-----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, BCtI7oyd3FtDz+afrFhM+VfGoPGcJSvREtundUC0g9RESOzPoc9r5gUvlu796Rzh 1tBmfYogHr9Egp75I/neNQ== 0000720671-06-000021.txt : 20060622 0000720671-06-000021.hdr.sgml : 20060622 20060622094309 ACCESSION NUMBER: 0000720671-06-000021 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060622 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060622 DATE AS OF CHANGE: 20060622 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: 06918587 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 f8k4qtre.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): June 22, 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 June 22, 2006, Halifax Corporation issued a press release reporting its financial results for the fourth quarter and fiscal year ended March 31, 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 June 22, 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: June 22, 2006 By: /s/Joseph Sciacca Joseph Sciacca Vice President, Finance & CFO EXHIBIT INDEX Exhibit No. Description 99.1 Press Release dated June 22, 2006 EX-99.1 2 ex991e.txt Exhibit 99.1 HALIFAX ANNOUNCES FOURTH QUARTER AND FISCAL 2006 FINANCIAL RESULTS Company Reports Gross Margin Increase for the Quarter and Year; Annual Revenues Up 13% ALEXANDRIA, VA - June 22, 2006 - Halifax Corporation (AMEX:HX) today announced its financial results for the fourth quarter and fiscal year ended March 31, 2006. For the year, revenues were $54.9 million, up 13% compared to prior year revenues of $48.4 million. The revenue increase was the result of growth in both high-availability nationwide maintenance services and site-based managed services. Halifax reported a gross margin of $3.7 million, or 7% of revenues, for the 2006 fiscal year versus $1.9 million, or 4% of revenues, for the previous year. As previously reported, fiscal year 2006 included costs related to the cessation of a large nationwide enterprise maintenance contract that had generated significant losses for the Company over the last two years. This contract was concluded in April 2006. The operating loss for fiscal 2006 was $4.7 million versus an operating loss of $3.8 million for the prior year. The operating loss for fiscal year 2006 included non-recurring goodwill charges of $3.2 million and certain contract cessation costs. The writedown of goodwill had no impact on cash flow or tangible net worth. Halifax also recognized a gain of $5.7 million from the sale of its Secure Network Services business on June 30, 2005. Net income for fiscal year 2006 was $1.5 million, or $0.48 per diluted share, compared to a net loss of $1.4 million, or $0.46 per share, a year ago. According to Charles McNew, president and chief executive officer, "We are extremely pleased with our top line growth and our gross margin improvement. Our current backlog stands at a healthy $80 million and our pipeline for prospective new business is strong. We expect to return to sustainable profitability for the quarter ended June 30, 2006, and hope to have some exciting new revenue announcements in the near future. It's also worth noting that our balance sheet continues to strengthen as working capital improves and debt is reduced." For the quarter ended March 31, 2006, revenues were $12.9 million compared to $13.9 million for the same period last year. The revenue drop was attributable to the expiration of several contracts. The gross margin was $1.1 million, or 8.6%, for the 2006 fourth quarter versus $339,000, or 2.4%, for the comparable quarter a year ago. The operating loss for the quarter ended March 31, 2006, was $74,000 versus an operating loss of $1.1 million for the same period last year. Net income for the three months ended March 31, 2006, was $233,000, or $0.07 per diluted share, versus a net loss of $511,000, or $0.16 per share, for the same period in 2005. The net income improvement for the fiscal 2006 fourth quarter was due to the strengthening margin and certain tax benefits recorded during the period. McNew noted, "Our confidence in the long-term prospects for Halifax remains high, despite the challenging marketplace. As we approach our return to profitability, we're looking forward to building our stature in the enterprise maintenance solutions and managed services marketplace. In addition, we're continuing to evaluate various strategic alternatives to further position our Company for near and longer term growth opportunities." The Company will host a conference call for investors at 11:00 a.m. EDT on Thursday, June 22, 2006, to review the financial and operational results for the quarter. The conference call phone number is 800-847- 8127 for U.S. callers and 212-676-5269 for international callers. The conference call replay will be available from 11 a.m. EDT on Thursday, June 22, 2006, to 11 a.m. EDT on Friday, June 23, 2006. The replay number is 800-633-8284 for U.S. callers and 402-977-9140 for international callers. The reservation number is 21296626. 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 Thousands, except per share amounts)
Statement of operations For the three months For the years ended ended March 31, March 31, 2006 2005 2006 2005 Revenues $12,884 $13,915 $54,911 $48,426 Cost of Services 11,774 13,576 51,211 46,530 Gross margin 1,110 339 3,700 1,896 Selling, marketing, general & administrative 1,184 1,454 5,032 5,496 Abandonment of facility - - - 179 Severance costs - - 144 - Goodwill impairment - - 3,211 - Operating (loss) (74) (1,115) (4,687) (3,779) Other income Other income (expense) 1 (3) 6 - Interest expense (126) (201) (583) (663) (Loss) before income taxes (199) (1,319) (5,264) (4,442) Income tax (benefit) (112) (553) (777) (1,653) (Loss) from continuing operations (87) (766) (4,487) (2,789) Income from discontinued operations - 255 310 1,378 Gain on sale of discontinued operations 320 - 5,713 - Net income (loss) $233 $(511) $1,536 $(1,411) Income (loss) Earnings per common share - basic Continued operations $(.03) $(.24) $ (1.41) $(.92) Discontinued operations - .08 .09 .46 Gain on sale of discontinued operations .10 - 1.80 - $.07 $(.16) $.48 $(.46) Income (loss) Earnings per common share - diluted Continued operations $(.03) $(.24) $ (1.41) $(.92) Discontinued operations - .08 .09 .46 Gain on sale of discontinued operations .10 - 1.80 - $.07 $(.16) $.48 $(.46) Weighted average number of common shares outstanding Basic 3,175 3,168 3,174 3,043 Diluted 3,183 3,227 3,188 3,095
Balance Sheets March 31, March 31, 2006 2005 Current assets Cash $400 $1,264 Restricted cash 625 - Trade accounts receivable, net 11,415 9,626 Inventory, net 6,363 5,600 Prepaid expenses and other current assets 722 487 Deferred tax asset 1,332 3,814 Assets held for sale - 2,869 Total current assets 20,857 23,660 Property and equipment, net 1,381 1,581 Goodwill and intangibles, net 4,213 7,438 Other assets 130 141 Deferred tax asset 828 930 Total assets $27,409 $33,750 Liabilities and stockholders' equity Current liabilities Accounts payable and accrued expenses $7,135 $9,112 Deferred maintenance revenue 3,515 3,776 Notes payable 168 662 Income tax payable 331 - Current portion of long-term debt 34 17 Liabilities from discontinued operations - 1,619 Total current liabilities 11,183 15,186 Long-term bank debt 6,891 9,463 Other long-term debt 154 3 Subordinated debt - affiliate 1,000 2,400 Deferred income 218 278 Total liabilities 19,446 27,330 Stockholders' equity 7,963 6,420 Total liabilities and stockholders' equity $27,409 $33,750
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