Scientific Technologies (NASDAQ:STIZ)
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Scientific Technologies Incorporated (NASDAQ:STIZ), a
leading North American provider of automation safeguarding products,
announced today the results of operations for the three and twelve
month periods ended December 31, 2005. Sales for the fourth quarter of
2005 increased 25% to a record $16,917,000, as compared to sales of
$13,549,000 for the same quarter of 2004. Sales for the year ended
December 31, 2005 were $61,158,000, also a record and a 5% increase
over the $58,425,000 recorded in 2004.
Net income for the fourth quarter of 2005 was $1,183,000, or $.12
per common and diluted share, compared to a net loss for the fourth
quarter of 2004 of $4,832,000, or $.50 per share. Included in the net
loss for the fourth quarter of 2004 is an intangible asset impairment
charge of $4,815,000 and commission expense of approximately $600,000
associated with the settlement of a lawsuit with a former sales
representative organization.
Net income for fiscal year 2005 was $3,374,000, or $.35 per common
and diluted share, compared to a net loss for fiscal year 2004 of
$5,118,000, or $.53 per share. Included in the net loss for the year
ended December 31, 2004 are intangible asset impairment charges of
$6,817,000 and the $600,000 lawsuit settlement described above.
Commenting on the results, Joseph J. Lazzara, President and Chief
Executive Officer, stated, "We are very pleased to report a new record
for revenues for both a quarter and for the full year. The sales
growth of 25% for the fourth quarter of 2005 over the same period in
2004 was very gratifying, as we saw increased sales from both our
Safety Products Group and Automation Products Group. On a sequential
basis, revenue for the fourth quarter of 2005 increased 13% over the
third quarter of 2005.
"Finally, it was very rewarding to finish 2005 with net income of
$.35 per share for the year, compared with a loss of $.53 for 2004.
Based on the progress we have made in 2005 over the prior year, we
continue to be encouraged with our prospects for the future."
Fourth Quarter Highlights
Recent items of interest include:
-- STI's Safety Products Group received a Product of the Year
award for its innovative OptoShield OS3100 Laser Light Safety
Scanner -- an advanced area guarding scanner which employs
laser light to monitor entry into a user-configurable safety
detection zone and send a stop signal to a guarded machine.
The award honors the top new products as voted on by the
readers of PLANT ENGINEERING magazine. The OptoShield was
introduced by STI during the second quarter of 2005.
-- STI's Automation Product Group introduced the RPA Series Level
Measurement Sensors. These highly reliable measuring sensors
are designed to augment mechanical tank level indicators and
convert this older style method to one capable of an
electronic output, useful for remote monitoring applications.
The RPA Sensors are designed primarily for tank level
measurement in oil field applications.
About Scientific Technologies Inc.
Scientific Technologies, Inc. (STI) is a North American leading
provider of automation safeguarding products and services through its
Safety Products Group. STI's Optical Sensor Division (OSD) provides
safety products that are used to protect workers around machinery,
automated equipment and industrial robots. Our products serve a wide
variety of applications and markets, including semiconductor,
automotive, electronics manufacturing, packaging and consumer markets.
STI's Machine Services Division (MSD) provides safety services such as
safeguarding equipment installations, machine safety assessments, and
the design and custom fabrication of guarding solutions. MSD
specializes in machinery services including the repair, relocation,
installation and service of fabricating machinery. MSD serves
customers in a variety of industries, including metal fabrication,
aerospace, electronics, building materials, automotive and food
processing. Our web site is located at www.sti.com
STI's Automation Products Group serves the factory automation,
semiconductor, transportation, oil and gas, consumer and food
processing industries with a diversified offering of sensing
technologies. Products include level, flow, pressure sensing,
positioning transducers, vehicle separation, profiling and ultrasonic
sensors and controls. Further information is available at the Group's
web sites: www.automationsensors.com, and www.stiscanners.com.
Forward-Looking Statements
Certain statements in this press release, including statements
regarding future prospects, sales and financial results and the impact
of product introductions, are forward-looking statements that are
subject to risks and uncertainties. These risks and uncertainties,
which could cause STI's results to differ materially from the
forward-looking statements, include: economic and political conditions
in domestic and international markets; declining market demand for
industrial safety and security products generally; introduction of or
increased demand for alternative products; potential errors, defects,
design flaws or other problems with our products; changes in
regulations relating to industrial safety and security products; and
the other risks detailed from time to time in STI's Securities and
Exchange Commission filings and reports, including STI's annual report
filed on Form 10-K and quarterly reports filed on Form 10-Q. STI
disclaims any obligation to update information contained in any
forward-looking statement.
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SCIENTIFIC TECHNOLOGIES INCORPORATED
Condensed Consolidated Income Statement
(Amounts in thousands except per share data)
(Unaudited)
Three months ended Twelve months ended
December 31, December 31,
2005 2004 2005 2004
-------- -------- --------- ---------
Sales $ 16,917 $ 13,550 $ 61,158 $ 58,425
Intangibles write down -- 3,479 -- 4,206
Cost of sales 9,482 9,426 35,658 36,372
-------- -------- --------- ---------
Gross profit 7,435 645 25,500 17,847
Intangibles write down -- 1,336 -- 2,611
Operating expenses 5,982 6,512 22,350 23,094
-------- -------- --------- ---------
Operating income (loss) 1,453 (7,203) 3,150 (7,858)
Interest and other income 308 22 544 216
-------- -------- --------- ---------
Income (loss) before taxes 1,761 (7,181) 3,694 (7,642)
Provision (benefit) for income
taxes 578 (2,349) 320 (2,524)
-------- -------- --------- ---------
Net income (loss) $ 1,183 $ (4,832)$ 3,374 $ (5,118)
======== ======== ========= =========
Basic and diluted net
income (loss) per
Share $ .12 $ (.50)$ .35 $ (.53)
======== ======== ========= =========
Shares used to compute net
income (loss)
per share 9,783 9,741 9,775 9,741
======== ======== ========= =========
Condensed Consolidated Balance Sheet
(Amounts in thousands)
(Unaudited)
December 31, December 31,
2005 2004
------------ ------------
Assets
Current assets:
Cash and cash equivalents $ 7,253 $ 2,940
Accounts receivable 9,085 7,746
Inventories 8,414 10,584
Other assets 2,640 5,161
--------- ----------
Total current assets 27,392 26,431
Property, plant and equipment, net 3,224 3,470
Goodwill, intangibles and other assets 4,397 2,918
--------- ----------
Total assets $ 35,013 $ 32,819
========= ==========
Liabilities and shareholders' equity
Current liabilities:
Accounts payable $ 2,480 $ 3,246
Accrued expenses 3,661 3,920
Current portion of capital lease with
Parent 68 68
--------- ----------
Total current liabilities 6,209 7,234
Capital lease with Parent 28 96
Deferred income tax liability -- 118
--------- ----------
Total liabilities 6,237 7,448
Shareholders' equity 28,776 25,371
--------- ----------
Total liabilities and
shareholders' equity $ 35,013 $ 32,819
========= ==========
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