EX-99.1 2 a4691994ex991.txt VALPEY-FISHER CORPORATION EXHIBIT 99.1 Exhibit 99.1 Valpey-Fisher Corporation Reports Second Quarter 2004 Results HOPKINTON, Mass.--(BUSINESS WIRE)--July 30, 2004--Valpey-Fisher Corporation (AMEX:VPF), reported today its financial results for the second quarter and six months ended June 27, 2004. Valpey-Fisher Corporation specializes in providing frequency control devices, including quartz crystals and oscillators. In our 1st quarter letter, we said, "Given the current backlog, we expect to increase our shipping levels into the 2nd quarter." We are pleased to report we in fact increased our shipments from the $2,767,000 in the first quarter to $3,151,000 in the second quarter. Perhaps as important, we maintained a book-to-bill ratio of 1 so that our backlog remains at the same level as we enter the 3rd quarter. During the 2nd quarter, our headcount of permanent employees remained the same, however, we did add in 3 temporary direct labor people. Even counting the 3 temps, our sales per employee improved from $40,000 to $45,000 on a quarterly basis. Unfortunately, we still experienced an operating loss of $44,000, our smallest loss in more than 3 years. If there is a bright side to any loss at all, it's this is almost $100,000 less than the first quarter of this year and $600,000 less than the comparable quarter of 2003. Net sales for the quarter ending June 27, 2004 were $3,151,000 an increase of $971,000 over the amount reported in the 2nd quarter of 2003. Gross profit for the current quarter was $922,000, a $640,000 increase over the comparable 2003 quarter. For the current quarter we had an operating loss of $44,000 and an after tax loss of $23,000 or a net loss of $.01 per share from continuing operations. During the current quarter, we expensed $110,000 to increase the environmental expense accrual to reflect the revised estimate to complete the next phase of the environmental cleanup on the New Jersey property we sold in 1998. This expense is presented in the Condensed Consolidated Statement of Operations under the caption "(Loss) from discontinued operations". As a result, we are reporting a net loss of $133,000 or $.03 per share in the current quarter. New orders for the quarter were approximately $3.2 million, an increase of $969,000 over the comparable quarter of 2003 and about equal to that of the 1st quarter of 2004. Our balance sheet continues to remain strong with $4.2 million in cash and no outstanding debt. Although we continue to be cautious about predicting future results, we believe that the programs enacted over the last several quarters will continue to show positive results and should move us toward profitability. If market conditions for our major customers remain the same or hopefully improve, we expect to continue to reduce our operating loss in the 3rd quarter. Ted Valpey, Jr. Michael J. Ferrantino Chairman of the Board President and Chief Executive Officer July 30, 2004 Forward-Looking Statements Certain statements made herein contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Words such as "expects", "believes", "estimates", "plans" or similar expressions are intended to identify such forward-looking statements. The forward- looking statements are based on the Company's current views and assumptions and involve risks and uncertainties that include, but not limited to: the Company's ability to achieve profitability, the current production over-capacity within the suppliers of frequency control devices, the ability to develop, market and manufacture new innovative products competitively, the fluctuations in product demand of the telecommunications industry, the ability of the Company and its suppliers to produce and deliver materials and products competitively, and the ability to limit the amount of the negative effect on operating results caused by pricing pressure. Valpey-Fisher Corporation Condensed Consolidated Statements of Operations Unaudited (in thousands, except per share data) Quarter Ended Six Months Ended ---------------- ----------------- 6/27/04 6/29/03 6/27/04 6/29/03 ---------------- ----------------- Net sales $3,151 $2,180 $5,918 $3,891 Cost of sales 2,229 1,898 4,209 3,524 ---------------- ----------------- Gross profit 922 282 1,709 367 Selling and advertising expenses 401 371 797 746 General and administrative expenses 515 522 988 895 Research and development expenses 50 38 111 75 ---------------- ----------------- 966 931 1,896 1,716 ---------------- ----------------- Operating (loss) (44) (649) (187) (1,349) Other income, net 21 12 27 20 ---------------- ----------------- (Loss) from continuing operations before income taxes (23) (637) (160) (1,329) Income tax benefit 0 208 0 443 ---------------- ----------------- (Loss) from continuing operations (23) (429) (160) (886) (Loss) from discontinued operations (110) 0 (110) 0 ---------------- ----------------- Net (loss) $(133) $(429) $(270) $(886) ================ ================= Basic and diluted (loss) per share: Continuing operations $(0.01) $(0.10) $(0.04) $(0.21) Discontinued operations (0.02) 0.00 (0.02) 0.00 ---------------- ----------------- $(0.03) $(0.10) $(0.06) $(0.21) ================ ================= Basic and diluted weighted average shares 4,216 4,186 4,205 4,191 Valpey-Fisher Corporation Condensed Consolidated Balance Sheets (in thousands) (Unaudited) (Audited) 6/27/04 12/31/03 ---------------------- ASSETS Current assets: Cash and cash equivalents $4,161 $4,209 Receivables, net 2,812 2,467 Inventories, net 1,945 1,571 Deferred income taxes and other current assets 731 675 ---------------------- Total current assets 9,649 8,922 ---------------------- Property, plant and equipment, at cost 10,741 10,752 Less accumulated depreciation 7,406 7,064 ---------------------- 3,335 3,688 ---------------------- Other assets 143 134 ---------------------- $13,127 $12,744 ====================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities $2,002 $1,440 Deferred income taxes 626 646 Stockholders' equity 10,499 10,658 ---------------------- $13,127 $12,744 ====================== CONTACT: Valpey-Fisher Corporation Michael J. Kroll, 508-435-6831 ext. 600