SI Technologies Earns $0.10 Per Share in First Quarter of FY2001 Versus Prior-Year Loss
TUSTIN, Calif.--Dec. 21, 2001--SI Technologies, Inc. , which designs, manufactures and markets high-performance industrial sensors, weighing and factory automation equipment/systems and related products, today announced improved earnings for the first quarter of FY2002.Revenues for the quarter ended October 31, 2001, totaled $8.5 million, compared with $9.9 million in the first quarter of the previous fiscal year. The Company reported that the 14% revenue decline was similar for all products, both equipment and components, and across all business units.
Benefiting from the implementation of a three-point profitability plan initiated in the third quarter of last fiscal year, the Company reported net income of $353,000, or $0.10 per diluted share, in the most recent quarter, compared with a net loss of ($59,000), or ($0.02) per share, in the quarter ended October 31, 2000. The advancement in net income reflected an improvement of two percentage points in gross margin and a 15% reduction in operating expenses. Cash flow from operations, as measured by EBITDA, approximated $863,000 (equivalent to $0.24 per diluted share outstanding) in the first quarter of FY2002.
The previously announced three-point strategy to return SI Technologies to profitability is comprised of (1) increased outsourcing of production on certain high-volume component products to manufacturing partners in countries with lower labor costs, (2) consolidation of the Company's North American measurement components and weighing equipment operations into one facility and business unit, and (3) downsizing the scope of the Company's Southern California operations and corporate overhead in order to reduce expenses.
"We are pleased with first-quarter results, which reflect the initial benefits of the Company's restructuring and profitability plan announced last April and the progress our employees have made, to date, in implementing that plan," stated Rick Beets, President and Chief Executive Officer of SI Technologies, Inc. "While we are extremely confident in our plan and our organization, we remain concerned about the current recession and its impact on our revenues."
As reported in the Company's Form 10K filed for the fiscal year ending July 31, 2001, SI Technologies continues to operate in violation of several bank covenants. Management is currently negotiating a term sheet with its bank that reflects the implementation of the profitability plan. Additional information on this matter will be forthcoming in the future.
SI Technologies, Inc. is a leading designer, manufacturer and marketer of high-performance industrial sensors/controls, weighing and factory automation systems and related products. Its proprietary products enjoy leading positions in their respective markets, while sharing common technologies, manufacturing processes, and customers. The Company is positioned as an integrator of technologies, products and companies that are involved in the handling, measurement and inspection of goods and materials. SI Technologies' products are used throughout the world in a variety of industries, including aerospace, aviation, food processing and packaging, forestry, manufacturing, mining, transportation, warehousing/distribution, and waste management. The Company is headquartered in Tustin, California, and its common stock is traded on Nasdaq under the symbol "SISI".
This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe," "estimate," "project," "expect" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of the Company's products in the marketplace, competitive factors, dependence upon third-party vendors, and other risks detailed in the Company's periodic report filings with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.
SI TECHNOLOGIES, INC.
AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS
(In Thousands Except Share Data)
(Unaudited)
Three Months Ended October 31,
2001 2000
---- ----
Net Sales $ 8,536 $ 9,893
Cost of Sales 5,558 6,643
-------- ---------
Gross Profit 2,978 3,250
Selling, General & Admin. Expenses 1,893 2,308
Research, Develop. & Engineering Expenses 420 402
Amortization of Intangibles 95 112
--------- ---------
2,408 2,822
--------- ---------
Earnings from Operations 570 428
Interest Expense (277) (448)
Other Income, net 60 4
--------- ---------
Earnings (Loss) Before Income Taxes 353 (16)
Income Tax Expense - (43)
--------- ---------
Net Income (Loss) $ 353 $ (59)
=========== ===========
Net Earnings (Loss) Per Common Share:
Basic $ 0.10 $ (0.02)
=========== ===========
Diluted $ 0.10 $ (0.02)
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Weighted Average Shares Outstanding:
Basic 3,579,935 3,547,123
Diluted 3,579,935 3,547,123
SI TECHNOLOGIES, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share Data)
October 31, July 31,
2001 2001
------------ -----------
(Unaudited)
Current Assets:
Cash $ 562 $ 380
Trade Accounts Receivable, net 5,920 5,980
Inventories, net 8,662 8,584
Deferred Tax Assets - -
Other Current Assets 671 899
---------- ---------
Total Current Assets 15,815 15,843
Property and Equipment, net 2,511 2,655
Intangible Assets, net 7,104 7,175
Other Assets 218 237
---------- ---------
TOTAL ASSETS $ 25,648 $ 25,910
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Current Liabilities:
Current Maturities of Long-term Debt 14,284 14,514
Accounts Payable 3,609 3,249
Customer Advances 58 70
Accrued Liabilities 2,458 3,187
---------- ---------
Total Current Liabilities 20,409 21,020
Other Liabilities 508 569
Stockholders' Equity:
Common Stock ($.01 par value,
authorized 10,000,000 shares,
3,579,935 shares issued and
outstanding) 36 36
Additional Paid-in Capital 10,377 10,377
Retained Earnings (Accumulated Deficit) (5,315) (5,668)
Accumulated other comprehensive loss (367) (424)
---------- ---------
Total Stockholders' Equity 4,731 4,321
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 25,648 $ 25,910
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