EX-99 3 press.txt EXHIBIT 99.1 [COMPANY LOGO] FOR IMMEDIATE RELEASE CONTACT: SMTEK INTERNATIONAL, INC. Kirk A. Waldron, CFO (805) 532-2800, ext. 111 SMTEK INTERNATIONAL, INC. REPORTS THIRD QUARTER RESULTS MOORPARK, Calif. (May 12, 2003) - SMTEK International, Inc. (Nasdaq: SMTI / Pacific Exchange: SMK), a provider of electronics manufacturing services (EMS), today announced that revenues for the quarter ended March 31, 2003 were $17.4 million compared to $13.5 million for the quarter ended March 31, 2002. For the nine months ended March 31, 2003, revenues were $50.5 million compared to $48.3 million for the nine months ended March 31, 2002. For the quarter ended March 31, 2003, SMTEK reported a net loss of $1.1 million after discontinued operations, or $0.46 loss per basic share, compared to a net loss of $2.9 million for the quarter ended March 31, 2002, or $1.28 loss per basic share. For the nine months ended March 31, 2003, the net loss was $6.2 million after discontinued operations, or $2.68 loss per basic share, compared to a net loss of $3.7 million, or $1.60 loss per basic share, for the same period in the prior year. Included in the net loss for the nine months ended March 31, 2003, was approximately $2.0 million related to the consolidation of the Company's San Diego facility and the transitioning of its customers to SMTEK facilities in Moorpark and Santa Clara. Commenting on the results for the March quarter 2003, Edward J. Smith, President and Chief Executive Officer stated, "Although we posted results reflecting an operating loss, we are beginning to experience the benefits of our cost reduction efforts and efficiency improvements. In particular, we recently sold our Ireland operations and transferred operations from our San Diego, California facility. Based on these measures and our current backlog of business, we anticipate a positive trend in our fourth quarter results from operations. Although we are generally optimistic about our future prospects, we nevertheless remain cautious in light of current economic conditions." He further added, "The Company's balance sheet remains a challenge as we try to recover from the losses and nonrecurring charges that have been incurred over the past two years. We are very focused on trying to address our significant debt, and we are exploring alternatives to possibly resolve the burden that we face with servicing our current liability structure." * * * * * Headquartered in Moorpark, California, SMTEK International, Inc. is an EMS provider serving original equipment manufacturers (OEMs) in the industrial instrumentation, medical, telecommunications, security, financial services automation, aerospace and defense industries. We provide integrated solutions to OEMs across the entire product life cycle, from design to manufacturing to end-of-life services, for the worldwide low to medium volume, high complexity segment of the EMS industry. We have five operating facilities with locations in Moorpark, California; Santa Clara, California; Marlborough, Massachusetts; Fort Lauderdale, Florida; and the Ayuttya Province in Thailand. This press release contains 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 is subject to the safe harbor provisions created by those sections. You can identify these statements by the fact that they use words such as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," and other words of similar meaning in connection with any discussion of future operating or financial performance. Any forward- looking statements are only predictions and may differ materially from actual future events or results. Readers are cautioned that forward- looking statements regarding future events and the future performance of SMTEK International, Inc. involve various risks and uncertainties that could cause actual results to differ materially from those described in these statements. Readers are referred to the documents filed by SMTEK International, Inc. with the SEC, including our most recent Reports on Forms 10-K, 10-Q and 8-K, each as it may be amended from time to time, for a more complete description of important risk factors and other information with respect to risks and uncertainties relating to the materials in this press release, as well as to other aspects of our business and financial condition. We do not undertake, and specifically disclaim, any obligation to update forward-looking statements. SMTEK INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands except per share amounts)
Three Months Ended Nine Months Ended March 31, March 31, ------------------- --------------- ---- 2003 2002 2003 2002 ------- ------- ------- --- ---- Revenues $17,430 $13,463 $50,474 $48,345 Cost of goods sold 15,510 13,364 46,122 44,554 ------- ------- ------- --- ---- Gross profit 1,920 99 4,352 3,791 ------- ------- ------- --- ---- Operating expenses: Administrative and selling 2,216 3,034 8,242 6,470 Goodwill amortization - 9 - 28 ------- ------- ------- --- ---- Total operating expenses 2,216 3,043 8,242 6,498 ------- ------- ------- --- ---- Operating loss (296) (2,944) (3,890) (2,707) ------- ------- ------- --- ---- Interest expense, net (267) (236) (776) (707) Other income, net 269 195 261 231 ------- ------- ------- --- ---- Loss from continuing operations before income taxes (294) (2,985) (4,405) (3,183) Income tax provision (benefit) - (182) 6 (155) ------- ------- ------- --- ---- Loss from continuing operations (294) (2,803) (4,411) (3,028) Loss from discontinued operations, net of taxes (756) (122) (1,300) (632) ------- ------- ------- --- ---- Loss before change in accounting principle (1,050) (2,925) (5,711) (3,660) Change in accounting principle, net of taxes - - (420) - ------- ------- ------- --- ---- Net loss $(1,050) $(2,925) $(6,131) $(3,660) ======= ======= ======= ======= Loss from continuing operations $ (0.13) $ (1.23) $ (1.93) $ (1.32) Loss from discontinued operations (0.33) (0.05) (0.57) (0.28) Change in accounting principle - - (0.18) - ======= ======= ======= ======= Loss per share $ (0.46) $ (1.28) $ (2.68) $ (1.60) ======= ======= ======= ======= Average shares (in OOOs) 2,284 2,284 2,284 2,284 ======= ======= ======= =======
SMTEK INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (In thousands except share amounts)
March 31, June 30, 2003 2002 ------------- ---- ----- Current assets: Cash and cash equivalents $ 546 $ 816 Accounts receivable, net 11,518 8,390 Inventories, net 9,170 9,666 Prepaid expenses 807 809 Current assets, excluding cash - discontinued operations 3,360 5,572 -------- ---- ---- Total current assets 25,401 25,253 -------- ---- ---- Property, equipment and improvements, net 5,991 7,260 Property, equipment and improvements, net - discontinued operations 1,486 1,549 Other assets 330 772 -------- ---- ---- $ 33,208 $ 34,834 ======== ======== Current liabilities: Current portion of bank lines of credit payable $ 6,631 $ - Current portion of long-term debt 2,113 2,104 Accounts payable 8,842 6,867 Other accrued liabilities 6,491 4,746 Current liabilities - discontinued operations 5,312 5,621 -------- ---- ---- Total current liabilities 29,389 19,338 -------- ---- ---- Long-term bank line of credit payable - 4,005 Long-term debt 3,945 5,194 Long-term debt - discontinued operations 65 872 Other long-term liabilities 594 - -------- ---- ---- Total long-term debt 4,604 10,071 -------- ---- ---- Stockholders' equity (deficit): Common stock 23 23 Additional paid-in capital 37,028 37,028 Accumulated deficit (37,745) (31,616) Accumulated other comprehensive loss (91) (10) -------- ---- ---- Total stockholders' equity (deficit) (785) 5,425 -------- ---- ---- $ 33,208 $ 34,834 ======== ========