EX-99.1 2 a08-19741_1ex99d1.htm EX-99.1

Exhibit 99.1

 

AXSYS TECHNOLOGIES ANNOUNCES 40% GROWTH IN SALES AND

75% GROWTH IN INCOME FROM CONTINUING OPERATIONS IN SECOND QUARTER

 

Axsys Increases 2008 Guidance

 

ROCKY HILL, CT – July 22, 2008– Axsys Technologies, Inc. (NASDAQ:AXYS), a global leader in the design and development of high-performance surveillance cameras, imaging systems and related motion control technologies, today announced financial results for the second quarter ended June 28, 2008.

 

During the second quarter of 2008, Axsys generated sales of $60.3 million, compared to $43.0 million in the second quarter of 2007.  Income from continuing operations was $6.2 million or $0.54 per diluted share, up from $3.6 million or $0.32 per diluted share in the prior year period.

 

Net income was $6.1 million or $0.53 per diluted share, up from $3.8 million or $0.35 per diluted share in the second quarter of 2007.  The results for the second quarter of 2008 include a $126 thousand net loss and the results for the second quarter of 2007 include $297 thousand of net income, both related to the discontinued AST Bearings business, which was sold in November 2007.

 

Second Quarter Financial Highlights from Continuing Operations

 

Period comparisons vs. the second quarter of 2007.

 

·                  Sales increased 40% to a record $60.3 million;

·                  Gross margin improved to 34.4% from 32.8%;

·                  Operating margin improved to 16.2% from 13.9%;

·                  Income increased 75% to $6.2 million;

·                  Diluted earnings per share increased to $0.54 from $0.32;

·                  Backlog increased to a record $174 million.

 

Compared to the second quarter of 2007, the increase in sales was mainly due to continued strong demand for infrared cameras and lenses.  However, the acquisition of the gyrostabilized gimbal business in April 2007 also contributed to the year-over-year growth. Margins were favorably impacted by both the faster growth rate in the higher margin Surveillance Systems Group and improved leverage on operating expenses.  Backlog growth was mainly attributable to large infrared lens orders for the Common Remotely Operated Weapon Station (CROWS) and Thermal Weapons Sight (TWS) II programs.

 

Segment Sales

 

 

 

Three Months Ended:

 

Six Months Ended

 

(Millions)

 

Jun 28, 2008

 

Jun 30, 2007

 

Jun 28, 2008

 

Jun 30, 2007

 

Surveillance Systems Group

 

$

20.9

 

$

10.8

 

$

38.7

 

$

20.0

 

Imaging Systems Group

 

39.4

 

32.1

 

78.0

 

58.5

 

 

Compared to the same period in the prior year, the Surveillance Systems Group increased sales by 92%.  This segment’s strong performance was driven by continued broad-based demand for camera systems for land, marine and airborne applications.

 

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The Imaging Systems Group’s sales grew 23% year over year. Within the Imaging Systems segment, the infrared lens business’ results were particularly strong.

 

“Both of our business segments continued to demonstrate outstanding growth in the second quarter,” said Stephen W. Bershad, Chairman and CEO of Axsys Technologies.  “As expected, the Surveillance Systems Group is growing faster than the Imaging Systems Group and its higher margins are increasing the company’s overall profitability.  Based on our updated expectations for the remainder of the year, Axsys is increasing its financial guidance for fiscal 2008.”

 

Fiscal 2008 Earnings Guidance Increase

 

Axsys is increasing its full-year 2008 guidance as follows:

 

·      Sales are expected to be in the range of $237 million to $241 million, up from the $224 million to $228 million range previously provided.

·      Diluted earnings per share are expected to be in the range of $2.09 to $2.15, up from the previous guidance of $1.88 to $1.92.

 

“Axsys’ impressive financial performance coupled with 24% backlog growth in the first half of the year provide a solid basis for increasing our fiscal 2008 guidance,” continued Mr. Bershad. “Our updated guidance includes significant investments in both capital and R&D, which will be required to sustain our long-term growth.”

 

Conference Call

 

Management will conduct a conference call to review the Company’s financial results on Wednesday, July 23, 2008 at 10:00 a.m. Eastern Time.  Shareholders, institutional investors and equity research analysts are invited to participate in the call by dialing 1-888-713-4209 and providing the operator with the conference ID# 38811772 to enter the call. Callers are advised to dial into the call at least ten minutes prior to the call to register. Participants may pre-register for the call at https://www.theconferenceingservice.com/prereg/key.process?key=PE3CKLVPU. Pre-registrants will be issued a pin number to use when dialing into the live call. The pin will enable participants to bypass the operator for quicker access to the call.

 

The conference call will be webcast live via the Investor Relations section of the Company’s web site at www.axsys.com.  A replay of the webcast will be available shortly after the conclusion of the call for a period of approximately 90 days.

 

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About Axsys

 

Axsys Technologies, Inc. is a global leader in the design and development of high-performance surveillance cameras, imaging systems and related motion control technologies, serving the aerospace, defense, and high-performance commercial markets.  For more information, visit www.axsys.com.

 

Contacts

 

 

 

David A. Almeida

Julie L. Oakes

Chief Financial Officer

Director of Investor Relations

(860) 257-0200

(860) 594-5751

 

Invest@axsys.com

 

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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 Form 10-Q filed with the Securities and Exchange Commission, including without limitation: changes in the U.S. federal government spending priorities; the Company’s ability to compete in the industries in which it operates, including the introduction of competing products or technologies by other companies and/or pricing pressures from competitors and/or customers; the potential for the Company’s backlog to be reduced or cancelled; the Company’s ability to implement its acquisition strategy and integrate its acquired companies successfully; the Company’s ability to manage costs under the Company’s fixed-price contracts effectively; and changes in general economic and business conditions.  These statements reflect the Company’s current beliefs and are based upon information currently available to the Company.  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.

 

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AXSYS TECHNOLOGIES, INC.

Consolidated Statements of Operations

(Dollars in thousands, except share and per share data - Unaudited)

 

 

 

For the Three Months Ended

 

For the Six Months Ended

 

 

 

June 28, 2008

 

June 30, 2007

 

June 28, 2008

 

June 30, 2007

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

60,317

 

$

42,955

 

$

116,747

 

$

78,494

 

Cost of sales

 

39,592

 

28,854

 

76,815

 

53,350

 

Gross profit

 

20,725

 

14,101

 

39,932

 

25,144

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

8,856

 

6,249

 

18,113

 

11,590

 

Research, development and engineering expenses

 

2,097

 

1,863

 

4,054

 

2,946

 

Operating income

 

9,772

 

5,989

 

17,765

 

10,608

 

Interest expense

 

(12

)

(263

)

(25

)

(272

)

Interest income

 

68

 

56

 

188

 

119

 

Other income (expense), net

 

85

 

11

 

121

 

(252

)

Income from continuing operations before income taxes

 

9,913

 

5,793

 

18,049

 

10,203

 

Provision for income taxes

 

3,684

 

2,243

 

6,712

 

3,919

 

Income from continuing operations

 

6,229

 

3,550

 

11,337

 

6,284

 

(Loss) income from discontinued operations, net of income taxes

 

(126

)

297

 

(126

)

546

 

Net income

 

$

6,103

 

$

3,847

 

$

11,211

 

$

6,830

 

 

 

 

 

 

 

 

 

 

 

BASIC EARNINGS (LOSS) PER SHARE:

 

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.56

 

$

0.33

 

$

1.03

 

$

0.59

 

Discontinued operations

 

(0.01

)

0.03

 

(0.01

)

0.05

 

Total

 

$

0.55

 

$

0.36

 

$

1.02

 

$

0.64

 

Weighted average basic common shares outstanding

 

11,033,865

 

10,686,285

 

10,965,908

 

10,671,827

 

DILUTED EARNINGS (LOSS) PER SHARE:

 

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.54

 

$

0.32

 

$

0.99

 

$

0.57

 

Discontinued operations

 

(0.01

)

0.03

 

(0.01

)

0.05

 

Total

 

$

0.53

 

$

0.35

 

$

0.98

 

$

0.62

 

Weighted average diluted common shares outstanding

 

11,437,526

 

11,006,968

 

11,394,495

 

10,976,385

 

 

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AXSYS TECHNOLOGIES, INC.

Consolidated Balance Sheets

(Dollars in thousands, except share and per share data)

 

 

 

June 28, 2008

 

December 31,
2007

 

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash and cash equivalents

 

$

9,294

 

$

15,304

 

Accounts receivable – net

 

27,578

 

14,140

 

Inventories – net

 

58,352

 

52,362

 

Income taxes – deferred

 

5,505

 

3,923

 

Prepaid expenses

 

1,544

 

1,047

 

Other current assets

 

347

 

491

 

TOTAL CURRENT ASSETS

 

102,620

 

87,267

 

PROPERTY, PLANT AND EQUIPMENT – net

 

20,534

 

17,876

 

INTANGIBLE ASSETS – net

 

11,746

 

12,286

 

GOODWILL

 

85,620

 

85,620

 

OTHER ASSETS

 

1,398

 

1,634

 

TOTAL ASSETS

 

$

221,918

 

$

204,683

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Accounts payable

 

$

16,834

 

$

9,325

 

Accrued expenses and other current liabilities

 

18,430

 

21,650

 

Deferred income

 

7,298

 

12,742

 

TOTAL CURRENT LIABILITIES

 

42,562

 

43,717

 

OTHER LONG-TERM LIABILITIES

 

9,394

 

8,836

 

SHAREHOLDERS’ EQUITY:

 

 

 

 

 

Common stock

 

111

 

108

 

Capital in excess of par

 

111,101

 

104,674

 

Accumulated other comprehensive income

 

(277

)

(81

)

Retained earnings

 

59,027

 

47,816

 

Treasury stock

 

—

 

(387

)

TOTAL SHAREHOLDERS’ EQUITY

 

169,962

 

152,130

 

 

 

 

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

$

221,980

 

$

204,683

 

 

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