I didn't see this one coming.These are the dues one must pay when one lets down his guard.99% of the time I would have had this covered with a stop/loss.Live and learn.Release from this morning.........
Press Release Source: Torotel, Inc.
Torotel Reports Higher Sales, EBITDA for Second Quarter, Six Months
Friday December 13, 9:00 am ET
Aerospace Bookings Decline
Military Contracts Expected
KANSAS CITY, Mo.--(BUSINESS WIRE)--Dec. 13, 2002--Torotel, Inc. (OTC:TTLO - News), a manufacturer of precision magnetic components, today reported higher sales and earnings before interest, taxes, depreciation and amortization (EBITDA) for the three and six months ended October 31, 2002.
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The company also offered new guidance on its revenue goals for fiscal 2003.
Electronika Acquisition Improves Operating Performance, Cash Flow for Quarter
Net sales for the second quarter were $1,288,000, up nearly 27 percent compared with $1,017,000 at this time last year. Torotel Products' net sales were $1,046,000, a 3 percent increase from $1,017,000 for the year-ago period. Electronika, a custom designer of ballast transformers for the airline industry, acquired on April 1, contributed net sales of $242,000.
EBITDA, at $240,000, rose 19 percent from $202,000. Amortization of the intangible assets acquired in the purchase of Electronika led to an amortization cost of $83,000, which reduced the current quarter's operating earnings to $148,000. In addition, the 17 percent interest in Apex Innovations, Inc., which offers knowledge management products and services to government entities, resulted in a $9,000 loss. As a result, earnings before the extraordinary item were $121,000, or 2 cents per diluted share, compared with $182,000, or 7 cents per diluted share, for the second quarter last year. During the 2001 quarter, several old liabilities were settled at amounts lower than originally recorded. This extraordinary item increased net earnings for last year's three months to $593,000, or 21 cents per diluted share.
Electronika Strengthens First-Half Results
Net sales for the first half of fiscal 2003 were $2,428,000, up 24 percent compared with $1,962,000 at this time last year. Torotel Products' net sales were $2,004,000, a 2 percent increase from $1,962,000 for the year-ago period. The Electronika acquisition contributed net sales of $424,000.
EBITDA was $483,000, up 28 percent from $377,000. Amortization of the intangible assets acquired with Electronika led to an amortization cost of $166,000, which reduced the current year's operating earnings to $296,000. The interest in Apex Innovations added $1,000. As a result, earnings before the extraordinary item were $262,000, or 5 cents per diluted share, compared with $336,000, or 12 cents per diluted share, for the first half of last year. The extraordinary item in 2001, mentioned earlier, increased net earnings for last year's six months to $774,000, or 27 cents per diluted share.
Operations generated an additional $236,000 of cash flow in the second quarter, bringing the total for the year to date to $356,000, a 96 percent increase from a year ago.
Drop in Aerospace Bookings Reduce Backlog; Military Orders Anticipated
H. James Serrone, chief financial officer and general manager, said: "The rate of new order bookings decreased 18 percent compared with last year. This is attributable to very soft conditions over the last 45-60 days in Torotel's aerospace markets, specifically the components used in retrofitting and upgrading instrumentation and communication systems in existing aircraft. Feedback from major customers indicates this downward trend is expected to continue as the airline industry continues to reduce its active number of aircraft. This trend will also affect Electronika. However, new contracts associated with ongoing military programs have helped to offset the low order rate, and additional awards are expected."
(i)"As a result of the lower order rate at both operating companies, we are targeting approximately $4.4-$4.6 million as a revised consolidated sales goal for fiscal 2003, down from $5.4 million projected at the beginning of the year," Serrone concluded.(/i)
Torotel, Inc. specializes in the design and manufacture of a wide range of precision magnetic components. Its products include transformers, inductors, reactors, chokes and toroidal coils, which modify and control electrical voltages and currents in commercial, industrial and military electronics. These products are sold to original equipment manufacturers for use in conventional missile guidance systems, avionics equipment, computers, medical equipment, telecommunications systems, and digital control devices. The company also designs and distributes ballast transformers primarily used to activate and control the lights in the cockpits and passenger compartments of older Boeing/McDonnell Douglas aircraft.
This news release includes forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, which are subject to the safe harbor created by that Act. These statements are based on assumptions about a number of important factors and involve risks and uncertainties that could cause actual results to be different from what is stated here. These risk factors include the impairment of intangible assets, decreased demand for products, delays in developing new products, expected orders that do not occur, and loss of key customers. Other risk factors are detailed from time to time in Torotel's Securities and Exchange Commission filings.
TOROTEL, INC.
Operating Data
(In Thousands, Except per Share)
Condensed Statements of Operations
(Unaudited) (Unaudited)
Six Months Ended Three Months Ended
October 31, October 31,
---------- ----------
2002 2001 2002 2001
---- ---- ---- ----
Net Sales $ 2,428 $ 1,962 $ 1,288 $ 1,017
Gross Profit $ 1,046 $ 855 $ 529 $ 449
Amortization of Intangible
Assets $ 166 $ - $ 83 $ -
Earnings from Operations $ 296 $ 350 $ 148 $ 189
Earnings before Provision
for Taxes, Equity in
Earnings of Investee
and Extraordinary Item $ 261 $ 336 $ 130 $ 182
Equity in Earnings (Loss)
of Investee $ 1 $ - $ (9) $ -
Earnings before
Extraordinary Item $ 262 $ 336 $ 121 $ 182
Extraordinary Item:
Gain on settlements of
debt $ - $ 438 $ - $ 411
------ ------ ------ ------
Net Earnings $ 262 $ 774 $ 121 $ 593
====== ====== ====== ======
Basic and Diluted
Earnings per Share:
Earnings before
Extraordinary Item $ 0.05 $ 0.12 $ 0.02 $ 0.07
Extraordinary Item $ - $ 0.15 $ - $ 0.14
------ ------ ------ ------
$ 0.05 $ 0.27 $ 0.02 $ 0.21
====== ====== ====== ======
Weighted Average Shares
Outstanding 5,111 2,811 5,111 2,811
====== ====== ====== ======
Condensed Balance Sheet
(Unaudited) (Audited)
October 31, April 30,
2002 2002
---- ----
Cash $ 604 $ 338
Current Ratio 1.45:1 1.07:1
Quick Ratio 1.21:1 .82:1
Total Assets $5,127 $5,017
Short-term Debt $ 104 $ 152
Long-term Debt $1,108 $1,135
Total Liabilities $2,202 $2,354
Stockholders' Equity $2,925 $2,663
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Contact:
Torotel, Inc.
Dale H. Sizemore, Jr., 816/761-6314, ext. 3015
Jim Serrone, 816/761-6314, ext. 3024
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Source: Torotel, Inc. |
