EX-99.1 2 f99131exv99w1.txt EXHIBIT 99.1 Exhibit 99.1 NEWS RELEASE For Release on May 12, 2004 Contact: Mark H. Cosmez II 4:00 PM (ET) (925) 328-4656 Vice President, Finance/Chief Financial Officer Giga-tronics Reports Fourth Quarter and FY 2004 Results SAN RAMON, CA - Giga-tronics Incorporated (NASDAQ/NMS: GIGA) reported today that the net loss in the fourth quarter of fiscal year 2004 decreased 28% to $1,712,000 or $0.36 per fully diluted share compared to $2,387,000 or $0.51 per fully diluted share for the fourth quarter of last year. For the fiscal year ended March 27, 2004, the net loss decreased 37% to $6,821,000 or $1.45 per share fully diluted versus $10,762,000 or $2.31 per fully diluted share for the same period a year ago. Loss from continuing operations for the fourth quarter was $1,727,000 or $0.37 per fully diluted share compared to a loss from continuing operations of $1,101,000 or $0.24 per fully diluted share for the same period a year ago. Giga-tronics elected to discontinue the operations at its Dymatix division during the first quarter of FY2004. For the 2004 fiscal year, the net loss from continuing operations was $4,444,000 or $0.94 per fully diluted share versus a net loss from continuing operations of $8,426,000 or $1.81 per fully diluted share last year. Net sales from continuing operations were $3,295,000 in the fourth quarter of fiscal 2004 versus $4,730,000 in the fourth quarter of fiscal 2003. Net sales for fiscal year 2004 decreased 16% from the prior year to $17,491,000 from $20,822,000. New orders from continuing operations have increased over the last three quarters. Orders from continuing operations increased 61% in the fourth quarter of FY 2004 from the same quarter a year ago. Our book-to-bill ratio in the fourth quarter of fiscal 2004 was 1.58 compared to 0.68 in the fourth quarter of fiscal 2003. Orders booked in the fourth quarter from continuing operations were $5,210,000 compared to $3,232,000 last year and for the 2004 fiscal year were $17,109,000 compared to $16,348,000 a year ago. Backlog at quarter end was $16.4 million (approximately $7.5 million is shippable within one year) as compared to $16.7 million (approximately $7.7 million shippable within one year) in the fourth quarter of the prior year. Cash and cash equivalents at March 27, 2004 was $2,752,000 compared to $5,005,000 as of March 29, 2003. Based on current operations, Giga-tronics believes that it has sufficient cash and cash equivalents to fund its cash needs for approximately five to eight quarters. To operate beyond that term, the Company must either earn additional cash from operations, obtain a line of credit or obtain additional funds from other sources. During the fourth quarter of fiscal 2004, Giga-tronics consummated the sale of Dymatix, which had been discontinued during the first quarter. Under the terms of the sale, the Company will receive $300,000, of which $50,000 was paid at closing, $50,000 is to be paid in May 2004 and $200,000 is to be paid in quarterly installments over two years. The Company may receive additional earn-out payments based on a percentage of sales on a monthly basis over the next two years. Giga-tronics will host a conference call today at 4:30 PM ET to discuss the fourth quarter and full fiscal year results. To participate in the call, dial 612-332-0345. The call will also be broadcast over the internet at www.gigatronics.com under "Corporate Info/Investor Relations". The conference call discussion reflects management's views as of May 12, 2004 only. Giga-tronics produces instruments, subsystems and sophisticated microwave components that have broad applications in both defense electronics and wireless telecommunications. Giga-tronics is a publicly held company, traded on the NASDAQ National Market under the symbol "GIGA". This press release contains forward-looking statements concerning profitability, backlog and shipments. Actual results may differ significantly due to risks and uncertainties, such as future orders, cancellations or deferrals, disputes over performance and the ability to collect receivables. For further discussion, see Giga-tronics' annual report on Form 10-K for the fiscal year ended March 29, 2003 Part I, under the heading "Certain Factors Which May Adversely Affect Future Operations or an Investment in Giga-tronics" and Part II, under the heading "Management's Discussion and Analysis of Financial Conditions and Results of Operations". GIGA-TRONICS INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(In thousands except share data) March 27, 2004 March 29, 2003 -------------- -------------- ASSETS Current assets Cash and cash equivalents $ 2,752 $ 5,005 Notes receivable 253 6 Trade accounts receivable, net 1,959 3,325 Inventories 6,920 10,244 Income tax refund receivable -- 100 Prepaid expenses 271 488 ------------ ------------ TOTAL CURRENT ASSETS 12,155 19,168 Property and equipment 17,054 18,189 Less accumulated depreciation and amortization 15,803 15,915 ------------ ------------ Property and equipment, net 1,251 2,274 Other assets 327 433 ------------ ------------ TOTAL ASSETS $ 13,733 $ 21,875 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $ 1,686 $ 1,809 Accrued commissions 293 249 Accrued payroll and benefits 889 1,038 Accrued warranty 548 859 Customer advances 58 796 Obligations under capital lease 10 76 Other current liabilities 674 644 ------------ ------------ TOTAL CURRENT LIABILITIES 4,158 5,471 Obligations under capital lease, net of current portion -- 10 Deferred rent 379 434 ------------ ------------ TOTAL LIABILITIES 4,537 5,915 ------------ ------------ Shareholders' equity Preferred stock of no par value Authorized 1,000,000 shares; no shares outstanding at March 27, 2004 and March 29, 2003 -- -- Common stock of no par value; Authorized 40,000,000 shares; 4,724,896 shares at March 27, 2004 and 4,693,080 shares at March 29, 2003 issued and outstanding 12,752 12,695 Retained earnings (loss) (3,556) 3,265 ------------ ------------ TOTAL SHAREHOLDERS' EQUITY 9,196 15,960 ------------ ------------ TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 13,733 $ 21,875 ============ ============
GIGA-TRONICS INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share data)
Three Months Ended Twelve Months Ended ------------------ ------------------- March 27, 2004 March 29, 2003 March 27, 2004 March 29, 2003 -------------- -------------- -------------- -------------- NET SALES $ 3,295 $ 4,730 $ 17,491 $ 20,822 Cost of sales 2,927 3,523 12,755 14,635 ------------ ------------ ------------ ------------ GROSS PROFIT 368 1,207 4,736 6,187 Product development 952 977 3,766 4,321 Selling, general and administrative 1,140 1,403 5,413 6,071 Amortization of intangibles -- 4 -- 20 ------------ ------------ ------------ ------------ Operating expenses 2,092 2,384 9,179 10,412 ------------ ------------ ------------ ------------ OPERATING LOSS (1,724) (1,177) (4,443) (4,225) Other expense, net -- (38) (4) (163) Interest income (expense), net (3) 14 7 60 ------------ ------------ ------------ ------------ LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (1,727) (1,201) (4,440) (4,328) Provision (benefit) for income taxes -- (100) 4 4,098 ------------ ------------ ------------ ------------ LOSS FROM CONTINUING OPERATIONS $ (1,727) $ (1,101) $ (4,444) $ (8,426) Income (loss) on discontinued operations, net of income taxes 15 (1,286) (2,377) (2,336) ------------ ------------ ------------ ------------ NET LOSS $ (1,712) $ (2,387) $ (6,821) $ (10,762) ============ ============ ============ ============ BASIC AND DILUTED NET LOSS PER SHARE: From continuing operations $ (0.37) $ (0.24) $ (0.94) $ (1.81) On discontinued operations 0.01 (0.27) (0.51) (0.50) ------------ ------------ ------------ ------------ Basic and diluted net loss per share $ (0.36) $ (0.51) $ (1.45) $ (2.31) ============ ============ ============ ============ Shares used in per share calculation: Basic and dilutive 4,717 4,682 4,704 4,663 ============ ============ ============ ============