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High-grade gold intercepts continue at Rubicon’s (RBY) F2 Core Zone, Red Lake, Ontario
VANCOUVER, Aug. 18 /PRNewswire-FirstCall/ – Rubicon Minerals Corporation (RMX:TSX: / RBY:NYSE-AMEX) is pleased to provide an update of the latest diamond drill results at its 100% owned Phoenix Gold Project, located in the heart of the prolific Red Lake Gold District of Ontario. All new drill results are shown in Table 1 and Figures 1 and 2. Emerging gold zone outlines of the F2 Gold System are shown in Figure 3.
Deep drilling in target area 8 confirms gold mineralizing system continues to depth
Recent drilling of deep target area 8 from both underground and surface has returned positive gold results in the southwestern part of the F2 Gold System at depth (Figure 1 and 2). Underground drill hole 305-06 intersected 0.54 oz/ton gold over 14.8 feet (18.6 g/t gold over 4.5 metres), and is part of a wider intercept grading 0.32 oz/ton gold over 29.5 feet (10.9 g/t gold over 9.0 metres) at a vertical depth of 4580 feet (1396 metres) below surface. Surface holes F2-100A and F2-100A-W1, testing target areas 5 and 8 intersected multiple gold zones including a bonanza hit of 22.0 oz/ton gold over 1.6 feet (754.2 g/t gold over 0.5 metres) at a vertical depth of 4331 feet (1320 metres) below surface in drill hole F2-100A and 4.16 oz/t gold over 1.6 feet (142.6 g/t gold over 0.5m) within a broader zone grading 0.27 oz/t gold over 31.5 feet (9.2 g/t gold over 9.6 metres) at a vertical depth of 3563 feet (1086 metres) below surface in drill hole F2-100A-W1 (Table 1 and Figure 2).
These results begin to fill in the deep target areas and demonstrate that the robust F2 Gold System, as documented by over 492,000 feet (150,000 metres) of drilling to date, continues to depth.
Drilling in target area 5 expands the 122-10 Zone to depth
The F2 Gold System is comprised of several zones identified to date: the F2 Core Zone, the Crown Zone, the 102 Zone in the Northern Extension Area, the Hanging Wall Zone, the 122-40 Zone and the 122-10 Zone (Figure 3). Drill hole 122-67 was designed to test approximately 820 feet (250 metres) below the 122-10 Zone (named after the discovery hole announced September 14, 2009 that intersected 0.40 oz/ton gold over 147.3 feet (13.7 g/t gold over 44.9 metres) including a higher grade section of 0.83 oz/t gold over 59.0 feet (28.4 g/t gold over 18.0 metres)). Drill hole 122-67 intersected 0.48 oz/ton gold over 16.7 feet (16.3 g/t gold over 5.1 metres) including 1.16 oz/t gold over 3.3 feet (39.9 g/t gold over 1.0 metres) at a vertical depth of 3087 feet (941 metres) below surface (Table 1 and Figures 1 and 2) and further extends the 122-10 Zone to depth.
Underground drift on the 305 metre level at halfway point – on target to reach F2 Core Zone in October
The 305 metre level drift (1001 feet) is designed to provide access for both definition drilling and bulk sampling of the F2 Core Zone. As of July 31, the drift reached the halfway point and is on schedule to access the F2 Core Zone by October 2010. A new drill station was set-up at the halfway point and three drills are now turning on the 305 metre level. This latest drill station allows for more cost-efficient drilling due to its closer proximity to the gold bearing zones discovered to date in the central F2 Gold System. Upon completion of the drift in October, Rubicon plans to establish a cross drift and up to four drill stations to be used for the definition drilling of the F2 Core Zone.
Rubicon plans to commence in August, 2010 the excavation of a second egress (a second underground exit to surface) from the 305 metre level as this is a Provincial regulatory requirement to permit mining from underground. The Company has also secured an option to purchase a larger hoist than currently on site, to allow for the project’s potential mining capacity to be increased up to 2000 tonnes per day.
Rubicon Minerals Corporation is a well-funded exploration and development company, focused on exploring and developing its high-grade gold discovery at its Phoenix project in Red Lake, Ontario. Rubicon controls over 65,000 acres (100 square miles) of prime exploration ground in the prolific Red Lake gold district of Ontario which hosts Goldcorp’s high-grade, world class Red Lake Mine. Rob McEwen, President and CEO of McEwen Capital and former Chairman and CEO of Goldcorp, owns 21.4% of the issued shares of the Company.
RUBICON MINERALS CORPORATION
“David W. Adamson”
President & CEO
Table 1: Assay Results
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Hole Depth to Centre Gold Width Gold Width 9X
of Intercept (g/t) (m) (oz/t) (ft) Target
(m) Area
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F2-100 Anomalous - Auto-wedged and hole continued as F2-100A
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F2-100A 1085 7.3 1.8 0.21 5.9 5
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F2-100A 1129 3.1 14.0 0.09 45.9 5
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Incl. 1127 6.8 5.0 0.20 16.4 5
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Incl. 1129 17.4 1.0 0.51 3.3 5
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F2-100A 1174 4.9 2.5 0.14 8.2 8
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F2-100A 1276 4.6 8.0 0.13 26.2 8
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Incl. 1275 15.1 1.0 0.44 3.3 8
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And Incl. 1279 16.6 1.0 0.48 3.3 8
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F2-100A 1320 754.2 0.5 22.00 1.6 8
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F2-100A 1453 13.3 1.4 0.39 4.6 8
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F2-100A-W1 1082 9.2 9.6 0.27 31.5 5
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Incl. 1086 142.6 0.5 4.16 1.6 5
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F2-100A-W1 1327 6.4 3.0 0.19 9.8 8
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F2-102 515 24.8 1.0 0.72 3.3 4
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F2-102 552 3.2 8.0 0.09 26.2 6
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Incl. 555 11.9 1.0 0.35 3.3 6
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F2-103 69 373.8 0.5 10.90 1.6 4
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F2-103A 376 12.4 1.5 0.36 4.8 4
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F2-103A 395 3.5 5.0 0.10 16.4 4
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F2-103A 407 27.4 0.5 0.80 1.6 4
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F2-103A 414 6.2 2.5 0.18 8.2 4
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F2-104 486 3.2 12.4 0.09 40.7 4
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Incl. 481 9.9 2.0 0.29 6.6 4
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F2-104 582 40.0 1.0 1.17 3.3 6
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122-67 824 3.0 6.0 0.09 19.7 5
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Incl. 825 11.0 1.0 0.32 3.3 5
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122-67 941 16.3 5.1 0.48 16.7 5
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Incl. 940 21.8 3.6 0.64 12.0 5
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Incl. 940 39.9 1.0 1.16 3.3 5
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122-69 430 23.7 1.0 0.69 3.3 1
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122-70 167 170.9 1.0 4.98 3.3 3
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122-70 817 34.3 1.0 1.00 3.3 5
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122-70 847 3.3 4.0 0.10 13.1 5
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305-05 310 5.2 3.4 0.15 11.2 1
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Incl. 310 11.6 1.2 0.34 3.9 1
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305-05 311 3.1 7.5 0.09 24.6 1
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Incl. 311 24.2 0.5 0.71 1.6 1
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305-05-W1 310 3.9 6.0 0.11 19.7 1
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305-05-W1 363 3.5 7.0 0.10 23.0 1
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Incl. 362 6.0 3.0 0.18 9.8 1
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305-05-W1 370 3.4 8.0 0.10 26.2 1
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305-06 1398 10.9 9.0 0.32 29.5 8
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Incl. 1396 18.6 4.5 0.54 14.8 8
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Incl. 1394 104.7 0.5 3.05 1.6 8
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305-10 Anomalous
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305-11 292 8.3 3.6 0.24 11.8 1
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Incl. 292 25.7 1.1 0.75 3.6 1
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Holes with the prefix '122' and '305' were drilled from underground.
Assays are uncut. Reported results satisfy the following criteria:
greater than 10.0 gram gold x metre product and greater than 3.0 g/t
gold. Anomalous holes satisfy the following criteria: greater than 2.5
gram gold x metre product and less than 10.0 gram gold x metre product
and greater than 2 g/t gold. A complete listing of results to date for
the F2 Zone is available at www.rubiconminerals.com.
To view Figure 1: F2 Gold System Plan Map, Figure 2: Composite Long Section Looking Northwest and 9X Target Outlines and Figure 3: F2 Gold System Plan Map with Emerging Outlines of Gold Zones, please visit: http://files.newswire.ca/617/rubiconfig123.pdf
Assaying and Qualified Person
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Assays were conducted on sawn NQ-sized half core sections. Unless stated, reported intercept widths are core lengths. Further drilling is required in such cases before the true widths of reported intercepts can be determined. The saw blade is routinely cleaned between samples when visible gold is noted during logging and sampling of the drill core. Assays were conducted by SGS Minerals Services using standard fire assay on a 30 gram (1 assay ton) sample with a gravimetric finish procedure. Assays are uncut as is standard practice in Red Lake. Standards, blanks and check assays were included at regular intervals in each sample batch. Check assays on 5% of samples are carried out at a third party independent laboratory. Gold standards were prepared by CDN Resource Laboratories Ltd. Work programs in this release were supervised by Terry Bursey, P.Geo. Regional Manager for Rubicon and the project Qualified Person under the definition of NI 43-101.
Forward Looking Statements
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This news release contains statements that constitute “forward-looking statements” within the meaning of Section 21E of the United States Securities Exchange Act of 1934 and “forward looking information” within the meaning of applicable Canadian provincial securities legislation (collectively, “forward-looking statements”). Forward-looking statements often, but not always, are identified by the use of words such as “seek”, “anticipate”, “believe”, “plan”, “estimate”, “expect”, “targeting” and “intend” and statements that an event or result “may”, “will”, “should”, “could”, or “might” occur or be achieved and other similar expressions. Forward-looking statements in this document include statements regarding the timing and nature of future exploration programs which are dependent on projections which may change as drilling continues, or if unexpected ground conditions are encountered. In addition, areas of exploration potential are identified which will require substantial drilling to determine whether or not they contain similar mineralization to areas which have been explored in more detail. The description of the extent of mineralized zones is not intended to imply that any economically mineable estimate of reserves or resources exists on the Phoenix project. Similarly, although geological features of the F2 Gold System are interpreted to show similarities to nearby gold producing mines owned by third parties, this should not be interpreted to mean that the F2Gold System has, or that it will, generate similar reserves or resources. Significant additional drilling is required at F2 to fully understand system size before a meaningful resource calculation can be completed.
The forward-looking statements that are contained in this news release are based on various assumptions and estimates by the Company and involve a number of risks and uncertainties. As a consequence, actual results might differ materially from results forecast or suggested in these forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that 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 the forward-looking statements. Factors that could cause the actual results to differ include market prices, results of exploration, availability of capital and financing on acceptable terms, inability to obtain required regulatory approvals, unanticipated difficulties or costs in any rehabilitation which may be necessary, market conditions and general business, economic, competitive, political and social conditions. These statements are based on a number of assumptions, including assumptions regarding general market conditions, timing and receipt of regulatory approvals, the ability of the Company and other relevant parties to satisfy regulatory requirements, the availability of financing for proposed transactions and programs on reasonable terms and the ability of third-party service providers to deliver services in a timely manner. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those expressed or implied in forward-looking statements, there may be other factors which cause actual results to differ.
Forward-looking statements contained herein are made as of the date of this news release and the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
Medtronic (MDT) Signs Agreement to Acquire Osteotech (OSTE)
MEMPHIS, Tenn., Aug. 17 /PRNewswire-FirstCall/ — Medtronic Inc., (NYSE:MDT – News) and Osteotech, Inc., (Nasdaq:OSTE – News) today announced that the companies have signed a definitive agreement under which Medtronic will acquire Osteotech for $6.50 per share in cash for each share of Osteotech common stock. The total value of the transaction is expected to be approximately $123 million.
Osteotech is a leader in the growing field of biologic products for regenerative healing, and has pioneered several innovative technology platforms including Grafton® demineralized bone matrix, a family of products which has a large and growing body of evidence supporting its best-in-class bone generating capabilities. Osteotech’s differentiated portfolio of biologics also includes MagniFuse™ Bone Grafts and Plexur® Biocomposites, which are utilized in a broad range of musculoskeletal surgical procedures. In addition, Osteotech is in the midst of seeking U.S. Food & Drug Administration clearance for the first product based upon its first-in-class HCT™ (Human Collagen Technology) platform, an engineered human collagen biomaterial.
The acquisition of Osteotech will complement the Medtronic Biologics business’ bone healing portfolio and expand its current presence in spine, orthopedic trauma, and dental into several additional new treatment areas including joint reconstruction, foot and ankle, and sports medicine. In addition, the combined technical and product capabilities will create opportunities to develop breakthrough next-generation products.
“This acquisition represents a key step in Medtronic’s strategy to build a broader business in regenerative biologics,” said Chris O’Connell, Medtronic executive vice president and Restorative Therapies Group president. “Osteotech’s products and capabilities will better position Medtronic in today’s competitive musculoskeletal biologics market, and also position the company more broadly for the opportunity we see in the future.”
Tom McGuinness, general manager of Medtronic’s Biologics business said, “We see substantial opportunities during the next five to 10 years to help more patients with biologics and regenerative therapies. The combination of our two organizations will only accelerate our innovation and progress against our goals in helping to alleviate pain, restore health, and extend life for our patients.”
“Our mission is to develop leading-edge regenerative biologics that will positively impact the lives of patients, enhance physicians’ capabilities to deliver superior surgical outcomes and enhance the gift of life to promote healing,” said Sam Owusu-Akyaw, president and chief executive officer of Osteotech. “Through the efforts of all our stakeholders, we have created a pipeline of biologics platforms unprecedented in the emerging biologics industry. We believe Medtronic’s global scale and scope across geographies and functions and its commitment to innovation make them an ideal partner to carry forward our mission.”
“With a unanimous vote, the board of directors of Osteotech approved this transaction because the board believes it offers significant value to our stockholders,” said Kenneth P. Fallon, III, chairman of the board of directors of Osteotech. “We believe this is the best path forward for the Osteotech organization and products, and we look forward to finalizing this transaction smoothly and quickly.”
The transaction is subject to customary closing conditions, including approval by Osteotech’s stockholders and U.S. and foreign regulatory clearances.
About Medtronic and Medtronic Biologics
Medtronic, Inc. (www.medtronic.com), headquartered in Minneapolis, is the global leader in medical technology – alleviating pain, restoring health, and extending life for millions of people around the world.
Medtronic Biologics, based in Memphis, Tenn., is the global leader in biologics regeneration and pain therapies across a variety of musculoskeletal and other applications. The business markets breakthrough innovations such as INFUSE™ Bone Graft, which received the prestigious Prix Galien USA Award for Best Biotechnology Product in 2008. Medtronic Biologics also has a robust pipeline of other products, including sciatica and post-op pain therapies, all of which complement its focus on applications for the spine, orthopedic trauma, and dental.
About Osteotech
Osteotech, Inc., headquartered in Eatontown, New Jersey, is a global leader in providing biologic solutions for regenerative medicine to support surgeons and their patients in the repair of the musculoskeletal system through the development of innovative therapy-driven products that alleviate pain, promote biologic healing and restore function. For further information regarding Osteotech, please go to Osteotech’s website at www.Osteotech.com.
Additional Information about the Proposed Transaction and Where You Can Find It
Osteotech intends to file with the Securities and Exchange Commission (the “SEC”) preliminary and definitive proxy statements and other relevant materials in connection with the proposed acquisition of Osteotech by Medtronic. The definitive proxy statement will be mailed to Osteotech stockholders. Before making any voting or investment decisions with respect to the transaction, investors and security holders of Osteotech are urged to read the proxy statement and the other relevant materials when they become available because they will contain important information about the transaction, Osteotech and Medtronic. Investors and security holders may obtain free copies of these documents (when they are available) and other documents filed with the SEC at the SEC’s web site at www.sec.gov. In addition, investors and security holders may obtain free copies of the documents filed with the SEC by accessing Osteotech’s website at www.osteotech.com or by writing Osteotech at 51 James Way, Eatontown, New Jersey, 07724.
Information Regarding Participants
Osteotech, Medtronic and their respective directors, executive officers and certain other members of management and employees may be soliciting proxies from Osteotech stockholders in favor of the merger. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the Osteotech stockholders in connection with the proposed merger will be set forth in the proxy statement when it is filed with the SEC. You can find information about Medtronic’s executive officers and directors in its definitive proxy statement filed with the SEC on July 16, 2010. You can obtain a free copy of this document at the SEC’s web site at www.sec.gov, or by accessing Medtronics’s website at www.Medtronic.com and clicking on the Investors link. You can find information about Osteotech’s executive officers and directors in its definitive proxy statement filed with the SEC August 3, 2010. You can obtain a free copy of this document at the SEC’s web site at www.sec.gov or by accessing Osteotech’s website at www.osteotech.com or by writing Osteotech at 51 James Way, Eatontown, New Jersey, 07724.
Safe Harbor
This Press Release contains forward-looking statements that may include statements regarding the intent, belief or current expectations of Osteotech, Medtronic and their respective management. Forward looking statements include statements about the benefits and advantages of the acquisition for Osteotech and its stockholders, and the benefits of the acquisition for Medtronic post-transaction, such as product development opportunities and operating synergies. Actual results could differ materially from those projected in the forward-looking statements as a result of a number of important factors, including but not limited to the risk that the acquisition of Osteotech by Medtronic will not close as the transaction is subject to certain closing conditions, such as the ability to obtain regulatory approvals of the proposed acquisition, including antitrust approval, and the approval of the transaction by Osteotech’s stockholders. In addition, if and when the transaction is closed, there will be risks and uncertainties related to Medtronic’s ability to integrate Osteotech successfully, the risk that the cost savings and any other synergies from the acquisition may not be fully realized or may take longer to realize than expected; disruption from the acquisition making it more difficult to maintain relationships with customers, employees or suppliers; and competition and its effect on pricing, spending, third-party relationships and revenues. Additional factors that may affect future results are contained in the SEC filings for Medtronic and Osteotech, including but not limited to Medtronic’s Annual Report on Form 10-K for the year ended April 30, 2010 and Osteotech’s Annual Report on Form 10-K for the year ended December 31, 2009. Medtronic and Osteotech each disclaim any obligation to update and revise statements contained in this release based on new information or otherwise.
Molecular Insight (MIPI) Receives Seventh Extension of Waiver Agreement With Bond Holders
CAMBRIDGE, MA–(Marketwire – 08/17/10) – Molecular Insight Pharmaceuticals, Inc. (NASDAQ:MIPI – News), a biopharmaceutical company discovering and developing targeted therapeutic and imaging radiopharmaceuticals for use in oncology, today announced that the Company has received a seventh extension of its waiver agreement with its Bond holders, allowing debt restructuring discussions to progress.
Earlier this year, Molecular Insight executed the waiver agreement and subsequent amendments with holders of the Company’s outstanding Senior Secured Bonds and the Bond Indenture trustee and announced ongoing discussions with the Bond holders concerning a restructuring of its outstanding debt. Under terms of the seventh extension announced today, the Bond holders and Bond Indenture trustee agreed to extend the waiver of a default arising from the inclusion of a going concern explanatory paragraph in the independent auditor’s report on the Company’s financial statements for the year ended December 31, 2009 and other technical defaults under the Bond Indenture. The term of the waiver is extended until 11:59 PM Eastern Standard Time on August 31, 2010. During this waiver extension period, the Company will continue to discuss with its Bond holders various proposals which generally contemplate, among other things, a deleveraging of the Company through a debt for equity exchange. There are no assurances, however, that such discussions will be successful.
The waiver continues to be subject to a number of terms and conditions relating to the provision of certain information to the Bond holders, among other conditions and matters. In the event that the waiver expires or terminates prior to the successful conclusion of the Company’s negotiations with its Bond holders regarding the restructuring of its outstanding debt, the Company will be in default of its obligations under the Indenture and the Bond holders may choose to accelerate the debt obligations under the Indenture and demand immediate repayment in full and seek to foreclose on the collateral supporting such obligations. If the Company’s debt obligations are accelerated or are not restructured on acceptable terms, it is likely the Company will be unable to repay such obligations and may seek protection under the U.S. Bankruptcy Code or similar relief.
About Molecular Insight Pharmaceuticals, Inc.
Molecular Insight Pharmaceuticals is a clinical-stage biopharmaceutical company and pioneer in molecular medicine. The Company is focused on the discovery and development of targeted therapeutic and imaging radiopharmaceuticals for use in oncology. Molecular Insight has five clinical-stage candidates in development. For further information on Molecular Insight Pharmaceuticals, please visit www.molecularinsight.com.
Forward-Looking Statements
Statements in this release that are not strictly historical in nature are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about our continued negotiations with our Bond holders regarding debt restructuring, including a contemplated deleveraging of the Company through a debt for equity exchange, and the consequences of the failure to reach agreement with the Bond holders in regard to restructuring our debt on acceptable terms, our inability to meet our obligations under the Bond Indenture, and our potential filing for bankruptcy. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results of Molecular Insight to be materially different from historical results or from any results expressed or implied by such forward-looking statements. Such factors include, but are not limited to, risks and uncertainties related to the progress, timing, and results of our negotiations with the Bond holders regarding the debt restructuring, and the additional risks discussed in filings with the Securities and Exchange Commission (SEC). The Company’s SEC filings are available through the SEC’s Electronic Data Gathering Analysis and Retrieval system (EDGAR) at http://www.sec.gov. Press releases for Molecular Insight Pharmaceuticals, Inc. are available on our website: http://www.molecularinsight.com. If you would like to receive press releases via e-mail, please contact: investor@molecularinsight.com. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update this release to reflect events or circumstances after the date hereof.
Skystar Bio-Pharmaceutical (SKBI) Reports 33% Growth in Revenue From Continuing Operations
XI’AN, CHINA–(Marketwire – 08/17/10) – Skystar Bio-Pharmaceutical Company (NASDAQ:SKBI – News) (“Skystar” or the “Company”), a China-based manufacturer and distributor of veterinary medicines, vaccines, micro-organisms and feed additives, today reported unaudited second quarter fiscal year 2010 earnings, for the period ended June 30, 2010.
Second Quarter 2010 Highlights
- Revenue increases 33% YoY to $8.3 million
- Veterinary vaccines totaled $0.4 million, up 21% YoY
- Veterinary medicines totaled $5.5 million, up 41% YoY
- Feed additives totaled $0.4 million, up 31% YoY
- Micro-organism products totaled $2.0 million, up 14% YoY
- Gross margin of 53% for the second quarter of fiscal 2010 as compared to 53% in the year ago period
- GAAP net income of $2.4 million or $0.33 per fully diluted share, compared with a loss of $0.1 million or ($0.03) per fully diluted share in the year ago period
- Fiscal 2010 top line revenue guidance range remains at $45.5 million to $47.5 million
First Half 2010 Financial Highlights
- First half fiscal 2010 revenue increases 30% YoY to 13.1 million
- Gross margin of 53% for the first half of fiscal 2010 as compared to 51% in the year ago period
- GAAP net income of $3.5 million or $0.49 per fully diluted share, compared with GAAP net income of $0.9 million or $0.25 per fully diluted share in the year ago period
Mr. Weibing Lu, Skystar Bio-Pharmaceutical’s chairman and chief executive officer, commented, “Skystar’s performance in the second quarter of fiscal 2010 positions the Company well for the second half of the fiscal year which is seasonally our strongest half. The second quarter’s performance can be attributed to improved sales effort and increased utilization of production capacity at our Huxian plant, including the expanded micro-organism facility completed in 2009 and came online in June of this year, as well as increased product variety. We currently produce over 248 products as compared to over 195 products in the first quarter of 2010.
“Overall outlook for the industry remains promising despite severe flood damage in many of the agricultural regions of China. The Company anticipates meeting its financial goals and metrics for the year. During the quarter, the Company filed an S-1 registration which was subsequently withdrawn. The intention was not to raise capital at any price or level of dilution to shareholders but in preparation of strengthening our balance sheet should an opportunistic moment arise. The Company does not intend to raise capital at current price levels and is looking into alternative sources of funding such as low interest debt at the local level. Our current income from operations and cash on hand are at adequate levels to maintain daily operations.
“Skystar is committed to continue its efforts to expand manufacturing capacity to meet market demands for our products. In addition, the Company has negotiated with some of our raw material suppliers to receive favorable pricing while obtaining the necessary materials to supply seasonal production ramp up in the third quarter. Subsequently, we have lowered our cash advances to suppliers as compared to the same period last year, improving our cash flow position and will continue to manage this process closely.
“In preparation for the fiscal third quarter, historically the Company’s strongest quarter, the Company build up the inventory levels in anticipation of the upcoming demand. Accounts receivable and inventories increased significantly in the second quarter as part of the Company’s strategy to expand market share. Historically, we have collected nearly all of our accounts receivable, and management expects our collection rate to normalize in the third quarter. To be prudent, however, we have made provisions by increasing our allowance for bad debt.
“R&D for the period has decreased relative to the prior year as projects have entered late stage developments and required less cash outlays. General and administrative expenses for our Chinese operating entity have increased with expanded operations and added acquisition related expenses, plus increased allowance for accounts receivable.
“With regard to Skystar’s construction projects, the construction of the vaccine facility at our Huxian plant was completed as of June 30, 2010. We expect to release a thorough update to shareholders regarding the facility shortly.
“We expect our sales and growth trajectory to continue through the remainder of the year as we reiterate fiscal guidance for the full year. The Company is positioning itself to be able to meet anticipated market demand for its products, and have sufficient cash resources on hand to maintain on-going operations. We hope to continue to maximize the Company’s performance for our shareholders,” concluded Mr. Lu.
Financial Summary
Gross profit for second quarter 2010 was $4.4 million, up 33% from second quarter 2009. Gross margin for the period was 53%, in line with historical year over year comparables.
Operating expenses for second quarter 2010 were $1.6 million, or 20% of total revenue, compared with $1.6 million or 25% of total revenue in the year ago period. Increased G&A expenses were offset by declines in R&D and selling expenses resulting in a slight increase in total operating expenses. Total operating expense increased 3% year over year.
Research and development (R&D) costs were $0.19 million, or less than 3% of revenue in the second quarter 2010, down from $0.3 million, or 6% of revenue during second quarter 2009. Most of the company’s existing research projects were in the later phases, and required less cash outlays as compared to the early stages of the projects in the same period last year where we had large scale testing and clinical trials.
Selling expenses totaled $0.4 million, or 5% of revenue, for the second quarter 2010, compared with $0.6 million, or 9% of revenue, in the second quarter 2009. General and administrative expenses were $1.0 million, or 12% of revenue, in second quarter 2010, compared with $0.6 million, or 10% of revenue, in second quarter 2009. General and administrative expenses have increased due to acquisition related costs and costs related to the expansion of existing operations, and the increased allowance for accounts receivable.
Operating income increased by 60% year over year to $2.7 million in the second quarter of fiscal year 2010, compared with $1.7 million in the same quarter a year ago, and operating margin increased to 33% from 27% in the same period a year ago.
Net income for the second quarter of 2010 was $2.45 million, or $0.33 per fully diluted share. This compares to a net loss of $0.1 million or a loss of $0.03 per fully diluted share in the same quarter of 2009. Skystar’s adjusted net income for the second quarter of 2010 was $2.2 million, or $0.31 per fully diluted share, compared with $1.36 million, or $0.36 per fully diluted share, in the second quarter of 2009 (See “About Non-GAAP Financial Measures” toward the end of this release.)
As of June 30, 2010, Skystar had approximately $3.5 million in cash and restricted cash, current assets of $29.4 million and current liabilities of $5.0 million.
China Floods
On July 21, 2010, Xinhua news agency, reported China’s worst flood in over a decade, displacing over 110 million people and affecting over 17 million acres of farmland. Additionally, as reported by Xinhua news agency on August 6, 2010, China’s Ministry of Agriculture urged local authorities to resume agricultural production as soon as possible and create favorable conditions for the fall harvest.
To date Skystar’s business lines have not been affected by the acts of nature; however, the Company will closely monitor the situation and react accordingly.
Fiscal 2010 Guidance
Taking into consideration the vast flooding and severity of the conditions across China’s farming communities and any potential impact on the Company’s business, we are taking a conservative approach and will maintain current guidance of $45.5 million to $47.5 million for the full fiscal 2010 year. We will re-evaluate the situation as visibility improves.
Conference Call & Webcast Information
Skystar will host a conference call at 8:00 a.m. ET on Tuesday, August 17, 2010 to review the Company’s second quarter financial and operational performance. Mr. Weibing Lu, Skystar Bio-Pharmaceutical chairman and chief executive officer, will host the call, which will be webcast live.
The webcast will be made available on the investor relations section of the Skystar corporate website at http://www.skystarbio-pharmaceutical.com. Telephone access to the conference call will also be available in North America by dialing +1 (877) 407-9210 or internationally by dialing +1 (201) 689-8049.
An audio replay of the conference call will be available approximately two hours following the conclusion of the call and for the following 30 day period. To access the replay in North America, dial +1 (877) 660-6853 or, when calling internationally, dial +1 (201) 612-7415, using replay account code # 286 and conference ID # 355460. An archived replay of the conference webcast will also be available on investor relations section of the Skystar corporate website at http://www.skystarbio-pharmaceutical.com.
To be added to the Company’s email distribution for future news releases, please send your request to skystar@grayling.com.
About Skystar Bio-Pharmaceutical Company
Skystar is a China-based developer and distributor of veterinary healthcare and medical care products. Skystar has four product lines (veterinary medicines, micro-organisms, vaccines and feed additives) and over 170 products. Skystar has formed strategic sales distribution networks covering 29 provinces throughout China. For additional information, please visit http://www.skystarbio-pharmaceutical.com.
About Non-GAAP Financial Measures
This press release contains non-GAAP financial measures for the change in the fair value of the Company’s warrants. The Company believes that these non-GAAP financial measures are useful to investors because they exclude non-cash charges that our management excludes when it internally evaluates the performance of the Company’s business and makes operating decisions, including internal budgeting, and performance measurement, because these measures provide a consistent method of comparison to historical periods. Moreover, management believes these non-GAAP measures reflect the essential operating activities of Skystar. Accordingly, management excludes the change in the fair value of the Company’s warrants when making operational decisions. The Company believes that providing the non-GAAP measures that management uses to its investors is useful to investors for a number of reasons. The non-GAAP measures provide a consistent basis for investors to understand the Company’s financial performance in comparison to historical periods. In addition, it allows investors to evaluate the Company’s performance using the same methodology and information as that used by our management. Non-GAAP measures are subject to inherent limitations because they do not include all of the expenses included under GAAP and because they involve the exercise of judgment of which charges are excluded from the non-GAAP financial measure. However, our management compensates for these limitations by providing the relevant disclosure of the items excluded.
The following table provides the non-GAAP financial measure and the related GAAP measure and provides a reconciliation of the non-GAAP measure to the equivalent GAAP measure.
SKBI- Adjusted Net Income
For the Three For the Three
Months Ending Months Ending
June 30, 2010 June 30, 2009
------------- -------------
GAAP Net Income $ 2,378,395 $ (116,797)
GAAP Basic Earnings Per Share 0.33 (0.03)
GAAP Diluted Earnings Per Share 0.33 (0.03)
Additions
Change in fair value of warrants (158,054) 1,480,484
------------- -------------
Addition (subtraction) (158,054) 1,480,484
Non GAAP Net Income $ 2,220,341 $ 1,363,687
Non GAAP Basic Earnings Per Share 0.31 0.36
Non GAAP Diluted Earnings Per Share 0.31 0.36
Shares used in computing net income per basic
share 7,104,606 3,739,024
Shares used in computing net income per diluted
share 7,140,518 3,739,024
SKYSTAR BIO-PHARMACEUTICAL COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATION AND OTHER COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
For Three Months Ended For Six Months Ended
June 30, June 30,
------------------------ ------------------------
2010 2009 2010 2009
----------- ----------- ----------- -----------
REVENUE, NET $ 8,264,541 $ 6,243,438 $13,133,784 $10,067,004
COST OF REVENUE 3,905,063 2,958,837 6,196,282 4,905,195
----------- ----------- ----------- -----------
GROSS PROFIT 4,359,478 3,284,601 6,937,502 5,161,809
----------- ----------- ----------- -----------
OPERATING EXPENSES:
Research and
development 192,088 366,695 236,083 484,047
Selling expenses 431,810 585,207 602,944 792,602
General and
administrative 998,034 625,359 1,617,584 940,054
----------- ----------- ----------- -----------
Total operating
expenses 1,621,932 1,577,261 2,456,611 2,216,703
----------- ----------- ----------- -----------
INCOME FROM OPERATIONS 2,737,546 1,707,340 4,480,891 2,945,106
----------- ----------- ----------- -----------
OTHER INCOME (EXPENSE):
Other income
(expense), net 36,257 (310) 36,674 (542)
Interest income
(expense), net (12,976) (788) (17,792) (486)
Change in fair value
of warrant liability 158,054 (1,480,484) (159,326) (1,442,156)
----------- ----------- ----------- -----------
Total other income
(expense), net 181,335 (1,481,582) (140,444) (1,443,184)
----------- ----------- ----------- -----------
INCOME BEFORE PROVISION
FOR INCOME TAXES 2,918,881 225,758 4,340,447 1,501,922
PROVISION FOR INCOME
TAXES 540,486 342,555 865,805 554,075
----------- ----------- ----------- -----------
NET INCOME (LOSS) 2,378,395 (116,797) 3,474,642 947,847
OTHER COMPREHENSIVE
INCOME (LOSS):
Foreign currency
translation
adjustment 280,998 (16,233) 240,182 (54,681)
----------- ----------- ----------- -----------
COMPREHENSIVE INCOME
(LOSS) $ 2,659,393 $ (133,030) $ 3,714,824 $ 893,166
=========== =========== =========== ===========
EARNINGS PER SHARE:
Basic $ 0.33 $ (0.03) $ 0.49 $ 0.25
=========== =========== =========== ===========
Diluted $ 0.33 $ (0.03) $ 0.49 $ 0.25
=========== =========== =========== ===========
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES:
Basic 7,104,606 3,739,024 7,083,149 3,737,708
=========== =========== =========== ===========
Diluted 7,140,518 3,739,024 7,119,846 3,824,432
=========== =========== =========== ===========
SKYSTAR BIO-PHARMACEUTICAL COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
June 30, December 31,
ASSETS 2010 2009
------------- -------------
Unaudited
-------------
CURRENT ASSETS:
Cash $ 3,482,558 $ 11,699,398
Accounts receivable, net of allowance for
doubtful accounts of $617,955 and $327,857 as
of June 30, 2010 and December 31, 2009,
respectively 7,711,719 4,383,187
Inventories, net of allowance of $263,539 and
$199,460 as of June 30, 2010 and December 31,
2009, respectively 13,318,742 4,074,645
Deposits and prepaid expenses 4,348,910 11,900,314
Other receivables 549,043 490,712
------------- -------------
Total current assets 29,410,972 32,548,256
------------- -------------
PLANT AND EQUIPMENT, NET 11,786,671 8,829,058
CONSTRUCTION-IN-PROGRESS 8,777,066 9,389,120
OTHER ASSETS:
Long-term prepayments 1,341,031 1,173,427
Long-term prepayments for acquisitions 12,376,146 6,806,880
Intangible assets, net 1,790,327 1,860,172
------------- -------------
Total other assets 15,507,504 9,840,479
------------- -------------
Total assets $ 65,482,213 $ 60,606,913
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 553,404 $ 297,567
Other payables and accrued expenses 832,816 917,284
Short-term loans - 220,050
Short-term loans from shareholders - 110,025
Deposits from customers 1,632,581 1,275,958
Taxes payable 1,481,748 722,106
Shares to be issued to related parties 372,739 327,374
Due to related parties 137,503 185,024
------------- -------------
Total current liabilities 5,010,791 4,055,388
------------- -------------
OTHER LIABILITIES:
Deferred government grant 1,104,750 1,100,250
Derivative liability 966,082 1,538,686
------------- -------------
Total other liabilities 2,070,832 2,638,936
------------- -------------
Total liabilities 7,081,623 6,694,324
------------- -------------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $0.001 par value, 50,000,000
shares authorized, Nil Series "A" shares
authorized as of June 30, 2010 and December
31, 2009 48,000,000 Series "B" shares
authorized, Nil Series "B" shares issued and
outstanding as of June 30, 2010 and December
31, 2009, respectively - -
Common stock, $0.001 par value, 40,000,000
shares authorized, 7,106,705 and 6,989,640
shares issued and outstanding as of June 30,
2010 and December 31, 2009, respectively 7,106 6,989
Paid-in capital 35,353,156 34,580,096
Statutory reserves 3,879,077 3,879,077
Retained earnings 16,049,548 12,574,906
Accumulated other comprehensive income 3,111,703 2,871,521
------------- -------------
Total shareholders' equity 58,400,590 53,912,589
------------- -------------
Total liabilities and shareholders' equity $ 65,482,213 $ 60,606,913
============= =============
SKYSTAR BIO-PHARMACEUTICAL COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2010 AND 2009
(UNAUDITED)
Six months ended June 30,
----------------------------
2010 2009
------------- -------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 3,474,642 $ 947,847
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 299,848 225,953
Amortization 77,133 77,070
Bad debt expense 287,561 -
Allowance for slow moving inventories 63,001 -
Common stock issued for services 16,245 30,521
Common stock to be issued to related
parties for compensation 70,367 78,024
Change in fair value of warrant
liability 159,326 1,442,156
Change in operating assets and liabilities
Accounts receivable (3,584,456) (1,412,505)
Inventories (9,252,221) (5,164,998)
Deposits and prepaid expenses 7,729,174 2,158,970
Other receivables (56,090) (43,532)
Accounts payable 253,565 (197,071)
Other payables and accrued expenses (88,372) (189,065)
Deposits from customers 349,949 (164,796)
Taxes payable 753,555 2,386,654
------------- -------------
Net cash provided by operating
activities 553,227 175,228
------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Refunds of prepayments for potentital
acquistions - 2,711,545
Proceeds from short-term investments - 43,971
Prepayment for acquisitions (5,518,478) -
Loans to third parties - (1,685,555)
Purchases of plant and equipment (2,136,531) -
Payments on construction-in-progress (748,449) (1,792,941)
------------- -------------
Net cash used in investing activities (8,403,458) (722,980)
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease in restricted cash - 80,662
Proceeds from short-term loans - 205,198
Repayment of short-term loans (220,035) (307,798)
Repayment to shareholders and directors (110,018) -
Proceeds from shareholders and directors - -
Due (from) to related parties (47,874) 420,038
------------- -------------
Net cash (used in) provided by
financing activities (377,927) 398,100
------------- -------------
EFFECT OF EXCHANGE RATE CHANGES ON CASH 11,318 (16,203)
------------- -------------
DECREASE IN CASH (8,216,840) (165,855)
CASH, beginning of period 11,699,398 576,409
------------- -------------
CASH, end of period $ 3,482,558 $ 410,554
============= =============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Cash paid for interest $ 7,435 $ 40,448
============= =============
Cash paid for income taxes $ 578,055 $ -
============= =============
Non-cash investing and financing activities
Long-term prepayment transferred to
construction-in-progress $ - $ 1,025,257
============= =============
Long-term prepayment transferred to plant
and equipment $ 439,897 $ -
============= =============
Construction-in-progress transferred to
plant and equipment $ 1,396,211 $ -
============= =============
Interest expense capitalized as
construction-in-progress $ $ 40,050
============= =============
Cashless exercise of warrants $ 1,511,604 $ -
============= =============
Issuance of common stock accrued in
previous year $ 25,002 $ -
------------- -------------
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain of the statements made in the press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. 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. Such statements typically involve risks and uncertainties and may include financial projections or information regarding the progress of new product development. Actual results could differ materially from the expectations reflected in such forward-looking statements as a result of a variety of factors, including the risks associated with the effect of changing economic conditions in The People’s Republic of China, variations in cash flow, reliance on collaborative retail partners and on new product development, variations in new product development, risks associated with rapid technological change, and the potential of introduced or undetected flaws and defects in products, and other risk factors detailed in reports filed with the Securities and Exchange Commission from time to time.
Resource America’s (REXI) Leasing Subsidiary Announces Securitization of Approximately $175 Million of Leasing Assets
PHILADELPHIA, PA–(Marketwire – 08/17/10) – LEAF Financial Corporation (“LEAF”), the commercial finance subsidiary of Resource America, Inc. (NASDAQ:REXI – News), announced today the closing of a new securitization transaction: LEAF 2010-3, which was completed on August 17, 2010.
Through LEAF 2010-3, LEAF securitized approximately $175 million of leases, term funded by the issuance of Contract Backed Notes on behalf of LEAF Equipment Finance Fund 4, LP (“LEAF 4”), one of the investment partnerships it manages. Guggenheim Securities, LLC was the arranger of the notes and LEAF will continue to be the servicer for the assets. In connection with LEAF 2010-3, LEAF 4 will reduce outstanding debt on its warehouse credit facilities to provide capacity for future originations.
Crit DeMent, Chairman and CEO of LEAF Financial, said, “We are very pleased to have completed our third securitization so far this year. Most encouraging was the fact that the bonds in this transaction were sold to a wide variety of institutional investors, which not only demonstrates continued confidence in our business but in equipment leasing as an asset class. An active securitization market is integral to our business model as it allows us to finance assets with long term, match funding rather than through short-term warehouse facilities. LEAF will continue to access this market for financing of leases for itself and its managed entities.”
Resource America, Inc. is a specialized asset management company that uses industry specific expertise to generate and administer investment opportunities for its own account and for outside investors in the real estate, commercial finance, and financial fund management sectors. For more information please visit our website at www.resourceamerica.com or contact Marketing and Investor Relations at pkamdar@resourceamerica.com.
Orient Paper Inc. (ONP) Announces Second Quarter 2010 Results
BAODING, Hebei, China, Aug. 16 /PRNewswire-Asia-FirstCall/ — Orient Paper, Inc. (Amex:ONP.a – News) (“Orient Paper” or the “Company”), a leading manufacturer and distributor of diversified paper products in Hebei, China, today announced its financial results for the three and six months ended June 30, 2010.
Second Quarter 2010 Highlights and Recent Events
-- Revenue increased 70.8% to $38.3 million
-- Gross profit increased 129.9% to $9.1 million
-- Gross margin increased 610 basis points to 23.9%
-- Operating income increased 100.5% to $7.4 million
-- Excluding the $1.1 million non-cash charge related to the disposal
of property, plant and equipment, non-GAAP operating income
increased 129.8% to $8.5 million, or 22.2% of sales (*)
-- Net income increased 116.3% to $5.4 million, or $0.30 per share
-- Excluding the $1.1 million non-cash charge related to the disposal
of property, plant and equipment, non-GAAP net income increased
160.0% to $6.4 million, or $0.36 per share (*)
-- Digital photo paper sales quantity reached 102 tons during the month
of June 2010
“We achieved strong revenue and earnings growth during the second quarter,” commented Mr. Zhenyong Liu, Chief Executive Officer. “Our performance was driven by increased pricing in both our medium-grade offset printing and corrugating medium paper businesses, a significantly higher volume of sales in our medium-grade offset printing paper business, and the contribution made by our new digital photo paper business. We are also very pleased with our bottom line performance, which benefited from our strong sales growth, and the contribution of our higher margin digital photo paper business.”
Second Quarter 2010 Financial Results
For the three months ended June 30, 2010, revenue was $38.3 million, a 70.8% increase from $22.4 million for the same period last year. The increase was attributable to the growth in overall sales quantities and higher average selling prices (ASP) for the Company’s products, which was driven by strong market demand and the rise in global and domestic paper and pulp pricing during the second quarter.
Sales of white paper increased 130.3% to $25.6 million, compared to $11.1 million in the comparable period in 2009. (The Company produced only medium- grade offset printing paper under this category in the second quarter of 2010 and produced no high-grade offset printing paper or writing paper.) The Company sold 34,365 tons of white paper, up 104.4% from 16,816 tons in the prior year period. To meet the strong market demand for medium-grade offset printing paper, which is driven by high wood pulp prices, the Company ramped- up production utilization at its second white paper production line, which was converted to produce medium-grade offset printing paper in the third quarter of 2009.
Revenue from corrugating medium paper increased 2.2% year-over-year to $11.5 million compared to $11.3 million in the same period last year. The Company sold 35,599 tons of corrugating medium paper, as compared to 39,455 tons in the same period last year. The decline in quantity sold was mainly due to the disposal of a 34,000 tons annual capacity corrugating medium paper production line to accommodate the Company’s new 360,000 tons annual capacity corrugating medium paper production line. The Company’s average selling price for corrugating medium paper increased by 13.2% year-over-year, an increase driven by global and domestic paper and pulp pricing, and was high enough to offset for the drop in sales volume.
Orient Paper also reported revenue of $1.1 million, or 3.0% of total revenue, from its new digital photo paper segment. The Company aggressively reduced the ASPs of its digital photo paper products in May and June 2010. The reduction in price was well received by the Company’s customers, who purchased a total of 102 tons of high-gloss and semi-matte digital photo paper in the month of June. As of June 30, 2010, the Company has been running two shifts of production at its digital photo paper production lines.
Gross profit was $9.1 million, an increase of 129.9% from $4.0 million for the same period last year. Gross profit margin was 23.9%, up 610 basis points from 17.7% for the same period last year. The increase in gross margin was mainly due to higher prices for the Company’s offset printing paper and corrugating medium paper, and contribution from the Company’s high-margin digital photo paper products. On a sequential basis, gross margin improved 560 basis points from 18.3% in the first quarter of 2010.
Selling, general and administrative expenses were $0.6 million, an increase of 131.5% from $0.3 million in the second quarter of 2009. The increase was primarily attributable to the increase in expenses related to the Company’s status as a public company, including professional fees related to legal, accounting, consulting, investor relations and road show activity.
Operating income increased 100.5% to $7.4 million from $3.7 million in the second quarter of 2009. Excluding the $1.1 million non-cash charge related to the disposal of property, plant and equipment, non-GAAP operating income was $8.5 million, or 22.2% of sales, up 129.8% from $3.7 million, or 16.5% of sales, in the prior year period. (*)
Net income increased 116.3% to $5.4 million, or $0.30 per share, compared to $2.5 million, or $0.22 per share, for the three months ended June 30, 2009. Excluding the $1.1 million non-cash charge related to the disposal of property, plant and equipment, non-GAAP net income increased 160.0 % to $6.4 million, or $0.36 per share, from $2.5 million, or $0.22 per share, in the prior year period.(*)
Six months ended June 30, 2010 Results
Revenue for the first six months of 2010 was $64.7 million, up 60.8% from the first six months of 2009. Gross profit was $14.0 million, up 91.2% from gross profit of $7.3 million in the comparable period a year ago. Gross margin was 21.6%, up 340 basis points from 18.2% in the prior year period. Operating income was $11.8 million, up 72.9% from $6.8 million in the first six months of 2009. Excluding the $1.1 million non-cash charge related to the disposal of property, plant and equipment, non-GAAP operating income was $12.9 million up 88.7% from $6.8 million in the prior year period. Net income was $8.5 million, up 77.6% from approximately $4.8 million in the first six months of 2009. Excluding the non-cash charge related to the disposal of property, plant and equipment, non-GAAP net income was $9.6 million up 100.3% from $4.8 million in the prior year period. Earnings per share was $0.51 for the first six months of 2010 compared to $0.42 in the first six months of 2009. Excluding the loss related to disposal of property, plant and equipment, non-GAAP earnings per share was $0.58, up 38.0% from $0.42 in the prior year period.(*)
(*) See table at the end of this press release for a reconciliation of
operating income, net income and EPS to exclude the non-cash charge
related to the disposal of property, plant and equipment.
Financial Condition
As of June 30, 2010, Orient Paper had $22.1 million in cash and cash equivalents. Working capital was $25.4 million with a current ratio of 3.5. The Company had $1.9 million in short-term bank loans (down from $4.3 million of short-term bank loan six months ago) and $6.1 million in long term debt. As of June 30, 2010, shareholders’ equity totaled $91.6 million compared to $56.3 million at the end of 2009.
During the first half of 2010, Orient Paper generated net cash flow from operating activities of approximately $10.7 million.
The Company incurred $19.9 million in capital expenditures in the first half of 2010, which included installment payments in the total amount of $8.5 million for the construction of a new corrugating medium paper production line and an $11.1 million investment for the first phase of the acquisition of a parcel of roughly 667,000 square meters of land across the street from its current manufacturing facilities for the Company’s future expansion over the next five years. The remaining $19.4 million of the purchase price of the 360,000 tons annual capacity corrugating medium paper production line will be made in additional installments throughout 2010 in conjunction with progress made on equipment installation. The Company will finance the estimated capital expenditure requirement for the next six-to-twelve months in the amount of $30 million, which includes $20 million for the new production line and $10 million for the second phase of the land acquisition, with (i) net cash proceeds from the April 2010 public offering, (ii) cash flow from operating activities, and/or (iii) additional bank loans.
Recent Developments
-- In July 2010, the Company's Audit Committee retained the
international law firm, Loeb & Loeb LLP ("Loeb & Loeb"), to conduct
an independent investigation into the issues raised by Muddy Waters,
LLC ("Muddy Waters"). In August 2010, the Company announced that
Loeb & Loeb retained Deloitte & Touche Financial Advisory Services
Limited ("Deloitte") to assist with the investigation. Deloitte
will provide support to Loeb & Loeb, which is working with the
Company's Audit Committee, in connection with the independent review
of the accounting aspects of the issues raised and the investigation
of the relevant financial transactions and customer relationships.
Business Outlook
Mr. Liu added, “Due to the rapidly increasing prices of wood pulp and the government’s environmental protection initiatives, the demand for medium-grade offset printing paper as a substitute for the high-grade printing paper that consumes wood pulp continues to exhibit robust growth. We are confident that the strong market demand, partly caused by the government-mandated elimination of inefficient capacities, may continue into the second half of the year.”
“We expect some minor delays in the installation of our new 360,000 tons annual capacity corrugating medium paper production line, which was expected to be completed in October 2010. Our current expectation is that trial production will begin at the end of the year. We expect this new facility will ramp up to achieve an annualized utilization rate of approximately 60%-70% by the end of fiscal year 2011.
“In connection with the government’s approval of our new corrugating medium paper production line, the Baoding City Environmental Protection Agency requires that we replace two of our four steam boilers with new more energy- efficient models. We removed the two old boilers in July 2010. Our production in the third quarter may be lower until the new boilers are installed and inspected possibly in the fourth quarter. As a result of all of the above mentioned factors, we now expect fiscal year 2010 adjusted net income of $16.2 million compared to our previously provided guidance of $18.0 million.”
Use of Non-GAAP Financial Measures
GAAP results for the three months and six months ended June 30, 2010 include a non-cash charge related to the disposal of property, plant and equipment. To supplement the Company’s condensed consolidated financial statements presented on a GAAP basis, the Company has provided non-GAAP financial information excluding the impact of these items in this release. It is a departure of U.S. GAAP; however, the Company’s management believes that this non-GAAP measure provides investors with a better understanding of how the results relate to the Company’s historical performance. A reconciliation of the adjustments to GAAP results appears in the table accompanying this press release. This additional non-GAAP information is not meant to be considered in isolation or as a substitute for GAAP financials. The non-GAAP financial information that the Company provides also may differ from the non-GAAP information provided by other companies.
Conference Call
The Company will host a conference call at 9:00 a.m. Eastern Time on Monday, August 16, 2010, to discuss the 2010 second quarter financial results.
To participate in the conference call, please dial the following number five to ten minutes prior to the scheduled conference call time: +1 877-410-4789. International callers should dial +1 706-679-8006. The conference call passcode is 937 602 01.
If you are unable to participate in the call at this time, a replay will be available starting on Monday, August 16, 2010 at 12:00 noon Eastern Time, through Monday, August 30, 2010. To access the replay, dial 800-642-1687. International callers should dial +1 706-645-9291. The conference call passcode is 937 602 01.
This conference call will be broadcast live over the Internet and can be accessed by all interested parties by clicking on http://www.orientalpapercorporation.com/ . Please access the link at least fifteen minutes prior to the start of the call to register, download, and install any necessary audio software. For those unable to participate during the live broadcast, a 90-day replay will be available shortly after the call by accessing the same link.
About Orient Paper, Inc.
Orient Paper, Inc., through its wholly-owned subsidiary, Shengde Holdings, Inc., controls and operates Baoding Shengde Paper Co., Ltd. (“Baoding Shengde”), and Hebei Baoding Orient Paper Milling Co., Ltd (“HBOP”). Founded in 1996, HBOP is engaged in the production and distribution of products such as corrugating medium paper, offset printing paper, and other paper and packaging-related products in China. The Company uses recycled paper as its primary raw material. Baoding Shengde, founded in June 2009 located in Baoding, is engaged in the production and distribution of digital photo paper. As one of the largest paper producers in Hebei Province, China, HBOP is strategically located in Baoding, a city in close proximity to Beijing where the majority of publishing houses are based. Orient Paper is led by an experienced management team committed to diversifying the Company’s product offering and delivering tailored services to its customers. For more information, please visit http://www.orientalpapercorporation.com .
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this announcement are forward-looking statements, including but not limited to, anticipated revenues from the digital photo paper business segment; the actions and initiatives of current and potential competitors; the Company’s ability to introduce new products; the Company’s ability to implement the planned capacity expansion of corrugate medium paper; market acceptance of new products; general economic and business conditions; the ability to attract or retain qualified senior management personnel and research and development staff; and other risks detailed in the Company’s filings with the Securities and Exchange Commission. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the companies and the industry. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or to changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results.
ORIENT PAPER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2010 AND 2009
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2010 2009 2010 2009
Revenues: $38,257,140 $22,400,383 $64,715,328 $40,237,862
Cost of Sales (29,130,668) (18,431,400)(50,748,327) (32,932,440)
Gross Profit 9,126,472 3,968,983 13,967,001 7,305,422
Selling, General and
Administrative
Expenses (638,361) (275,808) (1,077,699) (474,561)
Loss from disposal of
property, plant
and equipment (1,082,454) -- (1,082,454) --
Income from Operations 7,405,657 3,693,175 11,806,848 6,830,861
Other Income
(Expense):
Interest income 62,286 6,964 89,474 31,942
Interest expense (169,929) (326,231) (333,246) (416,080)
Income before Income
Taxes 7,298,014 3,373,908 11,563,076 6,446,723
Provision for Income
Taxes (1,946,159) (899,250) (3,085,127) (1,673,463)
Net Income 5,351,855 2,474,658 8,477,949 4,773,260
Other Comprehensive
Income:
Foreign currency
translation
adjustment 318,553 (99,632) 327,496 (146,268)
Total Comprehensive
Income $5,670,408 $2,375,026 $8,805,445 $4,626,992
Earnings Per Share:
Basic Earning per
Share $0.30 $0.22 $0.51 $0.42
Fully Diluted Earning
per Share $0.30 $0.22 $0.51 $0.42
Weighted Average
Number of Shares
Outstanding -
Basic 18,113,740 11,277,324 16,510,549 11,276,415
Outstanding -
Fully Diluted 18,113,740 11,277,324 16,512,621 11,276,415
ORIENT PAPER, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2010, AND DECEMBER 31, 2009
(Unaudited)
June 30, December 31,
2010 2009
Current Assets:
Cash and cash equivalents $22,089,907 $6,949,953
Restricted cash -- 29,105
Accounts receivable (net of
allowance for doubtful
accounts of $73,562 and
$41,977 as of June 30,
2010 and December 31, 2009,
respectively) 3,604,543 2,056,858
Inventories 9,328,868 6,926,392
Prepayment and other current
assets 383,575 434,093
Total current assets 35,406,893 16,396,401
Prepayment on property, plant and
equipment 19,901,301 --
Property, plant and equipment, net 52,462,805 55,303,753
Total Assets $107,770,999 $71,700,154
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Short-term bank loans $1,909,350 $4,273,750
Accounts payable 3,648,021 1,819,448
Accrued payroll and employee
benefits 276,655 271,208
Other payables and accrued
liabilities 2,179,209 1,662,673
Income taxes payable 2,042,775 1,345,069
Total current liabilities 10,056,010 9,372,148
Loan from credit union 1,950,474 1,942,315
Loan from related parties 4,128,002 4,110,735
Total liabilities 16,134,486 15,425,198
Commitments and Contingencies -- --
Stockholders' Equity:
Common stock, 500,000,000 shares
authorized, $0.001 par value per
share, 18,344,811 and 14,875,715
shares issued and outstanding as
of June 30, 2010 and December 31,
2009, respectively 18,345 14,876
Additional paid-in capital 45,727,657 19,169,469
Statutory earnings reserve 4,442,450 4,442,450
Accumulated other comprehensive
income 4,306,256 3,984,305
Retained earnings 37,141,805 28,663,856
Total stockholders' equity 91,636,513 56,274,956
Total Liabilities and Stockholders'
Equity $107,770,999 $71,700,154
ORIENT PAPER, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2010 AND 2009
(Unaudited)
Six Months Ended June 30,
2010 2009
Cash Flows from Operating Activities:
Net income $8,477,949 $4,773,260
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 2,022,597 1,702,861
Loss on disposal of property, plant
and equipment 1,082,454 --
Impairment on accounts receivable 31,289 55,587
Stock-based expense for service
received 101,046 27,300
Changes in operating assets and
liabilities:
Accounts receivable (1,564,445) (1,372,180)
Prepayment and other receivable (58,243) --
Inventories (2,364,301) (2,855,060)
2,779,16
Accounts payable 1,813,964
Accrued payroll and employee
benefits 4,291 --
Other payables and accrued liabilities 507,642 375,695
Income taxes payable 689,408 (410,919)
Net Cash Provided by Operating Activities $10,743,651 5,075,708
Cash Flows from Investing Activities:
Purchases of property, plant, and
equipment (263,022) --
Prepayment for purchases of equipment (8,486,045) --
Prepayment for Purchases of land use right (11,119,646) --
Net Cash Used in
Investing Activities (19,868,713) --
Cash Flows from Financing Activities:
Proceeds from related party loans 200,000 (8,017)
Repayment of related party loans (200,000) --
Repayments on short term loans (2,373,237) (1,265,845)
Proceeds from public offering of common
stock 26,570,162 --
Restricted cash 29,105 (430,000)
Net Cash Provided by Financing Activities 24,226,030 (1,703,862)
Effect of Exchange Rate Changes on Cash and
Cash
Equivalents 38,986 57,973
Net Increase in Cash and Cash Equivalents 15,139,954 3,429,819
Cash and Cash Equivalents - Beginning of
Period 6,949,953 3,234,419
Cash and Cash Equivalents - End of Period $22,089,907 $6,664,238
ORIENT PAPER, INC.
Reconciliation of Non-GAAP to GAAP Measures
For the quarter ended Six months ended
June 30, 2010 June 30, 2009 June 30, 2009 June 30, 2010
Operating Income as 7,405,657 3,693,175 11,806,848 6,830,861
reported under GAAP
Add: Loss on
Disposal of
property, plant
and equipment (1,082,454) 0 (1,082,454) 0
Non-GAAP Operating
Income 8,488,111 3,693,175 12,889,302 6,830,861
Net Income as
reported under GAAP 5,351,855 2,474,658 8,477,949 4,773,260
Add: Loss on
disposal
of property, plant
and equipment (1,082,454) 0 (1,082,454) 0
Non-GAAP Net Income 6,434,309 2,474,658 9,560,403 4,773,260
Diluted Earnings
Per Share reported
under GAAP $0.30 $0.22 0.51 0.42
Add: Loss on
disposal of
property, plant
and equipment ($0.06) $0.00 ($0.07) $0.00
Non-GAAP Diluted
Earnings Per Share $0.36 $0.22 $0.58 $0.42
Diluted weighted
average number of
common stock
outstanding 18,113,740 11,277,324 16,512,621 11,276,415
For more information, please contact:
CCG Investor Relations
Crocker Coulson, President
Phone: +1-646-213-1915
Email: crocker.coulson@ccgir.com
Orient Paper, Inc.
Winston Yen, CFO
Phone: +1-562-818-3817
Email: info@orientalpapercorporation.com
FieldPoint Petroleum Corporation (FPP) Announces Another Stock Buy-Back
AUSTIN, Texas, Aug. 16 /PRNewswire-FirstCall/ — FieldPoint Petroleum Corporation (NYSE Amex: FPP) announced today that its Board of Directors has authorized the Company to continue the repurchase of shares of its Common Stock at a cost not to exceed $250,000. Stock purchases may be made in open market or privately-negotiated transactions, if and when management determines to effect purchases. Repurchases shall occur subject to prevailing market conditions and will be funded from available cash. Repurchases will also be subject to compliance with applicable federal securities laws, including Rule 10b-18 under the Securities Exchange Act of 1934, as amended.
About FieldPoint Petroleum Corp. www.fppcorp.com
FieldPoint Petroleum Corporation is engaged in oil and natural gas exploration, production and acquisition, primarily in Louisiana, New Mexico, Oklahoma, Texas and Wyoming.
This press release may contain projection and other forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended. Any such projections or statement reflect the company’s current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that such projections will be achieved and that actual results could differ materially from those projected. A discussion of important factors that could cause actual results to differ from those projected, such as decreases in oil and gas prices and unexpected decreases in oil and gas production is included in the company’s periodic reports filed with the Securities and Exchange Commission (at www.sec.gov).
Houston American Energy (HUSA) Announces Second Quarter 2010 Financial Results
HOUSTON, Aug. 16 /PRNewswire-FirstCall/ — Houston American Energy Corp. (NYSE Amex: HUSA) today reported its financial results for the quarter and six months ended June 30, 2010.
The Company reported net income for the three months ended June 30, 2010 of $990,134, or $0.03 per share, on revenues of $7,629,274, as compared to net income of $112,107, or $0.00 per share, on revenues of $1,134,118 for the three months ended June 30, 2009. For the six months ended June 30, 2010, the company reported net income of $1,798,851, or $0.06 per share, on revenues of $11,870,669, as compared to a net loss of $1,366,212, or $0.05 per share, on revenues of $1,579,260 for the six months ended June 30, 2009.
The increase in revenue and profitability for the 2010 quarter and six month periods was attributable to higher prices realized from oil and gas sales during the 2010 periods coupled with increased volumes resulting from new wells brought onto production in Colombia and production from our Colombian properties for the full 2010 periods as compared to the 2009 periods when production from our principal Colombian properties was shut-in, due to market conditions, for a total of 52 days spanning the first and second quarters.
Mr. John F. Terwilliger, President and Chairman of Houston American Energy, stated, “Houston American Energy has continued to benefit from strong results in our Colombian operations together with a more favorable pricing environment. Our operations have recovered nicely from the difficult operating environment that prevailed during the first half of 2009, with revenues growing 572% for the 2010 second quarter compared to the 2009 quarter and 651% for the 2010 six month period compared to the 2009 six month period. Our revenue growth reflects increases in production volumes of 441% for the current quarter and 406% for the six month period, which, in turn, reflects our drilling successes, adding five new producing wells since June 2009, and production from our Colombian wells for the full 2010 periods while 2009 production volumes reflected the temporary cessation of production due to a severely depressed pricing environment.
We continue to be very bullish on Colombia, in general, and our Colombian holdings, in particular. We are moving forward on pace with our plans to drill our Serrania and CPO 4 prospects and, since quarter end, have increased our interest in the CPO 4 prospect to 37.5%. We continue to enjoy a strong balance sheet with no debt and with ample cash balances and operating cash flows to fund our anticipated drilling costs on each of our Colombian prospects. As previously announced, we continue in our efforts to market selected older prospects in Colombia with a view to monetizing a portion of our holdings and utilization of funds from such efforts to support our most attractive prospects. With our higher interest in CPO 4 and other recent prospects acquired in Colombia, we continue to focus on growing our reserves and production as our newer prospects are drilled over the next year.”
About Houston American Energy Corp.
Based in Houston, Texas, Houston American Energy Corp. is an independent energy company with interests in oil and natural gas wells and prospects. The company’s business strategy includes a property mix of producing and non-producing assets with a focus on Colombia, Texas and Louisiana. Additional information can be accessed by reviewing our Form 10-Q and other periodic reports filed with the Securities and Exchange Commission which can be found on our website at www.houstonamericanenergy.com.
Forward-Looking Statements
The information in this release includes certain forward-looking statements that are based on assumptions that in the future may prove not to have been accurate, including statements regarding the company’s ability to increase its reserves, production sales volumes, revenues and profitability in future periods, its ability to identify, finance, acquire and operate assets and operations on favorable terms, or at all, and the ultimate proceeds, if any, that may be received from current efforts to sell a portion of the company’s Colombian assets. Those statements, and Houston American Energy Corp., are subject to a number of risks, including the potential changes in price based on operations and fluctuations in oil prices, changes in market conditions and other factors, effects of government regulation, and the ultimate results derived from our projects and our efforts to identify, finance and consummate the acquisition of assets and operations. These and other risks are described in the company’s documents and reports that are available from the company and the United States Securities and Exchange Commission.
For additional information, view the company’s website at www.houstonamericanenergy.com or contact the Houston American Energy Corp. at (713) 222-6966.
THQ, Inc. (THQI) Announces Distinguished Lineup of World Wrestling Entertainment® Superstars
AGOURA HILLS, Calif.–(BUSINESS WIRE)–THQ Inc. (NASDAQ:THQI – News) today announced eight World Wrestling Entertainment® Superstars will be featured across multiple front covers of WWE® SmackDown® vs. Raw® 2011, the latest edition to the renowned simulation-based cornerstone of the company’s WWE videogame portfolio. WWE Superstars John Cena®, Big Show® and The Miz® are slated to appear on the front cover in the United States, Australia, New Zealand, Singapore, Hong Kong, Taiwan and India, while WWE Superstars Randy Orton®, Undertaker® and Sheamus® will appear on the front cover available throughout Europe. Additional regional covers are expected to be announced later this year. WWE SmackDown vs. Raw 2011 will mark one of the few times in franchise history that multiple variations of cover artwork will be available around the world.
“John Cena, Undertaker, Randy Orton, Big Show, The Miz and Sheamus are incredibly talented WWE Superstars who took part in some of the biggest moments ever witnessed in WWE,” said Danny Bilson, Executive Vice President, Core Games, THQ. “We look forward to delivering an unparalleled WWE simulation experience with WWE SmackDown vs. Raw 2011, including best-in-class creative tools and decision-making abilities for players to define their own virtual WWE moments.”
About WWE SmackDown vs. Raw 2011
Having shipped more than 50 million units worldwide, the renowned WWE simulation experience and annual centerpiece in THQ’s expanding WWE videogame portfolio returns to define the ultimate WWE moments and give players even greater creative and decision-making freedom throughout their storied journeys within WWE.
WWE SmackDown vs. Raw 2011 will empower players more than ever to define their gameplay experiences in a dynamic and ever-changing WWE. Along the way, gameplay scenarios will change based on player decisions, allowing for more spontaneous WWE action in and out of the ring. Players will also enjoy a greater level of interactivity and have increased control of their destinies in the game’s popular Road to WrestleMania story-driven mode.
A hallmark of the franchise, WWE SmackDown vs. Raw 2011 will deliver its largest offering to date of best-in-class creation and customization features. Players will have more creative tools than ever to customize their WWE Superstars, finishing moves and story designs. In addition, searching and sharing content will be greatly simplified with improvements to the highly regarded WWE Community Creations feature, which generated nearly 10 million downloads, including more than 7.5 million Created WWE Superstars, 500,000 story designs and 500,000 finishing moves in its franchise debut.
WWE SmackDown vs. Raw 2011 will also boast one of the largest rosters in franchise history with more than 70 of today’s prominent WWE Superstars and WWE Divas. Each in-game model will feature new skin textures and movement technology, delivering the most authentic looking and moving WWE Superstars and WWE Divas ever seen in a videogame. In addition, a new physics system will ensure all matches and object interactions look and feel unique, dynamic and unpredictable to capture the full essence of the WWE experience.
WWE SmackDown vs. Raw 2011 is currently in development for the Xbox 360® video game and entertainment system from Microsoft, PlayStation®3 computer entertainment system, PlayStation®2 computer entertainment system, PSP® (PlayStation®Portable) system and Wii™ video game system, with a scheduled release date of October 26, 2010. For more information, please visit wwe.thq.com, facebook.com/WWEgames and twitter.com/WWEgames.
About World Wrestling Entertainment, Inc.
World Wrestling Entertainment, Inc., a publicly traded company (NYSE:WWE – News), is an integrated media organization and recognized leader in global entertainment. The company consists of a portfolio of businesses that create and deliver original content 52 weeks a year to a global audience. WWE is committed to family-friendly, PG content across all of its platforms including television programming, pay-per-view, digital media and publishing. WWE programming is broadcast in more than 145 countries and 30 languages and reaches more than 500 million homes worldwide. The company is headquartered in Stamford, Conn., with offices in New York, Los Angeles, Chicago, London, Shanghai, Tokyo and Toronto. Additional information on World Wrestling Entertainment, Inc. (NYSE:WWE – News) can be found at corporate.wwe.com. For information on global activities, go to http://www.wwe.com/worldwide/.
About THQ Inc.
THQ Inc. (NASDAQ:THQI – News) is a leading worldwide developer and publisher of interactive entertainment software. The company develops its products for all popular game systems, personal computers and wireless devices. Headquartered in Los Angeles County, California, THQ sells product through its global network of offices located throughout North America, Europe and Asia Pacific. More information about THQ and its products may be found at www.thq.com. THQ and the THQ logo are trademarks and/or registered trademarks of THQ Inc.
Microsoft, Xbox, Xbox 360, Xbox Live, the Xbox logos, and the Xbox Live logo are either registered trademarks or trademarks of Microsoft Corporation in the U.S. and/or other countries.
“PlayStation” is a registered trademark of Sony Computer Entertainment Inc.
Wii is a registered trademark of Nintendo.
THQ Forward-Looking Statements: The statements contained in this press release that are not historical facts may be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates and projections about the business of THQ Inc. and its subsidiaries (collectively referred to as “THQ”), including, but not limited to, expectations and projections related to the release of the WWE SmackDown vs. Raw 2011 videogame, and are based upon management’s current beliefs and certain assumptions made by management. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, business, competitive, economic, legal, political and technological factors affecting our industry, operations, markets, products or pricing. Readers should carefully review the risk factors and the information that could materially affect THQ’s financial results, described in other documents that THQ files from time to time with the Securities and Exchange Commission, including its Quarterly Reports on Form 10-Q and Annual Report on Form 10-K for the fiscal period ended March 31, 2010, and particularly the discussion of risk factors set forth therein. Unless otherwise required by law, THQ disclaims any obligation to update its view on any such risks or uncertainties or to revise or publicly release the results of any revision to these forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.
Trademarks: All WWE programming, talent names, images, likenesses, slogans, wrestling moves, trademarks, copyrights and logos are the exclusive property of World Wrestling Entertainment, Inc. and its subsidiaries. All other trademarks, logos and copyrights are the property of their respective owners.
WWE Forward-Looking Statements: This news release contains forward-looking statements pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995, which are subject to various risks and uncertainties. These risks and uncertainties include risks relating to maintaining and renewing key agreements, including television distribution agreements; the need for continually developing creative and entertaining programming; the continued importance of key performers and the services of Vincent McMahon; the conditions of the markets in which we compete; acceptance of the Company’s brands, media and merchandise within those markets; uncertainties relating to regulatory and litigation matters; risks resulting from the highly competitive nature of our markets; the importance of protecting our intellectual property and complying with the intellectual property rights of others; risks associated with producing live events both domestically and internationally; uncertainties associated with international markets; risks relating to our film business and any new business initiative which we may undertake; risks relating to the large number of shares of common stock controlled by members of the McMahon family; and other risks and factors set forth from time to time in Company filings with the Securities and Exchange Commission. Actual results could differ materially from those currently expected or anticipated. In addition, our dividend is significant and is dependent on a number of factors, including, among other things, our liquidity and historical and projected cash flow, strategic plan (including alternative uses of capital), our financial results and condition, contractual and legal restrictions on the payment of dividends, general economic and competitive conditions and such other factors as our Board of Directors may consider relevant, including a waiver by the McMahon family of a portion of the dividends.
ICx Technologies (ICXT) Reports First-Half 2010 Results
ARLINGTON, Va.–(BUSINESS WIRE)–ICx Technologies, Inc. (Nasdaq GM: ICXT), a developer of advanced sensor technologies for homeland security, force protection and commercial applications, announced today its operating and financial results for the first six months and second-quarter ended June 30, 2010.
First-Half Financials
For the first six months ended June 30, 2010, ICx reported revenues of $77 million, compared to $92 million for the same six months last year. The Company also reported an increase in funded backlog, up 38% to $73 million from the beginning of the year. In addition, adjusted EBITDA remained positive at $1.5 million for the first six months of 2010 compared to adjusted EBITDA of $3.7 million for the same period last year.
Second-Quarter
For the second quarter of 2010, revenue was $36 million and adjusted EBITDA was a loss of ($0.6) million. Last year, the Company reported revenue of $45 million and adjusted EBITDA of $2.9 million.
Merger Agreement Announcement
As reported in a separate press release today, ICx has entered into a definitive merger agreement with FLIR Systems, Inc. pursuant to which ICx would be acquired through a cash tender offer, followed by a merger with a subsidiary of FLIR, for a price of $7.55 per share in cash, subject to the terms and conditions of the merger agreement.
ICx has cancelled the previously scheduled August 16 call to discuss its earnings.
About ICx® Technologies
ICx Technologies is a leader in the development and integration of advanced sensor technologies for homeland security, force protection and commercial applications. Our proprietary sensors detect and identify chemical, biological, radiological, nuclear and explosive threats, and deliver superior awareness and actionable intelligence for wide-area surveillance, intrusion detection and facility security. We then leverage our unparalleled technical expertise and government funding to address other emerging challenges of our time, ranging from a cleaner environment and alternative energy to life science.
Safe-Harbor Statement
All forward-looking statements contained in this release are made within the meaning of and pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are all statements other than statements of historical facts, including but not limited to statements concerning the outlook for the Company’s revenues and EPS for fiscal 2010; and all other statements concerning the plans, intentions, expectations, projections, hopes, beliefs, objectives, goals and strategies of management. Forward-looking statements are not guarantees of future performance or events and are subject to a number of known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed, projected or implied by such forward-looking statements. Important risks, uncertainties and other factors include, but are not limited to, demand for the Company’s products and services; the ability of the Company to successfully develop and expand its products, services, technologies and markets; the ability of the Company to effectively assimilate acquired businesses and achieve the anticipated benefits of its acquisitions; changes in U.S. government funding levels to purchase the Company’s products and services; the ability of the Company to sell its products to original equipment manufacturers, prime contractors and system integrators; seasonality; competition; the ability of the Company to develop innovative products; the ability of the Company to attract, retain and motivate key personnel; the ability of the Company to secure and maintain key contracts and relationships, including contracts with the U.S. government; general economic, market and business conditions, uncertainties and other factors identified from time to time in the Company’s filings with the Securities and Exchange Commission. Accordingly, there can be no assurance that the results expressed, projected or implied by any forward-looking statements will be achieved, and readers are cautioned not to place undue reliance on any forward-looking statements. The forward-looking statements in this press release speak only as of the date hereof and are based on the current plans, goals, objectives, strategies, intentions, expectations and assumptions of, and the information currently available to, management. The Company assumes no duty or obligation to update or revise any forward-looking statements for any reason, whether as the result of changes in expectations, new information, future events, conditions or circumstances or otherwise.
Use of Non-GAAP Financial Measures
In evaluating its business, ICx considers and uses Adjusted EBITDA as a supplemental measure of its operating performance. The Company defines Adjusted EBITDA as earnings from continuing operations before interest, taxes, depreciation and amortization, plus non-cash equity compensation. The Company also presents Adjusted EBITDA because it believes it is frequently used by securities analysts, investors and other interested parties as a measure of financial performance. The term Adjusted EBITDA is not defined under U.S. generally accepted accounting principles, or U.S. GAAP, and is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. Adjusted EBITDA has limitations as an analytical tool, and when assessing the Company’s operating performance, investors should not consider Adjusted EBITDA in isolation, or as a substitute for net income (loss) or other consolidated income statement data prepared in accordance with U.S. GAAP. Among other things, Adjusted EBITDA does not reflect the Company’s actual cash expenditures. Other companies may calculate similar measures differently than ICx, limiting their usefulness as comparative tools. ICx compensates for these limitations by relying primarily on its GAAP results and using Adjusted EBITDA only supplementally.
| ICx TECHNOLOGIES, INC. AND SUBSIDIARIES | ||||||||||||||||
| Consolidated Statements of Operations and Net Loss | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| (dollars in thousands, except per share amounts) | ||||||||||||||||
| Unaudited | Unaudited | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
| Revenues: | ||||||||||||||||
| Product revenues | $ | 19,584 | $ | 22,122 | $ | 41,299 | $ | 38,443 | ||||||||
| Contract research and development revenues | 10,147 | 12,692 | 22,308 | 23,974 | ||||||||||||
| Service and other revenue | 6,248 | 10,173 | 12,942 | 29,961 | ||||||||||||
| Total revenues | 35,979 | 44,987 |
76,549
|
92,378 | ||||||||||||
| Cost of revenues: | ||||||||||||||||
| Cost of product revenues | 8,633 | 10,837 | 16,998 | 18,937 | ||||||||||||
| Cost of contract research and development revenues | 7,441 | 9,565 | 16,394 | 17,879 | ||||||||||||
| Cost of service and other revenues | 4,031 | 7,335 | 8,852 | 21,529 | ||||||||||||
| Total cost of revenue | 20,105 | 27,737 | 42,244 | 58,345 | ||||||||||||
| Gross profit | 15,874 | 17,250 | 34,305 | 34,033 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| General and administrative | 7,248 | 6,717 | 14,288 | 13,906 | ||||||||||||
| Sales and marketing | 6,281 | 5,840 | 12,589 | 12,194 | ||||||||||||
| Research and development | 4,228 | 3,105 | 7,988 | 6,621 | ||||||||||||
| Depreciation and amortization | 1,872 | 2,996 | 3,825 | 6,019 | ||||||||||||
| Total operating expenses | 19,629 | 18,658 | 38,690 | 38,740 | ||||||||||||
| Operating loss | (3,755 | ) | (1,408 | ) | (4,385 | ) | (4,707 | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest income | 15 | 39 | 27 | 91 | ||||||||||||
| Interest expense | (17 | ) | (37 | ) | (45 | ) | (55 | ) | ||||||||
| Other, net | 587 | 344 | 834 | 401 | ||||||||||||
| Total other income | 585 | 346 | 816 | 437 | ||||||||||||
| Loss before income taxes | (3,170 | ) | (1,062 | ) | (3,569 | ) | (4,270 | ) | ||||||||
| Income tax expense | 509 | 122 | 789 | 235 | ||||||||||||
| Loss from continuing operations | $ | (3,679 | ) | $ | (1,184 | ) | $ | (4,358 | ) | $ | (4,505 | ) | ||||
| Loss on discontinued operations, net of tax | (9 | ) | (87 | ) | (322 | ) | (241 | ) | ||||||||
| Loss on sale of discontinued operations, net of tax | (29 | ) | — | (29 | ) | — | ||||||||||
| Net loss | $ | (3,717 | ) | $ | (1,271 | ) | $ | (4,709 | ) | $ | (4,746 | ) | ||||
| Other comprehensive income | ||||||||||||||||
| Foreign currency translation adjustment, net of tax | (768 | ) | (136 | ) | (1,041 | ) | (915 | ) | ||||||||
| Comprehensive loss | $ | (4,485 | ) | $ | (1,407 | ) | $ | (5,750 | ) | $ | (5,661 | ) | ||||
| Net loss per common share | ||||||||||||||||
| Basic and diluted | $ | (0.11 | ) | $ | (0.04 | ) | $ | (0.13 | ) | $ | (0.14 | ) | ||||
| Reconciliation of Non-GAAP Measure: | ||||||||||||||||
| Net loss | $ | (3,717 | ) | $ | (1,271 | ) | $ | (4,709 | ) | $ | (4,746 | ) | ||||
| Add (subtract) | ||||||||||||||||
| Loss from discontinued operations | 38 | 87 | 351 | 241 | ||||||||||||
| Income tax expense (benefit) | 509 | 122 | 789 | 235 | ||||||||||||
| Interest income | (15 | ) | (39 | ) | (27 | ) | (91 | ) | ||||||||
| Interest expense | 17 | 37 | 45 | 55 | ||||||||||||
| Depreciation and amortization | 1,872 | 2,996 | 3,825 | 6,019 | ||||||||||||
| Stock-based compensation expense | 655 | 955 | 1,185 | 1,985 | ||||||||||||
| Adjusted EBITDA | $ | (641 | ) | $ | 2,887 | $ | 1,459 | $ | 3,698 | |||||||
| ICx TECHNOLOGIES, INC. AND SUBSIDIARIES | ||||||
| Condensed Balance Sheets | ||||||
| (Unaudited) | ||||||
| (dollars in thousands) | ||||||
| June 30, | December 31, | |||||
| Assets | 2010 | 2009 | ||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 37,739 | $ | 22,257 | ||
| Restricted cash | 3,866 | 8,465 | ||||
| Trade accounts receivable, net | 20,737 | 36,751 | ||||
| Unbilled revenue | 9,268 | 8,957 | ||||
| Inventories | 28,929 | 22,491 | ||||
| Other current assets | 5,519 | 4,553 | ||||
| Current assets of discontinued operations | — | 1,065 | ||||
| Total current assets | 106,058 | 104,539 | ||||
| Property, plant and equipment, net | 9,432 | 9,673 | ||||
| Goodwill and intangibles, net | 77,802 | 80,176 | ||||
| Other noncurrent assets | 4,307 | 3,671 | ||||
| Noncurrent assets of discontinued operations | — | 365 | ||||
| Total assets | $ | 197,599 | $ | 198,424 | ||
| Liabilities and Stockholders’ Equity | ||||||
| Current liabilities | $ | 30,568 | $ | 26,142 | ||
| Current liabilities of discontinued operations | — | 879 | ||||
| Noncurrent liabilities | 513 | 966 | ||||
| Total liabilities | 31,081 | 27,987 | ||||
| Total stockholders’ equity | 166,518 | 170,437 | ||||
| Total liabilities and stockholders’ equity | $ | 197,599 | $ | 198,424 | ||
| ICx TECHNOLOGIES, INC. AND SUBSIDIARIES | ||||||||||||||||
| Selected Segment Information | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| (dollars in thousands) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
| Detection | ||||||||||||||||
| Product revenue | $ | 11,912 | $ | 10,886 | $ | 26,321 | $ | 20,181 | ||||||||
| Contract research and development revenue | 9,706 | 12,573 | 21,296 | 23,657 | ||||||||||||
| Service and other revenue | 1,300 | 864 | 2,459 | 1,683 | ||||||||||||
| Total revenue | $ | 22,918 | $ | 24,323 | $ | 50,076 | $ | 45,521 | ||||||||
| Gross profit % | 42.1 | % | 40.2 | % | 44.6 | % | 40.2 | % | ||||||||
| Surveillance | ||||||||||||||||
| Product revenue | $ | 5,912 | $ | 9,415 | $ | 11,955 | $ | 14,526 | ||||||||
| Contract research and development revenue | 441 | 119 | 1,012 | 317 | ||||||||||||
| Service and other revenue | 610 | 3,855 | 1,272 | 14,625 | ||||||||||||
| Total revenue(1) | $ | 6,963 | $ | 13,389 | $ | 14,239 | $ | 29,468 | ||||||||
| Gross profit % | 57.0 | % | 35.8 | % | 55.5 | % | 34.1 | % | ||||||||
| Solutions | ||||||||||||||||
| Product revenue | $ | 1,746 | $ | 1,831 | $ | 3,027 | $ | 3,769 | ||||||||
| Contract research and development revenue | 59 | 121 | 96 | 156 | ||||||||||||
| Service and other revenue | 4,516 | 5,624 | 9,428 | 13,915 | ||||||||||||
| Total revenue(2) | $ | 6,321 | $ | 7,576 | $ | 12,551 | $ | 17,840 | ||||||||
| Gross profit % | 35.7 | % | 35.4 | % | 32.4 | % | 31.7 | % | ||||||||
(1) Includes $0 and $8 of intersegment revenue that has been eliminated in the Consolidated Statement of Operations and Net Loss for the three and six months ended June 30, 2010 and 2009, respectively
(2) Includes $223 and $293 of intersegment revenue that has been eliminated in the Consolidated Statement of Operations and Net Loss for the three months ended June 30, 2010 and 2009, respectively; and $317 and $443 of intersegment revenue that has been eliminated in the Consolidated Statement of Operations and Net Loss for the six months ended June 30, 2010 and 2009, respectively
Rescare (RSCR) Receives Acquisition Proposal From Onex Corporation
LOUISVILLE, Ky., Aug. 16, 2010 (GLOBE NEWSWIRE) — ResCare, Inc. (Nasdaq:RSCR – News) announced today that it has received a proposal from Onex Corporation (“Onex”) to acquire all of the outstanding shares of common stock of ResCare not owned by affiliates of Onex for $12.60 per share. The written proposal, which includes several terms and conditions, is attached to this release.
Affiliates of Onex, the Toronto-based investment firm, currently hold common stock and preferred stock of ResCare representing 24.9% of the voting power of ResCare stock. The preferred stock held by Onex votes on an as-converted basis with common stock. Onex acquired its position in ResCare in 2004.
The board of directors of ResCare has formed a special committee of independent directors to evaluate the offer with the committee’s independent financial and legal advisors. The members of the committee are;
Ronald G. Geary, current Chairman of the Board and ResCare CEO until 2006;
James H. Bloem, Chief Financial Officer of Humana, Inc.;
Olivia F. Kirtley, ResCare audit committee chair; and
Steven S. Reed, former U.S. attorney and former Chair of the Board of Trustees of the University of Kentucky.
The special committee has engaged Goldman Sachs & Co. to serve as its financial advisor and Frost Brown Todd LLC as its legal counsel.
The board of directors cautions ResCare’s shareholders that no decisions have been made by the board with respect to a response to the proposal. There can be no assurance that any agreement will be executed or that this or any other transaction will be approved or consummated. Pending completion of the evaluation of the proposal by the special committee and the board of directors, neither ResCare nor the special committee will have any further comment with respect to the proposal.
From time to time, ResCare makes forward-looking statements in its public disclosures, including statements relating to expected financial results, revenues that might be expected from new or acquired programs and facilities, its development and acquisition activities, reimbursement under federal and state programs, financing plans, compliance with debt covenants and other risk factors, and various trends favoring privatization of government programs. In ResCare’s filings under the federal securities laws, including its annual, periodic and current reports, the Company identifies important factors that could cause its actual results to differ materially from those anticipated in forward-looking statements. Please refer to the discussion of those factors in the Company’s filed reports. Statements related to expected financial results are as of this date only, and ResCare does not assume any responsibility to update these statements.
Onex Corporation
161 Bay Street
Toronto, Ontario M5J 2S1
Canada
August 14, 2010
Board of Directors
Res-Care, Inc.
9901 Linn Station Road
Louisville, KY 40223
Gentlemen:
We are writing to set forth our proposal for a transaction in which a newly formed affiliate of Onex Corporation would acquire all of the outstanding shares of common stock, no par value, of ResCare, Inc. (the “Company”) not owned by our affiliates for a price of $12.60 per share (the “Transaction”). Our proposal is subject to the approval of the Board of Directors of the Company, participation in the investment by key members of the Company’s management, the negotiation, execution and delivery of a mutually satisfactory definitive agreement providing for the Transaction and the satisfaction of the conditions to be set forth therein.
The definitive agreement for the Transaction would provide for a “go-shop” period of 30 days during which the Company could solicit alternative offers, and a termination fee equal to 3% of the fully-diluted equity of the Company valued at the higher of our offer price or the price to be paid in an alternative transaction, which would be payable by the Company if the Board of Directors chose to support an alternative transaction and under other customary circumstances. We contemplate a financing structure with debt not exceeding 3.5x EBITDA upon consummation of the Transaction and that the definitive agreement for the Transaction would not be subject to a financing condition.
We look forward to working with you and your advisors with a view to achieving a definitive agreement as soon as practicable. This proposal will expire if a definitive agreement for the Transaction is not entered into on or before September 1, 2010.
Very truly yours,
Onex Corporation
Synutra (SYUT) Announces Ministry of Health Testing Results
QINGDAO, China and ROCKVILLE, Md., Aug. 16 /PRNewswire-Asia/ — Synutra International, Inc. (Nasdaq:SYUT – News), a leading infant formula company in China and a producer, marketer and seller of nutritional products for infants, children and adults, today announced that the Ministry of Health (“MOH”) has found no link between Synutra’s infant milk powder and premature development in infants.
The MOH announced on August 15th, after investigating claims that Synutra’s infant milk formula was linked to premature development in three infants, that no banned hormones were found in the 42 samples of Synutra infant milk formula, including samples from the affected families’ homes and 31 samples from 14 other Chinese and foreign infant formula producers. The MOH believes that the three claims of premature development cannot be linked to Synutra’s infant milk powder.
Mr. Liang Zhang, Chairman and CEO of Synutra stated, “We are very pleased with the test results issued by China’s top health authority, which support Synutra’s steadfast commitment to product quality and consumer safety. As a trusted provider of infant formula in China, Synutra has always made quality assurance a top priority. We are devoted to promoting the health of children in China and will continue to invest heavily in research, quality control, formulation and ingredients to maintain our industry-leading standards.”
About Synutra International, Inc.
Synutra International Inc. (Nasdaq:SYUT – News) is a leading infant formula company in China. It principally produces, markets and sells its products under the “Shengyuan” or “Synutra” name, together with other complementary brands. It focuses on selling premium infant formula products, which are supplemented by more affordable infant formulas targeting the mass market as well as other nutritional products and ingredients. It sells its products through an extensive nationwide sales and distribution network covering 30 provinces and provincial-level municipalities in China. As of June 30, 2010, this network comprised over 560 independent distributors and over 1,000 independent sub-distributors who sell Synutra products in over 74,000 retail outlets.
Forward-looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on our current expectations, assumptions, estimates and projections about Synutra International Inc. and its industry. All statements other than statements of historical fact in this release are forward-looking statements. In some cases, these forward-looking statements can be identified by words or phrases such as “anticipate,” “believe,” “continue,” “estimate,” “expect,” “intend,” “is/are likely to,” “may,” “plan,” “should,” “will,” “aim,” “potential,” “continue,” or other similar expressions. The forward-looking statements included in this press release relate to, among others, Synutra’s goals and strategies; its future business development, financial condition and results of operations; the expected growth of the nutritional products and infant formula markets in China; market acceptance of the Company’s products; adverse effects associated with the melamine contamination incident; Synutra’s expectations regarding demand for its products; Synutra’s ability to stay abreast of market trends and technological advances; competition in the infant formula industry in China; PRC governmental policies and regulations relating to the nutritional products and infant formula industries, and general economic and business conditions in China. These forward-looking statements involve various risks and uncertainties. Although Synutra believes that the expectations expressed in these forward-looking statements are reasonable, these expectations may turn out to be incorrect. Synutra’s actual results could be materially different from the expectations. Important risks and factors that could cause actual results to be materially different from expectations are generally set forth in the “Item 1. Business,” “Item 1A. Risk Factors,” “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and other sections in Synutra’s Form 10-K filed with the Securities and Exchange Commission on June 9, 2010. The forward- looking statements are made as of the date of this press release. Synutra International Inc. undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.
For further information, please contact: Synutra International, Inc. Investor Relations Department Phone: +1-301-840-3881 Email: ir@synutra.com
Uranium Energy Corp. (UEC)
Uranium Energy Corp. (AMEX:UEC) is a U.S.-based exploration and development company focused on near-term uranium production in the U.S. The company’s operations are managed by professionals who have earned a reputable profile through many decades of hands-on experience in the key facets of uranium exploration, development and mining.
Uranium Energy controls one of the largest databases of historic uranium exploration and development in the nation. Using this knowledge base, the company has acquired and is advancing exploration properties of merit throughout the southwestern U.S., a region known as being the most concentrated area for uranium mining in the United States.
The Company’s fully licensed and permitted Hobson processing facility is central to all of its projects in South Texas. Well financed to execute on its key programs, Uranium Energy’s Palangana is-situ recovery project is fully permitted, and its Goliad in-situ recovery project is in the final stages of mine permitting for production.
The company’s strategy of acquiring exploration databases and leveraging those databases to generate acquisition targets has proven to be effective thus far. With plans to continue aggressively pursuing this strategy, Uranium Energy Corp is well positioned to capitalize on the world’s first significant alternative energy boom.
Key statistics (12/10/10):
Market cap: $361.43 Million
Current Ratio: 4.2 versus industry average of 2.8
Quick Ratio: N/A versus industry average of 1.7
Institutional Holding Percentage: 33.30%
Cash and Equivalents: $25.9 Million
Total Assets: $52.2 Million
Total Shares Outstanding: 69,749,378
Debt/Equity Ratio: 0.0 versus industry average of 0.37
IncrediMail (MAIL) Reports $7.2 Million Revenues, $3.6 Million EBITDA and $2.3 Million Net Profit
TEL AVIV, Israel–(BUSINESS WIRE)–IncrediMail Ltd. (NASDAQ: MAIL – News), an Internet company, today reported financial results for the second quarter ended June 30, 2010.
Revenues for the second quarter of 2010 rose 7% to $7.2 million, up from $6.7 million in the same quarter last year. EBITDA was $3.6 million, or 50% of sales, compared to $3.4 million in the second quarter of 2009 and net profit in the second quarter of 2010 was $2.3 million or $0.23 per diluted share, compared to $2.4 million, or $0.26 per diluted share in the second quarter of 2009.
In the first half of 2010, revenues were $14.2 million, increasing over 8%, compared to $13.1 million in first half of 2009, and net profit was $4.4 million, up 16%, compared to $3.8 million in the first half of 2009.
Total operating expenses in the second quarter of 2010 were $3.6 million, which while lower than the previous quarter, increased 12% compared to the second quarter of 2009, primarily due to higher compensation costs.
Commenting on the results, Mr. Ofer Adler, said, “I am very pleased with the results, as revenues and profits in the second quarter of 2010 surpassed our expectations and continued to grow despite seasonality. We achieved this while investing a significant part of our attention to finalizing our strategy of revenue diversification for the latter part of 2010 and beyond. These results provide for a perfect backdrop as we engage Josef Mandelbaum as our CEO. Josef’s Internet experience together with his corporate and M&A accomplishments are just what we need to drive us even further.”
Mr. Josef Mandelbaum, IncrediMail’s newly appointed CEO commented, “I am very excited to join IncrediMail at this time and look forward to continuing the momentum demonstrated by these very positive results.”
Conference Call
IncrediMail will host a conference call to discuss the results, as well as introduce Mr. Josef Mandelbaum, IncrediMail’s newly appointed CEO, today, August 12th at 10:00 AM EDT (17:00 PM Israel Time). We invite all those interested in participating in the call to dial 1-(866)-229-7198. Callers from Israel may access the call by dialing (03) 918-0685. Participants may also access a live webcast of the conference call through the Investor Relations section of IncrediMail’s website at www.incredimail-corp.com. The webcast will be archived on the company’s website for seven days.
About IncrediMail Ltd.
IncrediMail Ltd. (NASDAQ: MAIL, www.incredimail-corp.com) is an internet company that develops customized, downloadable graphic consumer applications used to generate search related revenues and designs, markets and delivers high end personal desktop software. The company’s award winning e-mail client product, IncrediMail Premium, is sold in over 100 countries in 10 different languages. Other products include, HiYo a graphic add-on to instant messaging software, Magentic, a wallpaper and screensaver software, and PhotoJoy, software for presenting digital personal photos.
Non-GAAP measures
Use of Non-GAAP Financial Information – In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, IncrediMail uses EBITDA as a non-GAAP financial performance measurement. EBITDA is calculated by adding back to net income; interest, taxes, stock-based compensation and depreciation and amortization. IncrediMail’s management believes the non-GAAP financial information provided in this release is useful to investors’ understanding and assessment of IncrediMail’s on-going core operations and prospects for the future. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management uses both GAAP and non-GAAP information as presented in this press release in evaluating and operating business internally and as such deemed it important to provide all this information to investors. These non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Reconciliation between results on a GAAP and non-GAAP basis is provided in tables immediately following IncrediMail’s Statement of Operations in this press release.
Forward Looking Statements
This press release contains historical information and forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 with respect to the business, financial condition and results of operations of the Company. The words “believe,” “expect,” “intend,” “plan,” “should” and similar expressions are intended to identify forward-looking statements. Such statements reflect the current views, assumptions and expectations of the Company with respect to future events and are subject to risks and uncertainties. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in the markets in which the Company operates and in general economic and business conditions, loss of key customers and unpredictable sales cycles, competitive pressures, market acceptance of new products, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this press release. Various risks and uncertainties may affect the Company and its results of operations, as described in reports filed by the Company with the Securities and Exchange Commission from time to time. The Company does not assume any obligation to update these forward-looking statements.
|
INCREDIMAIL LTD.
|
|||||||||
|
CONDENSED BALANCE SHEETS
|
|||||||||
|
U.S. dollars in thousands (except share data)
|
|||||||||
|
June 30,
2010 |
December 31,
2009 |
||||||||
| Unaudited | |||||||||
| ASSETS | |||||||||
| CURRENT ASSETS: | |||||||||
| Cash and cash equivalents | $ | 11,316 | $ | 24,368 | |||||
| Marketable securities | 15,765 | 5,225 | |||||||
| Trade receivables | 2,562 | 2,320 | |||||||
| Other receivables and prepaid expenses | 5,667 | 4,819 | |||||||
| Total current assets | 35,310 | 36,732 | |||||||
| LONG-TERM ASSETS: | |||||||||
| Severance pay fund | 1,109 | 1,104 | |||||||
| Deferred taxes | 101 | 63 | |||||||
| Other long-term assets | 476 | 495 | |||||||
| Property and equipment, net | 1,205 | 1,366 | |||||||
| Other intangible assets, net | 206 | 134 | |||||||
| Total long-term assets | 3,097 | 3,162 | |||||||
| Total assets | $ | 38,407 | $ | 39,894 | |||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||
| CURRENT LIABILITIES: | |||||||||
| Trade payables | $ | 810 | $ | 1,039 | |||||
| Deferred revenues | 2,024 | 2,270 | |||||||
| Accrued expenses and other liabilities | 4,722 | 6,577 | |||||||
| Total current liabilities | 7,556 | 9,886 | |||||||
| LONG-TERM LIABILITIES: | |||||||||
| Deferred revenues | 1,529 | 1,616 | |||||||
| Accrued severance pay | 1,451 | 1,390 | |||||||
| Total long-term liabilities | 2,980 | 3,006 | |||||||
| SHAREHOLDERS’ EQUITY
Shares issued and outstanding: 9,627,572 and 9,527,821 at June 30, 2010 and December 31, 2009, respectively
|
27,871 | 27,002 | |||||||
| Total liabilities and shareholders’ equity | $ | 38,407 | $ | 39,894 | |||||
|
INCREDIMAIL LTD.
|
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|
CONDENSED STATEMENTS OF OPERATIONS
|
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|
U.S. dollars and number of shares in thousands (except per share data), unaudited
|
|||||||||||||||||||||||
| Quarter ended June 30, | Six months ended June 30, | ||||||||||||||||||||||
| 2010 | 2009 | 2010 | 2009 | ||||||||||||||||||||
| Revenues | $ | 7,213 | $ | 6,746 | $ | 14,208 | $ | 13,122 | |||||||||||||||
| Cost of revenues | 391 | 367 | 764 | 754 | |||||||||||||||||||
| Gross profit | 6,822 | 6,379 | 13,444 | 12,368 | |||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development | 1,501 | 1,336 | 3,083 | 2,694 | |||||||||||||||||||
| Selling and marketing | 1,303 | 1,150 | 2,705 | 2,319 | |||||||||||||||||||
| General and administrative | 821 | 747 | 1,687 | 1,746 | |||||||||||||||||||
| Total operating expenses | 3,625 | 3,233 | 7,475 | 6,759 | |||||||||||||||||||
| Operating income | 3,197 | 3,146 | 5,969 | 5,609 | |||||||||||||||||||
| Financial income (expense), net | (63 | ) | 274 | 89 | (124 | ) | |||||||||||||||||
| Income before taxes on income | 3,134 | 3,420 | 6,058 | 5,485 | |||||||||||||||||||
| Taxes on income | 846 | 1,003 | 1,634 | 1,645 | |||||||||||||||||||
| Net profit | $ | 2,288 | $ | 2,417 | $ | 4,424 | $ | 3,840 | |||||||||||||||
| Net earnings per Ordinary share: | |||||||||||||||||||||||
| Basic | $ | 0.24 | $ | 0.26 | $ | 0.46 | $ | 0.41 | |||||||||||||||
| Diluted | $ | 0.23 | $ | 0.26 | $ | 0.45 | $ | 0.41 | |||||||||||||||
| Diluted weighted number of shares | 9,761 | 9,378 | 9,815 | 9,830 | |||||||||||||||||||
| RECONCILIATION OF GAAP TO NON-GAAP RESULTS: | |||||||||||||||||||||||
| GAAP net income | $ | 2,288 | $ | 2,417 | $ | 4,424 | $ | 3,840 | |||||||||||||||
| Income tax expense | 846 | 1,003 | 1,634 | 1,645 | |||||||||||||||||||
| Interest (income) expense, net | 63 | (274 | ) | (89 | ) | 124 | |||||||||||||||||
| Depreciation, Amortization and Stock-based Compensation | 412 | 265 | 747 | 672 | |||||||||||||||||||
| EBITDA | $ | 3,609 | $ | 3,411 | $ | 6,716 | $ | 6,281 | |||||||||||||||
Energy Focus, Inc. (EFOI) Reports Second Quarter 2010 Results
SOLON, Ohio, Aug. 12, 2010 (GLOBE NEWSWIRE) — Energy Focus, Inc. (Nasdaq:EFOI – News) today announced financial results for the second quarter ended June 30, 2010 and forecast for third quarter 2010 sales and cash projections.
Financial and operating highlights for the second quarter of 2010 include the following:
- Net sales from continuing operations increased in the second quarter of 2010 to $9.0 million, compared to $3.3 million for the second quarter of 2009, with 55% of net sales from continuing operations, for the quarter, attributable to the new Stones River Companies, LLC (“SRC”) solutions business unit.
- The company finished the quarter with a balance sheet showing cash in the amount of $2.1 million and total shareholders’ equity of $8.7 million. Cash generation for the second quarter of 2010 was $0.3 million, compared to cash utilization of $1.2 million in the second quarter of 2009. Excluding net proceeds from financing activities, the company had a cash usage of $28,000 in the second quarter 2010.
- Excluding a one-time non-cash charge of $0.3 million related to the revaluation of warrants to purchase shares of our common stock, operating expenses were flat compared to the second quarter of 2009.
- An additional $2.5 million, for a total of $19.0 million, in lighting retrofit contracts secured for work expected to be substantially completed in 2010.
The forecast for Q3 and 2010 include the following:
- Net sales from continuing operations to exceed $9.0 million in the third quarter 2010 versus $3.0 million in the third quarter 2009, with an estimated 50% to 60% of the net sales attributable to the new SRC solutions business unit. Sales of $35 million are anticipated for 2010.
- Net cash outflow from continuing operations for the third quarter 2010 is expected to be cash neutral compared to a net cash outflow from continuing operations of $2.3 million in the third quarter 2009. The company expects to be net cash flow positive from operations in 2010.
- An additional $2.8 million, for a total of $21.8 million, in lighting retrofit contracts secured by the end of the third quarter for work expected to be substantially completed in 2010.
“We continue to be delighted with the performance of our SRC solutions and U.S. products businesses in the second quarter,” said Joe Kaveski, CEO of Energy Focus, Inc. “Rob Wilson, Steve Gasperson and their teams have helped sustain our first quarter’s sales momentum by securing $19.0 million in lighting solutions contracts which we expect to mostly complete in 2010 and $9.0 million in total sales recorded for the second quarter 2010. We expect to see continued good performance from both our solutions and product groups in the third quarter as further solutions contracts are secured and more customers choose EFOI’s energy efficient LED products.”
Energy Focus management will host a conference call on Thursday, August 12, 2010 at 4:30 p.m. EDT (1:30 p.m. PDT) to review the second quarter 2010 financial results and other corporate events, followed by a Q & A session. Dialing 1-888-206-4893 (U.S./Canada) or 1-913-312-0862 (International/Local), participants can access the conference call. The conference ID number is 6561948. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins.
The conference call will also be available over the Internet at http://www.energyfocusinc.com in the Investor Relations area of the site. A replay of the conference call will be available two hours after the call for the following 7 days by dialing 1-888-206-4893 (U.S./Canada) or 1-913-312-0862 (international/local) and entering the following pass code: 6561948. Also, a replay of the conference call will be available over the Internet at http://www.energyfocusinc.com on August 12th, 2010 and will remain available for one year in the Investor Relations area of the site.
About Energy Focus, Inc.
Energy Focus, Inc. is a leading provider of energy efficient LED lighting products and turnkey energy efficient lighting solutions, holding 69 relevant lighting patents. Our solutions provide energy savings, aesthetics, safety and maintenance cost benefits over conventional lighting. Our long-standing relationship with the U.S. Government includes numerous research and development projects for the DOE and DARPA, creating energy efficient LED lighting systems for the U.S. Navy fleet and the next generation Very High Efficiency Solar Cell. Customers include supermarket chains, the U.S. government, state and local governmental agencies, retail stores, museums, theme parks and casinos, hotels, swimming pool builders and many others. Company headquarters are located in Solon, OH, with additional offices in Nashville, TN, Pleasanton, CA, and the United Kingdom. For more information, see www.energyfocusinc.com.
The Energy Focus, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6633
Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. For more information about potential factors that could affect Energy Focus financial results, please refer to the Company’s SEC reports, including its Annual Reports on Form 10-K and its quarterly reports on Form 10-Q. These forward-looking statements speak only as of the date hereof. Energy Focus disclaims any intention or obligation to update or revise any forward-looking statements.
| ENERGY FOCUS, INC. | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| (amounts in thousands except share and per share data) | ||
| June 30, | December 31, | |
| 2010 | 2009 | |
| ASSETS | (unaudited) | |
| Current assets: | ||
| Cash and cash equivalents | $2,099 | $1,062 |
| Accounts receivable, net | 6,023 | 2,922 |
| Inventories, net | 2,948 | 3,770 |
| Prepaid and other current assets | 944 | 509 |
| Total current assets | 12,014 | 8,263 |
| Property and equipment, net | 2,730 | 3,091 |
| Goodwill | 672 | 672 |
| Intangible assets, net | 2,213 | 2,750 |
| Collateralized assets | 2,500 | 2,500 |
| Other assets | 64 | 102 |
| Total assets | $20,193 | $17,378 |
| LIABILITIES | ||
| Current liabilities: | ||
| Accounts payable | $5,820 | $1,677 |
| Accrued liabilities | 2,210 | 1,854 |
| Deferred revenue | 788 | 295 |
| Total current liabilities | 8,818 | 3,826 |
| Other deferred liabilities | 7 | 149 |
| Acquisition-related contingent liabilities | 971 | 1,183 |
| Long-term borrowings | 1,711 | 715 |
| Total liabilities | 11,507 | 5,873 |
| SHAREHOLDERS’ EQUITY | ||
| Preferred stock, par value $0.0001 per share: Authorized: 2,000,000 shares in 2010 and 2009 Issued and outstanding: no shares in 2010 and 2009 |
_ | _ |
| Common stock, par value $0.0001 per share: Authorized: 60,000,000 shares at June 30, 2010 and 30,000,000 at December 31, 2009 Issued and outstanding: 23,299,000 at June 30, 2010 and 21,250,000 at December 31, 2009 |
1 | 1 |
| Additional paid-in capital | 74,034 | 71,373 |
| Accumulated other comprehensive income | 376 | 474 |
| Accumulated deficit | (65,725) | (60,343) |
| Total shareholders’ equity | 8,686 | 11,505 |
| Total liabilities and shareholders’ equity | $20,193 | $17,378 |
| ENERGY FOCUS, INC. | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| (amounts in thousands except per share amounts) | ||||
| (unaudited) | ||||
| Three months ended | Six months ended | |||
| June 30, | June 30, | |||
| 2010 | 2009 | 2010 | 2009 | |
| Net sales | $8,958 | $3,325 | $17,315 | $5,848 |
| Cost of sales | 7,390 | 2,513 | 14,352 | 4,808 |
| Gross profit | 1,568 | 812 | 2,963 | 1,040 |
| Operating expenses: | ||||
| Research and development | (134) | 175 | (79) | 331 |
| Sales and marketing | 1,518 | 1,575 | 3,137 | 3,121 |
| General and administrative | 1,516 | 1,172 | 3,195 | 2,436 |
| Revaluation of equity instruments | 329 | — | 1,750 | — |
| Restructuring expense | — | — | 26 | — |
| Total operating expenses | 3,229 | 2,922 | 8,029 | 5,888 |
| Loss from operations | (1,661) | (2,110) | (5,066) | (4,848) |
| Other income (expense): | ||||
| Other (expense) income | (1) | 149 | (66) | 168 |
| Interest expense | (148) | (21) | (247) | (41) |
| Loss from continuing operations before income taxes | (1,810) | (1,982) | (5,379) | (4,721) |
| Provision for income taxes | (2) | — | (3) | — |
| Loss from continuing operations | $(1,812) | $(1,982) | $(5,382) | $(4,721) |
| Discontinued operations: | ||||
| Loss from discontinued operations before income taxes | — | (367) | — | (669) |
| Provision for income taxes | — | — | — | — |
| Loss from discontinued operations | — | (367) | — | (669) |
| Net loss | $(1,812) | $(2,349) | $(5,382) | $(5,390) |
| Net loss per share – basic and diluted | $(0.08) | $(0.16) | $(0.25) | $(0.36) |
| Shares used in computing net loss per share — | ||||
| basic and diluted | 22,582 | 14,915 | 21,953 | 14,877 |
China Agritech, Inc. (CAGC) Reports Record Quarterly Net Revenue and Gross Profit for 2Q of 2010
BEIJING, Aug. 12 /PRNewswire-Asia-FirstCall/ — China Agritech, Inc. (Nasdaq: CAGC) (“China Agritech”, or the “Company”), a leading organic compound fertilizer manufacturer and distributor in the People’s Republic of China, today announced its unaudited financial results for the second quarter and six months ended June 30, 2010.
Second Quarter Financial Highlights
-- Net revenue increased 63% year-over-year to a quarterly record of $34.3
million;
-- Gross profit increased 33% year-over-year to $11.9 million with a 34.7%
gross margin;
-- Net income was $21 million, or Diluted EPS $1.05;
-- Cash and cash equivalents were $51.7 million with no debt.
Mr. Yu Chang, Chief Executive Officer of China Agritech, commented, “We are very pleased with our second quarter performance as our granular products sales are experiencing accelerating growth. We are not only increasing our customer base and broadening geographic penetration, but also receiving more inquiries from farmers and distributors on the functionalities of our product, as more and more agricultural regions are affected by climate change and deteriorating soil conditions. As China is facing challenges of both food safety and food shortage, the organic food market is becoming an important sector due to its sustainable volume growth and high-quality nutritional standard. More farmers are willing to grow organic grains, fruits and vegetables because the end market is paying higher prices for quality products. We will continue to increase our R&D investment and roll out more products to meet the growing demand in China. Our goals of extending our market leadership and maximizing our long-term shareholders’ value remain unchanged.”
Mr. Chang continued, “Compared with liquid organic fertilizer, granular organic fertilizer has only emerged in the recent few years. However, due to its efficacy in plant growth, nutrient preservation, ease for transportation and favorable pricing, granular organic fertilizer has been well received by farmers. Moreover, the growing adoption of granular fertilizer also boosts the demand of liquid organic fertilizer as their different functions for different stages of farming. After over 2 years’ preparation of technology upgrades and production facility constructions, we are now one of the largest commercial producers of granular organic fertilizer with a number of mature products and well established production capacity, and we are moving full speed on market share acquisition.”
Second Quarter 2010 Results
Net revenue grew 63% year-over-year to a quarterly record of $34.3 million from $21.0 million in the second quarter last year. Liquid fertilizer sales increased year-over-year by 46% to approximately $20.0 million, while granular fertilizer sales posted a year-over-year 95% increase to reach approximately $14.3 million. Organic granular fertilizer continued to gain traction among farmers during the quarter, while the sales of organic liquid fertilizer is expected to further accelerate during the growing season starting from May. The increase of organic liquid fertilizer sales also reflected the expansion of the Company’s customer base to newly established markets in the central and southern regions of China.
Gross profit increased 33% year-over-year to a quarterly record of $11.9 million from $9.0 million for the same quarter last year. Blended gross margin for the second quarter was 34.7% compared with 42.7% for the same period in 2009. The decrease was primarily due to the ongoing shift in the product mix as the Company increases its share of the comparatively lower-margined organic granular products. Specifically, organic granular fertilizer recorded a gross profit margin of 20.3%, in line with the same period of 2009. Organic liquid fertilizer products had a gross profit margin of 45.1% compared with 53.2% for the same period in 2009. The decrease in gross margin for the organic liquid fertilizer was due to the changed composition of organic liquid fertilizer products, in which more raw materials lowered the profit margin.
Selling expenses were $1.3 million, or 3.8% of revenue, compared with $0.6 million, or 3.0% in the second quarter of 2009. The increase in both absolute value and as percentage of revenue in selling expenses was mainly due to increased promotion expenses and handling charges proportional to the increase in sales.
General and administrative expenses were $3.1 million, or 8.9% of revenue, compared with $0.9 million, or 4.2% of revenue, for the same period in 2009. The increase in administrative expenses was mainly due to increased research and development costs and share-based compensation. During the second quarter of 2010, the share-based compensation was $1.3 million as compared with $2,700 in the same period of 2009.
Income from operations was $7.5 million, in line with the same quarter of 2009.
Excluding the non-deductible charge for the change in fair value of warrants of $13.3 million and gain on extinguishment of warrants classified as derivatives of $1.6 million, our effective tax rate for the second quarter of 2010 would have been 19.2%, as compared to 21.5% for the same period in 2009. The decrease in effective tax rate was due to one of the operating subsidiary in China that generated net operating profit for the quarter still enjoying the tax rate reduction and subject to the income tax rate of 12.5%.
GAAP net income for the second quarter of 2010 was $21.0 million compared with $5.6 million in the same period of 2009. Diluted earnings per share of $1.05 on a substantially greater number of shares outstanding, compared with diluted earnings per share of $0.44 in the previous year’s same quarter.
Excluding the non-cash gain in the fair value of warrants, gain on extinguishment of warrants, and share-based compensation, non-GAAP net income attributable to common stockholders for the second quarter of 2010 was $7.1 million, up 27.1% from $5.6 million in the same period last year. Non-GAAP diluted earnings per share were $0.36 versus $0.44 for the same quarter in 2009, but on substantially greater number of shares outstanding in the 2010 period. Diluted weighted average number of shares outstanding for the second quarter of 2010 was 19.7 million compared with 12.7 million shares in the second quarter of 2009.
Six Month Results
Total revenue for the first six months of 2010 increased 91.2% year-over-year to $54.1 million from $28.3 million for the first six months last year. Gross profit for the first six months of 2010 was $18.4 million, up 49.2% from $12.3 million in the comparable period a year ago. Gross margin was 33.9% for the first six months of 2010, lower than the 43.5% for the same period in 2009 as the result of increased sales of the lower-margin granular products. Income from operations was $11.1 million, up 17.2% from $9.4 million in the first six months of 2009. GAAP net income was $13.9 million, with fully diluted earnings per share of $0.72, compared with $6.6 million, or diluted earnings per share of $0.53 in the first six months of 2009.
Financial Conditions
As of June 30, 2010, total cash and cash equivalents were $51.7 million as compared to $20.3 million on December 31, 2009. Stockholders’ equity increased to $140.9 million as of June 30, 2010 from $77.3 million as of December 31, 2009.
Recent Events
In May, 2010 the Company closed its previously announced public offering of 1,243,000 shares of common stock. Total gross proceeds from the offering and over-allotment were approximately $23.0 million. The Company intends to use the net proceeds from this offering to establish branded large-scale distribution centers and the remainder of the net proceeds, if any, for working capital and general corporate purposes.
In May, 2010, the Company signed a renewal contract with Sinochem for the sale of the Company’s “Green Vitality” organic liquid fertilizers. Pursuant to the agreement, China Agritech will supply Green Vitality liquid fertilizer worth an estimated value of RMB 61 million (approximately US$9 million). This contract is in effect through April 2011. The Company will continue to supply Sinochem with “Green Vitality” granular fertilizer under another existing contract.
In June, 2010, the Company received $10 million as a result of the exercise of common stock warrants held by Carlyle Asia Growth Partners IV, L.P. and CAGP IV Co-Investment, L.P., two affiliates of The Carlyle Group. The Carlyle Group affiliates originally acquired the warrants in connection with the Company’s private placement, consummated in October 2009.
Business Outlook
The Company reiterates its guidance for the year ending December 31, 2010 with revenues expected to reach approximately $114 million and non-GAAP net income, which excludes the change in the fair value of warrants issued, gain on extinguishment of warrant liability, and stock-based compensation, of approximately $23.5 million, representing a year-over-year growth of 50% and 45% on revenues and non-GAAP net income, respectively. These targets are based upon the Company’s current views on operating and market conditions, which are subject to change. This guidance follows 68.3% revenue growth since 2009.
“While we are encouraged by our solid performance in the first half of the year, we expect that the second half will be stronger as the peak farming season is unfolding and our products are gaining traction. Our balance sheet is now strengthened and we expect that our cash flow will continue to improve. With our product portfolio, growing R&D capability, nationwide distribution footprint and strong financial standing, we believe that we are well positioned to capture the wave of the organic food market growth in China,” Mr. Yu Chang, Chairman and Chief Executive Officer of China Agritech, concluded.
Conference Call
The Company will host a conference call, to be simultaneously webcast on Thursday, August 12, 2010 at 9:00 a.m. Eastern Daylight Time, or 9:00 p.m. Beijing Time.
To participate, please call the following phone numbers:
United States 1-866-519-4004 or 1-718-354-1231
China, Domestic 800-819-0121-Landline or 400-620-8038 - Mobile
Hong Kong 852-2475-0994 or 800-930-346
Canada 866-386-1016
International Toll Dial-In Number: +656-723-9381
Conference ID # 89992339
A live web cast of the conference call will be available on China Agritech’s website at http://www.chinaagritechinc.com. Please visit the website at least 15 minutes early to register for the web cast and download any necessary audio software.
A web cast replay will be available on the Company’s website, and the call replay will be available through Wednesday, August 18, 2010 at 11:59 p.m. EDT. To access the replay, please call the following phone numbers:
United States Dial-In #: 1-866-214-5335
Canada Dial-In #: 1-800-301-5423
China North Dial-In #: 10-800-714-0386
China South Dial-In #: 10-800-140-0386
Hong Kong Dial-In #: 800-901-596
International Dial-In #: +61 2 8235 5000
Conference ID # 89992339
About China Agritech, Inc.
China Agritech, Inc. is engaged in the development, manufacture and distribution of liquid and granular organic compound fertilizers and related products in China. The Company has developed proprietary formulas that provide a continuous supply of high-quality agricultural products while maintaining soil fertility. The Company sells its products to farmers located in 28 provinces of China. For more information, please visit http://www.chinaagritechinc.com .
Safe Harbor Statement
This press release contains certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, including, without limitation, statements about its business or growth strategy, general industry conditions, future operating results of the Company, capital expenditures, expansion and growth opportunities, financing activities and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this press release are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements. Certain of these risks and uncertainties are or will be described in greater detail in our filings with the SEC. Except as required by law, China Agritech is under no obligation to update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
Use of Non-GAAP Financial Measures
The non-GAAP adjusted net income and earnings per share information should not be considered an alternative to, or more meaningful than, net income and earnings per share as determined in accordance with GAAP, since it omits the impact of the change in fair value of warrants. Management believes that the presentation of this non-GAAP financial measure is warranted and useful to its stockholders because it provides an additional analytical tool for understanding the Company’s financial performance by excluding certain items that may obscure trends in the core operating performance of the Company’s business.
For more information, please contact:
In China:
Gareth Tang
Chief Financial Officer
China Agritech, Inc.
Email: gareth@chinaagritech.com
In the U.S.:
Shiwei Yin/Kevin Theiss
Investor Relations
Grayling
Phone: +1-646-284-9474
Email: shiwei.yin@grayling.com
- Tables to follow -
CHINA AGRITECH, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited, US$)
June 30, December 31,
2010 2009
ASSETS (Unaudited)
Current Assets
Cash and cash equivalents $51,738,535 $20,313,089
Accounts receivable, net 51,203,710 39,256,098
Inventories 18,424,145 6,606,095
Advances to suppliers 13,800,659 25,348,687
Prepayments and other receivables 5,175,062 2,287,220
Total Current Assets 140,342,111 93,811,189
Property, plant and equipment, net 6,117,778 5,980,696
Construction in progress 493,433 424,006
Intangible assets, net 368,421 397,507
Total Assets $147,321,743 $100,613,398
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current Liabilities
Accounts payable $1,532,487 $62,616
Accrued expenses and other payables 2,554,517 1,394,357
Warrant liabilities -- 20,157,869
Taxes payable 2,293,808 1,695,665
Total Current Liabilities 6,380,812 23,310,507
Stockholders' Equity
Preferred stock: $0.001 par value,
10,000,000 shares authorized,
none issued -- --
Common stock: $0.001 par value;
100,000,000 shares authorized,
20,766,243 and 17,002,542* shares
issued and outstanding as of June
30, 2010 and December 31, 2009,
respectively 20,766 17,003
Additional paid in capital 83,784,969 34,698,079
Statutory reserves 2,195,818 2,195,818
Accumulated other comprehensive
income 6,402,728 5,723,265
Retained earnings 48,536,650 34,668,726
Total Equity 140,940,931 77,302,891
Total Liabilities and
Stockholders' Equity $147,321,743 $100,613,398
*as retroactively adjusted for the 1-for-4 reverse stock split on
September 8, 2009 and the 2-for-1 forward stock split on February 1, 2010.
CHINA AGRITECH, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
FOR THE PERIODS ENDING JUNE 30,
(Unaudited, US$)
For the Three Months Ended For the Six Months ended
June 30, June 30,
2010 2009 2010 2009
Net revenue $34,268,842 $20,988,611 $54,182,722 $28,335,987
Cost of revenue (22,384,633) (12,033,792) (35,799,677) (16,012,477)
Gross profit 11,884,209 8,954,819 18,383,045 12,323,510
Operating expenses:
Selling expenses (1,286,505) (624,993) (1,846,274) (1,030,712)
General and
administrative
expenses (3,057,466) (871,838) (5,474,192) (1,855,513)
Total operating
expenses (4,343,971) (1,496,831) (7,320,466) (2,886,225)
Income from
operations 7,540,238 7,457,988 11,062,579 9,437,285
Other income
(expense)
Interest income 17,095 3,451 28,441 6,024
Exchange gain
(loss) 1,231 (2,609) 1,066 (3,056)
Gain on
extinguishment of
warrant liability 1,629,465 -- 1,629,465 --
Changes in fair
value of warrants
classified as
derivatives 13,307,462 -- 3,829,985 --
Other income (18,024) -- (18,024) --
Total other
income (expense) 14,937,229 842 5,470,933 2,968
Income before
income taxes 22,477,467 7,458,830 16,533,512 9,440,253
Provision for
income taxes (1,689,490) (1,601,958) (2,665,588) (2,316,236)
Net income 20,787,977 5,856,872 13,867,924 7,124,017
Net income
attributable to
non-controlling
interest in a
subsidiary -- (267,169) -- (481,452)
Net income
attributable to
China Agritech's
common
stockholders 20,787,977 5,589,703 13,867,924 6,642,565
Other
comprehensive
income:
Foreign currency
translation
adjustment 624,896 (22,528) 679,463 (124,341)
Comprehensive
income 21,412,873 5,567,175 14,547,387 6,518,224
Comprehensive
income
attributable to
non-controlling
interest
in a subsidiary -- (8,814) -- 8,403
Comprehensive
income
attributable to
China Agritech's
common
stockholders $21,412,873 $5,558,361 $14,547,386 $6,526,627
Net income per
share:
- Basic $1.12 $0.44* $0.77 $0.53*
- Diluted $1.05 $0.44* $0.72 $0.53*
Weighted average
number of shares
outstanding:
- Basic 18,594,916 12,656,621* 17,952,950 12,504,062*
- Diluted 19,749,122 12,656,621* 19,306,827 12,504,062*
*as retroactively adjusted for the 1-for-4 reverse stock split on
September 8, 2009 and the 2-for-1 forward stock split on February 1, 2010.
CHINA AGRITECH, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS FOR SIX MONTHS
ENDED JUNE 30, 2010 AND 2009
(Unaudited, US$)
For the Six Months Ended June 30,
2010 2009
Cash flows from operating activities:
Net income $13,867,924 $7,124,017
Adjustments to reconcile net income
to cash provided by operating
activities:
Share-based compensation 2,146,754 2,703
Changes in fair value of warrants
classified as derivatives (3,829,985) --
Gain on extinguishment of warrant
liability (1,629,465) --
Depreciation and amortization of
property, plant and equipment 348,240 320,109
Amortization of intangible assets 31,393 --
Reversal of allowance for doubtful
debts (659) --
Decrease / (Increase) in current
assets:
Accounts receivable (11,647,188) (8,937,538)
Inventories (11,712,387) (4,967,706)
Advances to suppliers 13,088,615 3,601,066
Prepayments and other receivable (1,675,598) 276,024
Increase in current liabilities:
Accounts payable 1,462,049 7,467,145
Tax payables 581,076 1,038,862
Accrued expenses and other payables 17,390 2,114,634
Net cash provided by operating
activities 1,048,159 8,039,316
Cash flows from investing activities:
Acquisition of 10% interest of
Pacific Dragon -- (1,000,000)
Acquisition of property, plant and
equipment (449,954) (2,200,669)
Construction in progress (66,601) 163,161
Net cash used in investing
activities (516,555) (3,037,508)
Cash flows from financing activities:
Issuance of shares for cash in
public offering 20,828,197 --
Proceeds from exercise of warrants 10,000,074 --
Net cash provided by financing
activities 30,828,271 --
Net increase in cash and cash
equivalents 31,359,875 5,001,808
Effect of exchange rate change on
cash and cash equivalents 65,571 (438,639)
Cash and cash equivalents, beginning
of period 20,313,089 11,952,235
Cash and cash equivalents, end of
period $51,738,535 $16,515,404
Supplement disclosure of cash flow
information:
Cash paid for interest -- --
Cash paid for income tax $$2,271,296 $2,316,236
GlobalOptions Group (GLOI) Agrees to Sell its Forensic DNA Solutions and Products Unit
NEW YORK–(BUSINESS WIRE)–GlobalOptions Group, Inc. (NASDAQ: GLOI – News), a leading provider of domestic and international risk management services, has entered into a definitive agreement to sell the stock of Bode Technology Group, its Forensic DNA Solutions and Products subsidiary and reporting segment to LSR Acquisition Corp. for a total consideration of up to $30.5 million.
The total aggregate consideration consists of (i) a $24.5 million fixed portion in cash at closing, (ii) contingent consideration based on 30% of revenues in excess of $27.0 million recognized for a period of one year from the closing, with total contingent consideration not to exceed $5.5 million, and (iii) $0.5 million in the event that the buyer makes a certain tax election. LSR Acquisition Corp. is a privately-held company based in New York that will operate three business segments: Security and Intelligence, Identity Solutions, and Situational Awareness. The transaction, which is subject to shareholder approval, is expected to close in the fourth quarter.
Selling the Forensic DNA Solutions and Products unit, known as Bode Technology Group completes the process of unlocking value at GlobalOptions Group and caps the evaluation of strategic and financial alternatives that we have been conducting for the past several months in order to maximize shareholder value,” said Dr. Harvey W. Schiller, Chairman and CEO of GlobalOptions Group. “As previously stated, subject to satisfaction of and compliance with existing contractual and banking obligations, and appropriate reserves, we currently intend to return the net proceeds from the sales of the SafirRosetti, Preparedness Services and Fraud and Special Investigations divisions and now the Forensic DNA Solutions and Products unit to our stockholders.”
On behalf of LSR Acquisition Corp, Bart M. Schwartz stated, “We are delighted to enter into a definitive agreement with GlobalOptions Group to acquire Bode Technology Group as we build out our client centric businesses. Bode met or exceeded all of our criteria including being excellent in what they do, providing a profitable platform for growth, possessing a capable and experienced staff and enjoying established and trusted relationships with significant clients.”
Needham & Company, LLC served as financial advisor to GlobalOptions Group on this transaction.
GlobalOptions Group
GlobalOptions Group (NASDAQ: GLOI – News), with headquarters in New York City, is an integrated provider of risk mitigation and management services to government entities, FORTUNE 1000 corporations and high net-worth and high-profile individuals throughout the world. We enable clients to identify, assess and prevent natural and man-made threats to the well-being of individuals and the operations of governments and corporations. In addition, we assist our clients in recovering from the damages or losses resulting from the occurrence of acts of terror, natural disasters, fraud and other risks. Additional information is available at www.globaloptionsgroup.com.
Bode Technology Group
Bode Technology Group serves the U.S. and international law enforcement and identification markets and is unique in providing both state-of-the-art human DNA analysis and innovative DNA collection products. The range of Bode’s services include diverse offerings such as high-throughput DNA testing services, case work analysis, missing person identification, CODIS databanking of convicted offenders or arrestees, private databanking, as well as paternity and non-forensic identification. Our patented DNA collection systems are in use worldwide for collections of DNA from convicted offenders and arrestees, from crime scenes, as well as from parents and children for genealogy and identification services. Our analysts and our research and development teams are constantly looking for better ways to bring previously unused approaches and technologies into the labs for routine use for analysis of challenging samples – be it bones or aged, decayed tissue. On the strength and experience of our research and development teams and casework analysts, Bode is able to offer worldwide DNA analysis services, consulting, training, and validation services on a customized basis. Additional information is available at www.bodetech.com.
LSR Acquisition Corp.
LSR Acquisition Corp. is a privately-held company based in New York that was founded by Anthony Lanza, whose father Frank Lanza was a founder of L-3 Communications. LSR, upon the closing of the Bode acquisition, intends to operate three business segments serving commercial and government clients: Security and Intelligence (through Guidepost Solutions LLC), Identity Solutions (through The Bode Technology Group), and Situational Awareness. (through 3DRS International, Inc.). Guidepost Solutions LLC, which purchased SafirRosetti in April 2010, is currently headed by Bart Schwartz, the founder of Decision Strategies and former Chief of the Criminal Division of the Southern District of New York, and Joe Rosetti , the cofounder of SafirRosetti and former Vice Chairman of Kroll Associates. It is expected that upon the consummation of the Bode acquisition, Mr. Schwartz will serve as LSR’s Chairman of the Board and CEO while Mr. Rosetti will be a Vice Chairman of LSR.
Statements in this press release regarding the company’s business that are not historical facts are “forward-looking statements” that involve risks and uncertainties. The company wishes to caution readers not to place undue reliance on such forward-looking statements, which statements are made pursuant to the Private Securities Litigation Reform Act of 1994, and as such, speak only as of the date made. To the extent the content of this press release includes forward-looking statements, they involve various risks and uncertainties including the successful integration of acquired businesses and revenue run rates.
Certain of these risks and uncertainties will be described in greater detail in GlobalOptions Group’s filings with the Securities and Exchange Commission. GlobalOptions Group 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.
In connection with the proposed transaction, the Company will file a proxy statement with the SEC. INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE PROXY STATEMENT WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Investors and security holders may obtain a free copy of the proxy statement (when available) and other documents filed by the Company at the SEC’s website at www.sec.gov. The proxy statement and such other documents may also be obtained for free from the Company by directing such request to the Company at 75 Rockefeller Plaza, 27th Floor, New York, New York 10019, Attention: Chief Financial Officer, or by telephone at (212) 445-6262.
The Company and its directors, executive officers and other members of its management and employees may be deemed to be participants in the solicitation of proxies from its stockholders in connection with the proposed transaction. Certain executive officers and directors of the Company have interests in the transaction that may differ from the interests of shareholders generally, including without limitation acceleration of vesting of stock options, restricted stock and restricted stock units, and other benefits conferred under employment agreements. These interests will be described in the proxy statement when it becomes available. Information concerning the interests of the Company’s participants in the solicitation is set forth in the Company’s proxy statements and Annual Reports on Form 10-K, previously filed with the SEC, and in the proxy statement relating to the transaction when it becomes available.
Supreme Industries (STS) Reports Second-Quarter and First-Half 2010 Financial Results
GOSHEN, Ind.–(BUSINESS WIRE)–Supreme Industries, Inc. (NYSE Amex: STS), a leading manufacturer of specialized commercial vehicles, including truck bodies, shuttle buses, armored vehicles and homeland response vehicles, today announced financial results for its second quarter and first half ended June 26, 2010.
During the second quarter, the Company experienced improved demand for all major product lines including truck, bus and armored vehicles. Sales order backlog at June 26, 2010, was up 35% to $91.7 million, versus $68.1 million at year-end 2009, and up 50% from $61.2 million a year ago.
Net sales for the 2010 second quarter increased 27% to $60.5 million, compared with $47.6 million in the prior-year quarter. For the first six months of 2010, net sales increased 13% to $109.0 million, versus $96.2 million in 2009’s first half.
Compared with last year’s second quarter, sales in Supreme’s core dry-freight and armored vehicle divisions improved 39% and 52%, respectively. The Company’s bus division posted a 5% sales increase versus the prior-year period. Net sales also improved in each of the Company’s primary product lines during the first half of 2010, with dry-freight and armored vehicles reporting 10% and 11% gains, respectively. Bus sales increased 24% versus the first six months of 2009.
The second-quarter loss from continuing operations before income taxes was $18,000, compared with the pre-tax loss of $1.5 million for the year-ago quarter. For the first half of 2010, the Company reported a loss from continuing operations before income taxes of $2.4 million, versus the 2009 pre-tax loss of $4.4 million. The Company did not record an income tax benefit for the three and six months ended June 26, 2010, due to having fully utilized its loss carryback benefits in 2009. This resulted in a valuation allowance for the potential future tax benefits of the net operating loss. Accordingly, the after-tax loss from continuing operations was $18,000, or breakeven on a per-share basis, compared with an after-tax loss of $0.9 million, or $0.07 per share, in 2009’s second quarter. For the first six months of 2010, the after-tax loss from continuing operations was $2.4 million, or $0.17 per share, compared with an after-tax loss of $2.1 million, or $0.15 per share, in 2009’s comparable period.
Supreme’s President and Chief Operating Officer Robert W. Wilson commented: “Improving truck markets allowed Supreme to realize revenue growth in its major truck product categories, but such growth has to be viewed in the context of the severely depressed levels of truck sales in 2009. We believe that, as a result of the above-average fleet age, an increasing freight tonnage index and our improving performance, as well as other economic indicators, the market for our core truck products should continue to gradually recover.”
Second-quarter gross profit increased 55%, or more than $2.1 million, to $5.9 million, up from $3.8 million last year. Gross profit margin as a percentage of net sales improved to 9.7% for the 2010 second quarter and 8.6% for the first half of 2010. That compares with 8.1% in the second quarter of 2009 and 7.0% in the first half of 2009. The year-over-year gross margin increases for both periods were primarily the result of higher unit volume.
Selling, general and administrative expenses increased $0.5 million, or 10%, to $5.7 million for the second quarter and, for the first half, were up 5% to $11.3 million. This compares with SG&A of $5.2 million and $10.8 million for the respective periods in 2009. The increases were primarily attributable to higher selling expenses as a result of increased sales volumes. As a percentage of net sales, SG&A declined to 9%, compared with 11% of sales in the second quarter of 2009. For the first half, SG&A expense was 10% of sales, versus 11% in last year’s first half.
Interest expense was $0.4 million and $0.9 million for the second quarter and first half of 2010, respectively, compared with $0.5 million and $1.0 million for the corresponding periods in 2009.
Net cash used for operating activities during the first half of 2010 totaled $2.2 million and primarily reflected increased inventory to support higher sales levels and backlog. Working capital was $21.1 million at June 26, 2010, compared with $21.5 million at year-end 2009, and the working capital ratio was 1.4 to 1 versus 1.5 to 1. Total debt was relatively flat at $28.8 million at June 26, 2010, and as a percentage of total assets, stood at 25.2%, versus 25.0% at Dec. 26, 2009. Stockholders’ equity was $60.5 million, or $4.23 per share, at the end of the second quarter, compared with $62.6 million, or $4.40 per share, at Dec. 26, 2009.
Wilson concluded: “Actions taken during the economic downturn contributed to meaningful improvements in our second-quarter operating performance. Our efforts have positioned us to benefit from a gradually recovering economic environment, as pent-up demand is starting to translate into orders. Although certain signals point to an improving market for our products, we remain cautious and continue to focus on managing costs, enhancing revenue opportunities at higher margins and further reducing debt as we restore profitability.”
A live webcast of Supreme Industries’ earnings conference call can be heard Thursday, Aug. 12, 2010, at 9 a.m. Eastern Time at http://www.SupremeInd.com. Those unable to participate in the live conference call may access a replay, which will be available on the Company’s website for approximately 30 days.
To be added to Supreme Industries’ e-mail distribution list, please click on the link below:
http://www.clearperspectivegroup.com/clearsite/sts/emailoptin.html
News releases and other information on the Company are available on the Internet at:
http://www.SupremeInd.com or http://www.b2i.us/irpass.asp?BzID=1482&to=ea&s=0
About Supreme Industries
Supreme Industries, Inc. (NYSE Amex: STS), is a nationwide manufacturer of specialized truck bodies produced to the specifications of its customers. Supreme also manufactures special-purpose “shuttle-type” buses, armored vehicles and homeland response vehicles. The Company’s transportation equipment products are used by a wide variety of industrial, commercial, law enforcement and homeland security customers.
This report contains forward-looking statements, other than historical facts, which reflect the view of management with respect to future events. When used in this report, words such as “believe,” “expect,” “anticipate,” “estimate,” “intend,” and similar expressions, as they relate to the Company or its plans or operations, identify forward-looking statements. Such forward-looking statements are based on assumptions made by, and information currently available to, management. Although management believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that the expectations reflected in such forward-looking statements are reasonable, and it can give no assurance that such expectations will prove to be correct. Important factors that could cause actual results to differ materially from such expectations include, without limitation, an economic slowdown in the specialized vehicle industry, limitations on the availability of chassis on which the Company’s product is dependent, availability of raw materials, raw material cost increases and severe interest rate increases. Furthermore, the Company can provide no assurance that such raw material cost increases can be passed on to its customers through implementation of price increases for the Company’s products. The forward-looking statements contained herein reflect the current view of management with respect to future events and are subject to those factors and other risks, uncertainties, and assumptions relating to the operations, results of operations, cash flows and financial position of the Company. The Company assumes no obligation to update the forward-looking statements or to update the reasons actual results could differ from those contemplated by such forward-looking statements.
─FINANCIAL TABLES FOLLOW─
| Supreme Industries, Inc. and Subsidiaries
Consolidated Statements of Operations |
||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||
| June 26, | June 27, | June 26, | June 27, | |||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||
| Revenue: | ||||||||||||
| Net sales | $ 60,544,185 | $ 47,582,740 | $ 109,041,002 | $ 96,204,729 | ||||||||
| Cost of sales | 54,665,742 | 43,740,823 | 99,654,089 | 89,458,736 | ||||||||
| Gross profit | 5,878,443 | 3,841,917 | 9,386,913 | 6,745,993 | ||||||||
| Selling, general and administrative expenses | 5,716,945 | 5,196,414 | 11,336,875 | 10,842,867 | ||||||||
| Other income | (179,837 | ) | (374,548 | ) | (397,005 | ) | (674,287 | ) | ||||
| Operating income (loss) | 341,335 | (979,949 | ) | (1,552,957 | ) | (3,422,587 | ) | |||||
| Interest expense | 359,430 | 519,552 | 878,750 | 976,878 | ||||||||
| Loss from continuing operations before income taxes | (18,095 | ) | (1,499,501 | ) | (2,431,707 | ) | (4,399,465 | ) | ||||
| Income tax benefit | – | (573,416 | ) | – | (2,288,622 | ) | ||||||
| Loss from continuing operations | (18,095 | ) | (926,085 | ) | (2,431,707 | ) | (2,110,843 | ) | ||||
| Discontinued operations | ||||||||||||
| Operating loss of discontinued | ||||||||||||
| motorhome operations | (143,970 | ) | (180,961 | ) | (138,766 | ) | (394,180 | ) | ||||
|
Net Loss
|
$ (162,065 | ) | $ (1,107,046 | ) | $ (2,570,473 | ) | $ (2,505,023 | ) | ||||
|
Loss Per Share
|
||||||||||||
| Loss from continuing operations | $ (0.00 | ) | $ (0.07 | ) | $ (0.17 | ) | $ (0.15 | ) | ||||
| Loss from discontinued operations | (0.01 | ) | (0.01 | ) | (0.01 | ) | (0.03 | ) | ||||
| Net Loss | $ (0.01 | ) | $ (0.08 | ) | $ (0.18 | ) | $ (0.18 | ) | ||||
|
Shares used in the computation of loss per share:
|
||||||||||||
| Basic | 14,292,955 | 14,185,065 | 14,274,747 | 14,165,215 | ||||||||
| Diluted | 14,292,955 | 14,185,065 | 14,274,747 | 14,165,215 | ||||||||
| Supreme Industries, Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
|
||||
| June 26, | Dec. 26, | |||
| 2010 | 2009 | |||
| Assets | ||||
| Current assets | $ 72,716,432 | $ 66,002,138 | ||
| Property, plant and equipment, net | 41,074,669 | 42,237,084 | ||
| Other assets | 567,712 | 1,181,357 | ||
| Total assets | $114,358,813 | $109,420,579 | ||
| Liabilities | ||||
| Current liabilities | $ 51,618,705 | $ 44,508,269 | ||
| Long-term debt | 991,308 | 1,115,410 | ||
| Deferred income taxes | 1,211,262 | 1,211,262 | ||
| Total liabilities | 53,821,275 | 46,834,941 | ||
| Total stockholders’ equity | 60,537,538 | 62,585,638 | ||
| Total liabilities and stockholders’ equity | $114,358,813 | $109,420,579 |
PHC, Inc.’s (PHC) Seven Hills Behavioral Institute Receives CMS Approval
PEABODY, Mass., Aug. 11 /PRNewswire-FirstCall/ — PHC, Inc., d/b/a Pioneer Behavioral Health (NYSE Amex: PHC), a leading provider of inpatient and outpatient behavioral health services, today announced that its Seven Hills Behavioral Institute, located in Henderson, Nevada, has obtained Centers for Medicare and Medicaid services (CMS) approval and the facility can immediately accept patients enrolled in the Medicare program.
“We are pleased to achieve this important approval, as we will now be able to provide our important treatment services to a wider population of potential patients,” commented Bruce A. Shear, Pioneer’s President and CEO. “The census at this facility has been increasing steadily, and we continue to see consistently strong demand in the region. The recently opened 10-bed adolescent unit has added to this demand and reinforced our confidence that this facility can contribute significantly to our profitability in the near term. With this certification, the Seven Hills Behavioral Institute has the potential to add as much as five cents per year to the Company’s earnings per share.”
About PHC d/b/a Pioneer Behavioral Health
PHC, Inc., d/b/a Pioneer Behavioral Health, is a national healthcare company providing behavioral health services in five states, including substance abuse treatment facilities in Utah and Virginia, and inpatient and outpatient psychiatric facilities in Michigan, Pennsylvania, and Nevada. The Company also offers internet and telephonic-based referral services that includes employee assistance programs and critical incident services. Contracted services with government agencies, national insurance companies, and major transportation and gaming companies cover more than one million individuals. Pioneer helps people gain and maintain physical, spiritual and emotional health through delivering the highest quality, most culturally responsive and compassionate behavioral health care programs and services. For more information, visit www.phc-inc.com.
Statement under the Private Securities Litigation Reform Act of 1995
This press release may include “forward-looking statements” that are subject to risks and uncertainties. Forward-looking statements include information about possible or assumed future results of the operations or the performance of the Company and its future plans and objectives. Various future events or factors may cause the actual results to vary materially from those expressed in any forward-looking statements made in this press release. For a discussion of these factors and risks, see the Company’s annual report on Form 10-K for the most recently ended fiscal year.
Universal Power Group (UPG) Reports Record Second Quarter Net Income
CARROLLTON, Texas–(BUSINESS WIRE)–Universal Power Group, Inc. (NYSE Amex: UPG), a Texas-based distributor and supplier of batteries and related power accessories and a third-party logistics provider, today announced financial results for the second quarter and six months ended June 30, 2010.
For the second quarter, UPG reported record net income of $0.8 million, or $0.17 per share, on net sales of $28.4 million. These results compare with net income of $0.6 million, or $0.12 per share, on net sales of $27.9 million reported in the second quarter of 2009.
“We are very pleased with the 38 percent growth in our bottom line results in the second quarter,” stated UPG’s President and Chief Executive Officer, Ian Edmonds. “While our revenues continued to be affected by weakness in consumer confidence and employment in the broader economy, the actions we’ve taken over the past few quarters, such as the changes to our sales force made at the end of 2009, have yielded positive results. In the second quarter, our sales of batteries, related power accessories and other products posted solid and broad-based gains across new and existing customers. We continued to carefully manage our operating expenses in order to lower our costs, and improve operating efficiency while remaining responsive to the demands of our customers.”
Second Quarter and Six Month Overview
Net sales for the second quarter rose 1.6 percent, to $28.4 million, from $27.9 million in the second quarter of 2009. Net sales of batteries, related power accessories and other products to customers other than Broadview Security and its authorized dealers grew 18.1 percent, to $17.7 million in the second quarter of 2010, compared to $15.0 million for the second quarter of 2009. Net sales to Broadview Security and its authorized dealers in the second quarter were $10.7 million, a decrease of 17.5 percent from $12.9 million in the same quarter of 2009. Net sales to Broadview Security and its authorized dealers accounted for 37.6 percent of total net sales in the second quarter of 2010, compared to 46.3 percent of total net sales in the second quarter of 2009.
Higher net sales, continued cost control and better sourcing efficiency – partially offset by UPG’s decision to employ more aggressive pricing in the current competitive environment – resulted in 17.8 percent gross margins for the quarter, compared to 17.7 percent for the second quarter of 2009. UPG reported gross profit of $5.1 million in the quarter, compared to gross profit of $5.0 million in the second quarter of 2009. Operating expenses decreased by $0.1 million, or 3.4 percent, to $3.7 million in the second quarter, compared to $3.8 million in the second quarter of 2009, due mainly to the Company’s continued efforts to control operating costs and improved operating efficiency.
For the second quarter of 2010, UPG reported operating income of $1.4 million and pre-tax income of $1.2 million, compared to operating income of $1.2 million and pre-tax income of $0.9 million in the second quarter of 2009. At the bottom line, UPG reported net income of $0.8 million, or $0.17 per share, compared to net income of $0.6 million, or $0.12 per share, in the second quarter of 2009.
For the first six months of 2010, net sales fell 2.2 percent, to $54.4 million, from $55.6 million in the comparable period of 2009. Net sales of batteries, related power accessories and other products to customers other than Broadview Securities and its authorized dealers grew 8.4 percent, to $32.7 million in the first six months of 2010, compared to $30.2 million for the comparable period of 2009. Net sales to Broadview Security and its authorized dealers in the first six months of 2010 were $21.7 million, a decrease of 14.7 percent from $25.4 million in the same period of 2009. Net sales to Broadview Security and its authorized dealers accounted for 39.9 percent of total net sales in the first six months of 2010, compared to 45.8 percent of total net sales in the first six months of 2009.
Lower net sales combined with increased inventory reserves and tooling costs contributed to lower gross profit of $9.5 million, or 17.4 percent of sales, compared to $9.9 million, or 17.8 percent of sales for the first six months of 2009. Total operating expenses decreased $2.8 million, or 28.3 percent to $7.1 million, from $10.0 million in the prior year. However, the 2009 amount includes settlement expenses of $2.5 million relating to the departure of the Company’s former chief executive officer and the cancellation of the Company’s relationship with its principal purchasing agent. Excluding the settlement costs, operating expenses improved by approximately $0.3 million.
For the first six months of 2010, UPG reported operating income of $2.4 million and pre-tax income of $2.0 million, compared to an operating loss of $39,000 and a pre-tax loss of $0.5 million in the comparable period of 2009. Excluding the settlement expenses incurred in the first quarter of 2009, UPG’s non-GAAP operating income for the 2009 period was $2.5 million, and non-GAAP pre-tax income was $2.0 million. The reduction in operating income in 2010 compared to non-GAAP operating income in 2009 was due primarily to decreases in net sales and associated gross profit, partially offset by reductions in operating expenses. UPG reported net income for the first six months of 2010 of $1.3 million, or $0.27 per share, compared to a net loss of $1.1 million, or $0.23 per share, in the first six months of 2009.
Balance Sheet and Financial Position
In the second quarter, inventory was reduced by $1.7 million, to $27.2 million, from $28.9 million at the end of the first quarter, continuing management’s objective of maintaining inventory levels to meet current levels of demand. Accounts receivable increased by $1.6 million from last quarter, while accounts payable increased by $1.8 million during the quarter. The outstanding balance on UPG’s line of credit was reduced to $11.7 million, compared to $17.2 million last quarter and $15.2 million at the end of 2009.
UPG generated operating cash flow of $2.1 million in the six months ended June 30, 2010, compared to operating cash flow of $0.6 million in the same period of 2009, reflecting the significant improvement in net income and continued efforts to control working capital. Given the considerable repayment of debt in the period, the Company ended the quarter with $0.7 million in cash and cash equivalents, down from $2.1 million at year-end.
Logistics Center Realignment
UPG also announced a number of changes to its network of logistics centers as part of its effort to reduce costs and enhance productivity without sacrificing customer service. UPG will consolidate its Oklahoma City logistics center with its main facility in Carrollton, Texas. UPG expects this move will result in improved capacity utilization and lower cost of operations.
In addition to this consolidation, UPG announced that it will move its current logistics center in Columbus, Ga. to Atlanta. The Company believes this relocation will result in better service to its customers on the East Coast who will benefit from closer proximity to air and ground transportation hubs in Atlanta. The move is expected to be completed by the expiration of the current lease at the end of the third quarter.
Edmonds concluded: “The positive results posted for the second quarter illustrate the impact of our effort to grow revenue and control costs. Despite lingering softness in the broad economy, we have taken appropriate steps to further enhance the efficiency of our operations and continue serving the needs of our customers. Over the long term, we see significant growth opportunities within the United States and internationally, but we will maintain a disciplined approach to ensure that our growth is sustainable and supported by the strength of UPG’s balance sheet and operating results.”
Reconciliation of GAAP Operating Income (Loss) and Income (Loss) Before Provision for Income Taxes to Non-GAAP Operating Income and Income Before Provision for Income Taxes (Unaudited)
The following table reconciles GAAP operating income (loss) and GAAP income (loss) before provision for income taxes, as reported, to non-GAAP operating income and non-GAAP income before provision for income taxes. We believe that non-GAAP operating income, which is generally operating income less costs related to settlement agreements, represents our operating efficiency. Non-GAAP operating income and non-GAAP income before provision for income taxes, which are non-GAAP financial measures, should not be considered alternatives to, or more meaningful than, net income prepared on a GAAP basis. Additionally, non-GAAP operating income and non-GAAP income before provision for income taxes may not be comparable to similar metrics used by others in the industry.
| Financial Summary (Non-GAAP) | ||||||||||||
| (unaudited) | ||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||
| Operating income (loss) and income (loss) before provision for income taxes as reported: | ||||||||||||
| Operating expenses | $ | 3,657,219 | $ | 3,786,800 | $ | 7,130,494 | $ | 7,421,691 | ||||
| Settlement expenses | — | — | — | 2,529,345 | ||||||||
| Total operating expenses | 3,657,219 | 3,786,800 | 7,130,494 | 9,951,036 | ||||||||
| Operating income (loss) | 1,403,503 | 1,167,653 | 2,363,201 | (38,819) | ||||||||
| Interest expense | (236,936) | (233,246) | (398,296) | (480,796) | ||||||||
| Income (loss) before provision for income taxes | 1,166,573 | 934,407 | 1,964,905 | (519,615) | ||||||||
| Non-GAAP measures to exclude settlement expenses from operating expenses: | ||||||||||||
| Settlement expenses | — | — | — | 2,529,345 | ||||||||
| Non-GAAP operating income | $ | 1,403,503 | $ | 1,167,653 | $ | 2,363,201 | $ | 2,490,526 | ||||
| Non-GAAP income before provision for income taxes | $ | 1,166,573 | $ | 934,407 | $ | 1,964,905 | $ | 2,009,730 | ||||
Conference Call Information
Universal Power Group will host an investor conference call today, Wednesday, Aug. 11, 2010 at 11:30 a.m. EDT (10:30 a.m. CDT) to discuss the Company’s financial results for the quarter and six months ended June 30, 2010.
Interested parties may access the conference call by dialing 1.866.730.5768, passcode 40860835. The conference call will also be broadcast live on www.upgi.com and through the Thomson StreetEvents Network. Individual investors can listen to the call at www.earnings.com, Thomson’s individual investor portal. Institutional investors can access the call via Thomson StreetEvents (www.streetevents.com), a password-protected event management site.
A replay of the conference call will be made available through Aug. 18, 2010 by calling 1.888.286.8010, passcode 54898566, and an archived webcast will be available at www.upgi.com.
About Universal Power Group, Inc.
Universal Power Group, Inc. (NYSE Amex: UPG) is a leading supplier and distributor of batteries and power accessories, and a provider of supply chain and other value-added services. UPG’s product offerings include proprietary brands of industrial and consumer batteries of all chemistries, chargers, jump-starters, 12-volt accessories, and solar and security products. UPG’s supply chain services include procurement, warehousing, inventory management, distribution, fulfillment and value-added services such as sourcing, battery pack assembly and coordinating battery recycling efforts, as well as product development. For more information, please visit the UPG website at www.upgi.com.
Forward-Looking Statements
Statements in this press release that are not statements of historical or current fact constitute “forward-looking statements.” Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause the Company’s actual operating results to be materially different from any historical results or from any future results expressed or implied by such forward-looking statements. In addition to statements that explicitly describe these risks and uncertainties, readers are urged to consider statements that contain terms such as “believes,” “belief,” “expects,” “expect,” “intends,” “intend,” “anticipate,” “anticipates,” “plans,” “plan,” to be uncertain and forward-looking. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in the Company’s filings with Securities and Exchange Commission. Historical financial results are not necessarily indicative of future performance.
| UNIVERSAL POWER GROUP, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED) ASSETS |
||||||
| June 30,
2010
|
December 31,
2009
|
|||||
| CURRENT ASSETS | ||||||
| Cash and cash equivalents | $ | 662,277 | $ | 2,059,475 | ||
| Accounts receivable: | ||||||
| Trade, net of allowance for doubtful accounts of $628,518 (unaudited) and $452,200 | 12,255,142 | 11,440,179 | ||||
| Other | 292,102 | 13,561 | ||||
| Inventories – finished goods, net of allowance for obsolescence of $1,150,137 (unaudited) and $756,671 | 27,169,530 | 30,977,213 | ||||
| Current deferred tax asset | 1,383,520 | 1,151,635 | ||||
| Prepaid expenses and other current assets | 1,084,970 | 1,064,152 | ||||
| Total current assets | 42,847,541 | 46,706,215 | ||||
| PROPERTY AND EQUIPMENT | ||||||
| Logistics and distribution systems | 1,812,379 | 1,807,069 | ||||
| Machinery and equipment | 991,261 | 984,918 | ||||
| Furniture and fixtures | 394,660 | 385,940 | ||||
| Leasehold improvements | 402,849 | 388,334 | ||||
| Vehicles | 199,992 | 222,549 | ||||
| Total property and equipment | 3,801,141 | 3,788,810 | ||||
| Less accumulated depreciation and amortization | (2,241,940) | (1,940,715) | ||||
| Net property and equipment | 1,559,201 | 1,848,095 | ||||
| OTHER ASSETS | 270,335 | 313,754 | ||||
| NON-CURRENT DEFERRED TAX ASSET | 470,242 | 771,490 | ||||
| TOTAL ASSETS | $ | 45,147,319 | $ | 49,639,554 | ||
| UNIVERSAL POWER GROUP, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (CONTINUED) LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||
| June 30,
2010
|
December 31,
2009
|
|||||
| CURRENT LIABILITIES | ||||||
| Line of credit | $ | 11,689,710 | $ | 15,174,305 | ||
| Accounts payable | 10,341,952 | 11,971,502 | ||||
| Income taxes payable | — | 698,654 | ||||
| Accrued liabilities | 819,432 | 384,976 | ||||
| Current portion of settlement expenses | 861,155 | 955,730 | ||||
| Current portion of capital lease and note obligations | 25,952 | 25,535 | ||||
| Current portion of deferred rent | 82,210 | 92,040 | ||||
| Total current liabilities | 23,820,409 | 29,302,742 | ||||
| LONG-TERM LIABILITIES | ||||||
| Settlement expenses, less current portion | 599,894 | 985,027 | ||||
| Capital lease and note obligations, less current portion | 37,764 | 50,606 | ||||
| Deferred rent, less current portion | — | 36,103 | ||||
| Non-current deferred tax liability | 214,009 | 233,654 | ||||
| Total long term liabilities | 851,667 | 1,305,390 | ||||
| TOTAL LIABILITIES | 24,672,076 | 30,608,132 | ||||
| COMMITMENTS AND CONTINGENCIES | ||||||
| SHAREHOLDERS’ EQUITY | ||||||
| Common stock – $0.01 par value, 50,000,000 shares authorized, 5,000,000 shares issued and outstanding | 50,000 | 50,000 | ||||
| Additional paid-in capital | 15,983,236 | 15,951,626 | ||||
| Retained earnings | 4,664,125 | 3,314,887 | ||||
| Accumulated other comprehensive loss | (222,118) | (285,091) | ||||
| Total shareholders’ equity | 20,475,243 | 19,031,422 | ||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 45,147,319 | $ | 49,639,554 | ||
| UNIVERSAL POWER GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||
| Net sales | $ | 28,393,923 | $ | 27,947,335 | $ | 54,428,718 | $ | 55,636,258 | ||||
| Cost of sales | 23,333,195 | 22,992,882 | 44,935,023 | 45,724,041 | ||||||||
| Gross profit | 5,060,728 | 4,954,453 | 9,493,695 | 9,912,217 | ||||||||
| Operating expenses | 3,657,219 | 3,786,800 | 7,130,494 | 7,421,691 | ||||||||
| Settlement expenses | — | — | — | 2,529,345 | ||||||||
| Total operating expenses | 3,657,219 | 3,786,800 | 7,130,494 | 9,951,036 | ||||||||
| Operating income (loss) | 1,403,509 | 1,167,653 | 2,363,201 | (38,819) | ||||||||
| Interest expense (including $0, $71,102, $0 and $146,831 to Zunicom, Inc.) | (236,936) | (233,246) | (398,296) | (480,796) | ||||||||
| Income (loss) before provision for income taxes | 1,166,573 | 934,407 | 1,964,905 | (519,615) | ||||||||
| Provision for income taxes | (323,044) | (322,066) | (615,667) | (617,997) | ||||||||
| Net income (loss) | $ | 843,529 | $ | 612,341 | $ | 1,349,238 | $ | (1,137,612) | ||||
| Net income (loss) per share | ||||||||||||
| Basic | $ | 0.17 | $ | 0.12 | $ | 0.27 | $ | (0.23) | ||||
| Diluted | $ | 0.17 | $ | 0.12 | $ | 0.27 | $ | (0.23) | ||||
| Weighted average shares outstanding | ||||||||||||
| Basic | 5,000,000 | 5,000,000 | 5,000,000 | 5,000,000 | ||||||||
| Diluted | 5,008,976 | 5,000,000 | 5,008,976 | 5,000,000 | ||||||||
| UNIVERSAL POWER GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
||||||
| Six Months Ended June 30, | ||||||
| 2010 | 2009 | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||
| Net income (loss) | $ | 1,349,238 | $ | (1,137,612) | ||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||
| Depreciation and amortization | 381,965 | 392,036 | ||||
| Provision for bad debts | 168,341 | 230,000 | ||||
| Provision for obsolete inventory | 420,000 | 170,000 | ||||
| Deferred income taxes | 49,718 | (53,994) | ||||
| Gain on disposal of property | (2,000) | — | ||||
| Stock-based compensation | 31,610 | (18,230) | ||||
| Changes in operating assets and liabilities: | ||||||
| Accounts receivable – trade | (983,304) | (1,604,746) | ||||
| Accounts receivable – other | (278,541) | 5,764 | ||||
| Inventories | 3,387,683 | 7,110,306 | ||||
| Prepaid expenses and other current assets | (20,818) | (184,886) | ||||
| Income tax receivable/payable | (698,654) | 193,386 | ||||
| Accounts payable | (1,629,551) | (7,602,920) | ||||
| Accrued liabilities | 497,429 | 772,439 | ||||
| Settlement expenses | (479,709) | 2,390,776 | ||||
| Deferred rent | (45,933) | (31,382) | ||||
| Net cash provided by operating activities | 2,147,474 | 630,937 | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||
| Purchases of property and equipment | (34,889) | (31,105) | ||||
| Proceeds from sales of equipment | 2,000 | — | ||||
| Net cash paid in Monarch acquisition | — | (892,000) | ||||
| Change in restricted cash | — | 900,000 | ||||
| Net cash used in investing activities | (32,889) | (23,105) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||
| Net activity on line of credit | (3,484,595) | 146,163 | ||||
| Payments on capital lease and note obligations | (27,188) | (3,400) | ||||
| Payment on notes payable to Zunicom, Inc. | — | (731,250) | ||||
| Net cash used in financing activities | (3,511,783) | (588,487) | ||||
| Net increase (decrease) in cash and cash equivalents | (1,397,198) | 19,345 | ||||
| Cash and cash equivalents at beginning of period | 2,059,475 | 326,194 | ||||
| Cash and cash equivalents at end of period | $ | 662,277 | $ | 345,539 | ||
| SUPPLEMENTAL DISCLOSURES | ||||||
| Income taxes paid | $ | 1,579,341 | $ | 276,080 | ||
| Interest paid | $ | 197,061 | $ | 480,796 | ||
| NONCASH FINANCING AND INVESTING ACTIVITIES | ||||||
| Purchase of equipment with a note payable | $ | — | $ | 38,556 | ||
B.O.S. Better Online Solutions (BOSC) Announces Net Profit for the Second Quarter of 2010
RISHON LEZION, Israel, Aug. 11, 2010 (GLOBE NEWSWIRE) — B.O.S. Better Online Solutions Ltd. (the “Company”, “BOS”) (Nasdaq:BOSC – News), a leading Israeli provider of RFID and supply chain solutions to global enterprises, today reported its financial results for the second quarter, ended June 30, 2010.
Revenues for the second quarter of 2010 amounted to $10.4 million, which reflects 10% growth over the previous quarter, and 30% growth as compared to the second quarter last year.
Backlog as of June 30, 2010, continued to remain at the relatively high level of $12.3 million.
Operating profit for the second quarter amounted to $563,000 compared to an operating loss of $2.1 million in the comparable quarter last year.
Operating profit for the first six months of 2010 amounted to $778,000 compared to an operating loss of $2.4 million in the comparable six month period last year.
Financial expenses for the first six months of 2010 increased to $671,000 from $262,000 in the comparable six months period last year. The increase was attributed mainly to (a) stock based compensation of $139,000, and $100,000 of interest expenses related to the convertible debt raised in July 2009 and (b) expenses related to currency differences in the amount of $71,000 in the first six months of 2010, compared to currency differences income of $70,000 in the comparable six month period last year.
Net profit for the second quarter amounted to $115,000 compared to a net loss of $2.4 million dollars in the comparable quarter last year.
Net profit for the first six months of 2010 amounted to $15,000 compared to a net loss of $3.1 million in the comparable six month period last year.
Excluding the amortization of intangible assets and stock based compensation, BOS’ net profit was $362,000 in the second quarter of 2010, and $488,000 for the first half of 2010, compared to a net loss of $857,000 and of $1.45 million in the comparable periods last year.
Edouard Cukierman, Chairman of the Board, stated, “We are very pleased with these results, which prove that the company has turned itself around. These results reflect the successful execution of our cost-reduction plan. In parallel, we are continuing to expand our RFID activities, and we expect these positive trends to continue in the future.”
Yuval Viner, BOS CEO, stated, “For the first time in many years, we are pleased to report a net profit, as well as two consecutive quarters of operating profit. We are revising our original outlook for 2010: we reiterate our target of $35 million in revenues, and now believe we will end the year with net profit, not only an operating profit. We expect to make several new customer-related announcements in the near future.”
Conference Call
BOS will host a conference call on Wednesday, August 11, 2010 at 10:30 a.m. Eastern Daylight Time/17:30 p.m. Israel Time. A question-and-answer session will follow management’s presentation. Interested parties may participate in the conference call by dialing the following numbers approximately five to ten minutes before the call start time:
North America +1-8662297198
International +972-3-9180688
For those unable to listen to the live call, a replay of the call will be available from the day after the call on the BOS website, at: http://www.boscorporate.com
About BOS
B.O.S. Better Online Solutions Ltd. (Nasdaq:BOSC – News) is a leading Israeli provider of RFID and Supply Chain solutions to global enterprises. BOS’ RFID and supply chain offerings are helping over 2,000 customers worldwide improve the efficiency of enterprise logistics and organizational monitoring and control. BOS’ RFID and mobile division (Israel) offers both turnkey integration services as well as stand-alone products, including best-of-breed RFID and AIDC hardware and communications equipment, BOS middleware, and industry-specific software applications. The Company’s supply chain divisions (Israel and US) provide RFID and electronic components consolidation services to the aerospace, defense, medical, telecommunications industries as well as to enterprise customers worldwide.
For more information, please visit: http://www.boscorporate.com
Use of Non-GAAP Financial Information
BOS reports financial results in accordance with U.S. GAAP and herein provides some non-GAAP measures. These non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. These non-GAAP measures are intended to supplement the Company’s presentation of its financial results that are prepared in accordance with GAAP. The Company uses the non-GAAP measures presented to evaluate and manage the Company’s operations internally. The Company is also providing this information to assist investors in performing additional financial analysis that is consistent with financial models developed by research analysts who follow the Company. The reconciliation set forth below is provided in accordance with Regulation G and reconciles the non-GAAP financial measures with the most directly comparable GAAP financial measures.
Safe Harbor Regarding Forward-Looking Statements
The forward-looking statements contained herein reflect management’s current views with respect to future events and financial performance. These forward-looking statements are subject to certain risks and uncertainties that could cause the actual results to differ materially from those in the forward-looking statements, all of which are difficult to predict and many of which are beyond the control of BOS. These risk factors and uncertainties include, amongst others, the dependency of sales being generated from one or few major customers, the uncertainty of our being able to maintain current gross profit margins, inability to keep up or ahead of technology and to succeed in a highly competitive industry, inability to maintain marketing and distribution arrangements and to expand our overseas markets, uncertainty with respect to the prospects of legal claims against BOS, the effect of exchange rate fluctuations and general worldwide economic conditions; and additional risks and uncertainties detailed in BOS’s periodic reports and registration statements filed with the U.S. Securities Exchange Commission. BOS undertakes no obligation to publicly update or revise any such forward-looking statements to reflect any change in its expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.
| CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (U.S. dollars in thousands, except per share amounts) |
||||||||
| Six months ended June 30, |
Three months ended June 30, |
|||||||
| 2010 | 2009 | 2010 | 2009 | |||||
| (Unaudited) | (Unaudited) | |||||||
| Revenues | $ 19,857 | $ 17,053 | $ 10,411 | $ 8,009 | ||||
| Inventory allowance and write off | (155) | (56) | (73) | (89) | ||||
| Cost of revenues | 15,298 | 12,989 | 7,997 | 6,247 | ||||
| Gross profit | 4,714 | 4,120 | 2,487 | 1,851 | ||||
| Operating costs and expenses: | ||||||||
| Research and development | 182 | 361 | 62 | 153 | ||||
| Sales and marketing | 2,736 | 4,216 | 1,308 | 2,201 | ||||
| General and administrative | 1,018 | 784 | 554 | 402 | ||||
| Impairment of goodwill | — | 1,218 | — | 1,218 | ||||
| Total operating costs and expenses | 3,936 | 6,579 | 1,924 | 3,974 | ||||
| Operatingprofit (loss) | 778 | (2,459) | 563 | (2,123) | ||||
| Financial expenses, net | (671) | (262) | (366) | (172) | ||||
| Other expenses, net | (88) | (219) | (81) | (52) | ||||
| Income (loss) before taxes on income | 19 | (2,940) | 116 | (2,347) | ||||
| Taxes on income | (4) | (192) | (1) | (41) | ||||
| Net income (loss) | $ 15 | $ (3,132) | $ 115 | $ (2,388) | ||||
| Basic net income (loss) per share (*) | $ 0.01 | $ (1.30) | $ 0.04 | $ (0.95) | ||||
| Diluted net income (loss) per share (*) | $ 0.01 | $ (1.30) | $ 0.04 | $ (0.95) | ||||
| Weighted average number of shares used in computing basic net earnings per share (*) |
2,627,055 | 2,395,844 | 2,626,760 | 2,475,932 | ||||
| Weighted average number of shares used in computing diluted net earnings per share (*) |
2,753,356 | 2,395,844 | 2,753,036 | 2,475,932 | ||||
| (*) All earnings (loss) per share data are reported after the effect of the 1 for 5 reverse split that occurred on January 12, 2010. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEET (U.S. dollars in thousands) |
||||
| June 30, 2010 | December 31, 2009 | |||
| (Unaudited) | (Audited) | |||
| ASSETS | ||||
| CURRENT ASSETS: | ||||
| Cash and cash equivalents | $369 | $597 | ||
| Trade receivables, net | 10,184 | 8,685 | ||
| Other accounts receivable and prepaid expenses | 835 | 1,043 | ||
| Inventories | 7,420 | 8,776 | ||
| Investment in other company | — | 361 | ||
| Total current assets | 18,808 | 19,462 | ||
| LONG-TERM ASSETS: | ||||
| Severance pay fund | 601 | 652 | ||
| Investment in other companies | 117 | 218 | ||
| Other assets | 197 | 123 | ||
| Total long-term assets | 915 | 993 | ||
| PROPERTY, PLANT AND EQUIPMENT, NET | 1,179 | 1,278 | ||
| OTHER INTANGIBLE ASSETS, NET | 1,766 | 1,999 | ||
| GOODWILL | 4,065 | 4,172 | ||
| Total assets | $26,733 | $27,904 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
| CURRENT LIABILITIES: | ||||
| Short-term bank loans and current maturities | $11,397 | $11,787 | ||
| Trade payables | 4,774 | 5,097 | ||
| Employees and payroll accruals | 670 | 652 | ||
| Deferred revenues | 584 | 731 | ||
| Accrued expenses and other liabilities | 1,171 | 1,226 | ||
| Total Current Liabilities | 18,596 | 19,493 | ||
| LONG-TERM LIABILITIES: | ||||
| Long-term bank loans, net of current maturities | 578 | 816 | ||
| Deferred taxes and income tax accruals | 365 | 377 | ||
| Accrued severance pay | 711 | 770 | ||
| Convertible notes | 2,229 | 1,886 | ||
| Other long-term liabilities | 625 | 919 | ||
| Total long-term liabilities | 4,508 | 4,768 | ||
| SHAREHOLDERS’ EQUITY | 3,629 | 3,643 | ||
| Total liabilities and shareholder’s equity | $26,733 | $27,904 | ||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (U.S. dollars in thousands) |
||||||||
| Six months ended June 30, |
Three months ended June 30, |
|||||||
| 2010 | 2009 | 2010 | 2009 | |||||
| (Unaudited) | (Unaudited) | |||||||
| Cash flows provided by (used in) operating activities | 297 | (1,564) | 293 | (306) | ||||
| Net cash provided by (used in) investing activities | 21 | (1,049) | (13) | (126) | ||||
| Net cash provided by (used in) financing activities | (546) | 1,787 | (722) | 108 | ||||
| Decrease in cash and cash equivalents | (228) | (826) | (442) | (324) | ||||
| Cash and equivalents at the beginning of the period | 597 | 1,637 | $ 811 | 1,135 | ||||
| Cash and cash equivalents at the end of the period | $ 369 | $ 811 | $ 369 | $ 811 | ||||
| CONDENSED CONSOLIDATED EBITDA (U.S. dollars in thousands) |
||||||||
| Six months ended June 30, |
Three months ended June 30, |
|||||||
| 2010 | 2009 | 2010 | 2009 | |||||
| (Unaudited) | (Unaudited) | |||||||
| Operating Profit (loss) | $ 778 | $ (2,459) | $ 563 | $ (2,123) | ||||
| Add: | ||||||||
| Amortization of intangible assets | 214 | 181 | 117 | 83 | ||||
| Stock based compensation | 120 | 278 | 61 | 230 | ||||
| Depreciation | 134 | 101 | 66 | 53 | ||||
| Impairment of goodwill | — | 1,218 | — | 1,218 | ||||
| EBITDA | $ 1,246 | $ (681) | $ 807 | $ (539) | ||||
| CONDENSED CONSOLIDATED SALES BY GEOGRAPHIC AREA (U.S. dollars in thousands) |
||||||||
| Six months ended June 30, |
Three months ended June 30, |
|||||||
| 2010 | 2009 | 2010 | 2009 | |||||
| (Unaudited) | (Unaudited) | |||||||
| America | $ 3,485 | $ 2,558 | $ 1,791 | $ 1,362 | ||||
| Far East | 907 | 512 | 621 | 240 | ||||
| Europe | 2,146 | 2,387 | 1,040 | 1,281 | ||||
| Israel and others | 13,319 | 11,596 | 6,959 | 4,896 | ||||
| Total | $ 19,857 | $ 17,053 | $ 10,411 | $ 8,009 | ||||
Ameristar Casinos (ASCA) Confirms It is Evaluating Strategic Alternatives
LAS VEGAS–(BUSINESS WIRE)–Ameristar Casinos, Inc. (NASDAQ-GS: ASCA) today confirmed that the Transaction Committee of its Board of Directors is evaluating strategic alternatives to enhance stockholder value, including a possible sale of the Company.
The Company has engaged Lazard and Bank of America Merrill Lynch as its financial advisors and Gibson, Dunn & Crutcher LLP as its legal advisor to assist the Transaction Committee in its evaluation.
The Company noted that there can be no assurance that the exploration of strategic alternatives will result in any transaction. The Company does not intend to disclose developments regarding these matters unless and until its Board of Directors determines that there is a material need to update the market.
About Ameristar
Ameristar Casinos, Inc. is a leading Las Vegas-based gaming and entertainment company known for its premier properties characterized by state-of-the-art casino floors and superior dining, lodging and entertainment offerings. Ameristar’s focus on the total entertainment experience and the highest quality guest service has earned it leading positions in the markets in which it operates. Founded in 1954 in Jackpot, Nev., Ameristar has been a public company since November 1993. The Company has a portfolio of eight casinos in seven markets: Ameristar Casino Resort Spa St. Charles (greater St. Louis); Ameristar Casino Hotel East Chicago (Chicagoland area); Ameristar Casino Hotel Kansas City; Ameristar Casino Hotel Council Bluffs (Omaha, Neb. and southwestern Iowa); Ameristar Casino Hotel Vicksburg (Jackson, Miss. and Monroe, La.); Ameristar Casino Resort Spa Black Hawk (Denver metropolitan area); and Cactus Petes and The Horseshu in Jackpot, Nev. (Idaho and the Pacific Northwest).
Visit Ameristar Casinos’ website at www.ameristar.com (which shall not be deemed to be incorporated in or a part of this news release).
Forward-Looking Information
This release contains certain forward-looking information that generally can be identified by the context of the statement or the use of forward-looking terminology, such as “believes,” “estimates,” “anticipates,” “intends,” “expects,” “plans,” “is confident that,” “should” or words of similar meaning, with reference to Ameristar or our management. Similarly, statements that describe our future plans, objectives, strategies, financial results or position, operational expectations or goals are forward-looking statements. It is possible that our expectations may not be met due to various factors, many of which are beyond our control, and we therefore cannot give any assurance that such expectations will prove to be correct. For a discussion of relevant factors, risks and uncertainties that could materially affect our future results, attention is directed to “Item 1A. Risk Factors” and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2009, and “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2010. As noted above, there can be no assurance that the exploration of strategic alternatives will result in any transaction.
US Homeland Security Selects ICOP Digital, Inc. (ICOP)
LENEXA, KS–(Marketwire – 08/11/10) – ICOP Digital, Inc. (NASDAQ:ICOP – News), an industry-leading company engaged in advancing digital surveillance technology solutions, today announced the receipt of an initial order for the ICOP Model 20/20®-W in-car video systems from the US Department of Homeland Security. Due to the security nature of the project, ICOP agreed not to release details of the project until the Department releases its own press release. The order will outfit just over one hundred (100) vehicles, and will include recording of mobile video/audio, wireless uploading, live streaming video capability, and ICOP’s video management software.
“Ease of use and the quality of the recorded video were the deciding factors in the selection of ICOP. This is an example of our shift in focus to key accounts and use of our products outside the standard police agency. This project is a significant advance for ICOP. ICOP is proud that our equipment will play a major role in helping to secure our nation,” said Dave Owen, Chief Executive Officer at ICOP.
About ICOP Digital, Inc.
ICOP Digital, Inc. (NASDAQ:ICOP – News) is a leading provider of in-car video and mobile video solutions for Law Enforcement, Fire, EMS, Military, and Homeland Security markets worldwide. ICOP solutions help the public and private sectors mitigate risks, reduce losses, and improve security through the live streaming, capture and secure management of high quality video and audio. www.ICOP.com
Forward-Looking Statements
This document contains forward-looking statements. You should not rely too heavily on forward-looking statements because they are subject to uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. The Company may experience significant fluctuations in future operating results due to a number of economic, competitive, and other factors, including, among other things, our reliance on third-party manufacturers and suppliers, government agency budgetary and political constraints, new or increased competition, changes in market demand, and the performance or reliability of our products. This, plus other uncertainties and factors described in our most-recent annual report and our most-recent prospectus filed with the Securities and Exchange Commission, could materially affect the Company and our operations. These documents are available electronically without charge at www.sec.gov.
China Pharma Holdings, Inc. (CPHI) Reports Second Quarter 2010 Financial Results
HAIKOU CITY, China, Aug. 10 /PRNewswire-Asia-FirstCall/ — China Pharma Holdings, Inc. (NYSE AMEX: CPHI) (“China Pharma” or the “Company”), a leading fully-integrated specialty pharmaceuticals company in China, today announced financial results for the second quarter ended June 30, 2010.
Second Quarter Highlights
-- Revenue increased 22% to $16.6 million from $13.6 million in the second
quarter of fiscal year 2009
-- Gross profit grew 19% to $7.0 million from $5.9 million in the second
quarter of fiscal year 2009
-- Net income climbed 23% to $5.3 million, or $0.12 per basic and diluted
share in the second quarter, from $4.3 million, or $0.10 per basic and
diluted share a year ago
“We are pleased to report another solid quarter with strong organic growth in both revenue and net income,” said China Pharma’s President and CEO, Ms. Zhilin Li. “We performed well across our key product categories, led by Digestive Diseases, which benefitted from very encouraging sales of our new generic GERD drug, Omeprazole. Furthermore, we have started to see tangible evidence of rising demand in EDL related products, such as higher Vitamin B6 sales this quarter, which played a key factor in our Other Products category growth. Going forward, we expect to opportunistically pursue attractive new markets, such as EDL drugs, while carefully managing our product mix. Finally, in addition to managing our current portfolio of products for growth and profitability, this quarter we continued to advance our pipeline, which includes several late-stage drug candidates which we believe could have significant market potential.”
Second Quarter Results
Second quarter 2010 total revenues grew 22% to $16.6 million from $13.6 million in second quarter 2009. Digestive Diseases product sales for the second quarter 2010 grew by 129% year-over-year to $2.3 million, primarily due to increased sales of Omeprazole, our generic gastroesophageal reflux disease (GERD) drug launched in fourth quarter 2009. In second quarter 2010, our Other Products category rose 40% year-over-year to $3.2 million, reflecting higher sales of Vitamin B6, one of two China Pharma products included on the National EDL (Essential Drug List). The Company’s Anti-viro/Infection and Respiratory product sales increased 21% to $6.3 million from $5.2 million in the same quarter last year, driven by growth of antibiotics products. Sales of the Company’s Central Nervous System (CNS) and Cardio Vascular products decreased 5% to $4.9 million from $5.1 million in the comparable 2009 period.
Gross profit for the three months ended June 30, 2010 increased to $7.0 million from $5.9 million in the comparable period last year. Gross margin for the second quarter was 42.4% as compared to 43.5% in the previous year quarter. The decrease in gross margin was largely due to higher volume of lower margin products sold compared to the same period a year ago.
Total operating expenses rose to $1.6 million (9.3% of revenue) for the three months ended June 30, 2010 from $1.1 million (8.2% of revenue) in the same period last year, primarily due to a share-based compensation cost and higher intangible amortization expenses for the Company’s drug formulas during the quarter ending June 30, 2010 compared to the same quarter a year ago.
Net income for the three months ended June 30, 2010 increased 23% to $5.3 million, or $0.12 per basic and diluted share, compared to $4.3 million, or $0.10 per basic and diluted share, for the same period a year ago. Net Income margin in second quarter 2010 improved to 31.7% from 31.5% in the prior year period.
Six-month Results
Revenues for the six months ended June 30, 2010 were $31.7 million, up 19% from revenues of $26.6 million for the six months ended June 30, 2009. Gross profit for the six months ended June 30, 2010 was $13.2 million, up 11% from gross profit of $11.8 million for the corresponding period of 2009. Gross margin was 41.5%, compared to 44.6% for the first six months of 2009. Operating income was $10.3 million, up 16.4% from $8.9 million for the first six months of 2009. Net income was $9.6 million, or $0.22 per basic and diluted share, compared to $8.0 million, or $0.19 per basic and diluted share, for the same period a year ago.
Financial Condition
As of June 30, 2010, the Company had cash and cash equivalents of $4.5 million compared to $3.6 million as of December 31, 2009. Year-over-year, working capital increased to $69 million from $61 million while the current ratio fell slightly to 6.5 times.
Accounts receivable balance rose to $57.7 million from $54.0 million at the end of 2009. The Company’s management team continues to be sharply focused on improving accounts receivable collection and expects to make further progress in the quarters to come.
For the six months ended June 30, 2010, cash flow from operating activities rose to $3.3 million, from $3.1 million during the same period in 2009. The Company’s cash flow from operating activities benefited from a reduction in cash used by trade receivables to $3.4 million during the first six months of 2010 from $6.8 million during the first six months of 2009 even as revenue grew by 19%.
Financial Guidance
China Pharma reiterates 2010 revenue growth guidance of 20% to 25% from the prior year, with the upside coming from new drug launches during this year. While the Company is very encouraged to see strong demand from EDL related products, managing the product mix to achieve profitability goals is still a focus for the management. With the first half of 2010 behind us, the Company anticipates stronger consumer demand for products included on the National EDL, which will benefit the Company with pricing flexibility and top-line growth due to seasonality of the product portfolio.
“We are beginning to see early benefits of China’s unprecedented $124 billion healthcare reform program and believe this initiative will be a significant volume driver in the country’s pharmaceutical industry,” said Ms. Li. “In the second half of 2010 and beyond, our goal is to enhance shareholder value by not only continuing to successfully grow our current portfolio of products but also by brining to market important new drugs to help meet large unmet patient demand.”
Pipeline Update
As of June 30, 2010, China Pharma had 9 pipeline drugs in different stages of active SFDA registration progress.
-- The Company completed the clinical trials earlier this year for
candesartan (generic form of Atacand), a front-line antihypertensive
therapy. The Company has completed all review testing procedures and is
currently waiting for the final SFDA production approval.
-- We continue to receive positive feedback from patients during our
clinical trial of Rosuvastatin, a generic form of Crestor. The majority
of the patients in the clinical trial have completed the treatment
cycle.
-- The Phase I clinical trial for the novel anti-resistant antibiotic
combination drug is also progressing on schedule and nearing its
completion.
Conference Call
The Company will hold a conference call at 8:00 am ET on August 10, 2010 to discuss second quarter 2010 results. Listeners may access the call by dialing 1-800-599-9816 or 1-617-847-8705 for international callers, access code: 52278171. A webcast will also be available through CPHI’s website at http://www.chinapharmaholdings.com . A replay of the call will be accessible through August 17, 2010 by dialing 1-888-286-8010 or 1-617-801-6888 for international callers, access code: 49499602.
About China Pharma Holdings, Inc.
China Pharma Holdings, Inc. is a rapidly growing specialty pharmaceutical company that develops, manufactures and markets a diversified portfolio of products focused on conditions with a high incidence and high mortality rates in China, including cardiovascular, CNS, infectious, and digestive diseases. The Company’s cost-effective, high margin business model is driven by market demand and supported by eight scalable GMP-certified product lines covering the major dosage forms. In addition, the Company has a broad and expanding nationwide distribution network across all major cities and provinces in China. The Company’s wholly owned subsidiary, Hainan Helpson Medical & Biotechnology Co., Ltd., is located in Haikou City, Hainan Province. For more information about China Pharma Holdings, Inc., please visit http://www.chinapharmaholdings.com .
Safe Harbor Statement
Certain statements in this press release constitute forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Any statements set forth above that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, which may include, but are not limited to, such factors as the achievability of financial guidance, success of new product development, unanticipated changes in product demand, increased competition, downturns in the Chinese economy, uncompetitive levels of research and development, and other information detailed from time to time in the Company’s filings and future filings with the United States Securities and Exchange Commission. The forward-looking statements made herein speak only as of the date of this press release and the Company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations except as required by applicable law or regulation.
For more information, please contact:
China Pharma Holdings, Inc.
Phone: +86-898-6681-1730 (China)
Email: hps@chinapharmaholdings.com
CCG Investor Relations
Kalle Ahl, CFA, Account Manager
Phone: +1-646-833-3417 (New York)
Email: kalle.ahl@ccgir.com
Vivian Chen, Sr. Market Intelligence Exec.
Phone: +1-646-701-7445(New York)
Email: vivian.chen@ccgir.com
- FINANCIAL TABLES FOLLOW -
CHINA PHARMA HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2010 2009
ASSETS (Unaudited)
Current Assets:
Cash and cash equivalents $4,528,115 $3,634,753
Trade accounts receivable, less
allowance for doubtful
accounts of $2,833,981 and
$2,718,358, respectively 54,868,863 51,238,339
Other receivables, less allowance for
doubtful accounts of $8,304 and
$3,556, respectively 104,763 78,525
Advances to suppliers 2,717,044 1,798,446
Inventory 19,306,706 14,233,073
Deferred tax assets 467,274 319,820
Total Current Assets 81,992,765 71,302,956
Advances for purchases of property
and equipment and intangible assets 4,072,982 3,599,949
Property and equipment, net of
accumulated depreciation of
$2,418,184 and $2,020,462, respectively 6,409,424 6,705,873
Intangible assets, net of accumulated
amortization of $1,820,516 and
$1,359,048, respectively 23,389,595 19,332,284
TOTAL ASSETS $115,864,766 $100,941,062
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Trade accounts payable $6,343,401 $3,957,923
Accrued expenses 52,783 47,435
Accrued taxes payable 1,301,152 1,528,691
Other payables 59,434 58,191
Advances from customers 1,024,755 1,037,693
Other payables - related parties 75,741 75,741
Short-term notes payable 3,818,700 3,802,726
Total Current Liabilities 12,675,966 10,508,400
Long-term research and development
commitments -- 36,565
Total Liabilities 12,675,966 10,544,965
Stockholders' Equity:
Preferred stock, $0.001 par value;
5,000,000 shares authorized;
no shares issued or outstanding -- --
Common stock, $0.001 par value;
95,000,000 shares of authorized;
43,393,644 shares and 42,308,350
shares of common stock outstanding,
respectively 43,393 42,308
Additional paid-in capital 23,981,130 21,178,114
Retained earnings 72,843,772 63,272,868
Accumulated foreign currency
translation adjustment 6,320,505 5,902,807
Total Stockholders' Equity 103,188,800 90,396,097
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $115,864,766 $100,941,062
CHINA PHARMA HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME
(Unaudited)
For the Three Months Ended For the Six Months Ended
June 30, June 30,
2010 2009 2010 2009
Revenue $16,631,354 $13,601,355 $31,733,864 $26,593,337
Cost of revenue 9,587,417 7,681,845 18,555,719 14,745,072
Gross profit 7,043,937 5,919,510 13,178,145 11,848,265
Operating expenses:
Selling expenses 621,580 603,924 1,204,468 1,206,684
General and
administrative
expenses 894,507 553,607 1,547,255 1,041,654
Bad debt expense, net
of recoveries 37,615 (40,147) 108,521 734,785
Total operating
expenses 1,553,702 1,117,384 2,860,244 2,983,123
Income from operations 5,490,235 4,802,126 10,317,901 8,865,142
Other income
(expense):
Interest income 5,401 10,720 12,158 21,309
Interest expense (51,631) (40,471) (102,121) (78,707)
Other income 465,663 -- 465,663 --
Net other income
(expense) 419,433 (29,751) 375,700 (57,398)
Income before income
taxes 5,909,668 4,772,375 10,693,601 8,807,744
Income tax expense (633,419) (486,231) (1,122,698) (843,953)
Net income 5,276,249 4,286,144 9,570,903 7,963,791
Other comprehensive
income -
foreign currency
translation adjustment 403,253 5,698 417,698 93,189
Comprehensive income $5,679,502 $4,291,842 $9,988,601 $8,056,980
Earnings per Share:
Basic $0.12 $0.10 $0.22 $0.19
Diluted $0.12 $0.10 $0.22 $0.19
CHINA PHARMA HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Six Months Ended
June 30,
2010 2009
Cash Flows from Operating Activities:
Net income $9,570,903 $7,963,791
Depreciation and amortization 841,762 558,866
Stock based compensation 221,101 --
Deferred income taxes (145,552) (115,762)
Changes in assets and liabilities:
Trade accounts receivable (3,402,232) (6,798,955)
Other receivables (25,809) 74,139
Advances to suppliers (907,559) 703,994
Inventory (4,994,669) (1,716,958)
Trade accounts payable 2,404,264 2,426,525
Accrued expenses (31,448) 3,133
Accrued taxes payable (233,065) (81,466)
Other payables 1,014 7,819
Advances from customers (17,231) 36,727
Net Cash Provided by Operating Activities 3,281,479 3,061,853
Cash Flows from Investing Activities:
Advances for purchases of property
and equipment and intangible assets (2,018,906) (3,813,857)
Purchase of property and equipment (108,842) (232,624)
Purchase of intangible assets (2,852,168) (2,308,941)
Net Cash Used in Investing Activities (4,979,916) (6,355,422)
Cash Flows from Financing Activity:
Proceeds from exercise of warrants 2,583,000 --
Net Cash Provided by Financing Activity 2,583,000 --
Effect of Exchange Rate Changes on Cash 8,799 9,221
Net Increase (Decrease) in Cash 893,362 (3,284,348)
Cash and Cash Equivalents at
Beginning of Period 3,634,753 6,927,149
Cash and Cash Equivalents at End of
Period $4,528,115 $3,642,801
Supplemental Cash Flow Information:
Cash paid for interest $102,121 $85,429
Cash paid for income taxes 2,906,168 1,115,831
CPI Aerostructures (CVU) Announces Record 2010 Second Quarter Results
EDGEWOOD, N.Y.–(BUSINESS WIRE)–CPI Aerostructures, Inc. (“CPI Aero®”) (NYSE Amex: CVU) today announced record results for the 2010 second quarter and six month period ended June 30, 2010.
Second Quarter 2010 vs. 2009
- Revenue increased 10% to $12,544,625 from $11,437,691;
- Gross margin was 26.7% compared to 24.8%;
- Pre-tax income increased 31% to $1,826,254, compared to $1,389,489; and,
- Net income increased 33% to $1,205,254 or $0.18 per diluted share, compared to $903,489, or $0.14 per diluted share. Diluted earnings per share were calculated on 8.7% more shares in 2010 second quarter vs. 2009 second quarter.
First Half 2010 vs. 2009
- Revenue increased 11% to $23,550,154 from $21,128,926;
- Gross margin was 25.9% compared to 23.2%;
- Pre-tax income increased 41% to $3,130,068 compared to $2,216,410;
- Net income increased 42% to $2,066,068 or $0.32 per diluted share, compared to $1,449,410 or $0.23 per diluted share; and,
- Unawarded solicitations remain at a high level with open solicitations totaling a maximum realizable value of approximately $288 million.
Edward J. Fred, CPI Aero’s President & CEO, stated, “Our three largest commercial customers, The Boeing Company, Northrop Grumman and Sikorsky accounted for 29%, 20% and 13% of revenue, respectively; only 24% of our revenue for the six month period ended June 30, 2010, was from government prime contract awards.”
He continued, “The gross margin gains drove the bottom line improvement for the quarter and year-to-date. Comparable quarter gross margin improved, just as it did in the current first quarter as we are no longer incurring excess costs due to customer-driven engineering and design changes on several new programs as was the case last year. We expect gross margin for 2010 to be in the range of 24% to 26%.”
Mr. Fred noted, “Based on results for the first half of the year and expectations for a strong second half, we are confident that we will reach our 2010 guidance which calls for revenue to be in the range of $48 million to $51 million, with resulting net income in the range of $4.3 million to $4.8 million.”
Mr. Fred continued, “As of June 30, 2010, total contract awards were approximately $31.1 million which included approximately $5.6 million of government prime contract awards, approximately $24.4 million of government subcontract awards and approximately $1.1 million of commercial subcontract awards, compared to a total of $4.9 million of new contract awards, of all types, in the first half of last year.”
Orders received in the second quarter include:
- Our largest order was for Outer Wing Panel kits for use in the manufacture of wings for the E-2D Advanced Hawkeye and the C-2A Greyhound aircraft from Northrop Grumman Corporation valued at up to $27.6 million. The purchase order includes firm, funded requirements valued at approximately $16.4 million and options valued at an additional $11.2 million.
- Boeing expanded the scope of work that we are performing under the existing long-term requirements contract to support its A-10 Wing Replacement Program with additional structural assemblies and subsystem installations and also spare main landing gear door assemblies. These orders have increased the value of our contract with Boeing to approximately $81 million, of which we have received $15.6 million of orders to date.
- We received three purchase orders from Sikorsky Aircraft Corporation with a combined value of approximately $2.6 million: for the S-70B® SEAHAWK® helicopter to provide Penguin Missile Launcher assemblies; for the MH-53 and CH-53 variant helicopters to provide rotary wing head ring assemblies; and, for the MH-53E “Sea Dragon” helicopter to provide tow assemblies.
- The U.S. Air Force released a new order under our C-5 TOP contract for a variety of panels and spoilers valued at approximately $1.5 million. Orders under this program have totaled $32.1 million since the inception of the contract.
Mr. Fred added, “We look forward to additional new orders from existing contracts as well as from the unawarded solicitations of approximately $288 million on which we have bid.”
Reaffirms Long-Term Guidance
Mr. Fred added, “We are again reaffirming our long-term guidance which is based on our expectation that our three major long-term production programs (A-10, E-2D and G650) will be in full scale production and producing consistent significant revenue during 2011. For 2011 we expect that revenue will be in the range of $78 million to $81 million, with resulting net income in the range of $8.9 million to $9.5 million. Using 2008 as the baseline, we expect a three-year compound annual growth rate for revenue in the range of 30% to 35%, with a resulting compound annual growth rate for net income in the range of 50% to 60%.”
Raises $3.5 Million through Registered Direct Offering
Mr. Fred concluded, “As previously announced, in the second quarter of 2010 we completed a registered direct offering raising $3.5 million in net proceeds through the sale of 500,000 shares of our common stock. As a result, we strengthened our financial position in preparation for continued growth and enhanced the potential liquidity of our stock.”
Conference Call
CPI Aero’s President and CEO, Edward J. Fred, and CFO, Vincent Palazzolo, will host a conference call today, Tuesday, August 10, 2010 at 10:00 am ET to discuss second quarter results as well as recent corporate developments. After opening remarks, there will be a question and answer period. Interested parties may participate in the call by dialing 706-679-3079. Please call in 10 minutes before the scheduled time and ask for the CPI Aero call. The conference call will also be broadcast live over the Internet. To listen to the live call, please go to www.cpiaero.com and click on the “Investor Relations” section, then click on “Event Calendar”. Please access the website 15 minutes prior to the call to download and install any necessary audio software. The conference call will be archived and can be accessed for approximately 90 days. We suggest listeners use Microsoft Explorer as their browser.
About CPI Aero
CPI Aero is engaged in the contract production of structural aircraft parts for leading prime defense contractors, the U.S. Air Force and other branches of the armed forces. In conjunction with its assembly operations, CPI Aero provides engineering, technical and program management services. Among the key programs that CPI Aero supplies are the E-2D Hawkeye surveillance aircraft, the UH-60 BLACK HAWK helicopter, the S-92® helicopter, the MH-60S mine countermeasure helicopter, the Gulfstream G650, C-5A Galaxy cargo jet, the T-38 Talon jet trainer, the A-10 Thunderbolt attack jet, and the E-3 Sentry AWACS jet. CPI Aero is included in the Russell Microcap® Index.
The above statements include forward looking statements that involve risks and uncertainties, which are described from time to time in CPI Aero’s SEC reports, including CPI Aero’s Form 10-K for the year ended December 31, 2009 and Form 10-Q for the quarter ended March 31, 2010.
CPI Aero® is a registered trademark of CPI Aerostructures, Inc.
|
CPI AEROSTRUCTURES, INC.
CONDENSED STATEMENTS OF INCOME |
||||||||||||||||
|
For the Three Months
Ended June 30, |
For the Six Months
Ended June 30, |
|||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
| Revenue | $ |
12,544,625
|
$ |
11,437,691
|
$ |
23,550,154
|
$ |
21,128,926
|
||||||||
| Cost of Sales | 9,193,296 | 8,605,436 | 17,449,743 | 16,233,775 | ||||||||||||
| Gross profit | 3,351,329 |
2,832,255
|
6,100,411 | 4,895,151 | ||||||||||||
| Selling, general and administrative expenses | 1,484,741 | 1,386,064 | 2,870,368 | 2,575,294 | ||||||||||||
| Income from operations | 1,866,588 | 1,446,191 | 3,230,043 | 2,319,857 | ||||||||||||
| Interest expense | 40,334 | 56,702 | 99,975 | 103,447 | ||||||||||||
| Income before provision for income taxes | 1,826,254 | 1,389,489 | 3,130,068 | 2,216,410 | ||||||||||||
| Provision for income taxes | 621,000 | 486,000 | 1,064,000 | 767,000 | ||||||||||||
| Net income | $ | 1,205,254 | $ | 903,489 | $ | 2,066,068 | $ | 1,449,410 | ||||||||
| Earnings per common share – basic | $ | 0.18 | $ | 0.15 | $ | 0.33 | $ | 0.24 | ||||||||
| Earnings per common share – diluted | $ | 0.18 | $ | 0.14 | $ | 0.32 | $ | 0.23 | ||||||||
| Shares used in computing earnings per common share: | ||||||||||||||||
| Basic | 6,558,316 | 5,995,465 | 6,299,284 | 5,990,192 | ||||||||||||
| Diluted | 6,790,911 | 6,250,021 | 6,465,290 | 6,183,881 | ||||||||||||
|
CPI AEROSTRUCTURES, INC.
CONDENSED BALANCE SHEETS |
||||||||
| June 30, | December 31, | |||||||
| 2010 | 2009 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 774,326 | $ | 2,224,825 | ||||
| Accounts receivable, net | 2,735,045 | 5,403,932 | ||||||
| Costs and estimated earnings in excess of billings on uncompleted | ||||||||
| Contracts | 49,042,816 | 43,018,221 | ||||||
| Prepaid expenses and other current assets | 352,647 | 451,068 | ||||||
| Total current assets | 52,904,834 | 51,098,046 | ||||||
| Plant and equipment, net | 873,058 | 853,820 | ||||||
| Deferred income taxes | 697,000 | 526,000 | ||||||
| Other assets | 29,313 | 59,265 | ||||||
| Total Assets | $ | 54,504,205 | $ | 52,537,131 | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 5,402,271 | $ | 5,859,182 | ||||
| Accrued expenses | 203,901 | 610,448 | ||||||
| Current portion of long-term debt | 685,810 | 636,592 | ||||||
| Line of credit | 0 | 2,200,000 | ||||||
| Income tax payable | 1,327,006 | 2,368,374 | ||||||
| Deferred income taxes | 305,000 | 305,000 | ||||||
| Total current liabilities | 7,923,988 | 11,979,596 | ||||||
| Long-term debt, net of current portion | 1,519,266 | 1,801,357 | ||||||
| Other liabilities | 239,571 | 238,664 | ||||||
| Total Liabilities | 9,682,825 | 14,019,617 | ||||||
| Shareholders’ Equity: | ||||||||
| Common stock – $.001 par value; authorized 50,000,000 shares, issued 6,772,590 and 6,122,524 shares, respectively, and outstanding 6,650,756 and 6,033,690 shares, respectively |
6,773 | 6,123 | ||||||
| Additional paid-in capital | 31,897,934 | 27,369,043 | ||||||
| Retained earnings | 13,954,096 | 11,888,028 | ||||||
| Accumulated other comprehensive loss | (56,197 | ) | (52,874 | ) | ||||
| Treasury stock, 121,834 and 88,834 shares, respectively (at cost) | (981,226 | ) | (692,806 | ) | ||||
| Total Shareholders’ Equity | 44,821,380 | 38,517,514 | ||||||
| Total Liabilities and Shareholders’ Equity | $ | 54,505,205 | $ | 52,537,131 | ||||
EPIX and Netflix (NFLX) Announce Exclusive Internet-Only Deal to Instantly Stream EPIX Movies to Netflix Members
NEW YORK & BEVERLY HILLS, Calif.–(BUSINESS WIRE)–EPIX™ and Netflix, Inc. [Nasdaq: NFLX] today announced an agreement through which Netflix members can instantly watch an array of new releases and library titles from EPIX streamed over the Internet from Netflix. Movies from the multi-year deal will begin streaming from Netflix on September 1 and include movies from Paramount, Lionsgate and MGM.
EPIX has subscription pay TV rights to new releases and movies from the libraries of its partners and will make these movies available to Netflix 90 days after their premium pay TV and subscription on demand debuts. Historically, the rights to distribute these films are pre-sold to pay TV for as long as nine years after their theatrical release.
For Netflix, the agreement is a significant step in building the company’s streaming offer, adding many popular movie titles from some of the world’s leading studios. It adds meaningfully to a growing library of movies and TV shows that can be watched instantly on TVs via a range of leading consumer electronic devices capable of streaming from Netflix and on computers.
For EPIX, the deal reflects the value of the EPIX platform which, from its start, has provided new rights and flexibility for the distribution of its movies. The agreement allows EPIX to continue the distribution of popular content on a variety of platforms and preserve the premium television, subscription on demand and online window reserved for cable, satellite and telco television partners.
“Adding EPIX to our growing library of streaming content, as the exclusive Internet-only distributor of this great content, marks the continued emergence of Netflix as a leader in entertainment delivered over the Web,” said Ted Sarandos, chief content officer for Netflix. “The EPIX deal is an example of the innovative ways in which we’re partnering with major content providers to broaden the scope and freshness of choices available to our members to watch instantly over the Internet.”
Mark Greenberg, president of EPIX, added: “Netflix is an incredibly popular service and we welcome them as our newest distribution partner. We are pleased to be able to continue our mission of bringing consumers the movies where they want to watch them, while satisfying the differing needs of cable, telco and satellite operators. This deal also underscores the tremendous value of our offerings in the marketplace.”
About Netflix
With more than 15 million members, Netflix, Inc. (Nasdaq: NFLX – News) is the world’s largest subscription service streaming movies and TV episodes over the Internet and sending DVDs by mail. For $8.99 a month, Netflix members can instantly watch unlimited TV episodes and movies streamed to their TVs and computers and can receive unlimited DVDs delivered quickly to their homes. With Netflix, there are never any due dates or late fees. Members can select from a growing library of titles that can be watched instantly and a vast array of titles on DVD. Among the large and expanding base of devices that can stream movies and TV episodes from Netflix are Microsoft’s Xbox 360, Sony’s PS3 and Nintendo’s Wii consoles; Blu-ray disc players from Samsung, LG and Insignia; Internet TVs from LG, Sony and VIZIO; the Roku digital video player and TiVo digital video recorders, and Apple’s iPad tablet. For more information, visit http://www.netflix.com.
About EPIX
EPIX, a joint venture between Viacom Inc. [NYSE: VIA and VIA.B], its Paramount Pictures unit, Metro-Goldwyn-Mayer Studios Inc. (MGM) and Lionsgate [NYSE: LGF], is a next-generation premium entertainment channel, on-demand and online service. EPIX provides a powerful entertainment experience with more feature films on demand and online and more HD movies than any other service. It is the only premium service providing its entire monthly line-up of new Hollywood titles, classic feature films, original series, music and comedy specials through the linear channel, on-demand and online. EPIX has made the commitment to deliver the industry’s most expansive online collection of movies, making more than 3,000 titles available to subscribers this year. The service is available to over 30 million homes nationwide through carriage agreements with Verizon FiOS, DISH Network, Cox Communications, Mediacom Communications, Charter Communications and NCTC. For more information about EPIX, go to www.EpixHD.com
Fossil, Inc. (FOSL) Reports Second Quarter Results
RICHARDSON, Texas, Aug. 10, 2010 (GLOBE NEWSWIRE) — Fossil, Inc. (Nasdaq:FOSL – News) (the “Company”) today reported second quarternet sales and earnings for the thirteen-week (“Second Quarter”) and twenty-six week (“Six Month Period”) periods ended July 3, 2010.
Second Quarter Results (2010 vs 2009):
- Net sales increased by 30.6% to $412.6 million compared to $315.9 million;
- Gross profit rose 41.7% to $236.9 million, or 57.4% of net sales, compared to $167.2 million, or 52.9% of net sales;
- Operating income increased by 186.3% to $64.3 million, or 15.6% of net sales, compared to $22.5 million, or 7.1% of net sales;
- Income taxes decreased by 22.1% to $7.5 million, resulting in an effective tax rate of 12.1%, compared to $9.6 million, resulting in an effective tax rate of 36.6%;
- Net income increased by 227.8% to $54.5 million compared to $16.6 million; and
- Diluted earnings per share increased by 220.0% to $0.80 on 68.3 million shares compared to $0.25 per diluted share on 67.1 million shares.
Six Month Period Results (2010 vs 2009):
- Net sales increased by 26.1% to $805.8 million compared to $638.9 million;
- Gross profit increased by 35.6% to $456.3 million, or 56.6% of net sales, compared to $336.6 million, or 52.7% of net sales;
- Operating income increased by 149.8% to $115.6 million, or 14.3% of net sales, compared to $46.3 million, or 7.2% of net sales;
- Net income increased by 166.3% to $90.4 million compared to $33.9 million; and
- Diluted earnings per share increased by 160.8% to $1.33 on 68.1 million shares compared to $0.51 per diluted share on 66.9 million shares.
Mike Kovar, Executive Vice President and Chief Financial Officer, stated: “Our focus continues to be on growing the penetration of the Fossil brand worldwide while capitalizing on our powerful multi-brand watch portfolio. Successful execution of these key strategies continued to result in record sales and earnings. An improving global economy, a resurgence in the fashion watch category and our laser focus to be a leader in the introduction of new materials and design innovation combined to deliver a 42% increase in our wholesale watch business during the second quarter. We are seeing balanced growth on a global basis and strong momentum among our major watch brands. In our FOSSIL retail and e-commerce channels, double-digit comparable stores sales, in addition to the strong performance in our Fossil brand watch sales, propelled a 28% increase in Fossil branded sales globally. All of this places us in excellent shape as we begin the second half of the year.”
Operating Results
On a constant dollar basis, worldwide net sales during the Second Quarter rose 31.9%, representing sales growth ranging from 28% to 37% across all of the Company’s operating segments. Strong increases in watch sales globally, and to a lesser extent, the growth of the jewelry category in North America and Europe and the expansion of leather categories internationally, primarily fueled the Second Quarter sales increases. The translation impact of a stronger U.S. dollar during the Second Quarter reduced the Company’s reported net sales by approximately $4.1 million in comparison to the prior year quarter. For the Six Month Period, consolidated net sales increased 24.6% in constant dollars, as a result of double-digit sales growth in each of the Company’s global wholesale and direct to consumer businesses.
During the Second Quarter, net sales from the North America wholesale segment increased 37.0%, or $41.9 million, on a constant dollar basis in comparison to the prior year quarter, as a result of innovative product offerings and a continuing resurgence in the overall fashion watch category. The Company continues to gain market share in the wholesale channel as double-digit sell-through rates of its watch offerings, in general, exceed the retailer’s watch department performance as a whole. In addition, a steady flow of inventory replenishment as opposed to retailers generally de-stocking a year ago resulted in North American watch shipments increasing by $41.1 million, or 59.2%. While all major watch brands contributed to the sales growth, MICHAEL KORS(R), FOSSIL(R) and MICHELE(R) watches experienced the strongest performance. During the Second Quarter, North America wholesale accessory sales volumes increased 1.9%, or $0.8 million, on a constant dollar basis in comparison to the prior year quarter. This sales volume growth was primarily due to increased shipments of FOSSIL women’s leather products and the expansion of the Company’s footwear and accessory jewelry categories, all partially offset by a sales volume decline in men’s leather products.
Internationally, European wholesale net sales rose 30.0%, or $26.5 million, in constant dollars for the Second Quarter in comparison to the prior year quarter. A slightly better economy and the resurgence of the fashion watch category in Europe reversed a slight sales decline in the first quarter into strong double-digit growth in the Second Quarter. Wholesale watch shipments increased $18.6 million, or 28.9%, in constant dollars, with all major watch brands contributing to this increase. Leather and jewelry categories also contributed solid double-digit increases. The largest net sales contributions in the European wholesale segment were attributable to FOSSIL watches and jewelry and licensed brand watches led by EMPORIO ARMANI(R). During the Second Quarter, Asia Pacific wholesale shipments increased 28.8%, or $9.8 million, in constant dollars in comparison to the prior year quarter. This increase was principally the result of solid increases in the Company’s watch and leather categories across the broader Asia Pacific region. Additionally, the Company continues to transition its Korean operations from a third-party distributor to a Company-owned subsidiary, which further benefits sales due to the increased mix of sales being generated through Company-owned concessions at full retail value.
Direct to consumer net sales for the Second Quarter increased by 28.0%, or $22.5 million, on a constant dollar basis in comparison to the prior year quarter, primarily the result of constant dollar comparable store sales gains of 15.5% and an 8.4% increase in the average number of company-owned stores open during the Second Quarter. Additionally, net sales from the Company’s e-commerce businesses increased 44.2%, or $2.2 million, on a constant dollar basis for the Second Quarter in comparison to the prior year quarter.
Gross profit of $236.9 million in the Second Quarter represents an increase of 41.7% in comparison to $167.2 million in the prior year quarter. This increase is a result of an increase in net sales and gross profit margin expansion. Gross profit margin increased 450 basis points to 57.4% in the Second Quarter compared to 52.9% in the prior year quarter. The increase in gross profit margin was primarily driven by an increase in the mix of sales of higher margin watch products in comparison to leather products, including a greater mix of higher margin licensed watch brands, and reduced levels of low margin sales through off-price liquidation channels. These increases in gross profit margin were partially offset by a stronger U.S. dollar, which unfavorably impacted gross profit margin by approximately 30 basis points during the Second Quarter. For the Six Month Period, gross profit margin increased by 390 basis points to 56.6% compared to 52.7% in the prior year period. This increase is a result of similar beneficial changes in sales mix as experienced during the Second Quarter and a 45 basis point improvement as a result of a weaker U.S. dollar during the six month period in comparison to the same period in fiscal 2009.
Operating expenses, expressed as a percentage of net sales, decreased to 41.8% in the Second Quarter compared to 45.8% in the prior year quarter. Total operating expenses in the Second Quarter increased by $27.8 million primarily as a result of increased sales and included a $2.0 million favorable impact from the translation of foreign-based expenses as a result of the stronger U.S. dollar as compared to the prior year quarter. During the Second Quarter, on a constant dollar basis, operating expenses in the Company’s wholesale segments and corporate cost areas increased $15.5 million and $5.5 million, respectively, as compared to the prior year quarter. Expense growth in the wholesale segment was a result of increased payroll costs and marketing expenses, while expense growth in the corporate cost areas was primarily associated with increases in payroll costs. During the Second Quarter, operating expenses in the direct to consumer segment rose by $8.8 million as compared to the prior year quarter, primarily due to store growth, expansion of the Company’s catalog mailings and increased web-based marketing expenditures. For the Six Month Period, operating expenses as a percentage of net sales decreased to 42.3% compared to 45.4% in the prior year period and included an unfavorable impact of approximately $3.0 million related to the translation of foreign-based expenses due to a weaker U.S. dollar. On a constant dollar basis, operating expenses for the Six Month Period increased by $47.4 million as compared to the same period of fiscal 2009, with increases across all of the Company’s operating segments, primarily the result of the same factors experienced during the Second Quarter.
Operating income increased to 15.6% of net sales in the Second Quarter compared to 7.1% of net sales in the prior year quarter as a result of increased net sales, gross profit margin expansion and lower operating expenses as a percentage of sales. During the Second Quarter, operating income was negatively impacted by approximately $1.6 million as a result of the translation of foreign-based sales and expenses into U.S. dollars. During the Six Month Period, operating profit margin increased to 14.3% compared to 7.2% in the prior year period. The Company’s operating income for the Six Month Period included approximately $5.9 million of net currency gains related to the translation of foreign-based sales and expenses into U.S. dollars.
Other income (expense) decreased unfavorably by $6.1 million and $8.6 million during the Second Quarter and Six Month Period, respectively, in comparison to the prior year periods. These decreases were primarily driven by unfavorable foreign currency transactions resulting from mark-to-market and hedging activities during the Second Quarter and Six Month Period in comparison to the respective prior year periods as well as increased non-controlling interest expenses.
The Company’s income tax expense for the Second Quarter was $7.5 million, resulting in an effective income tax rate of 12.1%. For the comparable prior year quarter, income tax expense was $9.6 million, resulting in an effective income tax rate of 36.6%. Included in the Company’s 12.1% effective tax rate for the Second Quarter was a 22% rate reduction from the Company’s structural tax rate of 34.1% related to the recognition of previously unrecognized tax benefits as a result of recent audit settlements. Income tax expense was $23.2 million for the Six Month Period, resulting in an effective tax rate of 20.4%. For the comparable fiscal 2009 period, income tax expense was $18.9 million, resulting in an effective tax rate of 35.8%. The Company estimates its effective tax rate for the third and fourth quarters will approximate 35%, excluding any discrete events.
Second Quarter net income increased by 227.8% to $54.5 million, or $0.80 per diluted share, inclusive of an unfavorable $0.06 per diluted share impact related to the stronger U.S. dollar and a favorable $0.22 per diluted share benefit as a result of the lower effective tax rate. Net income of $90.4 million, or $1.33 per diluted share, for the Six Month Period represents a 166.3% increase compared to the $33.9 million, or $0.51 per diluted share, earned during the comparable prior year period. Net income for the Six Month Period includes net foreign currency losses of $0.01 per diluted share and a benefit of $0.26 per diluted share as a result of the aforementioned reduction in certain income tax liabilities.
Selective Balance Sheet Information
At July 3, 2010, cash, cash equivalents and securities available for sale totaled $443.0 million compared to $272.1 million at the end of the prior year quarter and the Company had $7.9 million of debt. During the Second Quarter, the Company invested approximately $11.2 million to repurchase approximately 293,000 shares of its common stock. Subsequent to the end of the Second Quarter, the Company completed the $20 million share buyback plan previously approved by its Board of Directors. Additionally, the Company has announced today that its Board of Directors has approved an additional $30 million share buyback plan which the Company expects to complete by the end of fiscal 2010.
Inventory at Second Quarter end was $297.5 million, representing an increase of 18.9% from the end of the prior year quarter balance of $250.1 million. Accounts receivable increased by 17.1% to $162.9 million at July 3, 2010 compared to $139.2 million at the end of the prior year quarter, primarily due to an increase in wholesale shipments during the Second Quarter versus the comparable prior year quarter. Days sales outstanding for the Company’s wholesale segments for the Second Quarter was 46 days, which decreased from 52 days in the prior year quarter. This decrease was primarily related to a slight reduction in sales mix of internationally-based sales that generally result in longer collection cycles than those experienced in the U.S. and a higher proportion of sales generated through Company-owned concessions, primarily in Asia.
Sales and Earnings Guidance
For the third quarter of 2010, the Company expects reported net sales to increase in a range of 25% to 27% with constant dollar net sales increasing in a range of 27% to 29%, respectively. Third quarter 2010 diluted earnings per share are expected to be in a range of $0.68 to $0.72, and includes $0.02 of unfavorable currency impact related to the translation of an average stronger dollar compared to last year’s third quarter.
For the fourth quarter, the Company expects reported net sales to increase in a range of 14% to 16% with constant dollar sales increasing in a range of 18% to 20%. Fourth quarter diluted earnings per share are expected to be in a range of $1.12 to $1.18. This range includes an unfavorable currency impact of approximately $0.06 per diluted share due to a stronger dollar in comparison to the prior year fourth quarter. This guidance results in fiscal year 2010 diluted earnings per share in a range of $3.13 to $3.23 in comparison to fiscal year 2009 actual diluted earnings per share of $2.07. The Company’s forward guidance is based upon the current prevailing rate of the U.S. dollar compared to other foreign currencies for countries in which the Company operates.
Safe Harbor
Certain statements contained herein that are not historical facts constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. The actual results of the future events described in such forward-looking statements could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are changes in economic trends and financial performance, changes in consumer demands, tastes and fashion trends, lower levels of consumer spending resulting from a general economic downturn, shifts in market demand resulting in inventory risks, changes in foreign currency rates, and the outcome of current and possible future litigation, as well as the risks and uncertainties set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended January 2, 2010 and its Form 10-Q reports filed with the Securities and Exchange Commission (the “SEC”).
About Fossil
Fossil is a global design, marketing and distribution company that specializes in consumer fashion accessories. The Company’s principal offerings include an extensive line of men’s and women’s fashion watches and jewelry sold under proprietary and licensed brands, handbags, small leather goods, belts, sunglasses, cold weather products, footwear, and apparel. In the watch and jewelry product category, the Company’s offerings include a diverse portfolio of globally recognized proprietary and licensed brand names under which its products are marketed. The Company’s extensive range of accessories products, brands, distribution channels and price points allows it to target style-conscious consumers across a wide age spectrum on a global basis. The Company’s products are sold to department stores, specialty retail stores, and specialty watch and jewelry stores in the U.S. and in over 100 countries worldwide through 23 company-owned foreign sales subsidiaries and a network of over 60 independent distributors. The Company also distributes its products in 354 company owned and operated retail stores and through international e-commerce websites and the Company’s U.S. e-commerce website at www.fossil.com, where certain product, press release and SEC filing information concerning the Company is also available.
The Fossil, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3296
Consolidated Income Statement Data (in 000’s): |
For the 13 Weeks Ended |
For the 13 Weeks Ended |
For the 26 Weeks Ended |
For the 26 Weeks Ended |
| July 3, 2010 |
July 4, 2009 |
July 3, 2010 |
July 4, 2009 |
|
| Net sales |
$ 412,560 | $ 315,865 | $ 805,789 | $ 638,893 |
| Cost of sales | 175,675 | 148,683 | 349,485 | 302,331 |
| Gross profit | 236,885 | 167,182 | 456,304 | 336,562 |
| Selling expenses | 129,192 | 107,522 | 254,047 | 215,610 |
| Administrative exp. | 43,347 | 37,184 | 86,648 | 74,673 |
| Operating income | 64,346 | 22,476 | 115,609 | 46,279 |
| Interest exp. | 59 | 69 | 117 | 132 |
| Other (exp.) inc. — net | (2,315) | 3,832 | (1,911) | 6,725 |
| Tax provision | 7,487 | 9,616 | 23,189 | 18,929 |
| Net income | $54,485 | $16,623 | $90,392 | $33,943 |
| Basic earnings per share | $ 0.81 | $ 0.25 | $ 1.34 | $ 0.51 |
| Diluted earnings per share | $ 0.80 | $ 0.25 | $ 1.33 | $ 0.51 |
| Weighted average shares outstanding : |
||||
| Basic | 67,446 | 66,668 | 67,235 | 66,607 |
| Diluted | 68,278 | 67,110 | 68,111 | 66,881 |
| Consolidated Balance Sheet Data (in 000’s): | July 3, 2010 |
July 4, 2009 |
| Working capital | $788,752 | $596,925 |
| Cash, cash equivalents and securities available for sale | 442,989 | 272,070 |
| Accounts receivable | 162,918 | 139,183 |
| Inventories | 297,470 | 250,132 |
| Total assets | 1,313,634 | 1,079,299 |
| Short-term debt | 3,776 | 3,505 |
| Long-term liabilities | 60,888 | 82,893 |
| Stockholders’ equity | 1,036,932 | 842,051 |
| Sales Mix Breakdown (in millions) |
Amounts For the 13 Weeks Ended |
Percentage of Total For the 13 Weeks Ended |
||
| July 3, 2010 | July 4, 2009 | July 3, 2010 | July 4, 2009 | |
| Wholesale: | ||||
| North America | $ 155.9 | $ 113.1 | 37.8% | 35.8% |
| Europe | 107.7 | 88.2 | 26.1% | 27.9% |
| Asia Pacific | 46.4 | 34.0 | 11.2% | 10.8% |
| Total wholesale | 310.0 | 235.3 | 75.1% | 74.5% |
| Direct to consumer | 102.6 | 80.6 | 24.9% | 25.5% |
| Total net sales | $ 412.6 | $ 315.9 | 100.0% | 100.0% |
| Sales Mix Breakdown (in millions) |
Amounts For the 26 Weeks Ended |
Percentage of Total For the 26 Weeks Ended |
||
| July 3, 2010 | July 4, 2009 | July 3, 2010 | July 4, 2009 | |
| Wholesale: | ||||
| North America | $ 309.7 | $ 230.6 | 38.4% | 36.1% |
| Europe | 220.2 | 195.6 | 27.3% | 30.6% |
| Asia Pacific | 85.1 | 65.6 | 10.6% | 10.3% |
| Total wholesale | 615.0 | 491.8 | 76.3% | 77.0% |
| Direct to consumer | 190.8 | 147.1 | 23.7% | 23.0% |
| Total net sales | $ 805.8 | $ 638.9 | 100.0% | 100.0% |
Contact:
Fossil, Inc. Mike Kovar, Chief Financial Officer (972) 699-6811 Integrated Corporate Relations Investor Relations: Allison Malkin (203) 682-8200
ZST Digital Networks, Inc. (ZSTN) Announces Second Quarter 2010 Results
ZHENGZHOU, China, Aug. 10 /PRNewswire-Asia-FirstCall/ — ZST Digital Networks, Inc. (Nasdaq:ZSTN – News) (the “Company” or “ZST”), a major developer, manufacturer, and supplier of cable systems and commercial GPS products in China, today announced its financial results for the second quarter ended June 30, 2010.
Second Quarter 2010 Financial Highlights
-- Total revenue for the second quarter of 2010 was US$33.0 million, an
increase of 39.6% compared to the second quarter of 2009.
-- Gross profit for the second quarter of 2010 was US$8.2 million, an
increase of 130.8% compared to the second quarter of 2009. Gross profit
margin for the second quarter of 2010 was 25.0% compared to 15.1% for
the second quarter of 2009.
-- Operating income for the second quarter of 2010 was US$7.2 million, an
increase of 111.6% compared to the second quarter of 2009.
-- Net income for the second quarter of 2010 was US$5.2 million, an
increase of 103.1% compared to the second quarter of 2009.
-- Net income margin for the second quarter of 2010 was 15.7% compared to
10.8% for the second quarter of 2009.
Recent Business Highlights
Mr. Bo Zhong, Chairman and Chief Executive Officer of ZST, commented, “We are very pleased to report a strong quarter of healthy top- and bottom-line growth, exceeding our guidance. Our robust results were driven by continued demand for our Cable TV equipment as well as better than expected growth from our commercial line of vehicle tracking and fleet management systems utilizing our GPS technologies. Revenue from our vehicle tracking GPS products and related services reached approximately $6 million for the quarter, representing 18% of our total revenues. As we have stated since the launch of this product line in late 2009, we believe there is a large and untapped market opportunity in Henan Province for vehicle tracking and fleet management systems utilizing our GPS technologies, and our results are beginning to reflect that fact. We are pleased with the market acceptance of our vehicle tracking products and services to date, and we will continue our efforts to penetrate this rapidly growing market.
“We also experienced strong sales growth from our Cable TV networking equipment, with revenues increasing 51% year-over-year. During the quarter, we continued to benefit from the ongoing government mandated efforts to integrate telecommunications networks, cable TV networks and Internet services in 2010, which has led to an increase in system wide upgrades by regional TV broadcast stations, the primary customers for our Cable TV networking equipment. Leveraging this product replacement cycle has been a core element of our strategy, and we are pleased to see continued traction on this front.
“Finally, we experienced healthy volume growth for our IPTV set-top boxes; however, the revenue from these products continued to be impacted by the increased percentage of lower priced Standard Definition IPTV set-top boxes in the mix. As of the quarter end, Standard Definition set-top boxes accounted for 58% of our IPTV set-top boxes sold, with the higher priced High Definition set-top boxes accounting for the remaining 42%. While we continue to expect pricing pressure and volume declines for our High Definition set-top boxes, we expect the overall performance from our IPTV segment to exhibit moderate growth, as strong demand and volume growth for our Standard Definition set-top boxes should lead to improved bottom line performance given the high gross margins generated by this product. Looking ahead, we will continue to capitalize on the favorable trends in our end markets by executing our strategy to increase sales across our product and service lines, especially within the vehicle tracking market, while further developing our brand and technology platform.”
John Chen, Chief Financial Officer of ZST, commented, “Our results for the quarter were driven by the continued execution of our strategy, with a focus on increasing sales of our fast-growing vehicle tracking products and services utilizing our GPS technologies and further penetrating the IPTV and Cable TV network equipment markets. We delivered strong margin expansion across our product lines, especially for our vehicle tracking products and services, which carry the highest margin within our product portfolio. In fact, sales of vehicle tracking hardware utilizing our GPS technologies and corresponding service contracts accelerated significantly throughout the first quarter, outpacing our expectations. In addition, we continued to maintain a strict focus on cost controls, which, when coupled with our relatively fixed cost base and our strong sales growth, amplified the impact on our bottom line. We believe that the growth in our vehicle tracking segment is sustainable given the accelerating demand we experienced during the quarter, and we will continue to focus on expanding our share of this high-margin market.
Second Quarter 2010 Unaudited Financial Highlights
Revenue
Revenue for the second quarter 2010 was US$33.0 million, representing an increase of 39.6% from US$23.7 million in the second quarter 2009. The increase in revenue for the quarter resulted from an increase in sales of Cable TV networking equipment and vehicle tracking products utilizing our GPS technologies and related services. The Company did not have any vehicle tracking related revenue in the same period of last year as the GPS related businesses were established in October 2009.
Gross Profit and Gross Profit Margin
Gross profit for the second quarter 2010 was US$8.2 million, representing a 130.8% year-over-year increase. Gross profit margin for the second quarter 2010 was 25.0%, up from 15.1% in the second quarter 2009. The year-over-year increase in gross margin was driven mainly by sales of vehicle tracking products utilizing our GPS technologies and related services and Standard Definition set-top boxes, which carry high gross margin relative to the Company’s other products. The Company introduced its Standard Definition set- top boxes in the first quarter 2010, and GPS related services in October 2009.
Operating Expenses
Total operating expenses for the second quarter of 2010 were US$1.0 million, representing an increase of 504.0% from US$170,000 in the second quarter of 2009. The year-over-year increase in operating expenses was a result of the overall growth in our revenue base.
Selling expense was US$109,000 for the second quarter of 2010, representing an increase of 115.1% from US$51,000 in the second quarter of 2009. Selling expenses consist mainly of shipping costs, after-sale service, and salary of sales staff. Selling expense in the second quarter of 2009 contained only salary expenses.
General and administrative expenses (G&A) for the second quarter of 2010 were US$840,000, up 587.6% from US$120,000 in the second quarter of 2009. The increase in G&A expenses was mainly attributable to the Company’s expanded operations and revenue base and additional expenses incurred as a result of being a publicly reporting company in the United States.
Research and development expenses (R&D) for the second quarter of 2010 were US$100,000, compared to nil for the second quarter of 2009. The investment in R&D was driven primarily by capacity increases to accommodate vehicle tracking product development utilizing our GPS technologies and continued development of IPTV set-top box products.
Income Tax
Income tax expense for the second quarter of 2010 was US$2.0 million, compared to US$840,000 in the second quarter of 2009. This increase was mainly due to the Company’s continued growth in pre-tax income primarily driven by the increase in sales revenue and increased gross margin.
Income from Operations and Net Income
Income from operations was US$7.2 million in the second quarter of 2010, an increase of 112.0% compared to operating income of US$3.4 million in the second quarter of 2009.
Net income for the second quarter of 2010 was US$5.2 million, a year-over- year increase of 103.1% from US$2.6 million in the second quarter of 2009. Net margin was 15.7% for the second quarter of 2010, compared to 10.8% in the second quarter of 2009.
Diluted net income per share was US$0.45 in the second quarter of 2010, compared to US$0.30 for the second quarter of 2009.
Balance Sheet
Cash and cash equivalents totaled to US$15.8 million as of June 30, 2010, attributable to the closing of the recent public offering in October 2009 and cash generated by the Company’s operations.
As of June 30, 2010, total trade receivables were US$28.9 million, an increase of 59.5% from US$18.1 million as of March 31, 2010, primarily due to the increase in revenue.
As of June 30, 2010, inventories decreased by US$0.39 million, or 43.6%, to US$500,000 from US$890,000 as of March 31, 2010, primarily due to increased sales of vehicle tracking products utilizing our GPS technologies and related services.
Third Quarter and Full Year 2010 Outlook
Based on the current estimates, the Company approximates that revenue for the third quarter of 2010 will range between US$34.0 million and US$37.0 million. The Company also estimates that net income for the third quarter of 2010 will range between US$5.5 million and US$6.0 million.
The company has updated it guidance for the full year 2010 from what was previously announced on May 14, 2010 as a result of continuing strong demand for its products and services. The Company now estimates that revenues will range between US$125 million and US$130 million, and net income will range between US$17 million and US$19 million. The Company had previously expected that its revenues would range between US$115 million and US$125 million, and net income would range between US$13 million and US$15 million. This represents the Company’s current and preliminary view, which is subject to change.
Conference Call
The Company’s management team will conduct a conference call on Tuesday, August 10, 2010 at 8:00 am (U.S. Pacific Time) / 11:00 am (U.S. Eastern Time) / 11:00 pm (HK / Beijing Time) to discuss its 2010 second quarter financial results and recent business activity. The conference call may be accessed by calling +1-866-519-4004 or +1-718-354-1231 (for callers in the U.S.), 800-819- 0121 (for callers in China), 800-930-346 (for callers in Hong Kong), +0808- 234-6646 (for callers in United Kingdom) or +65-6723-9381 (for other international callers) and entering pass code 92298808. Please dial in approximately 10 minutes before the scheduled time of the call.
A recording of the conference call will be available through August 24, 2010, by calling +1-866-214-5335 (for callers in the U.S.) or +61-2-8235-5000 (for callers outside the U.S.) and entering pass code 92298808.
About ZST Digital Network, Inc.
ZST Digital Networks, Inc. (Nasdaq:ZSTN – News) is a China-based company, principally engaged in supplying digital and optical network equipment and providing installation services to cable system operators in China. The Company has developed a line of IPTV devices that are used to provide bundled cable television, Internet and telephone services to residential and commercial customers. The Company has assisted in the installation and construction of over 400 local cable networks in more than 90 municipal districts, counties, townships, and enterprises. The Company has also launched a commercial line of vehicle tracking devices utilizing our GPS technologies and support services for transport-related enterprises to track, monitor and optimize their businesses. For more information about ZST Digital Networks, Inc., please visit http://www.shenyangkeji.com .
Statement Regarding Unaudited Financial Information
The unaudited financial information set forth above is preliminary and subject to adjustments. Adjustments to the financial statements may be identified when audit work is performed for the year-end audit, which could result in significant differences from this preliminary unaudited financial information.
“Safe Harbor” Statement
This release contains certain “forward-looking statements” relating to the business of the Company and its subsidiary companies. These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects” or similar expressions. Such forward looking statements involve known and unknown risks and uncertainties, including, but not limited to, our ability to maintain and increase revenues and sales of our products; our ability to develop and market new products; our strategic investments and acquisitions; compliance and changes in the laws of the People’s Republic of China (the “PRC”) that affect our operations; our ability to obtain all necessary government certifications and/or licenses to conduct our business; vulnerability of our business to general economic downturn, especially in the PRC; adverse capital and credit market conditions; our ability to meet liquidity needs; and other risk factors detailed in reports filed with the Securities and Exchange Commission from time to time. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the factors discussed above and in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website (http://www.sec.gov ). All forward-looking statements attributable the Company or to persons acting on its behalf are expressly qualified in their entirety by these factors other than as required under the securities laws. The Company does not assume a duty to update these forward-looking statements.
ZST DIGITAL NETWORKS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(In U.S. Dollars)
December 31, June 30,
2009 2010
(Restated) (Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $13,627,992 $15,781,269
Accounts receivable 24,885,497 28,944,450
Inventories 1,245,803 502,051
Advance to suppliers 7,399,141 8,847,600
Prepaid expenses 1,064,499 1,039,356
Total current assets 48,222,932 55,114,726
Property, machinery, equipment and
software, net 875,806 2,347,573
Intangible asset 171,122 153,358
Prepaid expenses - long term 858,609 312,696
Total assets $50,128,469 $57,928,353
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $700,940 $2,650
Advance from customers 376,586 1,070,466
Accruals and other payables 295,410 138,953
Accrued payroll and related expense 66,370 98,845
VAT payable 198,828 535,947
Franchise tax payable 162,100 --
Income tax payable 547,917 827,985
Total current liabilities 2,348,151 2,674,846
Equity
Common stock $0.0001 par value,
100,000,000 shares authorized,
11,650,442 and 11,650,442 shares
issued and outstanding 1,165 1,165
Additional paid-in capital 30,677,932 30,677,932
Appropriated earnings 3,328,345 3,328,345
Retained earnings 13,752,791 20,926,558
Translation adjustment 20,085 319,507
Total equity 47,780,318 55,253,507
Total liabilities and equity $50,128,469 $57,928,353
ZST DIGITAL NETWORKS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(In U.S. Dollars)
Six Months Ended June 30, Three Months Ended June 30,
2009 2010 2009 2010
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues:
Sales of products $41,439,540 $47,993,924 $23,678,912 $31,566,021
Sales of services -- 2,100,497 -- 1,480,122
Total revenue 41,439,540 50,094,421 23,678,912 33,046,143
Cost of sales:
Cost of products sold 34,950,607 37,581,909 20,106,328 24,757,120
Cost of service -- 91,640 -- 42,143
Cost of sales 34,950,607 37,673,549 20,106,328 24,799,263
Gross profit 6,488,933 12,420,872 3,572,584 8,246,880
Selling expense 69,243 376,279 50,671 108,974
Research and
development expenses -- 330,891 -- 95,367
General and
administrative
expenses 477,238 1,565,765 121,459 835,155
Merger cost 566,654 -- -- --
Income from operations 5,375,798 10,147,937 3,400,454 7,207,384
Interest income
(expense), net (72,514) 32,222 8,867 30,607
Other income (expense) (7,680) 2,401 (10,684) 2,401
Income before income
taxes 5,295,604 10,182,560 3,398,637 7,240,392
Income tax provision 1,487,315 3,008,793 836,706 2,036,280
Net income $3,808,289 $7,173,767 $2,561,931 $5,204,112
Weighted average
common shares
outstanding - basic 7,954,507 11,650,442 8,264,003 11,650,442
Earnings per share -
basic 0.48 0.62 0.31 0.45
Weighted average
common shares
outstanding - diluted 8,116,641 11,650,442 8,434,621 11,650,442
Earnings per shares -
diluted 0.47 0.62 0.30 0.45
Comprehensive income:
Net income 3,808,289 7,173,767 2,561,931 5,204,112
Translation adjustment (638,658) 299,422 (215,994) 249,390
Comprehensive income $3,169,631 $7,473,189 $2,345,937 $5,453,502
ZST DIGITAL NETWORKS, INC. AND SUBSIDIARIES
Statements of Cash Flows
(In U.S. Dollars)
Six Months Ended June 30,
2009 2010
(Unaudited) (Unaudited)
Cash flows from operating activities:
Net income $3,808,289 $7,173,767
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities: -- --
Depreciation and amortization 9,687 232,806
Share-based compensation -- 85,721
Imputed interest 31,413 --
Changes in operating assets and
liabilities: -- --
Accounts receivable (12,442,523) (4,033,881)
Inventory 185,069 738,848
Advance to suppliers 1,380,359 (1,439,433)
Prepayments and other assets (64,246) 475,485
Accounts payable 5,595,654 (702,869)
Accruals and other payable 55,380 52,644
Advance from customers -- 698,373
Taxes payable 480,931 281,860
Net cash provided by(used in)
operating activities (959,987) 3,563,321
Cash flows from investing activities:
Additions to fixed assets (782,334) (1,664,612)
Additions to intangible assets (191,330) --
Net cash used in investing activities (973,664) (1,664,612)
Cash flows from financing activities:
Repayments for short term bank loans (1,725,038) --
Net proceeds from sale of preferred
stock 3,533,955 --
Net cash received from financing
activities 1,808,917 --
Effect of changes in foreign exchange
rates 218,161 254,568
Net increase in cash and cash
equivalents 93,427 2,153,277
Cash and cash equivalents, beginning
of the year 1,134,954 13,627,992
Cash and cash equivalents, end of the
period $1,228,381 $15,781,269
Supplemental disclosures of cash flow
information:
Cash paid for interest $84,894 $--
Cash paid for income taxes 1,094,566 2,734,435
For further information, please contact:
Company Contact:
ZST Digital Networks, Inc.
John Chen, Chief Financial Officer
Email: jchen@shenyangkeji.com
Investor Relations (HK):
Taylor Rafferty, LLC
Ruby Yim
Tel: +852-3196-3712
Email: zstdigital@taylor-rafferty.com
Web: http://www.taylor-rafferty.com
Investor Relations (US):
Taylor Rafferty, LLC
Mahmoud Siddig
Tel: +1-212-889-4350
Email: zstdigital@taylor-rafferty.com
Web: http://www.taylor-rafferty.com
Investor Relations (US):
BPC Financial Marketing
John Baldissera
Tel: +1-800-368-1217
Energy Services of America Corporation (ESA) Announces Financial Results
HUNTINGTON, W.Va., Aug. 9 /PRNewswire-FirstCall/ — Energy Services of America (Amex:ESA.a – News) announced today that the company had a net income for the three months ended June 30, 2010 of $4,098,413 which was an increase of $3,509,950 over the $588,463 in net income for the comparable period in 2009. EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter ended June 30, 2010 totaled $8,991,150 compared to an EBITDA of $2,622,304 for the same quarter of 2009. For the nine months ended June 30, 2010, the Company had a net income of $2,143,168 compared to a loss of ($4,474,088) for the same period in 2009 or an improvement of $6,617,256. Revenues were $126,475,855 for the nine months ended June 30, 2010 versus $77,419,585 for the same period in 2009. EBITDA for the nine months ended June 30, 2010 totaled $9,784,696 compared to an EBITDA for the same period in 2009 of ($2,241,404).
Marshall T. Reynolds, Chairman, noted he was very pleased with the performance for the quarter. “We have overcome the uncertainties that led to 2009 being such a difficult year for the Company as well as the severe winter just past which delayed projects and reduced our income during that quarter, and are now seeing the results we had anticipated and are optimistic about both the remainder of 2010 and 2011. Our backlog totaled $87.7 million at June 30, 2010 and the continued improvement in the demand for our services, places the Company on track to have a very good 2010.”
Edsel R. Burns, President of ESA, shared Mr. Reynolds thoughts. “We are very pleased that the benefits of all the hard work to position the Company for the increased demand for its services is starting to be realized. At June 30, 2009 our backlog was $50 million compared to the backlog of $87.7 million at June 30, 2010. Accordingly, even with the strong revenues for the quarter ended June 30, 2010, our Backlog is still 75% greater than last year. Further with the known projects that are coming up for 2011 and beyond, we are very optimistic about the Company’s prospects. 2010 shows every indication of having a performance in line with and perhaps exceeding, the original ESA business plan.” Key information at June 30, 2010 was as follows:
| Energy Services of America Corporation | ||||||||
| Key Financial Information | ||||||||
|
Three Months |
Three Months |
Nine Months |
Nine Months |
|||||
|
Ended |
Ended |
Ended |
Ended |
|||||
|
June 30, |
June 30, |
June 30, |
June 30, |
|||||
|
2010 |
2009 |
2010 |
2009 |
|||||
| Actual | ||||||||
| Revenues |
$ 76,228,776 |
$ 24,795,918 |
$126,475,855 |
$77,419,585 |
||||
| Net Income (loss) |
4,098,413 |
588,463 |
2,143,168 |
(4,474,088) |
||||
| Earnings (loss) Per Share-Basic |
0.34 |
0.05 |
0.18 |
(0.37) |
||||
| Earnings (loss) Per Share-Diluted |
0.34 |
0.05 |
0.18 |
(0.37) |
||||
| Other information | ||||||||
| Shares Outstanding |
12,092,307 |
|||||||
| Total Assets |
$136,551,633 |
|||||||
| Total Liabilities |
$80,073,022 |
|||||||
| Total Equity |
$56,478,611 |
|||||||
| Stated Book Value per Share |
$4.67 |
|||||||
| Backlog at June 30 , 2010 |
$87,700,000 |
|||||||
Certain statements contained in the release, including without limitation statements including the words “believes,” “anticipates,” “intends,” “expects” or words of similar import, constitute “forward-looking statements” within the meaning of section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements of the Company expressed or implied by such forward-looking statements. Such factors include, among others, general economic and business conditions, changes in business strategy or development plans and other factors referenced in this release. Given these uncertainties, prospective investors are cautioned not to place undue reliance on such forward-looking statements. The Company disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.
GeoEye (GEOY) Reports Record Revenues for Second Quarter 2010
DULLES, Va., Aug. 9 /PRNewswire-FirstCall/ — GeoEye, Inc. (Nasdaq:GEOY – News), a premier provider of satellite, aerial and geospatial information, announced today record revenue results for its second quarter ended June 30, 2010.
(Logo: http://photos.prnewswire.com/prnh/20080625/LAW528LOGO)
(Logo: http://www.newscom.com/cgi-bin/prnh/20080625/LAW528LOGO)
“For the second quarter, we delivered record setting revenues and 11 percent year-over-year revenue growth. Operating margins and adjusted EBITDA margins have continued to be strong as well. Our pipeline of work with the U.S. Government and commercial customers remains robust, we are encouraged by our growth, and we continue to have excellent revenue visibility,” said Matt O’Connell, chief executive officer and president. “The recent award we received from the National Geospatial-Intelligence Agency (NGA) under the EnhancedView program increases that visibility – we now have a sustaining relationship with the NGA for the next 10 years. We are focused on expanding our satellite constellation over the next few years by putting GeoEye-2 into service in 2013. We look forward to providing the NGA continued access to Earth imagery with unprecedented resolution and accuracy that delivers geospatial insight – anytime, anywhere. The additional capacity GeoEye-2 can provide will also benefit our commercial customers in the U.S. and overseas. We are also excited by the customer response to our innovative new Web services platform, EyeQ™, which allows our customers to turn imagery into business solutions.”
SECOND QUARTER RESULTS
Total revenues were $81.0 million for the second quarter of 2010, an 11.4 percent increase from $72.7 million for the second quarter of 2009. Net income for the second quarter of 2010 was $12.1 million, or $0.55 per fully diluted share, compared to net income of $9.6 million, or $0.46 per fully diluted share, for the second quarter of 2009.
Net income for the second quarter of 2010 includes a non-cash credit of $2.1 million related to fair value accounting for the Company’s financing commitment with Cerberus Capital Management L.P. (“Cerberus”). This credit reduced the charge taken in the first quarter. There is no income tax charge or benefit related to this credit. Excluding this credit, net income for the second quarter of 2010 was $10.1 million, or $0.46 per fully diluted share.
Revenues related to contracts with the U.S. Government, the Company’s largest customer, were $55.5 million for the second quarter of 2010, representing 68.5 percent of total revenues for the period. Domestic revenues were $62.1 million for the second quarter of 2010, which were 76.7 percent of total revenues for the period. These revenues included $37.5 million from our Service Level Agreement (SLA) with the National Geospatial-Intelligence Agency (NGA). International revenues were $18.9 million for the second quarter of 2010, which were 23.3 percent of total revenues for the period.
Operating income for the second quarter of 2010 was $24.3 million or 30.0 percent of revenues. Adjusted EBITDA, a non-GAAP measure that represents net income before net interest income or expense, income tax expense (benefit), depreciation and amortization expenses, non-cash stock-based compensation expense and other items, increased approximately $2 million to $42.3 million for the second quarter of 2010, from $40.4 million for the same period in 2009. Adjusted EBITDA margin was 52.3 percent for the second quarter of 2010.
The Company ended the second quarter of 2010 with cash and cash equivalents of $184.8 million, restricted cash of $63.4 million, current income tax receivable of $27.2 million, total assets of $972.3 million, long-term debt of $381.8 million and stockholders’ equity of $314.7 million.
OPERATING HIGHLIGHTS
- On August 6, 2010 the Company was awarded a contract from the NGA under the EnhancedView program for increased satellite imaging capacity. This contract supports NGA by providing products and services that will help meet the increasing geospatial intelligence needs of the intelligence community and Department of Defense.
- The contract replaces the Service Level Agreement currently in place with the NGA’s NextView program. The period of performance for the contract is 10 years and runs from Sept. 1, 2010 to Aug. 31, 2011, with nine, one-year options. The EnhancedView Service Level Agreement commences September 1, 2010.
- The EnhancedView contract supports the accelerated development of GeoEye’s next-generation satellite, GeoEye-2. The Company expects GeoEye-2 to be operational and delivering imagery in early 2013. Under the award, the NGA will contribute up to $336.9 million of the overall construction costs of GeoEye-2.
- On July 15, 2010, the Company announced that the NGA exercised the second of its monthly options to extend its SLA with GeoEye. This option becomes effective Aug. 1, 2010, and runs through Aug. 31, 2010.
- In the second quarter we recognized revenues of $37.5 million from our SLA with the NGA, which represents 100% achievement during the quarter of the stringent metrics required under the SLA.
- In March, the Company amended and expanded its contract with the NGA to provide Web mapping services under the NGA’s Rapid Delivery of Online GEOINT (RDOG) program. This Web hosting and dissemination contract modification and expansion is in addition to on-going production work being performed under the RDOG contract originally awarded in June 2009.
- During the quarter, the Company signed a multi-million dollar order with its Russian reseller, ScanEx Research and Development Center, for more than two million square kilometers of high-resolution satellite imagery to be tasked and downloaded from the IKONOS satellite.
- During the quarter the Company continued development and construction of the GeoEye-2 imagery satellite. To date the Company has invested $145 million in the GeoEye-2 satellite program.
FISCAL YEAR 2010 FINANCIAL OUTLOOK
GeoEye has revised its guidance upwards and now expects fiscal 2010 revenue to range from $320 million to $330 million, with adjusted EBITDA in the range of $160 million to $170 million. These estimates represent management’s current expectations about the Company’s future financial performance, based on information available at this time.
CONFERENCE CALL INFORMATION
GeoEye, Inc. (NASDAQ:GEOY – News) will host a conference call for investors and analysts to discuss financial results for the second quarter ended June 30, 2010.
When: Aug. 10, 2010, at 8:30 a.m. Eastern Daylight Time
To Participate: Callers wishing to participate on the conference call may dial 1-631-291-4808 at least 10 minutes prior to the start time. Domestic callers who wish to listen may dial toll-free at 1-877-776-4039. The conference ID number is 86302699. Questions will be accepted from phone participants during the live call after prepared remarks and as time permits.
Participants are encouraged to listen via webcast, which will be broadcast live at www.geoeye.com, under the Investor Relations section of the Company’s corporate Web site. To directly access the live webcast, go to: http://www.geoeye.com/CorpSite/corporate/investor-relations/Default.aspx and click on the “Aug. 10, 2010, Investor Update Webcast” link. Please allow 15 minutes before the scheduled start time to register, download and install any necessary audio software.
Replay: A replay of the teleconference will be available starting at 10:30 a.m. EDT, Aug. 10, 2010, and will run until midnight EDT on Tuesday, Aug. 17. To access the replay, please dial (800) 642-1687. The conference ID number for the replay is 86302699.
Selected financial results for the Company are as follows (dollars in thousands, except earnings per share):
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
|
(in thousands, except per share amounts) |
|||||||
|
Three Months Ended |
|||||||
|
6/30/10 |
6/30/09 |
Change |
|||||
|
(unaudited) |
|||||||
| Revenues |
$ 80,961 |
$ 72,701 |
$ 8,260 |
||||
| Operating expenses: | |||||||
| Direct costs of revenue (exclusive of depreciation and amortization) |
26,702 |
22,808 |
3,894 |
||||
| Depreciation and amortization |
16,200 |
15,936 |
264 |
||||
| Selling, general and administrative |
13,783 |
10,098 |
3,685 |
||||
| Total operating expenses |
56,685 |
48,842 |
7,843 |
||||
| Income from operations |
24,276 |
23,859 |
417 |
||||
| Interest expense, net |
(7,752) |
(8,618) |
866 |
||||
| Other non-operating income |
2,055 |
– |
2,055 |
||||
| Income before provision for income taxes |
18,579 |
15,241 |
3,338 |
||||
| Provision for income taxes |
(6,430) |
(5,689) |
(741) |
||||
| Net income |
$ 12,149 |
$ 9,552 |
$ 2,597 |
||||
| Earnings per share | |||||||
| Basic |
$ 0.56 |
$ 0.52 |
$ 0.04 |
||||
| Diluted |
$ 0.55 |
$ 0.46 |
$ 0.09 |
||||
| Weighted average shares basic |
21,760 |
18,545 |
|||||
| Weighted average shares diluted |
22,063 |
20,570 |
|||||
|
Six Months Ended |
|||||||
|
6/30/10 |
6/30/09 |
Change |
|||||
|
(unaudited) |
|||||||
| Revenues |
$ 161,350 |
$ 117,912 |
$ 43,438 |
||||
| Operating expenses: | |||||||
| Direct costs of revenue (exclusive of depreciation and amortization) |
51,183 |
46,400 |
4,783 |
||||
| Depreciation and amortization |
32,222 |
24,396 |
7,826 |
||||
| Selling, general and administrative |
27,165 |
21,552 |
5,613 |
||||
| Total operating expenses |
110,570 |
92,348 |
18,222 |
||||
| Income from operations |
50,780 |
25,564 |
25,216 |
||||
| Interest expense, net |
(15,995) |
(14,180) |
(1,815) |
||||
| Other non-operating expense |
(8,419) |
– |
(8,419) |
||||
| Loss from early extinguishment of debt |
(37) |
– |
(37) |
||||
| Income before provision for income taxes |
26,329 |
11,384 |
14,945 |
||||
| Provision for income taxes |
(13,406) |
(3,569) |
(9,837) |
||||
| Net income |
$ 12,923 |
$ 7,815 |
$ 5,108 |
||||
| Earnings per share | |||||||
| Basic |
$ 0.60 |
$ 0.42 |
$ 0.18 |
||||
| Diluted |
$ 0.59 |
$ 0.38 |
$ 0.21 |
||||
| Weighted average shares basic |
21,416 |
18,507 |
|||||
| Weighted average shares diluted |
21,950 |
20,396 |
|||||
|
ADJUSTED EBITDA |
||||||||
|
(in thousands) |
||||||||
|
Three Months Ended |
Six Months Ended |
|||||||
|
6/30/10 |
6/30/09 |
6/30/10 |
6/30/09 |
|||||
| Net income |
$ 12,149 |
$ 9,552 |
$ 12,923 |
$ 7,815 |
||||
| Adjustments: | ||||||||
|
Interest expense, net |
7,752 |
8,618 |
15,995 |
14,180 |
||||
|
Loss from early extinguishment of debt |
– |
– |
37 |
– |
||||
|
Provision for income taxes |
6,430 |
5,689 |
13,406 |
3,569 |
||||
|
Depreciation and amortization |
16,200 |
15,936 |
32,222 |
24,396 |
||||
|
Non-cash stock-based compensation expense |
1,848 |
557 |
2,841 |
1,029 |
||||
|
Non-cash change in fair value of financial instrument |
(2,055) |
– |
8,419 |
– |
||||
| Adjusted EBITDA |
$ 42,324 |
$ 40,352 |
$ 85,843 |
$ 50,989 |
||||
| Adjusted EBITDA is a non-GAAP financial measure that represents net income (loss) before net interest income or expense, income tax expense (benefit), depreciation and amortization expenses, non-cash stock-based compensation expense and other items. We believe that Adjusted EBITDA provides useful information to investors because it is an indicator of the strength and performance of our ongoing operations. However, Adjusted EBITDA is not a recognized term under financial performance under GAAP, and our calculation of Adjusted EBITDA may not be comparable to the calculation of similarly titled measures of other companies. | ||||||||
|
ADJUSTED NET INCOME AND ADJUSTED EPS |
||||||||
|
(in thousands, except per share amounts) |
||||||||
|
Three Months Ended 6/30/10 |
Six Months Ended 6/30/10 |
|||||||
|
Diluted EPS |
Diluted EPS |
|||||||
| Net income and diluted EPS |
$ 12,149 |
$ 0.55 |
$ 12,923 |
$ 0.59 |
||||
| Adjustment: | ||||||||
|
Non-cash change in fair value of financial instrument |
(2,055) |
(0.09) |
8,419 |
0.38 |
||||
| Adjusted net income and adjusted diluted EPS |
$ 10,094 |
$ 0.46 |
$ 21,342 |
$ 0.97 |
||||
| Adjusted Net Income is a non-GAAP financial measure that represents net income before other items, net of tax. Adjusted EPS is a non-GAAP financial measure that represents fully diluted earnings per share before other items, net of tax. We believe that Adjusted Net Income and Adjusted EPS provide useful information to investors because they allow investors to evaluate our performance for different periods on a more comparable basis by excluding items that are not related to the ongoing operations of our business. However, Adjusted Net Income and Adjusted EPS are not recognized terms under financial performance under GAAP, and our calculation of Adjusted Net Income and Adjusted EPS may not be comparable to the calculation of similarly titled measures of other companies. | ||||||||
|
CONSOLIDATED BALANCE SHEETS |
||||||
|
(in thousands) |
||||||
|
June 30, |
December 31, |
|||||
|
2010 |
2009 |
Change |
||||
|
(unaudited) |
||||||
|
ASSETS |
||||||
| Current assets: | ||||||
|
Cash and cash equivalents |
$ 184,812 |
$ 208,872 |
$ (24,060) |
|||
|
Accounts receivable – trade and unbilled receivables (net of allowances: 2010 – $1,390; 2009 – $923) |
40,553 |
32,578 |
7,975 |
|||
|
Income tax receivable |
27,190 |
40,237 |
(13,047) |
|||
|
Restricted cash |
51,717 |
52,268 |
(551) |
|||
|
Prepaid expenses |
4,883 |
5,898 |
(1,015) |
|||
|
Other current assets |
9,746 |
10,938 |
(1,192) |
|||
|
Total current assets |
318,901 |
350,791 |
(31,890) |
|||
| Property, plant and equipment, net |
27,422 |
25,381 |
2,041 |
|||
| Satellites and related ground systems, net |
556,682 |
505,035 |
51,647 |
|||
| Goodwill |
34,264 |
34,264 |
– |
|||
| Intangible assets, net |
10,364 |
11,685 |
(1,321) |
|||
| Non-current restricted cash |
11,679 |
13,653 |
(1,974) |
|||
| Other non-current assets |
12,965 |
6,398 |
6,567 |
|||
|
Total assets |
$ 972,277 |
$ 947,207 |
$ 25,070 |
|||
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||
| Current liabilities: | ||||||
|
Accounts payable and accrued expenses |
$ 29,750 |
$ 33,997 |
$ (4,247) |
|||
|
Current portion of deferred revenue |
49,170 |
52,221 |
(3,051) |
|||
|
Current deferred tax liabilities |
4,744 |
4,744 |
– |
|||
|
Current portion of long-term debt |
– |
497 |
(497) |
|||
|
Other current liabilities |
10,513 |
– |
10,513 |
|||
|
Total current liabilities |
94,177 |
91,459 |
2,718 |
|||
| Long-term debt |
381,842 |
380,594 |
1,248 |
|||
| Long-term deferred revenue, net of current portion |
178,839 |
192,313 |
(13,474) |
|||
| Non-current income tax reserve |
248 |
248 |
– |
|||
| Deferred tax liabilities |
2,078 |
2,078 |
– |
|||
| Other non-current liabilities |
406 |
560 |
(154) |
|||
|
Total liabilities |
657,590 |
667,252 |
(9,662) |
|||
| Commitments and contingencies | ||||||
| Stockholders’ equity: | ||||||
|
Common stock |
221 |
199 |
22 |
|||
|
Additional paid-in capital |
249,775 |
227,988 |
21,787 |
|||
|
Retained earnings |
64,691 |
51,768 |
12,923 |
|||
|
Total stockholders’ equity |
314,687 |
279,955 |
34,732 |
|||
|
Total liabilities and stockholders’ equity |
$ 972,277 |
$ 947,207 |
$ 25,070 |
|||
|
STATEMENT OF CASH FLOWS INFORMATION |
||||||
|
(in thousands) |
||||||
|
Six Months Ended |
||||||
|
6/30/10 |
6/30/09 |
Change |
||||
|
(unaudited) |
||||||
| Net cash provided by (used in) operating activities |
$ 46,331 |
$ (11,301) |
$ 57,632 |
|||
| Net cash used in investing activities |
(84,589) |
(49,525) |
(35,064) |
|||
| Net cash provided by financing activities |
14,198 |
1,848 |
12,350 |
|||
| Net decrease in cash and cash equivalents |
(24,060) |
(58,978) |
34,918 |
|||
| Cash and cash equivalents, beginning of period |
208,872 |
106,733 |
102,139 |
|||
| Cash and cash equivalents, end of period |
$ 184,812 |
$ 47,755 |
$ 137,057 |
|||
About GeoEye
GeoEye, Inc. is a leading international information services company serving government and commercial markets. The Company is recognized as one of the geospatial industry’s imagery experts, delivering exceptional quality imagery products, services and solutions to customers around the world. Headquartered in Dulles, Virginia, the Company has over 500 employees dedicated to developing best-in-class geospatial information products and services. GeoEye is a public company listed on the NASDAQ stock exchange under the symbol GEOY. The Company provides support to academic institutions and non-governmental organizations through the GeoEye Foundation (www.geoeyefoundation.org). Additional information about GeoEye is available at www.geoeye.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Without limitation, the words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “will” and similar expressions are intended to identify forward-looking statements. All statements that address operating performance, events or developments that we expect or anticipate will occur in the future, including statements relating to growth, expected levels of expenditures and statements expressing general optimism about future operating results, are forward-looking statements. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements and those presented elsewhere by our management from time to time are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements. These risks and uncertainties include, but are not limited to, those described in “Risk Factors” included in our Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2009, which we filed with the Securities and Exchange Commission (“SEC”) on March 12, 2010, and our Quarterly Reports on Form 10-Q for the period ended March 31, 2010, and June 30, 2010, which we filed with the SEC on May 10, 2010 and August 9, 2010 respectively. Copies of all SEC filings may be obtained from the SEC’s EDGAR web site, http://www.sec.gov/, or by contacting: William L. Warren, Senior Vice President, General Counsel and Secretary, at 703-480-5672.
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