EX-99.1 2 ex991q1f.txt Exhibit 99.1 HALIFAX ANNOUNCES FIRST QUARTER FINANCIAL RESULTS "Net Income Increases Over Prior Year" ALEXANDRIA, VA - August 6, 2008 - Halifax Corporation (AMEX:HX) today announced its financial results for the quarter ended June 30, 2008. Revenues for the first quarter of fiscal 2009 were $9.0 million compared to $12.5 million for the same quarter last year. The decrease in revenues was attributable to the termination of certain large nationwide enterprise maintenance contracts, including the loss of a large aeronautical manufacturing customer. Gross Profit margin for this year's first quarter was $1.51 million, or 17% of revenues, versus $1.48 million, or 12% of revenues, for the same period a year ago. The margin improvement was attributable to a more profitable sales mix coupled with an aggressive cost containment program. The Company reported net income of $203,000, or $0.06 per basic and diluted share as compared to $135,000, or $0.04 per basic and diluted share for the first quarter of last year. Charles McNew, President and Chief Executive Officer, stated, "We are pleased with our improving profitability profile. We have worked diligently to drive our costs down by utilization of a variable workforce model and by taking actions to move away from business that is dependent on major inventory investment and parts risk." "Our cash flow is improving, we have a new long-term financing in place and our borrowing levels remain low by historical standards." "We are confident that our new service model, which has positioned the Company as a leader in global supply chain solutions for the middle market, is presenting a significant opportunity for a return to market share expansion." "In addition, we continue to develop a robust pipeline of new business opportunities for both Enterprise Logistics Services and Field Maintenance Solutions." The Company will host a conference call for investors at 11 a.m. EDT on Wednesday, August 6, 2008, to review the financial and operational results for the quarter. The conference call phone number is 800-768- 5901 for U.S. callers and 212-231-2906 for international callers. The conference call replay will be available from 1 p.m. EDT on Wednesday, August 6, 2008, to 1 p.m. EDT on Thursday, August 7, 2008. The replay number is 800-633-8284 for U.S. callers and 402-977-9140 for international callers. The reservation number is 21390175. Founded in 1967, Halifax Corporation is an enterprise logistics and 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 enterprise logistics solutions and high availability hardware maintenance 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 ended June 30, 2008 2007 Revenues $ 9,017 $ 12,461 Cost of services 7,504 10,979 Gross profit 1,513 1,482 Selling, marketing, general & administrative 1,196 1,161 Operating income 317 321 Other income - 11 Interest expense (83) (192) Income before income taxes 234 140 Income tax expense 31 5 Net income $ 203 $ 135 Earnings per common share - basic and diluted $ 0.06 $ 0.04 Weighted average number of common shares outstanding: Basic 3,175 3,175 Diluted 3,175 3,181
Balance Sheets June 30, 2008 March 31, 2008 Current assets Cash $ 709 $ 232 Trade accounts receivable, net 6,533 10,206 Inventory, net 3,149 3,240 Prepaid expenses and other current assets 253 220 Total current assets 10,644 13,898 Property and equipment, net 921 1,001 Goodwill and intangibles, net 3,508 3,580 Other assets 103 111 Total assets $15,176 $18,590 Liabilities and stockholders' equity Current liabilities Accounts payable and accrued expenses $ 4,523 $ 5,280 Income tax payable 65 35 Deferred maintenance revenue 3,515 4,309 Bank debt 2,493 4,448 Auxillary line of credit - 60 Current portion of long-term debt 277 276 Total current liabilities 10,873 14,408 Other long-term debt 252 325 Subordinated debt - affiliate 1,000 1,000 Deferred income 84 99 Total liabilities 12,209 15,832 Stockholders' equity 2,967 2,758 Total liabilities and stockholders' equity $15,176 $18,590