Ballantyne Strong, Inc. (NYSE Amex: BTN):
Conference call:
Today, Monday, November 9, 2009 at 4:30 p.m. ET
Webcast / Replay URL:
www.earnings.com or
http://www.ballantyne-strong.com/IREvents.aspx
The replay will be available on the Internet for 90 days.
Dial-in number:
800-734-4208 (no pass code required)
Ballantyne Strong, Inc. (NYSE Amex: BTN), a provider of digital
cinema projection equipment and services, cinema screens and other
cinema products, today reported financial results for the third
quarter (Q3) and nine months ended September 30, 2009.
Q3 2009 net revenues rose 34% to $16.6 million from net revenues
of $12.3 million in Q3 2008, principally driven by sales of digital
cinema equipment which rose to $5.2 million in Q3 2009 compared to
$1.5 million a year ago and sales of cinema screens which rose to
$2.8 million versus $1.5 million in Q3 2008. The increase in
digital cinema equipment and cinema screen sales reflects growing
global demand for digital projection systems and specialty “silver”
screens that are used to deliver a 3-D cinema experience.
Q3 2009 gross profit increased to $3.6 million, or 21.5% of net
revenues, compared to gross profit of $2.1 million, or 17.4% of net
revenues, in Q3 2008. The increase in gross margin reflected
improved margins being achieved across digital cinema projectors
and cinema screens, as well as cost reductions in the Company’s
Omaha facility. SG&A in Q3 2009 decreased to $2.4 million
compared to $2.8 million in the year ago period, primarily
reflecting personnel reductions and associated decreases in salary,
benefit and travel expenses coupled with lower audit and bank
fees.
Net income increased to $0.5 million, or $0.04 per diluted
share, in Q3 2009 compared to a net loss of $0.3 million, or
($0.02) per diluted share, a year-ago. Per share results for the
third quarters of 2009 and 2008 are based on a weighted average
number of diluted shares outstanding of 14,163,609 and 13,933,152,
respectively.
Balance Sheet Update:
Ballantyne continued to generate cash in Q3 2009, ending the
quarter with a strong balance sheet with $23.3 million in cash and
cash equivalents. This compares to cash and cash equivalents of
$21.2 million as of June 30, 2009.
John P. Wilmers, President and Chief Executive Officer of
Ballantyne, commented, “During the third quarter Ballantyne
extended the momentum established in the first half of the year,
delivering year-over-year improvements in digital cinema projection
products, cinema services and cinema screen sales. Of particular
note, digital cinema projection equipment sales increased 217% from
the prior year, bolstered by international sales including initial
revenue from a recent order from China Film Group. Additionally,
our Strong/MDI screen business delivered another quarter of
substantial year-over-year growth, primarily due to ongoing demand
for silver screens required to exhibit 3-D cinema.
“Though large scale demand for digital cinema services has yet
to begin, our industry leading cinema service organization, Strong
Technical Services (STS), continued to expand its base of customer
relationships, securing a professional services agreement with a
major digital cinema equipment provider, as disclosed previously.
This agreement highlights STS’s projector ‘agnostic’ strategy as
well as its position as one of the industry’s largest and most
capable digital cinema service organizations. Finally, we are also
pleased with the initial and very encouraging customer reviews
received about NEC’s next generation 2K digital cinema projector
line which we debuted at the ShowEast industry tradeshow late last
month. This new line should be available for customer shipments
next year.”
Nine Month Results
For the nine months ended September 30, 2009, net revenues rose
32.7% to $53.3 million compared to $40.1 million a year ago. Gross
profit in the first nine months of 2009 was $11.2 million, or 21.0%
of net revenues, compared to gross profit of $6.5 million, or 16.2%
of net revenues, for the first nine months of 2008. Net income for
the first nine months of 2009 amounted to $2.0 million, or $0.14
per diluted share, compared to a net loss of $0.7 million, or
$(0.05) per diluted share, in the first nine months of 2008. Per
share results for the first nine months of 2009 and 2008 are based
on a weighted average number of diluted shares outstanding of
14,138,813 and 13,984,300, respectively.
About Ballantyne Strong, Inc.
Ballantyne Strong is a provider of digital cinema projection
equipment and services as well as cinema screens, motion picture
projectors and specialty lighting equipment and services. The
Company supplies major and independent theater chains, top arenas,
theme parks and architectural sites around the world. For more
information visit www.ballantyne-strong.com.
Except for the historical information in this press release, it
includes forward-looking statements that involve risks and
uncertainties, including but not limited to, quarterly fluctuations
in results; customer demand for the Company’s products; the
development of new technology for alternate means of motion picture
presentation; domestic and international economic conditions; the
management of growth; and other risks detailed from time to time in
the Company’s Securities and Exchange Commission filings. Actual
results may differ materially from management’s expectations.
Ballantyne Strong, Inc. and
Subsidiaries
Consolidated Statements of
Operations
(unaudited)
Three Months
EndedSeptember 30,
Nine Months Ended
September 30,
2009
2008
2009
2008
Net revenues $ 16,552,036 $ 12,309,109 $ 53,298,196 $
40,149,385 Cost of revenues 12,996,753 10,162,989 42,111,250
33,643,529 Gross profit 3,555,283 2,146,120 11,186,946 6,505,856
Selling & administrative expenses: Selling 518,790
835,294 1,954,980 2,365,814 General & administrative 1,921,228
1,989,584 5,873,540 5,649,852 Total SG&A expense 2,440,018
2,824,878 7,828,520 8,015,666 Gain (loss) on sale of assets 229
24,783 (1,714) 281,668 Income (loss) from operations 1,115,494
(653,975) 3,356,712 (1,228,142) Interest income 10,369
127,855 80,903 403,391 Interest expense (8,116) (8,805) (25,557)
(26,503) Equity in loss of Joint Venture (219,420) (164,329)
(637,557) (462,229) Other income (expense) net (142,734) 74,474
(29,830) 121,148 Income (loss) before income taxes 755,593
(624,780) 2,744,671 (1,192,335) Income tax benefit (expense)
(212,497) 284,132 (725,935) 477,170 Net income (loss) $ 543,096 $
(340,648) $ 2,018,736 $ (715,165) Earnings (loss) per share
Basic $ 0.04 $ (0.02) $ 0.14 $ (0.05) Diluted $ 0.04 $ (0.02) $
0.14 $ (0.05) Weighted average shares outstanding: Basic
14,005,912 13,933,152 13,996,533 13,984,300 Diluted 14,163,609
13,933,152 14,138,813 13,984,300
Selected Balance Sheet
Items:
September 30,2009
December 31,2008
(unaudited) Cash and cash equivalents $ 23,262,898 $
11,424,984 Restricted cash 729,827 701,498 Accounts receivable and
unbilled revenue, net 9,308,664 7,038,258 Inventories, net
12,390,424 9,476,687 Long-term investments in securities, net -
8,883,420 Total current liabilities 15,814,295 10,960,830 Total
stockholders’ equity $ 42,300,361 $ 38,834,639
Selected Cash Flow Statement
Items (unaudited):
Nine Months Ended
September 30,
2009
2008
Net income (loss) $ 2,018,736 $ (715,165) Depreciation and
amortization 1,329,011 1,879,244 Equity in loss of Digital Link II
Joint Venture 637,557 462,229 Net cash provided by operating
activities 2,271,611 1,273,733 Capital expenditures (807,715)
(632,772) Proceeds from redemptions of investment securities
10,025,000 1,250,000 Net cash provided by investing activities
9,261,959 775,415 Net increase in cash & cash equivalents
11,837,914 2,220,371 Cash & cash equivalents at beginning of
period 11,424,984 4,220,355 Cash & cash equivalents at end of
period $ 23,262,898 $ 6,440,726
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