Gerber Scientific, Inc. Reports Third Quarter and Nine Months Earnings Up 50 Percent
19 February 1998
Gerber Scientific, Inc. Reports Third Quarter and Nine Months Earnings Up 50 Percent
SOUTH WINDSOR, Conn., Feb. 19 -- Gerber Scientific, Inc.
today reported results for the third quarter and nine months ended
January 31, 1998.
Consolidated sales for the third quarter ended January 31, 1998 were
$104,836,000, an increase of 11 percent over the $94,591,000 reported for the
comparable period last year. Consolidated net earnings for the third quarter
were $6,215,000, up 50 percent over the $4,144,000 reported for the third
quarter of last year. Diluted earnings per share in this year's third quarter
were $.27, compared with $.18 per diluted share in last year's third quarter.
For the nine months ended January 31, 1998, consolidated sales reached a
record high of $310,189,000, up 13 percent from the $275,350,000 reported for
the same period last year. Consolidated net earnings in this year's first
nine months were $16,282,000, an increase of 50 percent from $10,882,000 in
the same period last year. Diluted earnings per share for the nine months
ended January 31, 1998 were $.70, compared with $.47 per diluted share
reported last year.
The Company recorded $104,400,000 in new orders in the three months ended
January 31, 1998, an increase of 7 percent over the same period last year and
a third quarter record. The increase in order entry came as a result of
higher demand for the company's fabric cutting systems, including those of the
recently acquired Cutting Edge business, and significantly greater demand for
optical lens manufacturing systems. Order entry for optical lens
manufacturing systems was more than double the prior year quarter.
Consolidated order entry also reached an all-time nine-month high the current
year. In the nine months ended January 31, 1998, the Company received
$320,600,000 in new orders, an increase of 12 percent from $285,600,000 for
the same period last year. Backlog at January 31, 1998 was $67,200,000
compared with $58,900,000 a year earlier.
George M. Gentile, Chairman and CEO, stated, "We had an excellent quarter
and first nine months, with 50 percent earnings growth and continued strong
cash flow. Cash generated by operations this year-to-date was up $30 million
from the prior year. Our sales gains were led by continued growth in our
Gerber Garment Technology unit, which benefited from strength in its North
American markets, and record business for our Optical unit, most notably as a
result of demand from optical retail chains for the company's lens
manufacturing systems. We are especially pleased that with this sales growth
has come significant improvement in earnings. We are also making significant
progress in identifying strategic direction for our computer-to-plate systems
business."
Gerber Scientific, Inc. ( http://www.gerberscientific.com ) is an
international supplier of automated manufacturing systems for a variety of
industries including apparel, signmaking, optical, commercial printing,
electronics, aerospace, and automotive.
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED SUMMARY OF EARNINGS
Comparison on a consolidated basis for the three and nine months ended
January 31, 1998 and 1997 follows:
THIRD QUARTER FINANCIAL FIGURES FOR
THREE AND NINE-MONTHS ENDED JANUARY 31, 1998 AND 1997
Third Quarter Nine Months
1998 1997 1998 1997
Sales $104,836,000 $94,591,000 $310,189,000 275,350,000
Earnings before
income taxes
(1)(2) $9,115,000 $ 5,944,000 $ 23,982,000 $15,082,000
Provision for
income taxes (2,900,000) (1,800,000) (7,700,000) (4,200,000)
Net earnings
(1)(2) $6,215,000 $ 4,144,000 $16,282,000 $10,882,000
Per share of common
stock; (1)(2)(3)
Basic $ .28 $ .18 $ .71 $ .47
Diluted $ .27 $ .18 $ .70 $ .47
Average shares outstanding:
Basic 22,586,000 23,261,000 22,863,000 23,234,000
Diluted 23,025,000 23,357,000 23,354,000 23,352,000
(1) Included in the nine months ended January 31, 1998 was the final
settlement of the Company's UK patent litigation with Lectra Systemes, S.A. of
France, which added $1,563,000 to earnings before income taxes and
approximately $1,000,000, or $.04 per share, to net income.
(2) Included in the nine months ended January 31, 1997 was a gain of
$1,032,000 ($.04 per share) from life insurance benefits the Company received
upon the death of Mr. H. Joseph Gerber.
(3) Earnings per share for 1998 and 1997 reflect the adoption of
Statement of Financial Accounting Standards No. 128, a new accounting standard
for reporting earnings per share.
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF EARNINGS
In Thousands
(except per share amounts)
Three Months Ended January 31, 1998 1997
Revenue:
Product sales $ 92,559 $ 83,041
Service 12,277 11,550
104,836 94,591
Costs and Expenses:
Cost of product sales 48,743 44,825
Cost of service 7,301 7,457
Selling, general and administrative 32,219 29,335
Research and development expenses 7,746 7,659
96,009 89,276
Operating income 8,827 5,315
Other income 378 717
Interest expense (90) (88)
Earnings before income taxes 9,115 5,944
Provision for income taxes 2,900 1,800
Net earnings $6,215 $4,144
Per share of common stock:
Basic $.28 $.18
Diluted $.27 $.18
Dividends $.08 $.08
Average shares outstanding:
Basic 22,586 23,261
Diluted 23,025 23,357
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF EARNINGS
In Thousands
(except per share amounts)
Nine Months Ended January 31, 1998 1997
Revenue:
Product sales $274,703 $240,919
Service 35,486 34,431
310,189 275,350
Costs and Expenses:
Cost of product sales 148,623 132,027
Cost of service 22,681 21,819
Selling, general and administrative 94,926 88,310
Research and development expenses 23,099 21,868
289,329 264,024
Operating income 20,860 11,326
Other income 3,388 4,017
Interest expense (266) (261)
Earnings before income taxes 23,982 15,082
Provision for income taxes 7,700 4,200
Net earnings $16,282 $10,882
Per share of common stock:
Basic $.71 $.47
Diluted $.70 $.47
Dividends $.24 $.24
Average shares outstanding:
Basic 22,863 23,234
Diluted 23,354 23,352
GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
In Thousands
January 31, 1998 April 30, 1997
Assets
Current Assets:
Cash and short-term cash investments $ 25,743 $ 9,503
Accounts receivable 93,489 92,378
Inventories 70,520 62,221
Prepaid expenses 13,411 13,702
203,163 177,804
Investments and long-term receivables 17,326 37,037
Property, plant and equipment 129,543 121,447
Less accumulated depreciation 62,039 58,883
67,504 62,564
Intangible assets 57,898 56,687
Less accumulated amortization 12,083 10,774
45,815 45,913
Other assets 457 1,897
$334,265 $325,215
Liabilities and Shareholders' Equity
Current Liabilities:
Notes payable $-- $--
Current maturities of long-term debt 193 193
Accounts payable 26,702 17,453
Accrued compensation and benefits 15,010 14,038
Other accrued liabilities 18,951 18,458
Deferred revenue 6,747 6,249
Advances on sales contracts 7,403 2,465
75,006 58,856
Noconcurrent Liabilities:
Deferred income taxes 11,687 11,193
Long-term debt 7,002 7,145
18,689 18,338
Shareholders' Equity:
Preferred stock, no par value; authorized
10,000,000 shares; no shares issued -- --
Common stock, $1.00 par value; authorized
65,000,000 shares; issued 23,392,275
and 23,306,900 shares 23,392 23,307
Paid-in capital 37,008 36,100
Retained earnings 198,685 187,880
Cumulative translation component (2,065) 734
Treasury stock, at cost (800,000 shares) (16,450) --
240,570 248,021
$334,265 $325,215
SOURCE Gerber Scientific, Inc.