Alpha Technologies Group Reports Fiscal 2002 First Quarter Results
LOS ANGELES--Feb. 28, 2002--Alpha Technologies Group, Inc. announced today a net loss from continuing operations for the first quarter of fiscal 2002 ended January 27, 2002 of $314,000, or $0.04 per share. This compares to net income from continuing operations of $1,150,000, or $0.17 per diluted share, for the first quarter of fiscal 2001. Reflecting continued weakness in the markets for the Company's thermal management products and aluminum extrusions, revenue declined to $12,587,000 for the first quarter of fiscal 2002 from $15,461,000 for the fourth quarter of fiscal 2001 and $16,161,000 for the first quarter of fiscal 2001.Results for the first quarter of both years include the results of National Northeast (NNE), a manufacturer of aluminum heat sinks and extrusions which was acquired on January 9, 2001.
"Business remains slow, although it appears to be improving somewhat from what seems to have been the cyclical trough reached in the third quarter of last fiscal year. We are continuing to manage our costs closely, including further reductions in headcount and other overhead expenses. This is in addition to the sharp cuts implemented during fiscal 2001. We are doing what is necessary to position Alpha Technologies to return to growth and profitability when conditions in our primary markets improve," said Chairman and Chief Executive Officer Lawrence Butler.
Cash flow, as measured by earnings from continuing operations before interest, taxes, depreciation and amortization (EBITDA), was $1,089,000 for the first quarter of fiscal 2002 compared to $3,007,000 for the first quarter of fiscal 2001. The Company repaid $1,500,000 of long-term debt during the first quarter of fiscal 2002 and ended the quarter with approximately $1,800,000 of cash.
Alpha is not in compliance with certain of its loan covenants. As a result, all of its debt is classified as current. Butler said that the Company continues its discussions with lenders regarding a restructuring of its loan agreement. "We are confident that the terms of an amended loan agreement will be reached soon. Once this is completed, our debt will be reclassified into current and long-term portions," Butler said.
Conference Call
Alpha has scheduled a conference call today at 11:00 AM EST. A simultaneous WebCast may be accessed at www.CompanyBoardroom.com or www.Alphatgi.com. A replay will be available immediately following the WebCast at these same Internet addresses. For a telephone replay, dial (800) 633-8284, reservation #20375535 one hour after the call.
About Alpha Technologies Group
Alpha Technologies Group, Inc. is engaged in the manufacture, fabrication and sale of thermal management products and aluminum extrusions. The Company is one of the leading manufacturers of thermal management products in the United States. Thermal management products, principally heat sinks, dissipate unwanted heat generated by electronic components. The Company's thermal management products serve the automotive, telecommunication, industrial controls, transportation, power supply, factory automation, consumer electronics, aerospace, defense, microprocessor, and computer industries. The Company also sells aluminum extrusions to various industries including the construction, sporting goods and other leisure activity markets.
Forward-Looking Statements
This press release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations, estimates and projections about the Company's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and the following: changes in demand for the Company's products, product mix, the timing of customer orders and deliveries, the impact of competitive products and pricing, excess or shortage of production capacity, difficulties encountered in the integration of acquired businesses and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.
Alpha Technologies Group, Inc. and Subsidiaries
CONSOLIDATED STATEMENT OF INCOME
($ in thousands except per share data) (unaudited)
Three Months Ended
Jan. 27, Jan. 28,
2002 2001
Sales $ 12,587 $ 16,161
Cost of sales 10,806 11,592
Gross profit 1,781 4,569
Operating expenses
Research and development 112 229
Selling, general and administrative 1,541 2,316
Total operating expenses 1,653 2,545
Operating income 128 2,024
Interest income (expense), net (627) (141)
Other income (expense), net -- (16)
Income (loss) from continuing operations
before taxes (499) 1,867
Provision (benefit) for income taxes
-- continuing operations (185) 717
Income (loss) from continuing operations (314) 1,150
(Loss) from discontinued operation,
net of tax -- (59)
Gain on sale of discontinued operation,
net of tax -- 207
Extraordinary loss, early extinguishment
of debt, net of tax -- (400)
Net income (loss) $ (314) $ 898
Basic earnings per common share
Income (loss) from continuing operations $ (0.04) $ 0.17
(Loss) from discontinued operation,
net of tax -- --
Gain on sale of discontinued operation,
net of tax -- 0.02
Extraordinary item, early extinguishment
of debt, net of tax -- (0.06)
Net income (loss) $ (0.04) $ 0.13
Diluted earnings per common share
Income (loss) from continuing operations $ (0.04) $ 0.15
(Loss) from discontinued operation, net
of tax -- --
Gain on sale of discontinued operation,
net of tax -- 0.02
Extraordinary item, early extinguishment
of debt, net of tax -- (0.05)
Net income (loss) $ (0.04) $ 0.12
Shares used in computing net income
per share -- Basic 7,108 6,843
Shares used in computing net income
per share -- Diluted 7,252 7,433
SELECTED BALANCE SHEET DATA
($ in thousands) (Jan. 2002 audited)
Jan. 27, Oct. 28,
2002 2001
Cash $ 1,810 $ 2,701
Working capital (15,498) (18,117)
Debt (including current maturities) 31,619 33,226
Total assets 74,270 77,451
Stockholders' equity $ 36,632 $ 36,870