2007 Elecsys News
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July 16, 2007
Olathe, Kansas (July 16, 2007) - Elecsys Corporation (AMEX: ASY), today announced its financial results for the fourth quarter and fiscal year ended April 30, 2007.
Sales for the quarter were $5,178,000, an increase of $1,163,000, or 29%, from the comparable period of fiscal 2006. For the fiscal year ended April 30, 2007, sales were $19,809,000, an increase of $5,117,000, or 35%, from the fiscal year ended April 30, 2006. Total consolidated backlog at April 30, 2007 was $10,403,000, a decrease of $140,000, or 1%, from a total backlog of $10,543,000 on April 30, 2006 and an increase of $594,000 from a total backlog of $9,809,000 on January 31, 2007.
Gross margin was approximately 28% of sales, or $1,429,000, for the quarter as compared to 32% of sales, or $1,305,000, for the fourth quarter ended April 30, 2006. For the fiscal year ended 2007, gross margin was 30%, or $5,851,000, compared to 32%, or $4,678,000, for the 2006 fiscal year.
Operating income for the quarter was $408,000, an increase of 32% as compared to $308,000 for the same quarter in the prior year. For the fiscal year ended April 30, 2007, operating income was $1,528,000, approximately 50% higher than the $1,019,000 reported in fiscal 2006.
During the last six months of the fiscal year, the Company recognized a $324,000 gain, net of selling expenses, on the sale of our Lenexa facility. In the fiscal year ended April 30, 2006, the Company incurred a loss on debt retirement of $124,000 as a result of the early retirement of the tax-exempt Industrial Revenue Bonds on the Company’s former Lenexa facility.
Income tax expense of $507,000 was recorded in fiscal 2007 compared with an income tax benefit of $916,000 in fiscal 2006. In the previous fiscal year we recognized a deferred tax asset of $930,000 in the fourth quarter as a result of our continued profitability and recorded minimal income tax expense during the year as a result of our net operating loss carryforwards from previous years.
As a result of the above, net income was $326,000, or $0.09 per diluted share, for the quarter ended April 30, 2007. For the quarter ended April 30, 2006 net income was $1,196,000, or $0.35 per diluted share. For the fiscal year ended April 30, 2007, net income was $1,046,000, or $0.31 per fully diluted share, as compared to $1,667,000, or $0.49 per fully diluted share for the fiscal year ended April 30, 2006.
The increase in sales for the quarter was due to both new and existing customer orders at DCI which increased approximately $5,117,000 or 35% for the current fiscal year as compared to the previous year. Sales volumes at NTG decreased approximately 9% in the 2007 fiscal year as a result of fewer unit shipments which were slightly offset by a large increase in recurring messaging services revenue, which grew by 92% over the prior fiscal year. Our overall improvement in gross margin dollars resulted from the increase in sales volumes while overall product mix led to a slight decrease in gross margin percentage. The increase in operating expenses was primarily driven by moving and relocation expenses, support engineering and related customer support expenses as well as increases in personnel and personnel-related expenses resulting from our growth. Due to the shipments scheduled from our backlog, we expect sales volumes at DCI in the first half of fiscal year 2008 to be similar to sales volumes achieved during the last few quarters. Sales at NTG are expected to be higher over the next few quarters based on their current backlog of orders in addition to sales of their new satellite-and digital cellular-based products.
Karl B. Gemperli, Chief Executive Officer, remarked, “This was an outstanding year for the Company, thanks mainly to the efforts of the many dedicated Elecsys people who are committed to our success. Once again, we increased sales and operating income and our business model, focused on excellent service and efficient execution, continued to deliver positive and consistent performance for our customers and our stockholders. We successfully completed a number of important initiatives during the past year that further strengthen our platform for continued growth. With several tax changes and one-time events making a direct year over year net earnings comparison difficult, operating income, which was up 50% from fiscal 2006, is a better indicator of our true performance in fiscal 2007.”
Elecsys Corporation is a publicly traded holding company with two wholly owned subsidiaries, DCI, Inc. and NTG, Inc. DCI designs, manufactures, and integrates custom electronic interface solutions for original equipment manufacturers in the aerospace, medical, communications, safety, transportation and other industrial product industries. DCI has specialized capabilities to design and efficiently manufacture custom electronic assemblies which integrate a variety of interface technologies, such as custom liquid crystal displays, light emitting diode displays, and keypads, with circuit boards and other electronic components. NTG designs, markets, and provides remote monitoring solutions for the gas and oil pipeline industry as well as other industries requiring remote monitoring solutions. For more information, visit our website at www.elecsyscorp.com.
Safe-Harbor statement: The discussions set forth in this press release may contain forward-looking comments based on current expectations that involve a number of risks and uncertainties. Actual results could differ materially from those projected or suggested in the forward-looking comments. The difference could be caused by a number of factors, including, but not limited to the factors and conditions that are described in Elecsys Corporation's SEC filings, including the Form 10-KSB for the year ended April 30, 2007. The reader is cautioned that Elecsys Corporation does not have a policy of updating or revising forward-looking statements and thus he or she should not assume that silence by management of Elecsys Corporation over time means that actual events are bearing out as estimated in such forward-looking statements.
Elecsys Corporation and Subsidiaries Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
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Three Months Ended April 30
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Year Ended April 30
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2007 |
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2006 |
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2007 |
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2006 |
| Sales |
$5,178 |
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$4,015 |
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$19,809 |
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$14,692 |
| Cost of products sold |
3,749 |
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2,710 |
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13,958 |
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10,014 |
| Gross margin |
1,429 |
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1,305 |
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5,851 |
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4,678 |
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| Selling, general and administrative expenses |
1,021 |
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997 |
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4,323 |
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3,659 |
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| Operating income |
408 |
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308 |
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1,528 |
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1,019 |
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| Financial income (expense): |
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| Interest expense |
(86) |
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(41) |
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(310) |
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(149) |
| Impairment of original investment in acquired subsidiary |
-- |
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-- |
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-- |
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(124) |
| Loss on debt retirement |
-- |
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-- |
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324 |
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-- |
| Interest income |
2 |
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1 |
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11 |
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5 |
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(84) |
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(40) |
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(25) |
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(268) |
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| Income before income tax (benefit) |
324 |
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268 |
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1,553 |
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751 |
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| Income tax (benefit) |
(2) |
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(928) |
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507 |
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(916) |
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| Net income |
$326 |
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$1,196 |
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$1,046 |
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$1,667 |
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| Net income per share information: |
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| Basic |
$0.10 |
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$0.37 |
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$0.32 |
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$0.51 |
| Diluted |
$0.09 |
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$0.35 |
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$0.31 |
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$0.49 |
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| Weighted average common shares outstanding: |
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| Basic |
3,285 |
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3,240 |
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3,259 |
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3,240 |
| Diluted |
3,435 |
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3,407 |
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3,402 |
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3,397 |
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