: http://www.newscom.com/cgi-bin/prnh/20030915/AGLSLOGO )
Second-Quarter Unaudited Results of Operations
Revenue declined 9.0% to $156.0 million, compared with $171.4 million in the second quarter of fiscal 2009. Hardware sales declined 3.5%, services declined 32.6% and software sales increased 14.0%. Consolidated revenues rebounded 19.8% from the $130.2 million reported in the first quarter, due to double-digit growth in hardware, software and services.
Cost-cutting initiatives and lower acquisition-related intangible amortization drove selling, general and administrative (SG&A) expense down $12.4 million, or 23.9%, to $39.6 million. The Company recently executed an additional $9 million in annual savings of which approximately $4 million will be realized in the second half of fiscal 2010.
The Company’s operating income, excluding restructuring and asset impairment charges (“Charges”), improved $6.2 million to $4.3 million from the operating loss of $1.9 million last year. Lower sales and gross profit year-over-year were more than offset by lower SG&A expense. Adjusted EBITDA (operating income plus depreciation and amortization), excluding Charges, increased 44.9% to $7.4 million for the quarter, compared with $5.1 million a year ago.
Agilysys reported net income from continuing operations of $2.9 million, or $0.12 per diluted share, a significant increase from the loss of $105.3 million, or a loss of $4.66 per share, recorded in the previous year.
“We are pleased to report strong sequential growth in sales and positive net earnings for the quarter. The improvement in profitability reflects the tangible benefits realized from our cost-saving efforts,” said Martin Ellis, President and Chief Executive Officer. “In addition to improved bottom-line performance, our order pipeline has started to show modest recovery from the depressed levels of the past several quarters.”
Fiscal 2010 First-Half Unaudited Results of Operations
First-half 2010 revenue was $286.2 million compared with revenue of $351.2 million in the first six months of 2009. Revenue in the first half of fiscal 2010 decreased 18.5% reflecting lower sales in each of the company’s three business segments. Hardware declined 13.6%, services declined 36.3% and software decreased 8.2%.
SG&A expense declined $23.7 million, or 22.0%, to $84.1 million, largely due to cost reductions. Approximately $44 million in annual costs have been eliminated since the first quarter of fiscal year 2009 when the company began aggressively reducing SG&A expenses to align cost structure with deteriorating market demand. Adjusted EBITDA, excluding Charges, was $1.1 million for the six-month period, versus $3.3 million in the comparable period of fiscal 2009.
For the first six months of fiscal 2010, the company reported a net loss from continuing operations of $9.5 million, or a loss of $0.42 per share, compared with a net loss from continuing operations of $165.4 million, or a loss of $7.33 per share, in the first six months of fiscal 2009.
Business Outlook
The year-over-year declines in revenue have moderated and while some economic indicators have improved, market conditions still reflect uncertainty regarding the overall business environment and demand for IT products. Ellis commented: “The business is stabilizing, our pipeline has improved, and we expect to see a seasonal increase in sales in our third quarter ending December. As we look to the balance of fiscal 2010, we plan to continue to focus on those items under our control that can help produce tangible improvements in results. Near-term, we are optimistic regarding our outlook for the third quarter of the fiscal year and expect financial performance in second half to improve versus the first half.”
Conference Call Information
A conference call will be held at 11:00 a.m. ET on November 4, 2009 to review unaudited second-quarter and first-half fiscal 2010 results. A slide deck will be the basis for the review. Both the slide deck and the conference call can be accessed via the Investor Relations section of www.agilysys.com. In addition, a replay of the call will be archived on the Web site. If you are unable to participate during the live webcast, the call will be archived at the Investor Relations section of www.agilysys.com.
Forward-Looking Language
This release contains certain management expectations, which may constitute forward-looking information within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the Private Securities Reform Act of 1995. Forward-looking information speaks only as to the date of this presentation and may be identified by use of words such as “may,” “will,” “believes,” “anticipates,” “plans,” “expects,” “estimates,” “projects,” “targets,” “forecasts,” “continues,” “seeks,” or the negative of those terms or similar expressions. Many important factors could cause actual results to be materially different from those in forward-looking information including, without limitation, competitive factors, disruption of supplies, changes in market conditions, pending or future claims or litigation, or technology advances. No assurances can be provided as to the outcome of cost reductions, business strategies, future financial results, unanticipated downturns to our relationships with customers, unanticipated difficulties integrating acquisitions, new laws and government regulations, interest rate changes, and unanticipated deterioration in economic and financial conditions in the United States and around the world. We do not undertake to update or revise any forward-looking information even if events make it clear that any projected results, actions, or impact, express or implied, will not be realized.
Other potential risks and uncertainties that may cause actual results to be materially different from those in forward-looking information are described in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC), under Item 1A, “Risk Factors.” Copies are available from the SEC or the Agilysys website.
Use of Non-GAAP Financial Information
To supplement the unaudited condensed consolidated financial statements presented in accordance with U.S. GAAP in this release, certain non-GAAP financial measures as defined by the SEC rules are used. Management believes that such information can enhance investors’ understanding of the Company’s ongoing operations and is a measure used in the Company’s debt agreement. The non-GAAP measures included in this release have been reconciled to the comparable GAAP measures within an accompanying table, shown on the last page of this release.
About Agilysys, Inc.
Agilysys is a leading provider of innovative IT solutions to corporate and public-sector customers, with special expertise in select markets, including retail and hospitality. The Company uses technology–including hardware, software and services–to help customers resolve their most complicated IT needs. The Company possesses expertise in enterprise architecture and high availability, infrastructure optimization, storage and resource management, identity management and business continuity; and provides industry-specific software, services and expertise to the retail and hospitality markets. Headquartered in Cleveland, Agilysys operates extensively throughout North America, with additional sales offices in the United Kingdom and Asia.
News releases and other information on Agilysys are available on the Internet at: www.agilysys.com.
Investor Contact:Curtis StoutVice President and TreasurerAgilysys, Inc.440-519-8635curtis.stout@agilysys.comMedia Contact:Maureen MorrealeSenior Communications ManagerAgilysys, Inc.440-519-8161maureen.morreale@agilysys.com
AGILYSYS, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)Three Months Ended Six Months Ended(In thousands, except Sep 30, Sep 30,share and per-share ———————– ———————–data) 2009 2008 2009 2008—- —- —- —-Net sales:Products $126,925 $128,313 $231,818 $265,892Services 29,070 43,125 54,367 85,297—— —— —— ——Total net sales 155,995 171,438 286,185 351,189Cost of goods sold:Products 99,623 99,449 185,503 212,890Services 12,499 21,881 24,958 41,169—— —— —— ——Total cost ofgoods sold 112,122 121,330 210,461 254,059——- ——- ——- ——-Gross margin 43,873 50,108 75,724 97,130Selling, general andadministrative expenses 39,618 52,032 84,144 107,834Asset impairmentcharges – 112,020 – 145,643Restructuring charges 54 510 68 23,573– — — ——Operating income (loss) 4,201 (114,454) (8,488) (179,920)Other expense(income):Other expense (income),net 81 (242) (390) (480)Interest income (9) (215) (42) (462)Interest expense 253 197 460 452— — — —Income (loss) beforeincome taxes 3,876 (114,194) (8,516) (179,430)Income tax expense(benefit) 988 (8,917) 1,003 (14,080)— —— —– ——-Income (loss) fromcontinuing operations 2,888 (105,277) (9,519) (165,350)Loss from discontinuedoperations (52) (1,312) (41) (1,274)— —— — ——Net income (loss) $2,836 $(106,589) $(9,560) $(166,624)====== ========= ======= =========Income (loss) per share- basicIncome (loss) fromcontinuing operations $0.13 $(4.66) $(0.42) $(7.33)Loss fromdiscontinuedoperations (0.00) (0.06) (0.00) (0.05)—– —– —– —–Net income (loss) $0.13 $(4.72) $(0.42) $(7.38)===== ====== ====== ======Income (loss) per share- dilutedIncome (loss) fromcontinuingoperations $0.12 $(4.66) $(0.42) $(7.33)Loss fromdiscontinuedoperations (0.00) (0.06) (0.00) (0.05)—– —– —– —–Net income (loss) $0.12 $(4.72) $(0.42) $(7.38)Weighted averageshares outstandingBasic 22,625,654 22,601,549 22,626,491 22,569,206Diluted 22,879,030 22,601,549 22,626,491 22,569,206Cash dividends pershare $0.03 $0.03 $0.06 $0.06
AGILYSYS, INC.BUSINESS SEGMENT INFORMATION (UNAUDITED)Three Months Ended Six Months EndedSep 30, Sep 30,———————– ———————–(In thousands) 2009 2008 2009 2008—- —- —- —-Hospitality (HSG)Total revenue $23,836 $23,488 $40,386 $48,242Elimination ofintersegment revenue (514) (43) (1,057) (82)—- — —— —Revenue fromexternal customers $23,322 $23,445 $39,329 $48,160======= ======= ======= =======Gross margin $14,237 $14,435 $23,777 $28,844======= ======= ======= =======61.0% 61.6% 60.5% 59.9%Depreciation andamortization $1,104 $1,855 $2,227 $3,186Operating income(loss) 3,997 (102,906) 2,095 (108,765)—– ——– —– ——–Adjusted EBITDA $5,101 $(101,051) $4,322 $(105,579)====== ========== ====== =========Goodwill andintangible assetimpairment $- $103,387 $- $110,852Retail (RSG)Total revenue $23,582 $29,437 $47,970 $67,704Elimination ofintersegment revenue (19) (148) (20) (316)— —- — —-Revenue fromexternal customers $23,563 $29,289 $47,950 $67,388======= ======= ======= =======Gross margin $4,694 $6,094 $10,070 $14,493====== ====== ======= =======19.9% 20.8% 21.0% 21.5%Depreciation andamortization $44 $53 $94 $141Operating income(loss) 1,133 (5,942) 2,763 (20,314)—– —— —– ——-Adjusted EBITDA $1,177 $(5,889) $2,857 $(20,173)====== ======= ====== ========Goodwill impairment $- $6,549 $- $24,910Technology (TSG)Total revenue $109,126 $120,047 $198,950 $238,748Elimination ofintersegment revenue (16) (1,343) (44) (3,107)— —— — ——Revenue fromexternal customers $109,110 $118,704 $198,906 $235,641======== ======== ======== ========Gross margin $24,909 $29,009 $42,638 $51,446======= ======= ======= =======22.8% 24.4% 21.4% 21.8%Depreciation andamortization $817 $4,061 $4,768 $8,534Operating income(loss) 6,320 5,732 3,786 (26,313)—– —– —– ——-Adjusted EBITDA $7,137 $9,793 $8,554 $(17,779)====== ====== ====== ========Goodwill impairment $- $2,084 $- $9,881Restructuring charge $- $510 $- $23,573
AGILYSYS, INC.BUSINESS SEGMENT INFORMATION(Unaudited)Three Months Ended Six Months EndedSep 30, Sep 30,———————– ———————–(In thousands) 2009 2008 2009 2008—- —- —- —-Corporate / OtherGross margin $33 $570 $(761) $2,347=== ==== ===== ======Depreciation andamortization (a) $1,205 $1,079 $2,409 $2,098Operating loss (7,249) (11,338) (17,132) (24,528)—— ——- ——- ——-Adjusted EBITDA $(6,044) $(10,259) $(14,723) $(22,430)======= ======== ======== ========Restructuring charge $54 $- $68 $-ConsolidatedTotal revenue $156,544 $172,972 $287,306 $354,694Elimination ofintersegmentrevenue (549) (1,534) (1,121) (3,505)—- —— —— ——Revenue fromexternal customers $155,995 $171,438 $286,185 $351,189======== ======== ======== ========Gross margin $43,873 $50,108 $75,724 $97,130======= ======= ======= =======28.1% 29.2% 26.5% 27.7%Depreciation andamortization (a) $3,170 $7,048 $9,498 $13,959Operating income(loss) 4,201 (114,454) (8,488) (179,920)—– ——– —— ——–Adjusted EBITDA $7,371 $(107,406) $1,010 $(165,961)====== ========= ====== =========Goodwill andintangible assetimpairment $- $112,020 $- $145,643Restructuring charge $54 $510 $68 $23,573(a) Does not include the amortization of deferred financing feestotaling $132 and $57 for the three months ended Sept. 30, 2009 and2008, respectively, and $220 and $113 for the six months endedSept. 30, 2009 and 2008, respectively, all of which related to theCorporate/Other segment.
AGILYSYS, INC.CONDENSED CONSOLIDATED BALANCE SHEETSSep 30, Mar 31,(In thousands) 2009 2009—- —-ASSETS (Unaudited)Current assets:Cash and cash equivalents $48,197 $36,244Accounts receivable, net 125,166 151,944Inventories, net 22,036 27,216Deferred income taxes – current,net 6,845 6,836Prepaid expenses and othercurrent assets 5,337 4,564Income taxes receivable 3,874 3,871Assets of discontinued operations- current 285 1,075— —–Total current assets 211,740 231,750Goodwill 50,563 50,382Intangible assets, net 29,877 35,699Deferred income taxes – non-current,net 511 511Other non-current assets 18,467 29,008Assets of discontinued operations -non-current – 56Property and equipment, net 29,471 27,030—— ——Total assets $340,629 $374,436======== ========LIABILITIES AND SHAREHOLDERS’ EQUITYCurrent liabilities:Accounts payable $92,832 $28,042Floor plan financing – 74,159Deferred revenue 20,435 18,709Accrued liabilities 20,665 37,807Long-term debt – current 195 238Liabilities of discontinuedoperations – current 575 1,176— —–Total current liabilities 134,702 160,131Other non-current liabilities 21,827 21,588Shareholders’ equity:Common shares, without par value,at $0.30 stated value; authorized80,000,000 shares; 31,606,831shares issued and 23,031,119shares outstanding at Sep 30, 2009 9,370 9,366Treasury stock (8,575,712 and8,896,778 shares at Sep 30, 2009,and Mar 31, 2009, respectively) (2,670) (2,670)Capital in excess of stated value (9,934) (11,036)Retained earnings 189,027 199,947Accumulated other comprehensiveloss (1,693) (2,890)—— ——Total shareholders’ equity 184,100 192,717——- ——-Total liabilities andshareholders’ equity $340,629 $374,436======== ========
AGILYSYS, INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)Six Months Ended(In thousands) Sep 30,————————Operating activities: 2009 2008—- —-Net loss $(9,560) $(166,624)Add: Loss from discontinuedoperations 41 1,274– —–Loss from continuing operations (9,519) (165,350)Adjustments to reconcile net lossfrom continuing operations to netcash provided by (used for)operating activities (net ofeffects from business acquisitions):Impairment of goodwill andintangible assets – 166,223Gain on redemption of cost basisinvestment – (51)Gain on partial redemption ofinvestment in The Reserve Fund’sPrimary Fund (70) -Loss on the sale of securities 91 -Depreciation 1,891 1,927Amortization 7,827 12,145Deferred income taxes (9) (18,372)Stock-based compensation 1,073 2,152Changes in working capital:Accounts receivable 26,778 32,699Inventories 5,180 2,001Accounts payable 65,150 (76,327)Accrued and other liabilities (15,309) (40,816)Income taxes payable (798) 946Other changes, net (866) (3,252)Other non-cash adjustments (2,357) (2,487)—— ——Total adjustments 88,581 76,788—— ——Net cash provided by (used for)operating activities 79,062 (88,562)Investing activities:Proceeds from (claim on) The ReserveFund’s Primary Fund 2,337 (7,657)Proceeds from redemption of costbasis investment – 7,172Proceeds from the borrowings againstcompany-owned life insurancepolicies 12,500 -Change in cash surrender value ofcompany-owned life insurancepolicies (107) (103)Acquisition of businesses, net ofcash acquired – (2,381)Purchase of property and equipment (5,923) (2,603)—— ——Net cash provided by (used for)investing activities 8,807 (5,572)Financing activities:Floor plan financing agreement, net (74,159) 75,551Proceeds from borrowings undercredit facility 5,000 -Principal payments under creditfacility (5,000) -Principal payment under long-termobligations (206) (47)Issuance of common shares 33 -Debt financing costs (1,520) -Dividends paid (1,360) (1,358)—— ——Net cash used for (provided by)financing activities (77,212) 74,146Effect of exchange rate changeson cash 1,092 (101)—– —-Cash flows provided by (used for)continuing operations 11,749 (20,089)Cash flows of discontinued operations:Operating cash flows 204 (29)Investing cash flows – 35– –Net increase (decrease) in cash 11,953 (20,083)Cash at beginning of period 36,244 69,935—— ——Cash at end of period $48,197 $49,852======= =======
AGILYSYS, INC.RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA(Unaudited)Three Months Ended Six Months EndedSep 30, Sep 30,———————– ———————–(In thousands) 2009 2008 2009 2008—- —- —- —-Net income (loss) $2,836 $(106,589) $(9,560) $(166,624)Plus:Interest expense, net 244 (18) 418 (10)Other income, net 81 (242) (390) (480)Income tax expense(benefit) 988 (8,917) 1,003 (14,080)Depreciation andamortizationexpense (a) 3,170 7,048 9,498 13,959Loss from discontinuedoperations, net oftax 52 1,312 41 1,274– — — —–Adjusted EBITDA 7,371 (107,406) 1,010 (165,961)Asset impairmentcharges – 112,020 – 145,643Restructuring charges 54 510 68 23,573– — — ——Adjusted EBITDA excludingasset impairment andrestructuring charges $7,425 $5,124 $1,078 $3,255====== ====== ====== ======(a) Depreciation and amortization expense excludes amortization ofdeferred finance costs, totaling $132 and $57 for the three monthsended Sept. 30, 2009 and 2008, respectively, and totaling $220 and$113 for the six months ended Sept. 30, 2009 and 2008,respectively, as such costs are already included in interestexpense, net.
MOD-PAC CORP. (MPAC) Reports Earnings per Share of $0.29 on $12.6 million in Revenue in Third Quarter 2009
Nov. 4, 2009 (Business Wire) — MOD-PAC CORP. (NASDAQ: MPAC), a manufacturer of custom and stock paper board packaging and personalized print products, today reported total revenue of $12.59 million in the third quarter of 2009, which ended October 3, 2009, relatively flat compared with revenue of $12.64 million in the 2008 third quarter. Strong sales growth in the custom folding carton line was offset by reduced sales in the stock packaging and personalized print lines which have been impacted heavily by the weak economy and the elimination of sales to the commercial print market due to the rationalization of the Company’s specialty print and direct mail product line in June this year. Excluding last year’s specialty print and direct mail sales, total revenue in the recent quarter grew $1.0 million, or 8.8%, as compared with the 2008 third quarter.
Net income for the quarter was $1.01 million, or $0.29 per diluted share compared with net income of $14 thousand, or $0.00 per diluted share, in the third quarter of 2008. Net income increased as a result of improved operating leverage from the rationalization and a $263 thousand fair value adjustment to increase the specialty print and direct mail assets.
Third Quarter 2009 Sales Review: Existing customers drove custom folding carton growth
Sales of folding cartons, which include custom folding cartons and stock packaging, were up 11.2%, or $1.18 million, to $11.65 million in the 2009 third quarter from $10.47 million in the prior year third quarter. Custom folding carton sales drove the product line increase.
Custom folding carton sales for the third quarter of 2009 were $9.41 million, up $1.21 million, or 14.8%, from 2008 third quarter sales of $8.19 million. Greater sales from two large existing customers and the addition of one new customer, more than offset reduced sales from customers impacted by the economy and decreased waste sales due to a drop in the recycled paperboard market.
Stock packaging sales were $2.24 million in the 2009 third quarter, a decline of $39 thousand, or 1.7%, from $2.28 million the prior year period. The stock packaging line has been impacted by economic conditions over the last year.
Print service sales, which are now solely comprised of personalized print, were down
$1.23 million, or 60.7%, to $0.80 million in the 2009 third quarter compared with $2.03 million in the same period in 2008. Of the decline, $1.06 million was related to sales in last year’s third quarter for specialty print and direct mail to the commercial market which the Company exited in June of this year. Personalized print sales declined $169 thousand, or 17.5%, to $0.80 million in the current quarter compared with sales of $0.97 million in last year’s third quarter. The decrease was primarily due to weakness in economic conditions.
Mr. Daniel G. Keane, President and CEO of MOD-PAC CORP., commented, “Our custom folding carton sales have grown exceptionally well. Many of our customers produce private label products for the consumer staples market. Consumers in this economic environment are highly cost conscious and tend to buy more store brands which drives sales for our customers. Importantly, as our customers are realizing stronger sales, we are also capturing a greater percentage of their business and adding new accounts.”
Third Quarter Operating Results: Product line rationalization improved operating leverage
Gross profit for the 2009 third quarter was $2.52 million, or 20.0% of total revenue, compared with gross profit of $1.98 million, or 15.6% of total revenue, in the same period the prior year. The improvement in gross profit and margin was driven by the measurable savings realized from the product line rationalization. Savings were realized through lower depreciation expense and decreased labor and supply costs. Lower freight and utility costs also helped margin improvement. Partially offsetting those gains were generally weaker custom folding carton sales mix and decreased product waste sales due to a drop in the recycled paperboard market.
Selling, general and administrative (SG&A) expense was relatively flat at $1.84 million, or 14.6% of total revenue, in the third quarter of 2009 when compared with $1.85 million, or 14.7% of total revenue, in the same period the prior year. Lower labor costs due to reduced headcount from the product line rationalization combined with decreased professional service fees more than offset increased commission expense.
Mr. David B. Lupp, Chief Operating Officer and Chief Financial Officer commented, “Our strategic decision to rationalize our product lines and refine our focus to our core products is validated by this quarter’s strong results. Our concentration is on establishing a solid business model that can succeed in all economic environments. We are generating cash, strengthening our balance sheet, maintaining cost discipline, and driving our value proposition to grow sales.”
Other income was $0.4 million in the third quarter of 2009. Included in this balance is a $263 thousand fair value adjustment to increase the balance of assets held for sale associated with the rationalized product line based on bids received in a public auction held in September 2009. These assets had previously been written down in the second quarter of 2009. Also included in other income was a $104 thousand gain on the sale of assets associated with the rationalized product line.
Adjusted earnings before interest, asset impairment, fair value adjustment, taxes, depreciation and amortization, and non-cash option expense (Adjusted EBITDA) was $1.51 million in the third quarter of 2009 compared with $1.04 million in the 2008 third quarter. The Company believes that, when used in conjunction with GAAP measures, Adjusted EBITDA, which is a non-GAAP measure, helps in the understanding of operating performance. (See the reconciliation of Net Income or Loss to Adjusted EBITDA in the attached table.)
As required by generally accepted accounting principles, in the second quarter of 2009 the Company recorded a full valuation allowance on its net deferred tax asset due to the uncertainty with respect to utilizing it in the future based on a past trend of operating losses. As a result, the effective tax rate for the third quarter of 2009 was 0% compared with an effective tax rate of 74.1% in the third quarter of 2008.
Liquidity: Cash from asset and insurance policy sales used to pay down $1.7 million on line
Cash and cash equivalents were $0.32 million at October 3, 2009, an increase compared with $0.17 million at July 4, 2009 and $0.20 million at December 31, 2008. MOD-PAC generated $1.0 million in cash from operations during the quarter from higher net income and non-cash depreciation and amortization expense, partially offset by increased working capital requirements. Also, in the third quarter of 2009, the Company surrendered life insurance policies and received the cash surrender value of $0.86 million and sold assets associated with its rationalized product line for net proceeds of $0.2 million. Proceeds were used to pay down debt and to increase cash on hand.
Capital expenditures in the third quarter of 2009 were $0.14 million compared with $0.34 million in the same period last year. Equipment upgrades made up the bulk of the third quarter 2009 expenditures. Capital expenditures were $0.8 million in the first nine months of 2009 compared with $1.6 million in the same period last year. Capital expenditures are expected to be approximately $1.0 million in fiscal year 2009. Depreciation and amortization was $2.5 million in the first nine months of 2009 compared with $2.9 million for the first nine months of 2008. Lower depreciation reflects a reduced asset base from the write-down of assets associated with the rationalized product line in the second quarter of 2009.
MOD-PAC has access to a $5.0 million committed line of credit with a commercial bank, which expires in March 2010. The line of credit balance at October 3, 2009, was $0.6 million, down $1.7 million from $2.3 million at July 4, 2009, and down $0.4 million from $1.0 million at December 31, 2008. An additional $0.2 million of the line of credit was in use through standby letters of credit. The Company believes that cash and cash equivalents and net cash provided by operations and its available line are sufficient to meet requirements in 2009 and beyond.
On October 9, 2009, MOD-PAC entered into a contract to sell its Blasdell, NY facility. The sale is subject to various terms and conditions and there is no assurance that the facility will be sold. The net proceeds of the sale are expected to approximate the carrying value of the property at October 3, 2009.
There were no shares repurchased by the Company in the first nine months of 2009. MOD-PAC has authorization to repurchase 75,885 shares.
Nine-Month Review: 16.7% growth in custom folding carton sales more than offsets other product line declines
Net sales for the nine months of 2009 were up 2.3% to $35.7 million compared with $34.9 million in the first nine months of 2008. New customer accounts and business expansion from several existing customers drove the 16.7% year-to-date growth in custom folding carton sales to $25.9 million, compared with $22.2 million in the corresponding period in 2008. Stock packaging sales were down 7.9% to $5.9 million for the first nine months of 2009, while personalized print sales declined 22.5% to $2.4 million over the same time period. Both product lines were negatively affected by reduced demand due to economic conditions. For the nine-month period last year, there was $3.2 million in specialty print and direct mail sales compared with the $1.5 million in the first half of this year while the Company still had the full product line. Excluding this product line from both years, total sales were $34.2 million for the nine-month period in 2009 up 7.8% compared with $31.7 million for the same period last year.
Gross profit for the first nine months of 2009 was $4.4 million, or 12.2% of total revenue, down from gross profit of $4.6 million, or 13.0% of total revenue, in the same period the prior year. The decline was driven by generally weaker sales mix, decreased waste sales due to a drop in the recycled paperboard market, and increased labor and repairs expense, partially offset by lower depreciation expense.
SG&A expense decreased 3.3% to $5.8 million, or 16.1% of total revenue, in the first nine months of 2009 compared with $6.0 million, or 17.0% of total revenue, in the first nine months of 2008. Lower professional service costs as a result of cost reduction initiatives implemented in 2008 contributed to the reduction in year-over-year expenses.
Included in the first nine months of 2009, was $2.2 million of expense that was associated with the write-down of impaired assets in the second quarter of 2009 due to the Company’s rationalization of the specialty print and direct mail product line.
Other income was $0.4 million in the first nine months of 2009, compared with $93 thousand in the same period the prior year. Included in the 2009 year-to-date balance is the previously noted adjustment to increase assets held for sale to fair value and the gain on the sale of assets associated with the rationalized product line.
For the nine-month period, Adjusted EBITDA was $1.5 million in 2009 compared with $1.8 million in 2008. (See the reconciliation of Net Income or Loss to Adjusted EBITDA in the attached table.)
Webcast and Conference Call
The release of the financial results will be followed by a company-hosted teleconference and webcast on Wednesday, November 4 at 4:30 p.m. Eastern Time. During the teleconference, Daniel G. Keane, President and Chief Executive Officer, and David B. Lupp, Chief Operating Officer and Chief Financial Officer, will review the financial and operating results for the period and discuss MOD-PAC CORP.’s corporate strategy and outlook. A question-and-answer session will follow.
The MOD-PAC conference call can be accessed the following ways:
The live webcast can be found at http://www.modpac.com. Participants should go to the website 10 – 15 minutes prior to the scheduled conference in order to register and download any necessary audio software.
The teleconference can be accessed by dialing (201) 689-8562 and requesting Conference ID Number 334954 approximately 5 – 10 minutes prior to the call.
The archived webcast will be at http://www.modpac.com. A transcript will also be posted once available. A replay can also be heard by calling (201) 612-7415 and entering conference ID number 334954 and account number 3055. The telephonic replay will be available from 7:30 p.m. Eastern Time the day of the teleconference through 11:59 p.m. Eastern Time on November 11, 2009.
ABOUT MOD-PAC CORP.
MOD-PAC CORP. is a high value-added, on demand print services firm providing products and services in two product categories: folding cartons and personalized print. Within folding cartons, MOD-PAC provides CUSTOM FOLDING CARTONS for branded and private label consumer products in the food and food service, healthcare, medical and automotive industries. The Company also offers a line of STOCK PACKAGING primarily to the retail confectionary industry. MOD-PAC’s PERSONALIZED PRINT product line is a comprehensive offering for consumer and corporate social occasions.
MOD-PAC’s strategy for growth is to leverage its capabilities to innovate and aggressively integrate technology into its production operations providing cost-effective solutions for its customers. Through its large, centralized facility, the Company has captured significant economies of scale by channeling large numbers of small-to-medium-sized orders through its operations due to its rapid order change out skills. Applying its lean manufacturing processes coupled with state-of-the-art printing technologies, MOD-PAC is able to address short-run, highly variable content needs of its customers with quick turn around times relative to industry standards.
Additional information on MOD-PAC can be found at its website: http://www.modpac.com.
Safe Harbor Statement: This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. One can identify these forward-looking statements by the use of the words such as “expect,” “anticipate,” “plan,” “may,” “will,” “estimate” or other similar expressions. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors, which could cause actual results to differ materially, include market events, competitive pressures, changes in technology, customers preferences and choices, success at entering new markets, the execution of its strategy, marketing and sales plans, the rate of growth of internet related sales, the effectiveness of agreements with print distributors and other factors which are described in MOD-PAC’s annual report on Form 10K on file with the Securities and Exchange Commission. The Company assumes no obligation to update forward-looking information in this press release whether to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial conditions or prospects, or otherwise.
FINANCIAL TABLES FOLLOW.
MOD-PAC CORP.
CONSOLIDATED INCOME STATEMENT DATA
(unaudited)
(in thousands except per share data)
Three months ended Nine months ended
10/3/2009 9/27/2008 10/3/2009 9/27/2008
Revenue
Product sales $ 12,446 $ 12,504 $ 35,727 $ 34,922
Rent 141 133 399 356
Total Revenue 12,587 12,637 36,126 35,278
Cost of products sold 10,071 10,662 31,732 30,675
Gross profit 2,516 1,975 4,394 4,603
Gross profit margin 20.0 % 15.6 % 12.2 % 13.0 %
Selling, general and administrative expense 1,841 1,854 5,799 5,994
Write-down of impaired assets 0 0 2,175 0
Income (Loss) from operations 675 121 (3,580 ) (1,391 )
Operating loss margin 5.4 % 1.0 % -9.9 % -3.9 %
Interest expense, net 64 79 194 203
Other income 400 12 410 93
Income (Loss) before taxes 1,011 54 (3,364 ) (1,501 )
Income tax expense (benefit) 0 40 (118 ) (477 )
Net income (loss) $ 1,011 $ 14 $ (3,246 ) $ (1,024 )
Basic earnings (loss) per share: $ 0.29 $ 0.00 $ (0.95 ) $ (0.30 )
Diluted earnings (loss) per share: $ 0.29 $ 0.00 $ (0.95 ) $ (0.30 )
Weighted average diluted shares outstanding 3,470 3,430 3,430 3,436
MOD-PAC CORP.
PRODUCT LINE REVENUE DATA
(unaudited)
($, in thousands)
Three Months Ended % Nine Months Ended % 2009 YTD % of
10/3/2009 9/27/2008 change 10/3/2009 9/27/2008 change Total
FOLDING CARTONS
Custom folding cartons $ 9,408 $ 8,194 14.8 % $ 25,888 $ 22,189 16.7 % 72.5 %
Stock packaging 2,239 2,278 -1.7 % 5,888 6,392 -7.9 % 16.5 %
Folding cartons subtotal 11,647 10,472 11.2 % 31,776 28,581 11.2 % 89.0 %
PRINT SERVICES
Specialty print & direct mail 0 1,064 -100.0 % 1,519 3,201 -52.5 % 4.2 %
Personalized 799 968 -17.5 % 2,432 3,140 -22.5 % 6.8 %
Print services subtotal 799 2,032 -60.7 % 3,951 6,341 -37.7 % 11.0 %
Total product revenue $ 12,446 $ 12,504 -0.5 % $ 35,727 $ 34,922 2.3 % 100.0 %
MOD-PAC CORP.
CONSOLIDATED BALANCE SHEET DATA
(dollars in thousands)
October 3, 2009 December 31,
(Unaudited) 2008
Current assets:
Cash and cash equivalents $ 315 $ 200
Trade accounts receivable, net of allowance
of $186 in 2009 and $170 in 2008 5,457 4,750
Inventories 4,118 4,313
Prepaid expenses 406 357
Total current assets 10,296 9,620
Property, plant and equipment, at cost 63,579 68,707
Less accumulated depreciation (47,685 ) (47,116 )
Net property, plant and equipment 15,894 21,591
Assets held for sale 2,091 –
Other assets 465 1,340
Totals assets $ 28,746 $ 32,551
Current liabilities:
Current maturities of long-term debt $ 186 $ 168
Accounts payable 2,902 3,222
Accrued expenses 729 581
Line of credit, current 600 –
Total current liabilities 4,417 3,971
Line of credit, long-term – 1,000
Long-term debt 2,301 2,413
Other liabilities 52 37
Deferred income taxes – 118
Total liabilities $ 6,770 $ 7,539
Shareholders’ equity:
Common stock, $.01 par value
Authorized 20,000,000 shares, issued
3,443,557 in 2009, 3,439,347 in 2008 34 34
Class B common stock, $.01 par value
Authorized 5,000,000 shares, issued
637,272 in 2009, 641,482 in 2008 7 7
Additional paid-in capital 2,595 2,385
Retained earnings 25,555 28,801
28,191 31,227
Less treasury shares, at cost 650,698 in
2009 and 2008 (6,215 ) (6,215 )
Total shareholders’ equity 21,976 25,012
Total liabilities and shareholders’ equity $ 28,746 $ 32,551
MOD-PAC CORP.
CONSOLIDATED STATEMENT OF CASH FLOWS
(dollars in thousands)
(Unaudited)
Nine Months Ended
October 3,
2009
September 27,
2008
Cash flows from operating activities:
Net loss $ (3,246 ) $ (1,024 )
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization 2,531 2,850
Provision for doubtful accounts 45 11
Stock option compensation expense 210 208
Deferred income taxes (118 ) (479 )
Write-down of impairment of assets 2,175 –
Fair value adjustment for assets held for sale (263 ) –
Gain on disposal of assets (80 ) (54 )
Cash flows from changes in operating assets and liabilities
Accounts receivable (752 ) (1,149 )
Inventories 195 (598 )
Prepaid expenses (49 ) (57 )
Other liabilities 15 (234 )
Accounts payable (320 ) 648
Accrued expenses 148 (5 )
Net cash provided by operating activities 491 117
Cash flows from investing activities:
Proceeds from the sale of assets 212 125
Proceeds from the cash surrender value of officers’ life insurance policies 857
–
Change in other assets (78 ) (45 )
Capital expenditures (841 ) (1,601 )
Net cash provided by (used in) investing activities 150 (1,521 )
Cash flows from financing activities:
Principal payments on long-term debt (126 ) (79 )
(Decrease) increase in line of credit (400 ) 1,125
Proceeds from loans – 580
Purchase of treasury stock – (150 )
Deferred financing fees – (5 )
Net cash (used in) provided by financing activities (526 ) 1,471
Net increase in cash and cash equivalents 115 67
Cash and cash equivalents at beginning of year 200 98
Cash and cash equivalents at end of period $ 315 $ 165
MOD-PAC CORP.
Reconciliation between GAAP Net Income or Loss and Adjusted EBITDA
(in thousands) Three Months Ended Nine Months Ended
10/3/2009 9/27/2008 10/3/2009 9/27/2008
GAAP Net Income (Loss) $ 1,011 $ 14 $ (3,246 ) $ (1,024 )
Interest 63 79 194 203
Write-down of impaired assets 0 0 2,175 0
Fair value adjustment for assets held for sale (263 ) 0 (263 ) 0
Taxes 0 40 (118 ) (477 )
Depreciation and amortization 662 860 2,531 2,850
Stock-based compensation 41 45 210 208
Adjusted EBITDA $ 1,514 $ 1,038 $ 1,483 $ 1,760
Adjusted EBITDA = earnings before interest, asset impairment, fair value adjustment, taxes, depreciation and amortization and non-cash option expense.
Seabridge Gold (SA) Reports Positive Drill Results From Kerr Zone
TORONTO, CANADA — (Marketwire) — 11/03/09 — Seabridge Gold Inc. (TSX: SEA)(NYSE Amex: SA) –
Results from this year’s core drill program at KSM’s Kerr zone should successfully upgrade in-pit inferred resources to measured and indicated and improve the waste to ore ratio by converting material previously defined as waste to mineral resources.
Seabridge President Rudi Fronk commented that “this year’s drilling on all three zones at KSM more than achieved our objectives. We are highly confident that we have upgraded the inferred resources in the proposed pit. We have also expanded the resource and improved the ore to waste ratio by discovering new zones and expanding the predicted width of the mineralization. Our next steps are to complete a new KSM resource estimate by year end, followed by new mine plans and culminating in a Preliminary Feasibility Study in March 2010.”
The 30 year mine plan in the 2009 Preliminary Assessment captured 1.29 billion tonnes of mineralized material of which 277 million (21%) was classified as inferred mineral resources. To upgrade these in-pit inferred resources to the measured and indicated categories, additional drilling was completed during the 2009 program at the Mitchell, Sulphurets and Kerr zones. Drill results from the Mitchell and Sulphurets zone were announced previously, with results exceeding expectations (see news releases dated October 27, 2009 and October 14, 2009). Conversion of in pit inferred resources to measured and indicated will enable Seabridge to report them as mine reserves in its Preliminary Feasibility Study scheduled for completion in March 2010.
At the Kerr zone, the mine plan captured 148 million tonnes in the indicated category (grading 0.25 grams per tonne gold and 0.47% copper) plus 18 million tonnes in the inferred category (grading 0.23 gpt gold and 0.43% copper). Four holes totaling approximately 900 meters were drilled this summer to upgrade the in-pit inferred resources in the Kerr zone. Assay results of the four infill holes are as follows:
———————————————————————— To Length Gold CopperDrill Hole Depth (meters) From (meters) (meters) (meters) (gpt) (%)———————————————————————— 72.0 134.0 62.0 0.17 0.18 K-09-01 351.0 ————- ——– ——– —– —— 218.2 351.0 132.8 0.19 0.57————————– ————- ——– ——– —– —— K-09-02 201.0 85.0 201.0 116.0 0.25 0.39————————– ————- ——– ——– —– —— 21.3 92.3 71.0 0.30 0.75 K-09-03 175.0 ————- ——– ——– —– —— 92.3 144.4 52.1 0.16 0.24————————– ————- ——– ——– —– —— K-09-04 150.0 6.8 120.0 113.2 0.19 0.37————————– ————- ——– ——– —– ——
The above reported drill holes were designed to intersect the true width of the Kerr zone.
Descriptions of the four infill drill holes follow.
K-09-01: Southern portion of the Kerr zone, section 58500, drilled at 90 degrees azimuth and inclination of minus 53 degrees. This is an infill hole down-dip of the zone. The upper mineral intercept was not predicted by the model and should convert material previously classified as waste to mineral resources. Gold and copper grades in the lower zone met expectations and the mineralized width was greater than predicted by the resource model.
K-09-02: North-central part of the Kerr zone, section 59500, drilled at azimuth 90 degrees and inclination of minus 70 degrees. This is an infill hole on the down-dip side of the zone. Grade and width of mineralization are consistent with the resource model.
K-09-03: Northern part of the Kerr zone, section 59750, drilled at an inclination of minus 55 degrees and azimuth 90 degrees. This is an infill hole on the up-dip side of the zone. Overall widths of mineralization are consistent with the resource model. Gold and copper grades in the upper interval exceed predictions from the resource model and in the lower interval are in line with expectations.
K-09-04: Northern part of the Kerr zone, section 59850, drilled at azimuth 90 degrees and inclination of minus 60 degrees. This is an infill hole on the up-dip side of the zone. The width and grade of mineralization are as predicted from the resource model.
The 100% owned KSM project, located near Stewart, British Columbia, Canada, is one of the world’s largest undeveloped gold/copper projects. The following table summarizes NI 43-101 compliant mineral resources prepared by Resource Modeling Incorporated for all three zones at the KSM project using a 0.50 gram per tonne gold equivalent cut-off grade (see news releases dated March 11, 2009 and March 25, 2009 for details).
KSM Mineral Resources at 0.50 gpt Gold Equivalent Cutoff-Grade——————————————————————— Zone Measured Mineral Resources——————————————————————— Tonnes (000) Au (g/t) Au Ozs (000) Cu (%) Cu Lbs (millions)——————————————————————— Mitchell 579,300 0.66 12,292 0.18 2,298———————- ——– ———— —— —————–Sulphurets No measured resources——————————————————————— Kerr No measured resources——————————————————————— Total 579,300 0.66 12,292 0.18 2,298———————- ——– ———— —— ————————————————————————————— Zone Indicated Mineral Resources———————————————————————- Tonnes (000) Au (g/t) Au Ozs (000) Cu (%) Cu Lbs (millions)———————————————————————- Mitchell 930,600 0.62 18,550 0.18 3,692———————- ——– ———— —— —————–Sulphurets 87,300 0.72 2,021 0.27 520———————- ——– ———— —— —————– Kerr 225,300 0.23 1,666 0.41 2,036———————- ——– ———— —— —————– Total 1,243,200 0.56 22,237 0.23 6,248———————- ——– ———— —— ————————————————————————————– Zone Measured plus Indicated Mineral Resources——————————————————————— Tonnes (000) Au (g/t) Au Ozs (000) Cu (%) Cu Lbs (millions)——————————————————————— Mitchell 1,509,900 0.64 30,842 0.18 5,990———————- ——– ———— —— —————–Sulphurets 87,300 0.72 2,021 0.27 520———————- ——– ———— —— —————– Kerr 225,300 0.23 1,666 0.41 2,036———————- ——– ———— —— —————– Total 1,822,500 0.59 34,529 0.21 8,546———————- ——– ———— —— ————————————————————————————— Zone Inferred Mineral Resources———————————————————————- Tonnes (000) Au (g/t) Au Ozs (000) Cu (%) Cu Lbs (millions)———————————————————————- Mitchell 514,900 0.51 8,442 0.14 1,589———————- ——– ———— —— —————–Sulphurets 160,900 0.63 3,259 0.17 603———————- ——– ———— —— —————– Kerr 69,900 0.18 405 0.39 601———————- ——– ———— —— —————– Total 745,700 0.50 12,106 0.17 2,793———————- ——– ———— —— —————–
Resource Modeling Incorporated is an independent consulting firm under the direction of Michael J. Lechner, Licensed Registered Geologist (Arizona) #37753, P.Geo. (British Columbia) #155344, AIPG CPG #10690 and a Qualified Person under NI-43-101.
Exploration activities at KSM are being conducted by Seabridge personnel under the supervision of William E. Threlkeld, Senior Vice President of Seabridge and a Qualified Person as defined by National Instrument 43-101. An ongoing and rigorous quality control/quality assurance protocol is being employed during the 2009 program including blank and reference standards in every batch of assays. Cross-check analyses are being conducted at a second external laboratory on 10% of the samples. Samples are being assayed at Eco Tech Laboratory Ltd., Kamloops, B.C., using fire assay atomic adsorption methods for gold and total digestion ICP methods for other elements.
Seabridge holds a 100% interest in several North American gold resource projects. The Company’s principal assets are the KSM property located near Stewart, British Columbia, Canada and the Courageous Lake gold project located in Canada’s Northwest Territories. For a breakdown of Seabridge’s mineral resources by project and resource category please visit the Company’s website at http://www.seabridgegold.net/resources.php.
All resource estimates reported by the Corporation were calculated in accordance with the Canadian National Instrument 43-101 and the Canadian Institute of Mining and Metallurgy Classification system. These standards differ significantly from the requirements of the U.S. Securities and Exchange Commission. Mineral resources which are not mineral reserves do not have demonstrated economic viability.
Statements relating to the estimated or expected future production and operating results and costs and financial condition of Seabridge, planned work at the Corporation’s projects and the expected results of such work are forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by words such as the following: expects, plans, anticipates, believes, intends, estimates, projects, assumes, potential and similar expressions. Forward-looking statements also include reference to events or conditions that will, would, may, could or should occur. Information concerning exploration results and mineral reserve and resource estimates may also be deemed to be forward-looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. These forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable at the time they are made, are inherently subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements, including, without limitation: uncertainties related to raising sufficient financing to fund the planned work in a timely manner and on acceptable terms; changes in planned work resulting from logistical, technical or other factors; the possibility that results of work will not fulfill projections/expectations and realize the perceived potential of the Corporation’s projects; uncertainties involved in the interpretation of drilling results and other tests and the estimation of gold reserves and resources; risk of accidents, equipment breakdowns and labour disputes or other unanticipated difficulties or interruptions; the possibility of environmental issues at the Corporation’s projects; the possibility of cost overruns or unanticipated expenses in work programs; the need to obtain permits and comply with environmental laws and regulations and other government requirements; fluctuations in the price of gold and other risks and uncertainties, including those described in the Corporation’s Annual Information Form filed with SEDAR in Canada (available at www.sedar.com) for the year ended December 31, 2008 and in the Corporation’s Annual Report Form 20-F filed with the U.S. Securities and Exchange Commission on EDGAR (available at www.sec.gov/edgar.shtml).
Forward-looking statements are based on the beliefs, estimates and opinions of the Corporation’s management or its independent professional consultants on the date the statements are made.
Donegal Insurance Group (DGICA) Wins Applied Systems Interface Partner Award
MARIETTA, Pa., Nov. 3, 2009 (GLOBE NEWSWIRE) — Donegal Insurance Group (Nasdaq:DGICA) (Nasdaq:DGICB) recently received the 2009 Interface Partner Award from insurance technology company Applied Systems. The award recognizes Donegal’s achievements in agency-carrier communication.
Applied Systems acknowledged Donegal’s leadership and innovations, citing the carrier’s commitment to providing agents with download, real-time inquiry and real-time rating.
“We are pleased to receive this award in recognition of our commitment to develop and maintain technology comparable to our very large competitors,” said Donald H. Nikolaus, President and Chief Executive Officer of Donegal Insurance Group. “We have appreciated the assistance of Applied Systems in developing real-time agency interfaces to significantly streamline our data exchange and communications with our independent agents.”
Donegal received the partnership award during a ceremony in Kansas City, Missouri, at 2009 TENCon, the Technology, Education & Networking Conference hosted by ASCnet, the Applied Systems Client Network.
“The continued commitment of Donegal and other forward-thinking carriers keeps our industry advancing,” said Doug Johnston, Vice President, Partner Relations & Product Innovations at Applied Systems. “We recognize the company’s dedication to interface partnerships with its agencies, and for overall benefit to the industry.”
Donegal Insurance Group consists of seven property and casualty insurance companies that provide full lines of personal, farm, and commercial insurance to various regions in the country through a network of independent insurance agencies. For more information about Donegal Insurance Group, please visit www.donegalgroup.com.
Applied Systems Inc. develops, sells and supports insurance agency and broker management systems and provides services for accounting, customer, policy, claims management, and all related agent and broker functions. More than 130,000 users in 11,000 agencies of every size and complexity level use Applied Systems solutions built around core systems Epic, TAM, Vision and DORIS. In addition, the company leads the industry in agency-carrier real-time and batch communication solutions. For more information about Applied Systems, please visit www.appliedsystems.com.
United Security Bancshares, Inc. (USBI) Reports Third Quarter Results
THOMASVILLE, Ala., Nov. 3 /PRNewswire-FirstCall/ — United Security Bancshares, Inc. (Nasdaq: USBI) today reported net income of $1.0 million, or $0.17 per diluted share, for the third quarter ended September 30, 2009, compared with $1.4 million, or $0.23 per diluted share, for the same period of 2008.
“We are pleased to report that United Security maintained its solid profitability in the third quarter despite the weak economy,” stated R. Terry Phillips, President and Chief Executive Officer of United Security Bancshares, Inc. “We remain focused on improving our operating results but expect that the continuation of soft real estate markets and higher unemployment in our core markets will result in lower loan demand and will put additional pressure on our loan quality metrics.”
“United Security and First United Security Bank continue to be rated as ‘well-capitalized,’ the highest regulatory rating. We believe that our strong capital base provides us with an important buffer to the soft economy. We remain diligent in monitoring our loan quality metrics and working through our non-performing assets to minimize future losses and to protect our capital base,” continued Mr. Phillips.
Third Quarter Results
United Security’s net income was down from 2008 due to lower net interest income, lower non-interest income and higher non-interest expenses. Net interest income was reduced by lower loan demand and lower interest rates. Non-interest expenses were up from 2008 due to higher costs for FDIC insurance premiums and increased expenses for other real estate owned (OREO).
Interest income totaled $11.8 million in the third quarter of 2009, compared with $12.8 million in the third quarter of 2008. The decrease in interest income was due to a decline in yield and a change in the mix of earning assets.
Interest expense declined 17.5% to $3.3 million in the third quarter of 2009, compared with $4.0 million in the third quarter of 2008. The decline in interest expense was due primarily to lower rates, offset partially by an increase in interest-bearing liabilities. Average deposits increased 3.1% to $499.3 million, compared with $484.1 million in the third quarter of 2008.
Net interest income decreased 3.8% to $8.5 million in the third quarter of 2009, compared with $8.8 million in the third quarter of the prior year. Net interest margin was 5.46% in the third quarter of 2009, compared with 5.91% in the third quarter of 2008. The decline in net interest income was due to a decrease in average loans, combined with the decline in net interest margin.
“Our net interest margin has been under pressure due to our asset yields declining at a faster rate than our funding costs since last year,” noted Mr. Phillips. “The overall decline in our loans has also resulted in our excess liquidity being invested in short-term investments that have a much lower yield than our loan portfolio. In addition, the increase in non-accrual loans since last year has reduced our interest income, further affecting our margin.”
Provision for loan losses was $1.5 million in the third quarter of 2009, or 1.5% annualized of average loans, compared with $1.9 million, or 1.9% annualized of average loans, in the third quarter of 2008. Net interest income after provision for loan losses rose to $7.0 million in the third quarter of 2009, compared with $6.9 million in the third quarter of 2008.
“Our provision for loan losses was up slightly from the second quarter of 2009, reflecting an increase in our non-performing loans,” stated Mr. Phillips. “We have experienced an increase in our non-performing loans since last year as a result of the soft economy. We remain focused on working through our non-performing loans and foreclosed real estate to improve our credit quality and to improve our future earnings potential.”
Total non-interest income decreased 21.7% to $1.2 million in the third quarter of 2009, compared with $1.5 million in the third quarter of the prior year. The decline in non-interest income was due to lower service charges, credit life insurance income and other income.
Non-interest expense increased 8.5% to $7.0 million in the third quarter of 2009, compared with $6.4 million in the third quarter of 2008. Salary and employee benefit costs were up 8% to $3.5 million due, in part, to higher health insurance costs. Other expenses rose 14.8% to $2.6 million due to higher FDIC insurance premiums and costs related to OREO, offset partially by lower legal expenses compared with the third quarter of 2008.
Nine Month Results
For the first nine months of 2009, net income increased 8.0% to $5.2 million, or $0.86 per diluted share, compared with $4.8 million, or $0.79 per diluted share, for the first nine months of 2008. The 2009 results include $2.7 million, or $0.30 per share, of non-interest income related to the settlement of a lawsuit.
For the 2009 nine-month period, net interest income declined 3.6% to $25.4 million, compared with $26.4 million for the same period last year. The decrease in net interest income was due primarily to a decline in interest earned on loans related to lower volume and yields.
Provision for loan losses declined to $4.9 million in the first nine months of 2009, or 1.5% annualized of average loans, compared with $5.5 million, or 1.7% annualized of average loans, for the same period in 2008.
Non-interest income rose 40.2% to $6.4 million for the first nine months of 2009, compared with $4.6 million for the same period in 2008. The increase in non-interest income resulted primarily from proceeds of $2.7 million from the settlement of a lawsuit.
Non-interest expense was up 6.0% for the first nine months of 2009 to $19.6 million, compared with $18.5 million in the same period of 2008. The increase was due to higher salary and benefits, FDIC insurance and assessment costs, offset partially by lower legal expenses.
Shareholders’ equity totaled $82.7 million, or book value of $13.75 per share, at the end of the third quarter of 2009. Return on average assets for the first nine months of 2009 was 1.01%, and return on average equity was 8.64%. Regular dividends were $0.11 per share in the third quarter of 2009.
About United Security Bancshares, Inc.
United Security Bancshares, Inc. is a bank holding company that operates nineteen banking offices in Alabama through First United Security Bank. In addition, the Company’s operations include Acceptance Loan Company, Inc., a consumer loan company, and FUSB Reinsurance, Inc., an underwriter of credit life and credit accident and health insurance policies sold to the bank’s and ALC’s consumer loan customers. The Company’s stock is traded on the Nasdaq Capital Market under the symbol “USBI.”
Forward-Looking Statements
This press release contains forward-looking statements as defined by federal securities laws. Statements contained in this press release that are not historical facts are forward-looking statements. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. USBI undertakes no obligation to update these statements following the date of this press release, except as required by law. In addition, USBI, through its senior management, may make from time to time forward-looking public statements concerning the matters described herein. Such forward-looking statements are necessarily estimates reflecting the best judgment of USBI’s senior management based upon current information and involve a number of risks and uncertainties. Certain factors that could affect the accuracy of such forward-looking statements are identified in the public filings made by USBI with the Securities and Exchange Commission, and forward-looking statements contained in this press release or in other public statements of USBI or its senior management should be considered in light of those factors. With respect to the adequacy of the allowance for loan losses for USBI, these factors include, but are not limited to, the rate of growth (or lack thereof) in the economy, the relative strength and weakness in the consumer and commercial credit sectors and in the real estate markets and collateral values. There can be no assurance that such factors or other factors will not affect the accuracy of such forward-looking statements.
UNITED SECURITY BANCSHARES, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION(Dollars in Thousands, Except Per Share Data)September 30, December 31,2009 2008—- —-(Unaudited)ASSETSCash and Due from Banks $11,641 $13,246Interest-Bearing Deposits in Banks 128 126— —Total Cash and Cash Equivalents 11,769 13,372Federal Funds Sold 19,875 1,105Investment Securities Available-for-Sale, atfair market value 192,852 184,213Investment Securities Held-to-Maturity, atcost 1,250 0Federal Home Loan Bank Stock, at cost 5,700 5,236Loans, net of allowance for loan losses of$7,992 and $8,532, respectively 397,746 399,483Premises and Equipment, net 17,542 17,495Cash Surrender Value of Bank-Owned LifeInsurance 12,039 11,724Accrued Interest Receivable 4,608 4,843Goodwill 4,098 4,098Investment in Limited Partnerships 1,879 1,993Other Assets 25,868 24,440—— ——Total Assets $695,226 $668,002======== ========LIABILITIES AND SHAREHOLDERS’ EQUITYDeposits $500,014 $485,117Accrued Interest Expense 3,037 3,402Short-Term Borrowings 718 2,294Long-Term Debt 100,000 90,000Other Liabilities 8,709 8,525—– —–Total Liabilities 612,478 589,338——- ——-Commitments and ContingenciesShareholders’ Equity:Common Stock, par value $0.01 per share,10,000,000 shares authorized; 7,317,560shares issued; 6,017,649 and 6,018,154 sharesoutstanding, respectively 73 73Surplus 9,233 9,233Accumulated Other Comprehensive Income, netof tax 4,356 2,476Retained Earnings 90,211 87,999Less Treasury Stock: 1,299,911 and 1,299,406shares at cost, respectively (21,125) (21,117)——- ——-Total Shareholders’ Equity 82,748 78,664—— ——Total Liabilities and Shareholders’ Equity $695,226 $668,002======== ========UNITED SECURITY BANCSHARES, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF INCOME(Dollars in Thousands, Except Per Share Data)Three Months Ended Nine Months EndedSeptember 30, September 30,2009 2008 2009 2008—- —- —- —-(Unaudited) (Unaudited)INTEREST INCOME:Interest and Fees on Loans $9,661 $10,535 $29,150 $32,860Interest on Investment Securities 2,143 2,299 6,568 6,541—– —– —– —–Total Interest Income 11,804 12,834 35,718 39,401INTEREST EXPENSE:Interest on Deposits 2,338 3,047 7,515 10,174Interest on Borrowings 952 941 2,793 2,867— — —– —–Total Interest Expense 3,290 3,988 10,308 13,041—– —– —— ——NET INTEREST INCOME 8,514 8,846 25,410 26,360PROVISION FOR LOAN LOSSES 1,489 1,927 4,857 5,467—– —– —– —–NET INTEREST INCOME AFTER PROVISIONFOR LOAN LOSSES 7,025 6,919 20,553 20,893NON-INTEREST INCOME:Service and Other Chargeson Deposit Accounts 758 842 2,150 2,448Credit Life Insurance Income 231 295 646 554Other Income 218 404 3,615 1,572— — —– —–Total Non-Interest Income 1,207 1,541 6,411 4,574NON-INTEREST EXPENSE:Salaries and Employee Benefits 3,538 3,276 10,175 9,641Occupancy Expense 498 503 1,412 1,403Furniture and Equipment Expense 316 361 926 1,064Other Expense 2,598 2,263 7,117 6,414—– —– —– —–Total Non-Interest Expense 6,950 6,403 19,630 18,522—– —– —— ——INCOME BEFORE INCOME TAXES 1,282 2,057 7,334 6,945PROVISION FOR INCOME TAXES 255 655 2,166 2,159— — —– —–NET INCOME $1,027 $1,402 $5,168 $4,786====== ====== ====== ======BASIC AND DILUTED NET INCOMEPER SHARE $0.17 $0.23 $0.86 $0.79===== ===== ===== =====DIVIDENDS PER SHARE $0.11 $0.27 $0.49 $0.81===== ===== ===== =====
SOURCE United Security Bancshares, Inc.
Taseko (TGB) Announces a New 7.7 Million Oz Gold and 3.6 Billion Lb Copper Reserve at Prosperity
Nov. 2, 2009 (PR Newswire) — VANCOUVER, Nov. 2 /PRNewswire-FirstCall/ – Taseko Mines Limited (TSX: TKO; NYSE Amex: TGB) (“Taseko” or the “Company”) is pleased to announce a 70% increase in mineral reserves at its 100% owned Prosperity Project, from 487 million tonnes to 830 million tonnes.
The reserve increase will add 3.0 million ounces of recoverable gold and 1.6 billion lbs of recoverable copper to the Prosperity reserve base, bringing total recoverable metal to 7.7 million ounces of gold and 3.6 billion lbs of copper.
This increase in recoverable metal, under present mine design criteria, extends Prosperity’s mine life from 20 years to 33 years.
Reserves were previously based on a $5.25 Net Smelter Return (“NSR”) cut-off using gold and copper prices of $500/oz and $1.50/lb, respectively. Current reserves are based on a $5.50 NSR cut-off using gold and copper prices of $650/oz and $1.65/lb, respectively.
Russell Hallbauer, President and CEO of Taseko commented, “In keeping with our historically conservative approach to reserve calculations, we have modestly adjusted our gold and copper price assumptions to better reflect longer-term metal price expectations. This increase in metal price assumptions will allow us to mine deeper, higher grade mineralization.
Prosperity now has the largest gold/copper reserve base of any mining project in Canada. At present gold and copper prices the projected operating costs per ounce of gold, net of copper credit, will be negative US$330/oz. With the size of this reserve and the longevity of its mine life, Prosperity will be one of the great mines of Canada. The 64% increase in recoverable gold and 80% increase in recoverable copper will allow Prosperity to operate for over 3 decades.
We look forward to the upcoming completion of our Environmental Assessment Review and getting on with building a mine that can benefit so many local, provincial and national stakeholders.”
------------------------------------------------------------------------- Mineral Reserves @ C$5.50 NSR/t Cut-off ------------------------------------------------------------------------- Grade Recoverable Metal Contained Metal Size ----------------------------------------------- M Tonnes Au Cu Au Cu Au Cu (g/t) (%) (M oz) (B lbs) (M oz) (B lbs) ------------------------------------------------------------------------- Proven 481 0.46 0.26 5.0 2.4 7.1 2.8 ------------------------------------------------------------------------- Probable 350 0.35 0.18 2.7 1.2 3.9 1.4 ------------------------------------------------------------------------- Total 831 0.41 0.23 7.7 3.6 11.0 4.2 ------------------------------------------------------------------------- Note: Recoveries for Cu and Au are 87% and 69% respectively
Remaining measured and indicated resources are grading 0.40 g/t gold and 0.30% copper containing 2.3 million ounces of gold and 1.2 billion lbs of copper (no recoveries applied).
The mineral resource and reserve estimations were completed by Taseko staff under the supervision of Scott Jones, P.Eng., Vice-President, Engineering and a Qualified Person under National Instrument 43-101. Mr Jones has verified the methods used to determine grade and tonnage in the geological model, reviewed the long range mine plan, and directed the updated economic evaluation. The estimates for the reserves used long term metal prices of US$1.65/lb for copper and US$650/oz for gold and a foreign exchange of C$0.82 per US dollar. Mr Jones has reviewed this release. A technical report will be filed on www.sedar.com.
Russell Hallbauer President and CEO No regulatory authority has approved or disapproved of the information contained in this news release.
Forward Looking Statements
This release includes certain statements that may be deemed “forward-looking statements”. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include capital market conditions, commodities market prices, exploitation and exploration successes, lack of continuity of mineralization, continued availability of capital and financing, the ability to obtain and maintain required permits, including environmental, construction and mining permits and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Company, Investors should review the Company’s annual Form 40-F filing with the United States Securities and Exchange Commission or the Company’s home jurisdiction filings at www.sedar.com.
Mountain Lake (MOA) Arranges Financing for Fall Drilling of its Little River Gold-Antimony project in Newfoundland
Nov. 2, 2009 (Filing Services Canada) — Mountain Lake Resources Inc (MOA – TSX Venture, MLKRF – OTCBB_Pink_Sheets), (“Mountain Lake” or the “Company”) reports it is arranging a non-brokered private placement (the “Offering”) to raise $450,000. Under the terms of the Offering, the Company expects to place 1,500,000 flow-through share units (the “Units”).
The Units will be offered at a price of $0.30 and will consist of one flow-through share and one-half of a transferable common share purchase warrant (the “Warrants”), with each full warrant exercisable at a price of $0.45 per common share for a period of 24 months following the close of the offering. The Company has the right to accelerate the expiry date of the Warrants if the volume weighted average closing price of the Company’s common shares, as traded on the TSX Venture Exchange, exceeds $0.90 per share for more than 20 consecutive trading days. In that event, the Warrants will expire 30 days after the Company has given notice of the accelerated expiry to the Warrant holders.
The net proceeds from the Offering will be used to fund the Company’s fall/winter exploration work in Newfoundland, which will commence with the initial phase of drilling on the Little River project where a recent trenching program returned up to 32.7 gpt gold and 5.5% antimony in bedrock grab samples.
The offering is subject to TSX Venture Exchange approval. All securities issued in connection with this offering will be subject to a four-month hold period in accordance with securities regulation.
About Mountain Lake Resources Inc.
Mountain Lake Resources Inc. (TSX-V: MOA) is a diversified junior mining and exploration company whose corporate strategy is to build shareholder value through the exploration and development of economically viable mineral properties. Current projects include: a 30% interest in the Valentine Lake gold project (Newfoundland) with and option to acquire the remaining 70% interest from Richmont Mines Inc.; a 100% interest in the Bobby’s Pond base metals project (Newfoundland) with an option to acquire initially a 51% interest in the surrounding claims from Cornerstone Resources; an option to earn a 100% interest in the Little River gold+/-antimony exploration property (Newfoundland); and a 2,350,000 share (~6.5%) stake in Etruscan Diamonds Limited, an alluvial diamond operation (South Africa). For more information visit: www.mountain-lake.com
Blockbuster Reports Strong Attach Rates on Consumer Electronics Powered by Roxio CinemaNow
NOVATO, Calif. and DALLAS, Nov. 2 /PRNewswire-FirstCall/ — Sonic Solutions® (Nasdaq: SNIC) and Blockbuster Inc. (NYSE: BBI, BBI.B), today announced that the recently launched BLOCKBUSTER On Demand® movie service, has exceeded all initial launch expectations and is being rapidly embraced by consumers who are looking for the latest movie releases on their connected TVs and set-top players. Reflecting the growing interest in digital delivered entertainment and the broad appeal of the Blockbuster brand, device reports show BLOCKBUSTER On Demand is driving attach rates over 50% higher than historic figures for Roxio CinemaNow(TM) powered services and increasing transaction volume beyond expectations.
“Latest device reports are a clear indication that we’ve found a winning formula in combining our Roxio CinemaNow content delivery platform with one of the most recognizable brands in entertainment,” said Dave Habiger, CEO of Sonic Solutions. “The Blockbuster brand clearly means ‘new movies here’ and is prompting consumers to jump at the chance to see first run hits from the comfort of their living rooms.”
The BLOCKBUSTER On Demand service is built on Sonic’s Roxio CinemaNow video platform, enabling consumers to find and access their favorite Hollywood hits from a broad range of consumer electronics devices, including availability now on select Samsung HDTVs, Blu-ray Players and Home Theater Systems as well as TiVo DVRs. Providing the same flexibility in compatibility and portability that consumers have come to expect from physical DVDs, the Roxio CinemaNow platform makes it possible for device manufacturers to add internet-delivered video services to their devices quickly and easily with leading brands, such as Blockbuster.
“Our alliances with Samsung and TiVo have allowed us to bring service to millions of homes across the country and we’re delighted with how quickly consumers are recognizing the value of the BLOCKBUSTER On Demand movie service,” said Jim Keyes, Blockbuster Chairman and CEO. “In a matter of a few weeks, we have already seen adoption for our digital services almost double following these initial device deployments, and we fully anticipate rates to continue to increase as more products are introduced by our device partners in the future. Additionally, by the end of the year we expect to add high definition content to our growing digital library. Through our multi-channel approach, we are the only entertainment provider that offers customers convenient access to media entertainment whenever and however they want it.”
With the BLOCKBUSTER On Demand service, consumers have access to the hottest new releases from Blockbuster to rent or purchase — whether it’s the latest comedies such as “Imagine That,” action-packed thrillers like “State of Play,” hot box office hits such as “Ghosts of Girlfriends Past” or award winners like “The Curious Case of Benjamin Button.” BLOCKBUSTER On Demand brings consumers titles as soon as they become available for digital download, typically within a couple of weeks after you can buy or rent them at your local BLOCKBUSTER store, and months or years before you can watch them on a streaming subscription services. Most rentals will range from $2.99 for classic hits to $3.99 for new releases.
About Blockbuster Inc.
Blockbuster Inc. is a leading global provider of rental and retail movie and game entertainment. The Company provides its customers with convenient access to media entertainment anywhere and any way they want it – whether in-store, by-mail, through vending and kiosks or digital download. With a highly recognized brand name and a library of over 125,000 movie and game titles, Blockbuster leverages its multi-channel presence to further build upon its leadership position in the media entertainment industry and to best serve the two million daily global customers and over 50 million annual global customers. The Company may be accessed worldwide at www.blockbuster.com.
About Sonic Solutions
Sonic Solutions® (NASDAQ: SNIC) is powering the digital media ecosystem through its complete range of Hollywood to Home(TM) applications, services, and technologies. Sonic’s Roxio® products enable consumers to easily manage and enjoy personal digital media content and, through Roxio CinemaNow(TM), access premium Hollywood entertainment on a broad range of connected devices. A wide array of leading technology firms, professionals, and developers rely on Sonic to bring innovative digital media functionality to next-generation devices and platforms. Sonic Solutions is headquartered in Marin County, California.
Forward-Looking Statements
This release may contain forward looking statements that are based upon current expectations, including the market acceptance and success of the alliance between Blockbuster and Sonic Solutions. Actual results could differ materially from those projected in the forward looking statements as a result of various risks and uncertainties. This press release should be read in conjunction with Blockbuster’s and Sonic Solutions’ most recent annual reports on Form 10-K, quarterly Forms 10-Q and other reports on file with the Securities and Exchange Commission, which contain a more detailed discussion of each company’s business including risks and uncertainties that may affect future results. Neither Blockbuster nor Sonic Solutions undertakes to update any forward looking statements.
Sonic, the Sonic logo, Sonic Solutions, Roxio, Roxio CinemaNow, and Hollywood to Home, are trademarks or registered trademarks owned by Sonic Solutions in the United States and/or other countries. All other company or product names are trademarks of their respective owners and, in some cases, are used by Sonic Solutions under license. Specifications, pricing and delivery schedules are subject to change without notice.
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