EX-99.1 2 a04-12407_1ex99d1.htm EX-99.1

EXHIBIT 99.1

 

 

AXSYS TECHNOLOGIES ANNOUNCES 79% INCREASE IN THIRD QUARTER

OPERATING INCOME AND INCREASES 2004 GUIDANCE

 

ROCKY HILL, CONN. – November 1, 2004 – Axsys Technologies, Inc. (NASDAQ: AXYS), a global leader in the design, manufacture and distribution of precision opto-mechanical subsystems and components, today announced financial results for the third quarter and nine-month period ended October 2, 2004.

 

Third Quarter Highlights – versus fiscal 2003 third quarter

•                  Sales rose 24.3% to $26.4 million.

•                  Gross margin increased to 30.2% from 26.9%.

•                  Operating income was up 79.3% to $2.2 million; operating margin rose to 8.4% from 5.8%.

•                  Net income grew to $1.9 million, or $0.27 per diluted share, from $1.2 million or $0.17 per diluted share, a 58.8% increase in diluted EPS.

•                  Effective tax rate for the current quarter was 10.0%, compared to a 4.5% rate in the third quarter of 2003.

•                  Third quarter bookings rose 87.8% to a record $37.7 million, bringing backlog to a record  $93.1 million.

•                  Significant bookings for the quarter include the $9.8 million James Webb Space Telescope project.

 

Axsys exceeded its sales and bookings expectations for the quarter as a result of heightened defense spending, general economic growth and the sale of increasingly complex electro-optical solutions.  In addition, growth in the quarter included the results of the newly integrated acquisition, Axsys Technologies IR Systems, formerly Telic Optics, Inc.  Excluding the acquisition, revenues increased 18.0% and bookings increased 81.6% in the third quarter.

 

Segment Sales (in millions):

 

 

 

Three Months Ended:

 

Nine Months Ended:

 

 

 

October 2,
2004

 

September 27,
2003

 

October 2,
2004

 

September 27,
2003

 

Aerospace and Defense

 

$

16.6

 

$

12.5

 

$

45.5

 

$

37.1

 

Commercial Products

 

3.3

 

3.3

 

10.9

 

10.3

 

Distributed Products

 

6.5

 

5.4

 

19.1

 

15.9

 

 

“Our third quarter results continue to build upon our successful track record,” said Stephen W. Bershad, Chairman and Chief Executive Officer of Axsys.  “Not only have we delivered solid revenue and income growth, but our backlog is the strongest in the Company’s history.  Our continuing efforts to deliver high quality, competitive products to our broad base of customers in a timely manner are resulting in larger and more sophisticated orders.  Importantly, higher margins are stemming from favorable product mix, volume-driven leverage and improved production efficiencies.”

 


 

Financial Guidance

 

The financial results for the first nine months of 2004, combined with the Company’s strong backlog, have led Axsys to increase financial guidance for fiscal 2004.  Axsys now anticipates its 2004 revenues of approximately $102 million and 2004 operating income of approximately $9 million, representing year-over-year growth of 20% and 79%, respectively.  This compares to previous guidance of 15% – 16% revenue growth and 55% – 60% operating income growth.

 

Mr. Bershad concluded, “We are confident that Axsys is positioned for continued growth.  The Company’s strong financial performance, large and growing backlog and solid balance sheet provide the financial foundation to drive the business forward.   We intend to build upon our successful products and capabilities to deliver increasingly sophisticated electro-optical solutions to our OEM customers.”

 

Conference Call

 

Management will conduct a conference call reviewing the financial results on Tuesday, November 2, 2004 at 10:00 am ET.  Interested parties may participate in the call by dialing 913-905-3161 – please call in 10 minutes before the call is scheduled to begin, and ask for the Axsys Technologies call.  The conference call will be broadcast live over the Internet via the Investors section of the Company’s web site at www.axsys.com.  To listen to the live call please go to the website at least 15 minutes early to register, download and install any necessary audio software.  If you are unable to listen live, the conference call will be archived on the Company’s web site.

 

About Axsys

 

Axsys Technologies, Inc. is a vertically integrated OEM supplier of precision optical and motion control assemblies and components for high technology applications, serving the aerospace, defense, health imaging, semiconductor and graphic arts markets.  For more information, visit www.axsys.com.

 

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. One can identify these forward-looking statements by the use of the words such as “expect,” “anticipate,” “plan,” “may,”  “will,” “estimate” or other similar expressions. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors, which could cause actual results to differ materially, are described in Axsys’ reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission, including without limitation: the introduction of competing products or technologies by other companies and/or pricing pressures from competitors and/or customers, a reversal or slowdown of the modest economic recovery presently being experienced in the United States, Axsys’ inability to achieve synergies in connection with the acquisition of Telic Optics, Inc., the incurrence of unexpected costs in connection with the acquisition and other contingencies and risks relating to the integration of Telic’s operations and business.  These statements reflect the Company’s current beliefs and are based upon information currently available to Axsys.   Be advised that developments subsequent to this release are likely to cause these statements to become outdated with the passage of time, and we specifically disclaim any obligation to update these statements.  For more information concerning the foregoing risks and uncertainties, see the Securities and Exchange Commission filings for Axsys.

 


 

AXSYS TECHNOLOGIES, INC.

Consolidated Statements of Operations

(Unaudited, in thousands)

 

 

 

For the Three Months Ended

 

For the Nine Months Ended

 

 

 

October 2,
2004

 

September 27,
2003

 

October 2,
2004

 

September 27,
2003

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

26,356

 

$

21,203

 

$

75,491

 

$

63,269

 

Cost of sales

 

18,407

 

15,489

 

52,940

 

46,122

 

Gross margin

 

7,949

 

5,714

 

22,551

 

17,147

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

5,055

 

3,906

 

14,321

 

11,968

 

Research, development and engineering expenses

 

681

 

574

 

1,984

 

1,628

 

Write off of restructuring accrual

 

—

 

—

 

(50

)

—

 

Operating income

 

2,213

 

1,234

 

6,296

 

3,551

 

Interest expense

 

(75

)

(39

)

(183

)

(137

)

Interest income

 

9

 

21

 

43

 

77

 

Other (expense) income, net

 

(7

)

67

 

(29

)

211

 

Income before income taxes

 

2,140

 

1,283

 

6,127

 

3,702

 

Provision for income taxes

 

213

 

58

 

612

 

167

 

Net income

 

$

1,927

 

$

1,225

 

$

5,515

 

$

3,535

 

 

 

 

 

 

 

 

 

 

 

BASIC INCOME PER SHARE (1):

 

 

 

 

 

 

 

 

 

Total

 

$

0.27

 

$

0.18

 

$

0.79

 

$

0.51

 

 

 

 

 

 

 

 

 

 

 

Weighted average basic common shares outstanding

 

7,040

 

6,987

 

7,009

 

6,985

 

 

 

 

 

 

 

 

 

 

 

DILUTED INCOME PER SHARE (1):

 

 

 

 

 

 

 

 

 

Total

 

$

0.27

 

$

0.17

 

$

0.77

 

$

0.50

 

Weighted average dilutive common shares outstanding

 

7,191

 

7,103

 

7,182

 

7,047

 

 

(1) Earnings per share and shares outstanding for the three months and nine months ended September 27, 2003 have been restated to reflect the 3:2 stock split on June 30, 2004.

 

CONTACT:

-OR-

INVESTOR RELATIONS COUNSEL:

Axsys Technologies, Inc.

 

The Equity Group Inc.

David A. Almeida, CFO

 

Loren G. Mortman

(860) 257-0200

 

(212) 836-9604, LMortman@equityny.com

www.axsys.com

 

Lauren Barbera

 

 

(212) 836-9610, LBarbera@equityny.com

 

 

www.theequitygroup.com

 


 

AXSYS TECHNOLOGIES, INC.

Consolidated Balance Sheets

(Unaudited, in thousands)

 

 

 

October 2,
2004

 

December 31,
2003

 

ASSETS

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash and cash equivalents

 

$

4,259

 

$

5,197

 

Short-term investments

 

—

 

6,983

 

Accounts receivable – net

 

15,506

 

10,197

 

Inventories – net

 

30,137

 

24,786

 

Income taxes – deferred and current

 

2,203

 

2,203

 

Other current assets

 

1,002

 

1,223

 

TOTAL CURRENT ASSETS

 

53,107

 

50,589

 

PROPERTY, PLANT AND EQUIPMENT – net

 

12,758

 

11,315

 

INTANGIBLE ASSET – net

 

2,151

 

—

 

EXCESS OF COST OVER NET ASSETS ACQUIRED

 

13,013

 

3,600

 

OTHER ASSETS

 

1,371

 

1,341

 

TOTAL ASSETS

 

$

82,400

 

$

66,845

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Accounts payable

 

$

6,463

 

$

4,240

 

Accrued expenses and other liabilities

 

8,093

 

7,955

 

Deferred income

 

7,907

 

4,546

 

Current portion of capital lease obligation

 

372

 

423

 

Current portion of long-term debt

 

1,000

 

—

 

TOTAL CURRENT LIABILITIES

 

23,835

 

17,164

 

 

 

 

 

 

 

CAPITAL LEASES, less current portion

 

243

 

568

 

 

 

 

 

 

 

LONG-TERM DEBT, less current portion

 

3,583

 

—

 

 

 

 

 

 

 

OTHER LONG-TERM LIABILITIES

 

4,820

 

5,215

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

 

 

 

 

 

 

 

 

 

SHAREHOLDERS’ EQUITY:

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

72

 

72

 

Capital in excess of par

 

39,591

 

39,375

 

Accumulated other comprehensive loss

 

(37

)

(39

)

Retained earnings

 

11,240

 

5,725

 

Treasury stock

 

(947

)

(1,235

)

TOTAL SHAREHOLDERS’ EQUITY

 

49,919

 

43,898

 

 

 

 

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

$

82,400

 

$

66,845