BEI Technologies, Inc. Reports Record First Quarter 2005 Revenue
SAN FRANCISCO, Feb. 2 /PRNewswire-FirstCall/ -- BEI Technologies,
Inc. (NASDAQ:BEIQ), an established manufacturer of electronic
sensors and motion control products, announces record first quarter
2005 earnings. Fiscal 2005 First Quarter compared with Fiscal 2004
First Quarter: * Revenues increased 11.8% to $76.9 million with
automotive revenue of $47.4 million, an increase of 11.4% * Net
income increased 82.1% to $3.648 million from $2.003 million * EPS
increased 78.6% to $0.25 from $0.14 Quarterly Results Charles
Crocker, Chairman and Chief Executive Officer stated, "Net sales
for the first quarter increased by $8.1 million compared with the
prior year first quarter due primarily to a $4.9 million increase
in automotive sensor sales, largely GyroChip(R) sensor shipments.
In addition to the record first quarter revenue, deferred
automotive revenue increased by $1.2 million during the quarter.
Deferred revenue is expected to be recognized in a future quarter
when all revenue recognition criteria have been met. Sales of
industrial sensors, actuators and motors increased in the quarter
to $24.0 million from $18.9 million in the prior year first
quarter, as a result of the addition of Newall Measurement Systems'
Digital Readout (DRO) and digital linear encoder sales not included
in the prior year and higher quartz product sales to commercial
aviation customers. Government aerospace and defense sales
decreased to $5.5 million compared with $7.3 million in the prior
year first quarter due to reduced quartz and encoder program
sales." Gross margin increased to 27.5% in the fiscal 2005 first
quarter from 22.0% in the prior year first quarter. Average gross
margin percentages improved in both industrial products and
automotive products compared to the prior year quarter. 1.3% of the
2005 first quarter gross margin resulted from a $1.0 million
insurance recovery related to a $1.6 million settlement with a
customer in the fourth quarter of fiscal 2004. The prior year first
quarter was unfavorably impacted by vendor scrap issues. Crocker
continued, "We are pleased with the progress Systron Donner
Automotive achieved in shipping a record of 1.26 million GyroChip
sensors for the quarter while increasing annual capacity to 5.0
million sensors. This was ahead of our previously stated goal of
4.5 million by December 2004. We are also gratified by the adoption
of the Newall products we acquired at the beginning of the quarter
which resulted in approximately $3.0 million of industrial revenue
for the quarter. These products contributed to the quarter's
favorable margin expansion." SG&A spending increased in the
first quarter to $10.8 million compared with the prior year first
quarter of $8.3 million. The inclusion of Newall SG&A added
approximately $1.1 million in spending not in the prior year. The
first quarter 2005 spending also included charges associated with
severance, technology licensing, and sales tax totaling $0.8
million. Research and development expense in the first quarter
increased to $4.2 million compared with $3.3 million in the prior
year first quarter due to the inclusion of Newall spending and
reduced prior year first quarter spending. During the first quarter
our operations used $4.6 million in cash. Cash used by operations
was primarily affected by an increase in receivables from
increasing sales volumes. The acquisition of Newall for $11.0
million and the purchase of property, plant and equipment for $4.6
million, primarily to increase GyroChip production at Systron
Donner Automotive, were major factors in a $17.4 million use of
cash financed by borrowing from the Company's line of credit.
Accordingly, cash inflow for the quarter was $26.3 million from
financing partially offset by the paydown of $7.0 million of Senior
Notes. The Company's cash balance at quarter end was $5.0 million,
with an outstanding balance on the Company's $35.0 million line of
credit of $14.3 million. Crocker concluded, "We have integrated
Newall Measurement Systems into our organization and are beginning
to execute plans that leverage both specific customer and market
opportunities. We enhanced our financing capabilities by increasing
our line of credit to $35 million. We look forward to continued
execution of our plan to increase both industrial and military
business through acquisition and investment, as well as organic
growth." Guidance for Second Quarter 2005 Revenue for the second
quarter should grow in the range of 3% to 7%. We are increasing our
GyroChip automotive sensor shipments guidance from 5.0 million
units to 5.6 million units for the 12 month period ending September
2005. About BEI Technologies, Inc. BEI Technologies, Inc. (the
"Company" or "Technologies") is an established manufacturer of
electronic sensors, motors, actuators, rotary optical encoders,
linear encoders with associated digital readouts (DROs), and motion
control products used for factory and office automation, medical
equipment, military, aviation and space systems. In addition, sales
to manufacturers of transportation equipment, including
automobiles, trucks and off-road equipment, have become a
significant addition to the Company's business in recent years. The
Company's micromachined quartz rate sensors are being used in
advanced vehicle stability control systems and a significant
increase in the production of those sensors had been in progress
from the middle of 1998 to FY 2005 except for a decrease in
production in fiscal 2002 due to increased competition. The Company
also manufactures electronic steering wheel position sensors,
seat-memory modules, throttle position sensors, inertial navigation
systems, and other devices used in transportation systems. Except
for historical information, this news release may be deemed to
contain forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ materially
from those discussed in this release. Factors that could cause or
contribute to such differences include, but are not limited to, the
Risk Factors discussed from time to time in the Company's reports
to the Securities and Exchange Commission, including the Company's
Annual Report on Form 10-K for fiscal 2004. BEI TECHNOLOGIES, INC.
AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in
thousands) January 1, October 2,* 2005 2004 (Unaudited) ASSETS Cash
and cash equivalents $4,995 $8,218 Investments 4,537 4,299 Trade
receivables, net 51,565 45,482 Inventories, net 31,137 29,897 Other
current assets 18,132 17,147 Total current assets 110,366 105,043
Property, plant and equipment, net 42,629 39,905 Goodwill 8,804
1,612 Other assets, net 9,972 6,008 $171,771 $152,568 LIABILITIES
AND STOCKHOLDERS' EQUITY Trade accounts payable $30,302 $33,698
Accrued expenses and other liabilities 24,496 25,450 Income tax
payable -- -- Current portion of long-term debt 21,610 7,263 Total
current liabilities 76,408 66,411 Long-term debt, less current
portion 15,781 10,639 Other liabilities 2,680 2,783 Stockholders'
equity 76,902 72,735 $171,771 $152,568 * Based on audited
information included on Form 10-K for fiscal year ended October 2,
2004 BEI TECHNOLOGIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (dollars in thousands except per share
amounts) Quarter Ended January 1, January 3, 2005 2004 (Unaudited)
(Unaudited) Net sales $76,924 $68,805 Cost of sales 55,780 53,658
21,144 15,147 Selling, general and administrative expenses 10,759
8,328 Research, development and related expenses 4,201 3,260 Income
from operations 6,184 3,559 Interest expense 441 368 Other income
(expense) 125 (10) Income before income taxes 5,868 3,181 Provision
for income taxes 2,220 1,178 Net income $3,648 $2,003 BASIC
EARNINGS PER COMMON SHARE Net income per common share $0.25 $0.14
Weighted average shares outstanding 14,496 14,230 DILUTED EARNINGS
PER COMMON AND COMMON EQUIVALENT SHARE Net income per common and
common equivalent share $0.25 $0.14 Weighted average shares
outstanding 14,766 14,517 BEI TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (dollars in
thousands) Quarter Ended January 1, January 3, 2005 2004
(Unaudited) (Unaudited) Net income $3,648 $2,003 Adjustments to
reconcile net income to net cash provided by operating activities:
Depreciation and amortization 2,604 2,599 Other (10,841) 276 Net
cash provided (used) by operating activities (4,589) 4,878 Net cash
used in investing activities (17,405) (2,115) Net cash provided by
(used in) financing activities 18,771 (6,324) Net decrease in cash
and cash equivalents (3,223) (3,561) Cash and cash equivalents at
beginning of period 8,218 9,211 Cash and cash equivalents at end of
period $4,995 $5,650 DATASOURCE: BEI Technologies, Inc. CONTACT:
John LaBoskey, Senior Vice President/CFO of BEI Technologies, Inc.,
+1-415-956-4477 Web site: http://www.bei-tech.com/
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