Excel (NASDAQ:XLTC)
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Excel Technology, Inc. (NASDAQ: XLTC) today announced the results for
the quarter and year ended December 31, 2006. Revenues of $38.3 million
and $154.5 million for the quarter and year ended December 31, 2006,
respectively, were 5.2% and 12.2% higher than the $36.4 million and
$137.7 million for the quarter and year ended December 31, 2005,
respectively. Pre-tax profits were $5.1 million for the fourth quarter
of this year compared to $6.0 million in the same period last year, a
decrease of 15.0%. For the year ended December 31, 2006, pre-tax profits
were $20.4 million compared to $20.7 million in 2005, a decrease of
1.4%. Net income was $3.7 million for the fourth quarter of this year as
compared to $4.4 million in the same period last year, a decrease of
15.9%. For the year ended December 31, 2006, net income was $14.0
million compared to $15.2 million for the same period in 2005. Net
income per share on a diluted basis of $0.30 for the quarter ended
December 31, 2006 was 16.7% lower than the $0.36 per share on a diluted
basis reported for the same period in 2005. For the year ended December
31, 2006, net income per share on a diluted basis was $1.12 in 2006
compared to $1.24 in 2005.
Non-GAAP Net Income and EPS: Net income for 2006 would have been
$17.5 million (unaudited) excluding merger, merger related and deferred
compensation and stock based compensation expenses (“special
items”) of $5.2 million or $3.5 million net of
tax. These “special items”
had a $0.28 cents per diluted share effect on EPS. EPS without these
charges would have been $1.40 per diluted share for the year ended
December 31, 2006 (unaudited).
Antoine Dominic, Chief Executive Officer, stated, "We are quite pleased
with our revenues for the year and the quarter. Our gross profit and
margins were affected negatively during the quarter due to a provision
for excess inventory and lower margins associated with a newly
introduced product during the initial phase of production. During the
year we launched several new products that helped us in achieving our
record bookings of $157 million. Our market development efforts, which
were hindered in 2006 due to the pending merger are now back on track
and we plan to further expand our organic growth. Having just completed
our sixth consecutive year of growth in revenues and profits (excluding
merger costs), we hope to build on these achievements in 2007. In
addition to increasing our market presence and new product
introductions, we plan to continue our emphasis on increased operational
efficiencies that will result in higher profit growth rates in relation
to sales. We have a healthy backlog going into 2007 and we are
optimistic about our future.”
Alice Hughes Varisano, Chief Financial Officer, concluded, "The Company
increased its sales 12.2% to $154.5 million for the year ended December
31, 2006. Pre tax profits increased 23.7% (excluding special items) to
$25.6 million compared to the same period last year. Net income after
tax increased 15.1% (excluding special items) to $17.5 million compared
to 2005. The pre-tax profits increased more than net income due to the
effective tax rate increasing from 26.4% to 31.4% in 2006. The increase
in the tax rate was due in part to increased non-deductible expenses and
the reduction of a tax exposure liability due to a settlement in 2005
that did not reoccur in 2006. The Company increased its cash by $12.8
million resulting in a cash and investment balance of $63.1 million as
of December 31, 2006, with no debt. The Company utilized $2.0 million of
cash during the quarter in order to repurchase 79,500 shares of its
stock. Year to date bookings at December 31, 2006 were $157 million, an
increase of $13 million over the same period in the prior year. The
backlog at the end of the fourth quarter 2006 was $36 million an
increase of $3 million compared to $33 million backlog for the fourth
quarter of 2005. Now that the failed merger is behind the Company, we
are focused on building upon our achievements of 2006.”
This news release contains forward-looking statements, which are based
on current expectations. Actual results could differ materially from
those discussed or implied in the forward-looking statements as a result
of various factors including future economic, competitive, regulatory,
and market conditions, future business decisions, market acceptance of
the Company’s products, and those factors
discussed in the Company’s Form 10-K for the
year ended December 31, 2005. In light of the significant uncertainties
inherent in such forward-looking statements, they should not be regarded
as a representation that the Company’s
objectives and plans will be achieved, and they should not be relied
upon by investors when making an investment decision. Words such as
"believes," "anticipates," "expects," "intends," "may," and similar
expressions are intended to identify forward-looking statements, but are
not the exclusive means of identifying such statements.
Excel and its wholly owned subsidiaries manufacture and market
photonics-based solutions, consisting of laser systems and
electro-optical components, primarily for industrial and scientific
applications.
FINANCIAL SUMMARY
(unaudited and in thousands, except per share data)
FOR THE QUARTER
FOR THE YEAR
ENDED DECEMBER 31
ENDED DECEMBER 31
2006
2005
2006
2005
Net Sales & Services
$
38,343
$
36,364
$
154,496
$
137,717
Cost of Sales and Services
$
22,713
$
19,227
$
85,602
$
72,295
Gross Profit
$
15,630
$
17,137
$
68,894
$
65,422
Operating Expenses:
Selling & Marketing
$
4,393
$
4,865
$
18,745
$
18,959
General & Administrative
$
3,362
$
2,952
$
13,051
$
12,448
Research and Development
$
3,716
$
3,629
$
14,523
$
14,477
Operating Income (without merger related & deferred compensation
expenses)
$
4,159
$
5,691
$
22,575
$
19,538
Merger and Merger Related and Deferred Compensation Expense
$
-
$
-
$
(5,069)
$
-
Interest Income
$
774
$
386
$
2,545
$
1,180
Other Income (Expense)
$
162
$
(115)
$
391
$
(47)
Pre-Tax Income
$
5,095
$
5,962
$
20,442
$
20,671
Provision for Income Taxes
$
1,421
$
1,610
$
6,423
$
5,463
Net Income
$
3,674
$
4,352
$
14,019*
$
15,208
Net Income Per Common Share - Diluted
$
0.30
$
0.36
$
1.12*
$
1.24
Weighted Average Common
Shares Outstanding - Diluted
12,437
12,254
12,488
12,246
Reconciliation of GAAP to non-GAAP net income and EPS
* Net income as reported under GAAP of $14,019, excluding the
merger, merger related and deferred compensation expenses, and
stock based compensation (“special items”)
net of tax effect, of approximately $3,530 for the year ended
December 31, 2006 (or 28 cents per diluted share) would have been
$17,549 (unaudited). EPS without these charges would have been
$1.40 per diluted share for the year ended December 31, 2006
(unaudited).
BALANCE SHEET & SELECTED FINANCIAL DATA
(unaudited )
DECEMBER 31, 2006
DECEMBER 31, 2005
Cash
$
9,903
$
16,303
Investments
$
53,220
$
34,000
Accounts Receivable, net
$
22,716
$
22,879
Inventory
$
34,906
$
30,269
Other Current Assets
$
3,445
$
3,013
Total Current Assets
$
124,190
$
106,464
Property, Plant & Equipment, net
$
25,503
$
25,983
Other Non-Current Assets & Goodwill
$
32,286
$
31,591
Total Assets
$
181,979
$
164,038
Accounts Payable
$
6,386
$
4,829
Accrued Expenses and
Other Current Liabilities
$
7,256
$
6,979
Total Current Liabilities
$
13,642
$
11,808
Other Non-Current Liabilities
$
4,546
$
3,492
Minority Interest in Net Income of Subsidiary
$
66
$
48
Stockholders' Equity
$
163,725
$
148,690
Total Liabilities & Stockholders' Equity
$
181,979
$
164,038
Working Capital
$
110,548
$
94,656