Here's the EPS announcement. $0.01 better than $0.35 consensus.
ADFlex Announces Fourth-Quarter 1997 Results
CHANDLER, Ariz.--(BUSINESS WIRE)--Jan. 27, 1998--ADFlex Solutions
Inc. (Nasdaq/NM:AFLX) Tuesday announced results from operations for
its fourth quarter ended Dec. 31, 1997.
For the quarter, ADFlex recorded net sales of $54.4 million, an
increase of 16.1 percent, compared with $46.8 million in the fourth
quarter of 1996. Net income for the quarter was $3.2 million, or
36 cents per diluted share vs. net income in the fourth quarter of
1996 of $0.5 million, or 5 cents per diluted share.
For the year ended Dec. 31, 1997, ADFlex recorded net sales of
$213.9 million, an increase of 36.4 percent, compared with $156.8
million for the year ended Dec. 31, 1996. Net income for the
year ended Dec. 31, 1997, was $8.6 million, or 97 cents per diluted
share vs. a net loss for the year ended Dec. 31, 1996, including
restructuring charges, of $25.0 million, or $2.92 per diluted
share.
*T
Three Months Ended 12 Months Ended
Dec. 31, Dec. 31,
(in millions except
per-share data) 1997 1996 1997 1996
Net Sales $ 54.4 $ 46.8 $ 213.9 $ 156.8
Operating Income (Loss) $ 5.2 $ 1.3 $ 14.6 $ (33.7)
Net Income (Loss) $ 3.2 $ 0.5 $ 8.6 $ (25.0)
Earnings (Loss)
Per Diluted Share $ 0.36 $ 0.05 $ 0.97 $ (2.92)
Weighted Average Diluted
Shares and Equivalents
(in thousands) 8,988 8,694 8,894 8,590
*T
Commenting on the results, ADFlex Chairman and CEO Rolando C.
Esteverena stated: "We are very pleased with our performance for
the quarter. Both gross margins and net income as a percent of sales
improved steadily for the year and the quarter.
"On a sequential basis, gross margins improved to 20.9 percent in
the fourth quarter, compared with 18.4 percent in the third quarter
of 1997 and net income as a percent of sales improved to 6.0 percent
in the fourth quarter, compared with 4.7 percent in the third quarter
of 1997.
"The improved performance during the quarter and the year is
primarily due to a combination of factors, including the successful
start-up of our new, lower-cost manufacturing facility located in
Thailand, the orderly closing of our higher cost manufacturing
facility located in the United Kingdom, and the continued success
of the company's long-term customer diversification strategy.
"This strategy has reduced ADFlex's exposure to disk drives
in general and specifically mitigated recent shortfalls in demand
experienced by the high-end disk drive market segment. Moving
forward, the company believes that its long-term business model will
be closely aligned with the percent gross margin achieved for the
fourth quarter of 1997."
Backlog for the company at the end of the fourth quarter was
$44.8 million, and the number of new products under development was
118. Esteverena commented: "Although the order backlog and the design
activity remains healthy, the outlook for the high-end disk drive
market segment continues to be uncertain.
"Nonetheless, we believe that ADFlex's position as a 'one-stop-
shop' supplier for flex interconnect and flex assembly will contribute
significantly to our future growth."
ADFlex Solutions is a leading supplier of flexible circuit-based
interconnect solutions to the computer, computer peripheral,
communication and other industries. Applications for flex-based
interconnects include cellular telephones, hard disk drives and other
storage systems, high-end consumer products, notebook computers,
pagers and personal communications systems.
Safe Harbor Statement under the Private Securities Litigation Reform
Act of 1995: The statements contained in this release which are not
historical facts may contain forward-looking statements that involve
risks and uncertainties, including, but not limited to, continuing
risks related to concentration of sales, customers and markets, and
the ability of the company to achieve and maintain broad-based
customer demand and growth and to mitigate demand variations in the
hard disk drive industry; risks associated with the company's ability
to sustain margins; risks relating to the expansion of manufacturing
capacity in Thailand; the long-term validity of the company's
"one-stop-shop" growth strategy; and other risks detailed in the
company's Annual Report on Form 10-K for the year ended Dec. 31,
1996, and other Securities and Exchange Commission filings.
*T
ADFlex Solutions Inc.
Summary Consolidated Statements of Operations
(in thousands, except per-share data)
Three Months Ended
Dec. 31,
1997 1996
Net sales $ 54,355 $ 46,825
Cost of sales 42,970 40,409
Gross profit 11,385 6,416
Operating expenses
Engineering, selling
& administrative 6,072 5,109
Amortization of
intangible assets 129 --
Restructuring charges -- --
Total operating expenses 6,201 5,109
Operating income (loss) 5,184 1,307
Other income (expense), net (412) (354)
Income (loss) before
income taxes 4,772 953
Income taxes 1,526 494
Net income (loss) $ 3,246 $ 459
Net income (loss) per share:
Basic $ 0.37 $ 0.05
Diluted $ 0.36 $ 0.05
Number of shares used in
computing net income (loss)
per share:
Basic 8,768 8,634
Diluted 8,988 8,694
Twelve Months Ended
Dec. 31,
1997 1996
Net sales $ 213,878 $ 156,836
Cost of sales 175,826 138,273
Gross profit 38,052 18,563
Operating expenses
Engineering,
selling & administrative 23,343 20,620
Amortization of intangible assets 129 2,386
Restructuring charges -- 29,248
Total operating expenses 23,472 52,254
Operating income (loss) 14,580 (33,691)
Other income (expense), net (2,166) (1,087)
Income (loss) before
income taxes 12,414 (34,778)
Income taxes 3,818 (9,754)
Net income (loss) $ 8,596 $ (25,024)
Net income (loss) per share:
Basic $ 0.99 $ (2.92)
Diluted $ 0.97 $ (2.92)
Number of shares used in
computing net income (loss)
per share:
Basic 8,712 8,580
Diluted 8,894 8,580
ADFlex Solutions Inc.
Summary Consolidated Balance Sheets
(in thousands)
Dec. 31, Dec. 31,
1997 1996
Assets
Current assets:
Cash & short-term investments $ 9,092 $ 6,097
Accounts receivable, net 31,581 25,149
Inventories 19,297 14,990
Deferred tax assets -- 2,505
Prepaid taxes 2,951 795
Other current assets 2,567 1,778
Total current assets 65,488 51,314
Property, plant & equipment, net 42,257 34,297
Deferred tax assets 5,481 7,546
Intangible assets 2,449 --
Other assets 24 24
$ 115,699 $ 93,181
Liabilities and Stockholders' Equity
Current liabilities:
Line of credit $ 7,000 $ 10,000
Notes payable 2,250 --
Accounts payable 22,692 19,882
Accrued liabilities 6,548 9,679
Current portion of long-term
debt and capitalized leases 1,959 2,651
Total current liabilities 40,449 42,212
Accrued restructuring charges,
non-current -- 2,500
Capitalized leases &
deferred tax liabilities 1,113 189
Long-term debt, less current
portion 23,230 7,500
Minority interest in
consolidated joint venture -- 491
Stockholders' equity 50,907 40,289
*T
CONTACT: ADFlex Solutions Inc., Chandler
Don E. Frederick, 602/963-4584
Lisa Peterson, 602/786-8400
KEYWORD: ARIZONA
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED TELECOMMUNICATIONS
EARNINGS
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