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B: Alpha Pro Tech, Ltd. Announces Record Revenue for the Fourth Q
B: Alpha Pro Tech, Ltd. Announces Record Revenue for the Fourth Quarter and Full
NOGALES, Ariz., Mar 08, 2007 (BUSINESS WIRE) --
Alpha Pro Tech (AMEX:APT) a leading manufacturer of products
designed to protect people, products and environments, including
disposable protective apparel and building products, today announced
its financial results for the fourth quarter and full-year period
ended December 31, 2006. The results are in-line with the expectations
announced February 15th.
Consolidated sales for the fourth quarter ended December 31, 2006
increased 50.1% to a record $10.5 million from $7.0 million in the
comparable 2005 quarter. The increase was primarily due to a
significant increase in disposable protective apparel products, and an
increase in engineered products construction supply weatherization
products, and infection control product sales, partially offset by a
decrease in extended care product sales. Sales for the Disposable
Protective Apparel segment for the quarter increased 73.8% to $6.4
million compared to $3.7 million for the same period of 2005. We
expect continued growth in 2007 due to the market acceptance of our
new ComforTech(R) line of products and our efforts to expand the
distribution network. Infection Control segment sales for the quarter
increased 25.8% to $2.0 million compared to $1.6 million for the same
period of 2005. Mask sales in this segment, especially sales of the
N-95 NIOSH approved respirator mask, continued the trend of sales
growth throughout 2006, as concerns about Avian Flu have not abated.
Engineered Products segment sales for the quarter increased 49.2% to
$1.8 million compared to $1.2 million for the same period of 2005.
Al Millar, President of Alpha Pro Tech commented, "In just two
years, our Engineered Products segment has grown from a true startup
to a strong driver of our consolidated top and bottom line results,
contributing 20.8% of our net sales. This segment posted 65.1% sales
growth for the year, and we believe our decision to move forward on a
non-exclusive basis with our distributor will enable us to maintain
this growth rate as we add to our distribution channels. Due to this
change in distribution channel strategy, we anticipate that our sales
will likely be affected in the early part of 2007, but the full-year
2007 should have a rate of growth similar to that realized in 2006.
The latest product in this segment is the state-of-the-art REX
SynFelt(TM) synthetic roof underlayment, which will add depth to our
current product offering representing an attractive opportunity for
our distributors. Our apparel segment recovered from a slow first
quarter of the year to report positive annual growth, supported by the
successful introduction of our ComforTech(R) line and the pending
launch of our ComforTech(R) Sterile(TM) product. Today, Alpha Pro Tech
has the most comprehensive and sophisticated line of products in its
history, and as we round out our distribution channels we are well
positioned for continued growth in 2007 and beyond. Our game plan is
to show overall growth for the Company of at least 20% in 2007."
Gross profit increased by 59.2% to a record $5.0 million for the
quarter, or 47.0% gross profit margin, from $3.1 million, or 44.3%
gross profit margin, for the same period in 2005. Gross profit margin
on the Engineered Products segment improved in each of the four
quarters of 2006 and is expected to continue to improve into 2007.
Selling, general and administrative expenses increased by 23.2% to
$3.1 million for the quarter from $2.5 million for the same quarter
last year. Despite the actual increase in operating expenses,
operating expenses as a percentage of revenue decreased to 29.3% from
35.7%, year-over-year.
Income from operations increased by 266.7%, to $1.8 million for
the quarter as compared to income from operations of $478,000 for the
quarter ended December 31, 2005.
Net income for the quarter was $1.1 million compared to net income
of $309,000 for the quarter ended December 31, 2005. Basic and diluted
income per share for the quarter was $0.04, based on 25.3 million
fully diluted shares, compared to basic and fully diluted earnings per
share of $0.01, based on 25.5 million fully diluted shares, for the
fourth quarter last year.
Mr. Millar added, "For the year, strong sales across all of our
core segments resulted in a record year of revenue and profitability
for Alpha Pro Tech. We continue to carefully manage our pricing
structure, which has allowed us to maintain and slightly expand
margins across our businesses, and manage expenses, leading to a
reduction of our selling, general and administrative expenses as a
percent of revenue."
For the full-year period ended December 31, 2006, consolidated
sales increased 20.1% to $37.3 million from $31.1 million for the year
ended December 31, 2005 due to increased sales of engineered products
construction supply weatherization products, disposable protective
apparel products and infection control segment sales. The Engineered
Products segment sales for the year increased 65.1% to $7.8 million
from $4.7 million in the 2005 period. Sales for the Disposable
Protective Apparel segment for the year were $21.2 million, an
increase of 8.9% from the $19.4 million for the prior year, helped by
an increase of sales in the second half of the year. Infection Control
segment sales for the year increased 35.2% to $6.9 million from $5.1
million in the same period of 2005 due in large part to sales of our
N-95 NIOSH approved Respirator mask.
Gross profit increased 22.4% to $17.3 million, or 46.4% gross
profit margin for the 2006 year compared to gross profit of $14.1
million, or 45.5% gross profit margin, for 2005. Selling, general and
administrative expenses increased 11.7% to $10.9 million, or 29.3% of
sales, for the year from $9.8 million, or 31.5% of sales, for the
prior year. We believe that as our sales grow, our expenses will
continue to decrease as a percentage of sales.
Income from operations for 2006 increased 54.0% to $5.9 million
from $3.9 million for the prior-year period. Net income for the year
was $3.7 million, or $0.15 per basic and fully diluted share (based on
25.1 million shares) compared to net income of $2.4 million, or $0.10
per basic and fully diluted (based on 25.2 million shares) for the
comparable prior-year period.
The balance sheet continued to remain strong with a current ratio
of 8.3 to 1 on December 31, 2006. The Company completed the quarter
with cash and cash equivalents of $1.8 million and working capital of
$19.6 million. Additionally at year end, the Company reported no
outstanding debt, maintains an unused $3.5 million credit facility and
shareholders' equity improved to $23.5 million from $18.6 million on
December 31, 2005. Inventories on December 31, 2006 totaled $12.7
million and were up $2.1 million or 19.8% compared to inventories as
of December 31, 2005. The increase is primarily attributable to an
increase of $2.2 million in inventory for the Engineered Product
segment.
Lloyd Hoffman, Chief Financial Officer commented, "Although our
Engineered Products segment inventory of $6.8 million has increased in
2006, the number of months of sales in inventory has decreased
slightly from 2005. We expect through sales growth that the number of
months of sales in inventory in this segment will be reduced during
2007."
About Alpha Pro Tech, Ltd.
Alpha Pro Tech, Ltd. is a leader in protecting environments. Alpha
Pro Tech, Inc. develops, manufactures and markets innovative
disposable and limited-use protective apparel products for the
industrial, clean room, medical and dental markets. In addition, Alpha
ProTech Engineered Products, Inc. manufactures and markets a line of
construction weatherization products, including building wrap, roof
underlayment and mold resistant framing sealant. The Company has
manufacturing facilities in Salt Lake City, Utah; Nogales, Arizona;
Janesville, Wisconsin; Valdosta, Georgia; and a joint venture in
India. For more information and copies of all news releases and
financials, visit Alpha Pro Tech's Website at
alphaprotech.com.
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