Presstek Reports Record Consumable Sales in the Second Quarter 2004
Company Enters Third Quarter with Strong Equipment Backlog HUDSON,
N.H., July 29 /PRNewswire-FirstCall/ -- Presstek, Inc. (NASDAQ:
PRST), a leading provider of direct digital imaging technology,
today announced financial results for the second quarter ended July
3, 2004. Presstek's President and Chief Executive Officer Edward J.
Marino said, "This is the eighth consecutive profitable quarter for
the company, with strong cash flows. Growth of 66% in our New
Technology consumable products from the same period last year drove
consumable sales to record levels at $14.1 million. In addition,
the company has a very healthy equipment backlog of approximately
$11.0 million, $9.0 million of which is shippable in the third
quarter of 2004. This is the highest equipment backlog Presstek has
had since the start of our transformation more than two years ago."
Marino continued, "Framing the second quarter results were
investments in the company's future through additional
Drupa-related marketing and product development expenses. In
addition, we also experienced the traditional reduction in customer
equipment spending in advance of the Drupa trade show. Viewed in
light of the above, we are very pleased with the quarter's
results." The company reported consolidated net income for the
second quarter of 2004 of $1.4 million, or $0.04 per basic and
diluted share, compared to consolidated net income of $1.8 million,
or $0.05 per basic and diluted share, for the corresponding period
in the prior year, and consolidated net income of $1.9 million, or
$0.06 per basic and $0.05 per diluted share, in the first quarter
of 2004. As planned, second quarter 2004 consolidated net income
included expenses of $450,000 related to the Drupa trade show held
in May. Second quarter 2003 net income included special charges of
$550,000 related to the company's workforce reduction in April
2003. The company reported consolidated revenue of $22.7 million in
the second quarter of 2004, compared to $22.5 million in the same
period a year ago, and $23.3 million in the first quarter of 2004.
Consumable revenue for the second quarter of 2004 was a record
$14.1 million, compared to $13.6 million in the corresponding
period in the prior year, and $13.0 million in the first quarter of
2004. Equipment revenue for the second quarter of 2004 totaled $8.1
million, compared to $8.0 million in the same period a year ago,
and $9.7 million in the previous quarter. Chief Financial Officer
Moosa E. Moosa said, "As expected, revenue from Presstek's New
Technology Business, which consists of all business other than the
Quickmaster DI platform products, was down slightly from the first
quarter of 2004 as the result of the traditional pre-Drupa slowdown
in equipment spending, but up 15% from the corresponding quarter in
the prior year. New Technology equipment revenue for the second
quarter of 2004 was down 3% compared to the same period last year,
and down 19% from the prior quarter. The pre-Drupa slowdown did not
affect New Technology consumable revenue, however, which was up
significantly at 66% compared to the same period last year, and up
14% compared to the first quarter of 2004." Moosa continued, "The
company furthered its objectives at its Lasertel subsidiary in the
second quarter of 2004 by increasing external sales, growing its
customer base and by narrowing its operating loss." Lasertel
recorded $573,000 in revenue from sales to external commercial
customers in the second quarter of 2004, up from $328,000 in the
second quarter of 2003, and up from $540,000 in the previous
quarter. The company reported an operating loss of $944,000 at
Lasertel in the second quarter of 2004, compared to an operating
loss of $1.2 million in the same period a year ago, and an
operating loss of $1.4 million in the first quarter of 2004. The
operating loss for the same period last year included $79,000 in
special charges related to the workforce reduction in April 2003.
Consolidated gross margins for the second quarter of 2004 were 40%,
compared to 43% in the second quarter of 2003, and 38% in the first
quarter of 2004. This was primarily the result of product mix and
increased contributions from Lasertel. Operating expenses (being
the sum of research & development and sales, general &
administrative expenses) were $7.6 million in the second quarter of
2004, up from $7.2 million in the same period last year, and $7.1
million in the first quarter of 2004. The current quarter includes
the $450,000 expense related to the Drupa trade show. Commenting on
the balance sheet, Moosa said, "Our cash position continues to be
very strong, ending the year at $34.2 million. The company
generated $3.6 million in cash from earnings and depreciation &
amortization in the second quarter of 2004. Total debt at the end
of the quarter was down $536,000 from the previous quarter." Marino
concluded, "As we have described in the past, Presstek has put all
of the elements in place for the next phase of our transformation.
We believe the company will begin to show both organic and
strategic growth in the second half of 2004. Our business
fundamentals are sound and our strong backlog gives us a good
platform for organic growth in our core businesses. With our
pending acquisition of Precision Lithograining and our proposed
acquisition of A.B.Dick, we are preparing to expand the company's
served markets and business prospects through strategic growth.
Presstek's management team is ready for these changes and looks
forward to the next several quarters with anticipation." Conference
Call Presstek's second quarter conference call is scheduled to take
place at 11:00 a.m. (Eastern) on Thursday, July 29, 2004. In the
call, the company intends to discuss its financial results,
quarterly highlights and current expectations of future
performance, as well as the company's acquisition strategy. To
participate in the call, dial (888) 396-2384, access code 50411985.
To listen to a live web cast of the call, click on
http://phx.corporate-/
ir.net/phoenix.zhtml?c=72101&p=IROL-eventDetails&EventId=918805
or visit the Events Calendar in the Investor section of Presstek's
website, http://www.presstek.com/, fifteen minutes prior to start
time. The webcast will be archived and available for replay until
midnight on August 5, 2004. You may also listen to a telephone
replay of the call from 1:00 p.m. on July 29, 2004 until midnight
on August 5, 2004, by dialing (888) 286-8010, access code 34771751.
Presstek, Inc. is a leading manufacturer and marketer of
environmentally responsible high tech digital imaging solutions to
the graphic arts and laser imaging markets. Presstek's patented
DI(R), CTP and plate products provide a streamlined workflow and
eliminate photographic darkrooms, film and toxic processing
chemicals, thereby reducing printing cycle time and lowering
production costs. Presstek solutions are designed to make it easier
for printers to cost effectively meet increasing customer demand
for shorter print runs and faster turnaround while providing
improved profit margins. The company's subsidiary, Lasertel, Inc.,
supplies Presstek and external customers with the valuable laser
diodes necessary for laser imaging applications. For more
information on Presstek, visit http://www.presstek.com/, call
603-595-7000 or email: . "Safe Harbor" Statement under the Private
Securities Litigation Reform Act of 1995: Certain statements
contained in this News Release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995, including statements regarding the expected
organic and strategic growth; the expected expansion of its served
markets; the expected effects and benefits of its product backlog;
the expected effects and benefits of the next phase of its
transformation; the expected effects and benefits of its new
product introductions; the expected effects and benefits of the
Company's pending and proposed acquisitions of Precision
Lithograining and A.B.Dick Company, if successful; the Company's
expectations regarding the sale of products in general; the ability
of the Company to achieve its stated objectives; the strength of
the Company's relationships with its partners (both on
manufacturing and distribution); expectations for the Company's
Lasertel subsidiary including its ability to improve results and
develop additional external commercial customers for its products;
and expectations regarding future growth and profitability. Such
forward-looking statements involve a number of known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Such factors include, but are not limited to, negative
reactions to the pending and proposed acquisitions from customers
and partners; the ability to achieve the intended benefit of the
pending and proposed acquisitions; the ability to successfully
integrate the acquired Companies; the ability of Presstek to
maintain its financing; the ability of Presstek to meet its stated
financial objectives, including its ability to manage the
acquisitions successfully; the ability of A.B.Dick to maintain
sufficient debtor-in-possession financing to fund its operation and
the expenses of the Chapter 11 process; the outcome and timing of
the Companies efforts to close definitive agreements; the
Companies' ability to obtain court approval with respect to motions
in the Chapter 11 proceeding; the ability of A.B.Dick to obtain and
maintain normal terms with its vendors and dealers; the ability of
A.B.Dick to maintain contracts that are critical to its operations;
the potential adverse impact of the Chapter 11 proceeding on
A.B.Dick's liquidity or results of operations; the ability of
A.B.Dick to attract, motivate and/or retain key executives and
employees; the ability of A.B.Dick to attract and retain vendors
and customers; Presstek's dependency on its strategic partners
(both on manufacturing and distribution); the introduction of
competitive products into the marketplace; shortages of critical or
sole-source component supplies; the availability and quality of
Lasertel's laser diodes; manufacturing constraints or difficulties
(as well as manufacturing difficulties experienced by our
sub-manufacturing partners and their capacity constraints); the
impact of general market factors in the print industry generally
and the economy as a whole; market acceptance of and demand for
Presstek's products and resulting revenues; and other risks
detailed in Presstek's Annual Report on Form 10-K and Presstek's
other reports on file with the Securities and Exchange Commission.
The words "looking forward," "looking ahead," "believe(s),"
"should," "may," "expect(s)," "anticipate(s)," "likely,"
"opportunity," and similar expressions, among others, identify
forward-looking statements. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date the statement was made. Presstek undertakes no
obligation to update any forward- looking statements contained in
this news release. CONTACTS: Moosa E. Moosa Chief Financial Officer
(603) 595-7000 Jane Miller Corporate Relations Manager (603)
594-8585 ext. 3346 Email: PRESSTEK, INC. STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED (In thousands, except per share data)
(unaudited) July 3, June 28, 2004 2003 REVENUE: Product sales
$22,585 $22,043 Royalties and fees from licensees 112 476 Total
revenue 22,697 22,519 COSTS AND EXPENSES: Cost of products sold
13,553 12,890 Research and product development 1,645 1,874 Selling,
general and administrative 5,991 5,281 Special charges - 550 Total
costs and expenses 21,189 20,595 INCOME FROM OPERATIONS 1,508 1,924
INTEREST, NET (61) (99) INCOME FROM OPERATIONS BEFORE INCOME TAXES
1,447 1,825 PROVISION FOR INCOME TAXES - - NET INCOME $1,447 $1,825
EARNINGS PER SHARE - BASIC $0.04 $0.05 EARNINGS PER SHARE - DILUTED
$0.04 $0.05 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC
34,438 34,156 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - DILUTED
35,364 34,283 PRESSTEK, INC. STATEMENTS OF OPERATIONS FOR THE SIX
MONTHS ENDED (In thousands, except per share data) (unaudited) July
3, June 28, 2004 2003 REVENUE: Product sales $45,698 $43,332
Royalties and fees from licensees 313 1,629 Total revenue 46,011
44,961 COSTS AND EXPENSES: Cost of products sold 28,085 25,842
Research and product development 3,321 3,824 Selling, general and
administrative 11,397 10,879 Special charges (296) 550 Total costs
and expenses 42,507 41,095 INCOME FROM OPERATIONS 3,504 3,866
INTEREST, NET (158) (251) INCOME FROM OPERATIONS BEFORE INCOME
TAXES 3,346 3,615 PROVISION FOR INCOME TAXES - - NET INCOME $3,346
$3,615 EARNINGS PER SHARE - BASIC $0.10 $0.11 EARNINGS PER SHARE -
DILUTED $0.09 $0.11 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING -
BASIC 34,352 34,149 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING -
DILUTED 35,258 34,211 PRESSTEK, INC. BALANCE SHEETS (In thousands)
July 3, January 3, 2004 2004 (unaudited) ASSETS CURRENT ASSETS:
Cash and cash equivalents $34,194 $28,196 Accounts receivable, net
16,051 14,922 Inventories 13,007 12,354 Other current assets 2,557
1,064 Total current assets 65,809 56,536 PROPERTY, PLANT AND
EQUIPMENT, NET 42,418 45,732 OTHER ASSETS, NET 4,397 4,260 TOTAL
ASSETS $ 112,624 $106,528 LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES: Current portion of long-term debt $2,143
$2,143 Accounts payable 6,725 4,750 Accrued expenses 6,175 7,131
Total current liabilities 15,043 14,024 LONG-TERM DEBT, NET OF
CURRENT PORTION 11,250 12,321 STOCKHOLDERS' EQUITY: Common stock
346 342 Additional paid-in capital 100,567 97,769 Comprehensive
loss (47) (47) Accumulated deficit (14,535) (17,881) Total
stockholders' equity 86,331 80,183 TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 112,624 $106,528 DATASOURCE: Presstek, Inc.
CONTACT: Moosa E. Moosa, Chief Financial Officer, +1-603-595-7000,
or Jane Miller, Corporate Relations Manager, +1-603-594-8585 ext.
3346, , both of Presstek, Inc. Web site: http://www.presstek.com/
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