ROCKY HILL, Conn., July 25, 2007 (PRIME NEWSWIRE) -- Axsys Technologies, Inc. (Nasdaq:AXYS), a global leader in the design, manufacture and distribution of precision optical solutions, today announced financial results for the second quarter ended June 30, 2007.
Consolidated sales totaled $49.2 million in the quarter ended June 30, 2007, compared to $38.5 million in the second quarter of 2006, an increase of $10.7 million, or 28%. Operating income for the quarter was $6.5 million, up 57% from $4.1 million in the second quarter of 2006. In the second quarter of 2007, Axsys reported net income of $3.8 million, or $0.35 per diluted share, an increase of 47% compared to net income of $2.6 million, or $0.24 per diluted share in the quarter ended July 1, 2006.
Backlog increased to a record $142.1 million, representing a 23% increase compared to the end of the second quarter of 2006, and a 5% increase compared to the end of the first quarter of 2007.
"The second quarter was a tremendous success for Axsys," said Stephen W. Bershad, Chairman and CEO of Axsys Technologies. "Not only did we complete an important acquisition and lay the groundwork to sell our Distributed Products business, but we also delivered record results across the board. Our business has never been healthier."
Pro Forma Results (Non-GAAP)
On July 9, 2007, the company announced its intention to sell its Distributed Products Group, and expects to report the business as a discontinued operation as of the third quarter of 2007.
Excluding the Distributed Products Group, the results for the second quarter of 2007, and comparisons to the second quarter of 2006, are as follows:
* Sales increased 36% to a record $43.0 million. * Operating income grew 62% to $6.0 million. * Net income increased 51% to $3.5 million. * Diluted earnings per share increased to $0.32 from $0.22. * Backlog increased to a record $126.9 million, representing a 25% increase compared to the end of the second quarter of 2006, and a 5% increase during the quarter.
The company experienced strong demand for its products from a variety of end-use applications including ground vehicle weapons stations and surveillance platforms, airborne targeting and surveillance systems, military satellites, commercial infrared applications, and long-range, ground-based surveillance systems.
Cineflex Camera Systems, which was acquired in April 2007, generated revenues of approximately $2 million during the quarter. Mr. Bershad continued, "I am very pleased with the performance of our new gyrostabilized camera business. We have resolved the issues surrounding the transfer of export licenses that threatened to delay some second quarter shipments, and as a consequence revenues exceeded our expectations. Even more importantly, however, the bookings rate is outpacing plan. We continue to be excited by the prospects for this business."
Conference Call
Management will conduct a conference call reviewing the financial results on Thursday, July 26, 2007 at 10:00 a.m. Eastern Time. Shareholders, institutional investors and equity research analysts are invited to participate in the call by dialing 1-866-277-1184 and entering conference passcode 33461363.
The conference call will be webcast live via the Investor Relations section of the Company's web site at www.axsys.com. A replay of the webcast will be available shortly after the conclusion of the call for a period of approximately 90 days.
About Axsys
Axsys Technologies, Inc. is a vertically integrated OEM supplier of precision optical solutions for high technology applications, serving the aerospace, defense, and high performance commercial markets. For more information, visit www.axsys.com.
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. One can identify these forward-looking statements by the use of the words such as "expect," "anticipate," "plan," "may," "will," "estimate" or other similar expressions. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors, which could cause actual results to differ materially, are described in Axsys' reports on Form 10-K and Form 10-Q on file with the Securities and Exchange Commission, including without limitation: changes in the U.S. federal government spending priorities; the Company's ability to compete in the industries in which it operates, including the introduction of competing products or technologies by other companies and/or pricing pressures from competitors and/or customers; the potential for the Company's backlog to be reduced or cancelled; the Company's ability to implement its acquisition strategy and integrate its acquired companies successfully, including the recent acquisition of Cineflex; the Company's ability to successfully complete the planned sale of the Distributed Products business, the Company's ability to manage costs under the Company's fixed-price contracts effectively; and changes in general economic and business conditions. These statements reflect the Company's current beliefs and are based upon information currently available to Axsys. Be advised that developments subsequent to this release are likely to cause these statements to become outdated with the passage of time, and we specifically disclaim any obligation to update these statements.
AXSYS TECHNOLOGIES, INC.
Consolidated Statements of Operations
(Dollars in thousands, except share and per share data - Unaudited)
For the Three For the Six
Months Ended Months Ended
----------------------- -----------------------
June 30, July 1, June 30, July 1,
2007 2006 2007 2006
----------- ----------- ----------- -----------
Sales $ 49,208 $ 38,505 $ 90,749 $ 75,963
Cost of sales 33,120 26,202 61,805 51,988
----------- ----------- ----------- -----------
Gross profit 16,088 12,303 28,944 23,975
Selling, general and
administrative
expenses 7,744 6,956 14,493 13,942
Research, development
and engineering
expenses 1,864 1,212 2,947 2,119
----------- ----------- ----------- -----------
Operating income 6,480 4,135 11,504 7,914
Interest expense (263) (45) (272) (62)
Interest income 56 42 119 151
Other income
(expense), net 6 45 (261) 25
----------- ----------- ----------- -----------
Income from continuing
operations before
income taxes 6,279 4,177 11,090 8,028
Provision for income
taxes 2,432 1,584 4,260 3,045
----------- ----------- ----------- -----------
Income from continuing
operations 3,847 2,593 6,830 4,983
Gain from discontinued
operations, net of
tax -- 20 -- 20
----------- ----------- ----------- -----------
Net income $ 3,847 $ 2,613 $ 6,830 $ 5,003
=========== =========== =========== ===========
BASIC EARNINGS PER
SHARE:
Continuing
operations $ 0.36 $ 0.25 $ 0.64 $ 0.47
Discontinued
operations 0.00 0.00 0.00 0.00
----------- ----------- ----------- -----------
Total $ 0.36 $ 0.25 $ 0.64 $ 0.47
=========== =========== =========== ===========
Weighted-average basic
common shares
outstanding 10,686,285 10,625,504 10,671,827 10,622,639
DILUTED EARNINGS PER
SHARE:
Continuing operations $ 0.35 $ 0.24 $ 0.62 $ 0.46
Discontinued
operations 0.00 0.00 0.00 0.00
----------- ----------- ----------- -----------
Total $ 0.35 $ 0.24 $ 0.62 $ 0.46
=========== =========== =========== ===========
Weighted-average
diluted common
shares outstanding 11,006,968 10,924,326 10,976,385 10,901,362
AXSYS TECHNOLOGIES, INC.
Consolidated Balance Sheets
(Dollars in thousands)
June 30, December 31,
2007 2006
(Unaudited) (Audited)
--------- ---------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 4,250 $ 6,044
Accounts receivable - net 22,320 21,321
Inventories - net 51,575 44,229
Income taxes - deferred 3,997 3,675
Prepaid expenses 1,366 994
Other current assets 342 368
--------- ---------
TOTAL CURRENT ASSETS 83,850 76,631
PROPERTY, PLANT AND EQUIPMENT - net 15,441 22,860
INTANGIBLE ASSETS - net 12,891 9,507
GOODWILL 84,089 62,231
OTHER ASSETS 1,568 1,116
--------- ---------
TOTAL ASSETS $ 197,839 $ 172,345
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Line of credit $ 14,000 $ --
Accounts payable 10,530 10,895
Accrued expenses and other current
liabilities 17,587 18,348
Deferred income 10,004 6,088
--------- ---------
TOTAL CURRENT LIABILITIES 52,121 35,331
OTHER LONG-TERM LIABILITIES 7,610 5,826
SHAREHOLDERS' EQUITY:
Common stock 107 106
Capital in excess of par 100,135 99,111
Retained earnings 37,868 31,977
Treasury stock (2) (6)
--------- ---------
TOTAL SHAREHOLDERS' EQUITY 138,108 131,188
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 197,839 $ 172,345
========= =========
AXSYS TECHNOLOGIES, INC.
Pro Forma Consolidated Statements of Operations (Non-GAAP)*
(Dollars in thousands, except share and per share data - Unaudited)
For Three Months Ended June 30, 2007
-----------------------------------------
Pro Forma Distributed Results
Results Products Group as Reported
----------- ----------- -----------
Sales $ 42,955 $ 6,253 $ 49,208
Cost of sales 28,854 4,266 33,120
----------- ----------- -----------
Gross profit 14,101 1,987 16,088
Operating expenses 8,112 1,496 9,608
----------- ----------- -----------
Operating income 5,989 491 6,480
Interest & other expense, net (196) (5) (201)
----------- ----------- -----------
Income before taxes 5,793 486 6,279
Provision for income taxes 2,244 188 2,432
----------- ----------- -----------
Net income $ 3,549 $ 298 $ 3,847
=========== =========== ===========
Earnings per share $ 0.32 $ 0.03 $ 0.35
Diluted shares outstanding 11,006,968 11,006,968 11,006,968
For Three Months Ended July 1, 2006
-----------------------------------------
Pro Forma Distributed Results
Results Products Group as Reported
----------- ----------- -----------
Sales $ 31,672 $ 6,833 $ 38,505
Cost of sales 21,355 4,847 26,202
----------- ----------- -----------
Gross profit 10,317 1,986 12,303
Operating expenses 6,612 1,556 8,168
----------- ----------- -----------
Operating income 3,705 430 4,135
Interest & other (expense)
income, net 49 (7) 42
----------- ----------- -----------
Income before taxes 3,754 423 4,177
Provision for income taxes 1,423 161 1,584
----------- ----------- -----------
Income from continuing
operations 2,331 262 2,593
----------- ----------- -----------
Income from discontinued
operations 20 -- 20
----------- ----------- -----------
Net income $ 2,351 $ 262 $ 2,613
=========== =========== ===========
Earnings per share $ 0.22 $ 0.02 $ 0.24
Diluted shares outstanding 10,924,326 10,924,326 10,924,326
* The Company believes that showing the results of operations
excluding the Distributed Products Group presents useful
information as the Company has announced its intent to sell this
business. These non-GAAP numbers provide investors with greater
transparency into the Company's results as they will be presented
in the future.