EX-99.1 2 doc2.txt NEWS RELEASE HEI INC P. O. Box 5000 Victoria, Minnesota 55386 USA 952-443-2500 CONTACTS: FOR IMMEDIATE RELEASE Anthony J. Fant, CEO Donald R. Reynolds, President/COO Steve E. Tondera, CFO HEI PROVIDES BUSINESS AND FINANCIAL UPDATE MINNEAPOLIS, April 19, 2001 -- HEI, Inc. (Nasdaq: HEII, www.heii.com) a leader in the design and manufacture of microelectronics for the hearing, medical and communications markets, today provided a financial update and status of actions taken to address current business and economic issues. Due to the continued general economic downturn, and specifically a slowdown in the hearing, RFID/Access, and electronic contract manufacturing markets, HEI expects revenue for its fiscal third quarter to be down 5% to 10% sequentially from fiscal second quarter, but 5% above third quarter a year ago. The Company expects a third quarter net loss of approximately 11 cents per share, including expenses associated with the phase out of the Mexico manufacturing facility. This facility will be completely phased out in the third quarter with profitable programs in strategic markets being transferred to other HEI locations. The Company is taking this action to focus its resources as it expands its broadband and hearing businesses. For the four quarters ended March 3, 2001, HEI would have earned 45 cents per share if the losses associated with the Mexico facility were excluded, compared to a reported net income of 3 cents per share including the losses associated with the Mexico facility. The Company believes that the hearing and medical markets will improve in the fourth quarter of 2001. This combined with HEI's expansion into the broadband market will result in fourth quarter revenue growth compared to the third quarter of this fiscal year and the fourth quarter of last fiscal year. HEI expects fourth quarter net income in the single digit earnings per share range, as well as significant revenue growth and improved earnings in FY2002. -------------------------------------------------------------------------------- HEI, Inc., and Cross Technology, Inc., a wholly owned subsidiary of HEI, Inc., specialize in the custom design and manufacture of high performance, ultraminiature microelectronic devices and high-technology products incorporating those devices. HEI and Cross contribute to their customers' competitiveness in the hearing, medical, communications, wireless smart cards, other RF applications, and industrial markets through innovative design solutions and by the application of state-of-the art materials, processes and manufacturing capabilities. Headquarters and Microelectronics Division PO Box 5000, 1495 Steiger Lake Lane, Victoria, MN 55386 High Density Interconnect Division 610 South Rockford Drive, Tempe, AZ 85281 Cross Technology, Inc. 1546 Lake Drive West, Chanhassen, MN 55317 -------------------------------------------------------------------------------- FORWARD LOOKING INFORMATION Information in this news release, which is not historical, includes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements contained in this press release, including the estimated HEI revenue and profit growth are forward looking statements. All of such forward-looking statements involve risks and uncertainties including, without limitation, adverse business or market conditions, the ability of HEI to secure and satisfy customers, the availability and cost of materials from HEI's suppliers, adverse competitive developments, change in or cancellation of customer requirements, and other risks detailed from time to time in HEI's SEC filings.