Bell (AMEX:BI)
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Bell Industries, Inc. (AMEX:BI) today reported financial
results for the year and fourth quarter ended December 31, 2005.
Revenue for 2005 amounted to $130.9 million, compared with $144.0
million for 2004. The company's net loss for 2005 was $799,000, equal
to $0.09 per share, which included approximately $1.8 million in
charges, including $325,000 of costs associated with a severance
agreement for a former executive in the third quarter and
approximately $1.5 million of charges and costs in the fourth quarter.
For 2004, Bell sustained a net loss of $953,000, or $0.11 per share.
For the 2005 fourth quarter, revenue totaled $25.7 million,
compared with $26.2 million for the corresponding prior-year period.
Including the charges and costs, Bell registered a net loss for the
2005 fourth quarter of $1.5 million, equal to $0.18 per share,
compared with a net loss of $767,000, or $0.09 per share, last year.
In the fourth quarter, the company posted approximately $600,000
in staff separation and reorganization charges. In addition, Bell
incurred approximately $850,000 in higher-than-usual start up and
related costs associated with a new depot services contract. The
higher start-up and related costs on the new contract continued to be
incurred during the first quarter of 2006.
John A. Fellows, who was appointed chief executive officer of Bell
Industries in October 2005, said, "We believe that the significant
operational changes recently completed within Bell Tech.logix (BTL)
will have a positive and lasting effect on our associates, customers
and prospects. By realigning our resources dedicated to BTL's product
group, we fully expect to realize revenue growth for the segment in
2006. Additionally, we will leverage existing product relationships
and capitalize on our certification as a Microsoft Large Account
Reseller for the education practice. Within BTL's services segment, we
reduced non-operational headcount and successfully recruited a number
of leading executives from technology based service companies.
"We have a strong focus on strengthening client relationships. In
fact, a number of service offerings currently provided to Philip
Morris USA have been extended. I am confident that our aggressive
management transition over the past 120 days has properly positioned
BTL for improved operational execution and substantial global business
expansion in the years ahead."
For the 2005 fourth quarter, BTL posted net revenues of $14.9
million, compared with $16.6 million in the prior-year period. Product
sales amounted to $6.7 million, compared with $9.6 million in the 2004
fourth quarter. Services revenues rose to $8.2 million in the 2005
fourth quarter from $7.0 million a year earlier, primarily
attributable to continued strength in BTL's reverse logistics and
depot repair business. BTL had an operating loss of $1.5 million for
the 2005 fourth quarter, versus a loss of $469,000 last year.
Fellows added, "Both J.W. Miller and our Recreational Products
Group delivered improved operating results for the year and fourth
quarter. Overall, we are now completely focused on driving profitable
revenue growth in each of our business units."
At Bell's Recreational Products Group, net revenues for the 2005
fourth quarter rose 7.2% to $8.4 million from $7.9 million last year,
primarily reflecting higher preseason marine product shipments and an
early snow season which generated additional sales of snow related
products. The division sustained a lower operating loss of $122,000
for the 2005 fourth quarter, compared with a loss of $221,000 a year
ago.
Revenues at J.W. Miller, Bell's electronic components operation,
advanced 34.9% to $2.3 million in the 2005 fourth quarter from $1.7
million a year earlier. Operating income increased 80% to $520,000
from $289,000 a year ago.
Bell's balance sheet at year-end remained strong, with no bank
debt. At December 31, 2005, cash and cash equivalents totaled $7.3
million, and net working capital amounted to $18.6 million, compared
with $10.8 million and $19.1 million, respectively, at December 31,
2004. The company said the lower cash amount at December 31, 2005
principally reflected the timing of collections. At year-end,
shareholders' equity totaled $20.3 million, or $2.37 per share,
compared with $20.8 million, or $2.47 per share, at December 31, 2004.
Fellows concluded, "I am pleased with our recent progress. We are
absolutely focused, and we have taken significant steps to properly
align our existing resources and attract new resources so that we can
quickly become market leaders in the industries which we serve. I look
forward to Bell's growth and success in the years ahead."
About Bell Industries, Inc.
Bell is comprised of three diversified business units, Bell
Tech.logix, Recreational Products Group and J.W. Miller. Bell
Tech.logix offers a comprehensive portfolio of technology products and
managed lifecycle services, including planning, product sourcing,
deployment and disposal, and support services. Bell's Recreational
Products Group distributes after-market parts and accessories
primarily to the recreational vehicle and boating markets. J.W. Miller
manufactures and sells standard and custom magnetic components used in
electronic applications for computer, medical, lighting and
telecommunication equipment.
Forward-Looking Statements
Certain matters discussed in this news release are forward-looking
statements that involve risks and uncertainties that could cause
actual results to differ materially from current trends. These
include, but are not limited to, BTL being positioned for substantial
global business expansion, as well as other factors described in the
company's public filings from time to time.
(Tables Follow)
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Bell Industries, Inc.
Consolidated Operating Results
(In thousands, except per share data)
(Unaudited)
Three months ended Year ended
December 31, December 31,
2005 2004 2005 2004
----------------------------------------------------------------------
Net revenues
Products $17,462 $19,187 $100,266 $113,832
Services 8,232 7,031 30,670 30,122
------- ------- -------- ---------
25,694 26,218 130,936 143,954
------- ------- -------- ---------
Costs and expenses
Cost of products sold 13,413 15,046 79,097 92,879
Cost of services provided 7,152 5,808 25,184 24,227
Selling and administrative 6,703 6,185 27,331 27,187
Interest, net (94) (54) (275) (161)
Special items (a) 325 700
------- ------- -------- ---------
27,174 26,985 131,662 144,832
------- ------- -------- ---------
Loss before income taxes (1,480) (767) (726) (878)
Income tax expense 13 73 75
------- ------- -------- ---------
Net loss $(1,493) $(767) $(799) $(953)
======= ======= ======== =========
Basic and diluted share data
Net loss per share $(.18) $(.09) $(.09) $(.11)
======= ======= ======== =========
Weighted average common stock 8,490 8,418 8,466 8,385
======= ======= ======== =========
----------------------------------------------------------------------
OPERATING RESULTS BY BUSINESS
SEGMENT
Net revenues
Technology Solutions
Products $6,730 $9,619 $46,035 $60,149
Services 8,232 7,031 30,670 30,122
------- ------- -------- ---------
14,962 16,650 76,705 90,271
Recreational Products 8,425 7,858 45,858 45,907
Electronic Components 2,307 1,710 8,373 7,776
------- ------- -------- ---------
$25,694 $26,218 $130,936 $143,954
======= ======= ======== =========
Operating income (loss)
Technology Solutions $(1,490) $(469) $(1,532) $(780)
Recreational Products (122) (221) 1,408 1,319
Electronic Components 520 289 1,923 1,526
Corporate costs (482) (420) (2,475) (2,404)
Special items (a) (325) (700)
------- ------- -------- ---------
(1,574) (821) (1,001) (1,039)
Interest, net 94 54 275 161
Income tax expense (13) (73) (75)
------- ------- -------- ---------
Net loss $(1,493) $(767) $(799) $(953)
======= ======= ======== =========
(a) Special item in 2005 represents costs associated with a severance
agreement for a former executive. Special item in 2004 represents
costs associated with an employment agreement for another former
executive.
Bell Industries, Inc.
Consolidated Condensed Balance Sheet
(In thousands)
(Unaudited)
December 31, 2005 2004
ASSETS
Current assets:
Cash and cash equivalents $7,331 $10,801
Accounts receivable 15,306 11,455
Inventories 12,764 14,364
Prepaid expenses and other 2,701 1,813
------- --------
Total current assets 38,102 38,433
-------- --------
Fixed assets, net 3,143 3,139
Other assets 3,108 3,617
-------- --------
$44,353 $45,189
======= ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Floor plan payables $68 $2,172
Accounts payable 11,023 8,998
Accrued payroll and liabilities 8,440 8,178
------- --------
Total current liabilities 19,531 19,348
------- --------
Long-term liabilities 4,518 5,025
Shareholders' equity 20,304 20,816
------- --------
$44,353 $45,189
======= ========
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