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
March
8, 2011
(Date of Report)
ULTRALIFE
CORPORATION
(Exact
name of registrant as specified in its charter)
|
Delaware |
000-20852 |
16-1387013 |
|
(State of incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
|
2000 Technology Parkway, Newark, New York |
14513 |
|
(Address of principal executive offices) |
(Zip Code) |
(315)
332-7100
(Registrant’s telephone number, including area
code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
⃞ 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 Operation and Financial Condition. |
Attached as Exhibit 99.1 and incorporated herein by reference is a copy of the press release issued by Ultralife Corporation (the “Company”) on March 10, 2011 relating to the exit activities described below in Item 2.05 of this Report, which will be included in the Company’s financial results for the first three quarters of 2011 and for the full year ended December 31, 2011. The press release also updates the Company’s guidance for 2011 operations. As a result of exiting the Energy Services business and reclassifying it as a discontinued operation when complete, management now expects to report revenue of approximately $168 million from continuing operations. Excluding SATCOM system shipments in both periods, revenue is expected to grow by 18% over 2010. Operating income is expected to be no less than $10.5 million, excluding the Energy Services closing costs of approximately $3.2 million relating to the exit activities described below in Item 2.05, representing an operating margin of 6.3%. This compares favorably to the 2010 operating margin of 4.4% adjusting for the $13.8 million non-cash impairment charge.
The press release is being furnished pursuant to Item 2.02 of Form 8-K and General Instruction B.2 thereunder. The information in the press release shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.
|
Item 2.05 |
Costs Associated with Exit or Disposal Activities. |
On March 8, 2011, senior management of the Company, as authorized by the Company’s Board of Directors, decided to exit the Company’s Energy Services business. As a result of management’s ongoing review of the Company’s business segments and products, and taking into account the growth and profitability potential of the Energy Services segment as well as its sizeable operating losses over the last several years, we determined it was appropriate to refocus the Company’s operations on profitable growth opportunities presented in our other segments, Battery & Energy Products and Communication Systems. In the fourth quarter of 2010, we recorded a non-cash impairment charge of $13.8 million to write-off the goodwill and intangible assets and certain fixed assets associated with the standby power portion of our Energy Services business. We anticipate that the actions taken to exit our Energy Services business will result in the elimination of approximately 40 jobs and the closing of five facilities, primarily in California, Florida and Texas, over several months. We expect to complete all exit activities with respect to our Energy Services segment by the end of the third quarter. Upon completion, we will reclassify our Energy Services segment as a discontinued operation.
In connection with the exit activities described above, the Company expects that it will record total restructuring charges of approximately $3.2 million, the majority of which are related to employee-related costs, including termination benefits, lease termination costs and inventory and fixed asset write-downs, of which approximately $1.2 million will be recorded in the first quarter of 2011. The cash component of the aggregate charge is expected to be approximately $2.2 million.
Forward-Looking Statements
This report on Form 8-K may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include: worsening global economic conditions, increased competitive environment and pricing pressures, and disruptions related to restructuring actions and delays. The Company cautions investors not to place undue reliance on forward-looking statements, which reflect our analysis only as of the date of this filing. We undertake no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances. Further information on these factors and other factors that could affect the Company’s financial results is included in our filings with the United States Securities & Exchange Commission, including our latest Annual Report on Form 10-K.
|
Item 9.01 |
Financial Statements and Exhibits. |
(d) Exhibits. The following exhibit is being furnished as part of this Report.
|
Exhibit |
|||
|
Number |
Description |
||
| 99.1 | Press Release of Ultralife Corporation dated March 10, 2011 |
SIGNATURES
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.
|
Date: |
March 10, 2011 |
ULTRALIFE CORPORATION |
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|
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||
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|
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By: |
/s/ Peter F. Comerford |
|
Peter F. Comerford |
|||
|
Vice President of Administration and
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EXHIBIT INDEX
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Exhibit |
|||
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Number |
Description |
||
| 99.1 | Press Release of Ultralife Corporation dated March 10, 2011 |
Exhibit 99.1
Ultralife to Exit Energy Services Business
Company Provides Operating Income Guidance for Fiscal 2011
NEWARK, N.Y.--(BUSINESS WIRE)--March 10, 2011--Ultralife Corporation (NASDAQ: ULBI) announced today that it will exit and close its Energy Services business. For the past two years, cautious spending and continued delays in implementing large capital projects by customers in the lead acid standby power industry have negatively impacted results for the company’s Energy Services segment.
In the fourth quarter of 2010, the company recorded a non-cash impairment charge of $13.8 million to write-off the goodwill and intangible assets and certain fixed assets associated with its Energy Services business. Since 2008, this business has incurred significant operating losses.
In connection with exiting its Energy Services business, the company expects to incur closing costs of approximately $3.2 million of which approximately $1.2 million will be recorded in the first quarter of 2011. The cash component of the closing costs is approximately $2.2 million and is expected to be offset by cash received from accounts receivables and liquidated assets. The company expects to complete the exit by the end of the third quarter. Once completed, the Energy Services segment will be reclassified as a discontinued operation.
“Since joining Ultralife two months ago, I have been conducting reviews of each business segment and the products in our portfolio with a view toward assessing their contribution to the company’s long-term sustainable growth and quality of earnings. As part of this exercise, we have examined the growth and profitability potential of the Energy Services business, taking into consideration its sizeable operating losses over the last several years and the time and resources required to achieve hurdle rate profitability levels going forward,” said Michael D. Popielec, Ultralife’s president and chief executive officer.
“By exiting the Energy Services business, we will be able to focus our resources on profitable growth opportunities, and expand our presence in commercial markets and internationally. This includes the development of new lithium ion storage technologies for renewable energy applications as well as for the transition from lead acid to lithium ion products in the standby power industry,” said Popielec.
Updated Fiscal 2011 Guidance
Separately, management has updated its full year guidance for 2011. The updated guidance reflects management’s decision to exit the Energy Services business and, once completed, to reclassify the Energy Services segment as a discontinued operation. Management now expects to report revenue of approximately $168 million from continuing operations. Excluding SATCOM system shipments in both periods, revenue is expected to grow by 18% over 2010. Operating income is expected to be no less than $10.5 million, excluding Energy Services closing costs of approximately $3.2 million, representing an operating margin of 6.3%. This compares favorably to the 2010 operating margin of 4.4% adjusting for the $13.8 million non-cash impairment charge. Management cautions that the timing of orders and shipments may cause variability in quarterly results.
About Ultralife Corporation
Ultralife Corporation, which began as a battery company, serves its markets with products and services ranging from portable power solutions to communications and electronics systems. Through its engineering and collaborative approach to problem solving, Ultralife serves government, defense and commercial customers across the globe.
Headquartered in Newark, New York, the company’s business segments include: Battery & Energy Products and Communications Systems. Ultralife has operations in North America, Europe and Asia. For more information, visit www.ultralifecorp.com.
This press release may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include: worsening global economic conditions, increased competitive environment and pricing pressures, disruptions related to restructuring actions and delays. The Company cautions investors not to place undue reliance on forward-looking statements, which reflect the Company’s analysis only as of today’s date. The Company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances. Further information on these factors and other factors that could affect Ultralife's financial results is included in Ultralife's Securities and Exchange Commission (SEC) filings, including the latest Annual Report on Form 10-K.
CONTACT:
Ultralife Corporation
Philip Fain,
315-332-7100
pfain@ulbi.com
or
Investor Relations:
Lippert/Heilshorn
& Associates, Inc.
Jody Burfening, 212-838-3777
jburfening@lhai.com