-----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, NMnD4ihyoEj0u98EBIpzS89KvJoZrsTTVastwH/qfzZv9AP/oH9zYLYeyuxrIfn2 AUxE18sLgCZgR8tM8OHlsQ== 0000720671-07-000013.txt : 20070711 0000720671-07-000013.hdr.sgml : 20070711 20070711085226 ACCESSION NUMBER: 0000720671-07-000013 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20070711 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070711 DATE AS OF CHANGE: 20070711 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: 07973325 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): July 11, 2007 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 July 11, 2007, Halifax Corporation issued a press release reporting its financial results for the fourth quarter and fiscal year ended March 31, 2007. 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 July 11, 2007 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: July 11, 2007 By: /s/Joseph Sciacca Joseph Sciacca Vice President, Finance & CFO EXHIBIT INDEX Exhibit No. Description 99.1 Press Release dated July 11, 2007 EX-99.1 2 ex991e.txt Exhibit 99.1 HALIFAX ANNOUNCES FOURTH QUARTER AND FISCAL 2007 FINANCIAL RESULTS Alexandria, VA - July 11, 2007 - Halifax Corporation (AMEX: HX) today announced its financial results for the fourth quarter and fiscal year ended March 31, 2007. Revenues for fiscal 2007 were $50.7 million compared to prior fiscal 2006 revenues of $54.9 million. The revenue decrease, which was primarily due to the cessation of an unprofitable nationwide contract in April 2006, was partially offset by new more profitable business. Halifax reported gross margins of $4.4 million, or 9% of revenues, for the 2007 fiscal year, versus $3.7 million, or 7% of revenues, for the previous year. The margin improvement in fiscal 2007 was due to a better mix of more profitable business. The Company's current year margins were negatively impacted as a result of a contract loss in the fourth quarter and a non-cash charge of $640,000 taken in the fourth quarter related to inventory reserves. In fiscal 2006, margins were negatively impacted by the unprofitable nationwide contract referenced above. This contract was concluded in April 2006. The Company reported breakeven results for operating profit in fiscal 2007, versus an operating loss of $1.5 million for the prior year. Halifax also recognized a gain of $2.5 million on the sale of its Secure Network Services business in fiscal 2006. The net loss for fiscal 2007 was $2.8 million, or $0.88 per share. The principal reason for the loss was a non-cash charge of approximately $2.2 million related to recording a full valuation allowance against a deferred tax asset, which had been carried on the balance sheet. For fiscal 2006 the Company reported net income of $1.5 million, or $0.48 per basic and diluted share. According to Charles McNew, president and chief executive officer, "Were it not for certain non-cash adjustments, we would have reported a marginally profitable year for fiscal 2007, as contrasted to a loss from continuing operations of $1.3 million for fiscal 2006. From an operational standpoint, we have a healthy backlog and as mentioned in recent releases, despite the competitive marketplace, we are encouraged by the present volume of potential new deals." McNew added, "We are continuing to evaluate various strategic alternatives to further position our Company for near and longer term growth opportunities." For the quarter ended March 31, 2007, revenues were $13.0 million compared to $12.9 million for the same period last year. Gross margin was $225,000 for the quarter ended March 31, 2007, compared to gross margin of $1.1 million for the same period last year. The primary reason for the decrease in gross margin was a non-cash charge for inventory obsolescence and a loss on a contract that has been terminated. The operating loss for the quarter ended March 31, 2007, was $822,000 as compared to an operating loss of $74,000 for the same period last year. Primarily as a result of the non-cash deferred tax asset adjustment, the Company reported a net loss of $2.9 million for the quarter ended March 31, 2007, or $0.93 per share, as compared to net income of $233,000, or $0.07 per basic and diluted share, for the same period last year, which included a gain on the sale of discontinued operations. The Company will host a conference call for investors at 11:00 a.m. EDT on Wednesday, July 11, 2007, to review the financial and operational results for the quarter. The conference call phone number is 800-926- 6531 for U.S. callers and 415-226-5360 for international callers. The conference call replay will be available from 1 p.m. EDT on Wednesday, July 11, 2007, to 1 p.m EDT on Thursday, July 12, 2007. The replay number is 800-633-8284 for U.S. callers and 402-977-9140 for international callers. The reservation number is 21343980. 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 March 31, ended March 31, 2007 2006 2007 2006 Revenues $12,977 $12,884 $50,695 $54,911 Cost of Services 12,752 11,774 46,268 51,211 Gross margin 225 1,110 4,427 3,700 Selling, marketing, general & administrative 1,047 1,184 4,427 5,032 Severance costs - - - 144 Operating loss (822) (74) - (1,476) Other income 9 - 32 6 Interest expense (181) (125) (673) (583) Loss before income taxes (994) (199) (641) (2,053) Income tax expense 1,953 (112) 2,149 (777) benefit Loss from continuing operations (2,947) (87) (2,790) (1,276) Income from discontinued operations - - - 310 Gain on sale of discontinued operations - 320 - 2,502 Net (loss) income $(2,947) $233 $(2,790) $1,536 Earnings per common share - basic Continued operations $(.93) $(.03) $(.88) $ (.40) Discontinued - - - .09 operations Gain on sale of - .10 - .79 discontinued operations $(.93) $.07 $(.88) $.48 Earnings per common share - diluted Continued operations $(.93) $(.03) $(.88) $ (.40) Discontinued - - - .09 operations Gain on sale of - .10 - .79 discontinued operations $(.93) $.07 $(.88) $.48 Weighted average number of common Shares outstanding Basic 3,175 3,172 3,175 3,174 Diluted 3,180 3,183 3,180 3,188
Balance Sheets March 31,2007 March 31,2006 Current assets Cash $1,078 $400 Restricted cash 673 625 Trade accounts receivable, net 11,345 11,415 Inventory, net 4,946 6,363 Prepaid expenses and other current assets 584 722 Deferred tax asset - 1,332 Total current assets 18,626 20,857 Property and equipment, net 1,225 1,381 Goodwill and intangibles, net 3,865 4,213 Other assets 121 130 Deferred tax asset - 828 Total assets $23,837 $27,409 Liabilities and stockholders' equity Current liabilities Accounts payable and accrued expenses $6,375 $7,135 Deferred maintenance revenue 3,058 3,515 Notes payable - 168 Income tax payable 11 331 Bank debt 6,880 - Auxiliary line of credit 1,000 - Current portion of long-term debt 31 34 Total current liabilities 17,355 11,183 Long-term bank debt 7,880 6,891 Other long-term debt 120 154 Subordinated debt - affiliate 1,000 1,000 Deferred income 159 218 Total liabilities 18,634 19,446 Stockholders' equity 5,203 7,963 Total liabilities and stockholders' equity $23,837 $27,409
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