-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ViunKnxyaGSQ5N75AZOHmfb92I7C7ew3AJw+JhOOTXhghrMzbZuK7Fga3OikoaUV z6oNYb11T0gHQkPRnm7X4Q== 0000720671-06-000003.txt : 20060215 0000720671-06-000003.hdr.sgml : 20060215 20060214174002 ACCESSION NUMBER: 0000720671-06-000003 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060214 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060215 DATE AS OF CHANGE: 20060214 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HALIFAX CORP CENTRAL INDEX KEY: 0000720671 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370] IRS NUMBER: 540829246 STATE OF INCORPORATION: VA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08964 FILM NUMBER: 06617919 BUSINESS ADDRESS: STREET 1: 5250 CHEROKEE AVE CITY: ALEXANDRIA STATE: VA ZIP: 22312 BUSINESS PHONE: 7037502202 MAIL ADDRESS: STREET 1: 5250 CHEROKEE AVENUE CITY: ALEXANDRIA STATE: VA ZIP: 22312 FORMER COMPANY: FORMER CONFORMED NAME: HALIFAX ENGINEERING INC/VA DATE OF NAME CHANGE: 19911204 8-K 1 f8k3qe.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of Earliest Event Reported): February 14, 2006 HALIFAX CORPORATION (Exact name of registrant as specified in its charter) Virginia 1-08964 54-0829246 (State or other (Commission File (I.R.S. Employer jurisdiction of Number) Identification No.) incorporation) 5250 Cherokee Avenue, Alexandria, Virginia 22312 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (703) 658-2400 N/A Former name, former address, and former fiscal year, if changed since last report Check the appropriate box below if the Form 8-K filing is intended to satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act(17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition. The following information is being provided pursuant to Item 2.02. Such information, including the exhibit attached hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. On February 14, 2006, Halifax Corporation issued a press release reporting its results for the third quarter of fiscal year 2006. A copy of this press release is attached hereto as an exhibit and is incorporated herein by reference. FOREWARD-LOOKING STATEMENTS Certain statements in this Currant Report on Form 8-K constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. While forward-looking statements sometimes are presented with numerical specificity, they are based on various assumptions made by management regarding future events over which we have little or no control. Forward-looking statements may be identified by words including "anticipate," "believe," "estimate," "expect" and similar expressions. We caution readers that forward-looking statements, including without limitation, those relating to future business prospects, revenues, working capital, liquidity, and income, are subject to certain risks and uncertainties that would cause actual results to differ materially from those indicated in the forward-looking statements. Factors that could cause actual results to differ from forward-looking statements include the concentration of our revenues, risks involved in contracting with our customers, including difficulties to accurately estimate costs when bidding on a contract and the occurrence of start-up costs prior to receiving revenues and contract with fixed price provisions, government contracting risks, potential conflicts of interest, difficulties we may have in attracting and retaining management, professional and administrative staff, fluctuation in quarterly results, risks related to acquisitions and acquisition strategy, continued favorable banking relationships, the availability of capital to finance operations and ability to make payments on outstanding indebtedness, weakened economic conditions, acts of terrorism, risks related to competition and our ability to continue to perform efficiently on contracts, and other risks and factors identified from time to time in the reports we file with the Securities and Exchange Commission ("SEC"), including our Annual Report on Form 10-K. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Forward-looking statements are intended to apply only at the time they are made. Moreover, whether or not stated in connection with a forward-looking statement, the Company undertakes no obligation to correct or update a forward-looking statement should we later become aware that it is not likely to be achieved. If the Company were to update or correct a forward-looking statement, you should not conclude that the Company will make additional updates or correction thereafter. Item 9.01 Financial Statements and Exhibits. (a) Financial Statements of Businesses Acquired None. (b) Pro-forma Financial Information None. (c) Exhibits 99.1 Press Release dated February 14, 2006 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. HALIFAX CORPORATION Date: February 14, 2006 By: /s/Joseph Sciacca Joseph Sciacca Vice President, Finance & CFO EXHIBIT INDEX Exhibit No. Description 99.1 Press Release dated February 14, 2006 EX-99.1 2 ex991e.txt Exhibit 99.1 HALIFAX ANNOUNCES THIRD QUARTER FINANCIAL RESULTS Company Reports Revenue Increase of 6% and Positive Gross Margin ALEXANDRIA, VA - February 14, 2006 - Halifax Corporation (AMEX:HX) today announced its financial results for the quarter ended December 31, 2005. Revenues for the third quarter of fiscal 2006 were $13.4 million versus $12.6 million for the same period in fiscal 2005, an increase of 6%, primarily as a result of new enterprise maintenance contract business and growth within its existing contract base. The Company reported a gross margin of $314,000 in the 2006 third quarter versus a loss of $372,000 in the same quarter a year ago. Included in the cost of services for the 2006 third quarter was a significant charge related to the potential cessation of one of the Company's large nationwide enterprise maintenance contracts. The operating loss for the third quarter of 2006 was $4.3 million versus an operating loss of $1.8 million for the comparable quarter of last year. The operating loss for this year's third quarter included non-recurring charges of $3.2 million for goodwill impairment and $144,000 for severance costs. The writedown of goodwill had no impact on cash flow or tangible net worth. Halifax also recognized a gain on the sale of discontinued operations for $5.4 million due to the sale of the Company's Secure Network Services business on June 30, 2005. The net income for the third quarter of 2006 was $1.4 million, or $0.44 per share, compared to a net loss of $1.0 million, or $0.33 per share, for the comparable period in fiscal 2005. According to Charles McNew, president and chief executive officer, "We are encouraged by our continued top line growth in a difficult marketplace, and the outlook for new enterprise maintenance business is very promising. We have a strong balance sheet and an excellent working capital position. We're continuing to evaluate various strategic alternatives to further position our Company for near- and longer-term growth opportunities." For the nine months ended December 31, 2005, revenues were $42.0 million, up 22% compared to $34.5 million for the same period last year. The operating loss for the nine months ended December 31, 2005, was $4.6 million versus an operating loss of $2.7 million for the same period last year. The net income for the nine months ended December 31, 2005, was $1.3 million, or $0.41 per share, versus a net loss of $900,000, or $0.30 per share, for the nine months ended December 31, 2004. McNew noted, "We are working diligently to resolve the issues associated with the losses on one large nationwide enterprise maintenance account, and we will not allow the ongoing losses related to this contract to continue. We expect to have final resolution this quarter, and we believe we can return our Company to sustained profitability." The Company will host a conference call for investors at 9 a.m. EST on Wednesday, February 15, 2006, to review the financial and operational results for the quarter. The conference call phone number is 866-503- 1968 for U.S. callers and 212-341-7080 for international callers. The conference call replay will be available from 11 a.m. EST on Wednesday, February 15, 2006, to 11 a.m. EST on Thursday, February 16, 2006. The replay number is 800-633-8284 for U.S. callers and 402-977-9140 for international callers. The reservation number is 21283722. Founded in 1967, Halifax Corporation is an enterprise maintenance solutions company providing a wide range of technology services to commercial and government customers throughout the United States. The Company's principal products are high availability hardware maintenance services, technology deployment and integration services. More information on Halifax can be found at www.hxcorp.com. Certain statements made by the Company which are not historical facts may be considered forward-looking statements, including, without limitation, statements as to trends, management's beliefs, views, expectations and opinions, which are based upon a number of assumptions concerning future conditions that ultimately may prove to be inaccurate. Such forward-looking statements are subject to risks and uncertainties and may be affected by various factors described in the Risk Factors Section in the Company's Annual Report on Form 10-K that may cause actual results to differ materially from those in the forward- looking statements. For further information that could affect the Company's financial statements, please refer to the Company's reports filed with the Securities and Exchange Commission.
Halifax Corporation Summary Financial Data (in 000's except per share Three Months Ended Nine Months Ended amounts) December 31, December 31, Statements of Operations 2005 2004 2005 2004 Revenues $ 13,390 $ 12,645 $ 42,027 $ 34,511 Cost of services 13,076 13,017 39,437 32,956 Gross Margin 314 (372) 2,590 1,555 Selling, Marketing, General 1,259 1,384 3,848 4,041 & Administrative Abandonment of facility - - - 179 Severance costs 144 - 144 - Goodwill impairment 3,211 - 3,211 - Operating (loss) income (4,300) (1,756) (4,613) (2,665) Other income - - 5 3 Interest expense (135) (163) (458) (462) (loss) before income taxes (4,435) (1,919) (5,066) (3,124) Income tax (benefit) (441) (668) (665) (1,107) Loss from continuing (3,994) (1,251) (4,401) (2,017) operations Income from continuing - 216 310 1,117 operations Gain on sale of discontinued 5,393 - 5,393 - operations Net income (loss) $ 1,399 $ (1,035) $ 1,302 $ (900) Income (loss) earnings per common share - basic: Continuing operations $ (1.26) $ (.40) $ (1.39) $ (.67) Discontinued operations - .07 .10 .37 Gain on sale of 1.70 - 1.70 - discontinued operations $ .44 $ (.33) $ .41 $ (.30) Income (loss) earnings per common share - diluted: Continuing operations $ (1.26) $ (.40) $ (1.39) $ (.67) Discontinued operations - .07 .10 .37 Gain on sale of 1.70 - 1.70 - discontinued operations $ .44 $ (.33) $ .41 $ (.30) Weighted average number of common shares outstanding: Basic 3,172 3,166 3,172 3,002 Diluted 3,183 3,238 3,188 3,052
Balance Sheets December 31, March 31, 2005 2005 Current assets Cash $ 555 $ 1,264 Restricted cash 2,024 - Trade accounts receivable, net 11,147 12,468 Inventory, net 6,323 5,600 Prepaid expense and other 500 487 current assets Deferred tax asset 1,083 3,814 Total current assets 21,632 23,633 Property and equipment, net 1,220 1,608 Goodwill and intangibles, net 4,306 7,438 Other assets 133 141 Deferred tax asset 750 930 Total assets $ 28,041 $ 33,750 Liabilities and Stockholders' Equity Current liabilities Accounts payable and accrued $ 7,742 $ 10,731 expenses Deferred maintenance revenue 3,529 3,776 Notes payable 168 662 Income tax payable 609 - Current portion of long-term 4 17 debt Total current liabilities 12,052 15,186 Long-Term bank debt 7,028 9,463 Other long-term debt - 3 Subordinated debt-affiliate 1,000 2,400 Deferred income 233 278 Total liabilities 20,313 27,330 Stockholders' equity 7,728 6,420 Total liabilities and $ 28,041 $ 33,750 stockholders' equity
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