Excel (NASDAQ:XLTC)
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Excel Technology, Inc. (NASDAQ: XLTC) announced record quarterly results
for the period ended September 29, 2006. Sales for the quarter were
$40.3 million and pretax income was $3.7 million and net income was $2.5
million ($0.20 per diluted share), which included $2.1 million (net of
taxes) of special items. Excluding the $2.1 million (net of taxes) of
special items ($0.17 per diluted share), the Company’s
pretax profit was $6.8 million and net income was $4.6 million ($0.36
per diluted share).
Sales: The Company realized record sales of $40.3 million, an
increase of 6.5% or $2.5 million, for the three months ended September
29, 2006 and $116.2 million, an increase of 14.6% or $14.8 million, for
the nine months ended September 29, over the comparable periods in 2005.
Pretax Profits: Pretax profits, excluding special items was $6.8
million for the third quarter of the year as compared to $6.0 million in
the same period last year, an increase of 14%. For the nine months ended
September 29, 2006 pretax profits, excluding special items were $20.4
million compared to $14.7 for the same period in 2005, an increase of
38.8%.
Profits: Net income, excluding special items was $4.6 million for
the third quarter of this year as compared to $4.4 million in the same
period last year, an increase of 4.6%. For the nine months ended
September 2006, net income, excluding special items was $13.8 million
compared to $10.9 million for the same period in 2005, an increase of
26.8%.
EPS: Net income per share, including special items, is $0.20 per
diluted share for the quarter and $0.83 per diluted share for the nine
months ending September 29, 2006. Net income per share, excluding
special items, was $0.36 on a diluted basis for the quarter ended
September 29, 2006, and $0.36 per share on a diluted basis reported for
the same period in 2005. For the nine months ended September 29, 2006,
net income per share, excluding special items, was $1.10 on a diluted
basis in 2006 compared to $0.89 on a diluted basis for 2005, a 23.6%
increase.
Antoine Dominic, Chief Executive Officer, stated “We
are quite pleased with our quarter and year to date results considering
that we achieved these results while having to work within the framework
of the merger contract, the uncertainty in the market and lack of new
efforts to further expand our market presence due to the pending merger.
Now that the merger is officially terminated, we are committed to
growing Excel by expanding our product portfolio and markets organically
and through acquisitions. Our year to date sales growth of 14.6% was
good because it was all organic. However, our year to date pre-tax
income growth of 38.8% (excluding special items) was even more
satisfying as we increased our operational efficiencies. We need to
continue our emphasis on organic growth as the ratio of sales increase
to profitability is far greater as evidenced this year. During the year
the Company has introduced several new products that have been well
received in the market and we plan to enter 2007 with a record product
portfolio that should aid in our organic growth. We also have a fairly
healthy cash balance that we hope will enable us to expand our
acquisition objectives and also to utilize it wisely for share
repurchases.”
Alice Hughes Varisano, Chief Financial Officer, concluded, “The
third quarter of 2006 was the Company’s fifth
straight quarter of record sales, pre tax profits, net income and
earnings per share (excluding special items). Sales increased 6.5%
during the quarter and 14.6% for the first nine months compared to the
same period last year. Pre tax profits (excluding special items)
increased 14% to $6.8 million for the third quarter and for the nine
months ended September 30, 2006 increased 38.8% to $20.4 million
compared to the same period last year. Profits for the quarter increased
4.6% and for the nine months 26.8% (excluding special items), less of an
increase than pre tax profits due to the effective tax rate increasing
from 27% to 33% in 2006. This increase in the tax rate was due in part
to the suspension of the R&D credit, non deductibility of certain merger
related costs, and the reduction of a tax exposure liability due to a
settlement in 2005 that did not reoccur in 2006. The Company generated
$9 million of cash during the first nine months, resulting in a cash and
investment balance of $59.0 million as of September 30, 2006; with no
debt. Year to date bookings at September 30, 2006 were $118 million, an
increase of over 11% or $12.0 million over the same period in the prior
year. The backlog at the end of the third quarter 2006 was $36.5 million
an increase of 16.0% or $5.0 million compared to $31.5 million backlog
for the third quarter 2005, which is quite strong.”
Excel and its wholly owned subsidiaries manufacture and market
photonics-based solutions, consisting of laser systems and
electro-optical components, primarily for industrial/commercial and
scientific applications.
FINANCIAL SUMMARY
(unaudited and in thousands, except per share data)
FOR THE QUARTER
FOR THE NINE MONTHS
ENDED SEPTEMBER 30
ENDED SEPTEMBER 30
(unaudited)
(unaudited)
2006
2005
2006
2005
Net Sales & Services
$
40,299
$
37,842
$
116,154
$
101,352
Cost of Sales and Services
$
22,350
$
19,803
$
62,890
$
53,068
Gross Profit
$
17,949
$
18,039
$
53,264
$
48,284
Operating Expenses:
Selling & Marketing
$
4,611
$
5,027
$
14,352
$
14,094
General & Administrative
$
3,724
$
3,536
$
9,689
$
9,496
Research and Development
$
3,527
$
3,757
$
10,807
$
10,848
Operating Income (without merger, merger related & deferred
compensation expenses)
$
6,087
$
5,719
$
18,416
$
13,846
Merger, Merger Related and Deferred Compensation Expense
$
3,085
$
0
$
5,069
$
0
Interest Income
$
755
$
337
$
1,770
$
794
Other Income (Expense)
$
(43)
$
(92)
$
230
$
69
Pre-Tax Income
$
3,714
$
5,964
$
15,347
$
14,709
Provision for Income Taxes
$
1,226
$
1,610
$
5,002
$
3,853
Net Income
$
2,488*
$
4,354
$
10,345*
$
10,856
Net Income Per Common Share - Diluted
$
0.20
$
0.36
$
0.83
$
0.89
Weighted Average Common Shares Outstanding - Diluted
12,522
12,259
12,505
12,243
Reconciliation of GAAP to non-GAAP net income and EPS
Net income as reported under GAAP of $2,488 and $10,345, excluding the
merger, merger related and deferred compensation expenses, net of tax
effect, of approximately $2.1 million for the three months ending
September 29, 2006 (or .17 cents per diluted share) and $3.4 million
for the nine months ending September 29, 2006 (or .27 cents per
diluted share) would have been $4,635 and $13,835 respectively
(unaudited). EPS without these charges would have been $0.36 and $1.10
per diluted share for the three and nine months ending September 29,
2006, respectively (unaudited).
BALANCE SHEET & SELECTED FINANCIAL DATA
SEPTEMBER 29, 2006
DECEMBER 31, 2005
Cash
$
9,774
$
16,303
Investments
$
49,150
$
34,000
Accounts Receivable, net
$
26,044
$
22,879
Inventories
$
36,497
$
30,269
Other Current Assets
$
2,855
$
3,013
Total Current Assets
$
124,320
$
106,464
Property, Plant & Equipment, net
$
25,158
$
25,983
Other Non-Current Assets & Goodwill
$
32,142
$
31,591
Total Assets
$
181,620
$
164,038
Accounts Payable
$
6,950
$
4,829
Accrued Expenses and Other Current Liabilities
$
9,013
$
5,882
Income Taxes Payable
$
436
$
1,097
Total Current Liabilities
$
16,399
$
11,808
Deferred Compensation
$
1,375
$
--
Other Non-Current Liabilities
$
3,478
$
3,492
Minority Interest in Net Income of Subsidiary
$
89
$
48
Stockholders' Equity
$
160,279
$
148,690
Total Liabilities & Stockholders' Equity
$
181,620
$
164,038
Working Capital
$
107,921
$
94,656
Current Ratio
7.58
9.02
Excel Technology, Inc. (NASDAQ: XLTC) announced record quarterly
results for the period ended September 29, 2006. Sales for the quarter
were $40.3 million and pretax income was $3.7 million and net income
was $2.5 million ($0.20 per diluted share), which included $2.1
million (net of taxes) of special items. Excluding the $2.1 million
(net of taxes) of special items ($0.17 per diluted share), the
Company's pretax profit was $6.8 million and net income was $4.6
million ($0.36 per diluted share).
Sales: The Company realized record sales of $40.3 million, an
increase of 6.5% or $2.5 million, for the three months ended September
29, 2006 and $116.2 million, an increase of 14.6% or $14.8 million,
for the nine months ended September 29, over the comparable periods in
2005.
Pretax Profits: Pretax profits, excluding special items was $6.8
million for the third quarter of the year as compared to $6.0 million
in the same period last year, an increase of 14%. For the nine months
ended September 29, 2006 pretax profits, excluding special items were
$20.4 million compared to $14.7 for the same period in 2005, an
increase of 38.8%.
Profits: Net income, excluding special items was $4.6 million for
the third quarter of this year as compared to $4.4 million in the same
period last year, an increase of 4.6%. For the nine months ended
September 2006, net income, excluding special items was $13.8 million
compared to $10.9 million for the same period in 2005, an increase of
26.8%.
EPS: Net income per share, including special items, is $0.20 per
diluted share for the quarter and $0.83 per diluted share for the nine
months ending September 29, 2006. Net income per share, excluding
special items, was $0.36 on a diluted basis for the quarter ended
September 29, 2006, and $0.36 per share on a diluted basis reported
for the same period in 2005. For the nine months ended September 29,
2006, net income per share, excluding special items, was $1.10 on a
diluted basis in 2006 compared to $0.89 on a diluted basis for 2005, a
23.6% increase.
Antoine Dominic, Chief Executive Officer, stated "We are quite
pleased with our quarter and year to date results considering that we
achieved these results while having to work within the framework of
the merger contract, the uncertainty in the market and lack of new
efforts to further expand our market presence due to the pending
merger. Now that the merger is officially terminated, we are committed
to growing Excel by expanding our product portfolio and markets
organically and through acquisitions. Our year to date sales growth of
14.6% was good because it was all organic. However, our year to date
pre-tax income growth of 38.8% (excluding special items) was even more
satisfying as we increased our operational efficiencies. We need to
continue our emphasis on organic growth as the ratio of sales increase
to profitability is far greater as evidenced this year. During the
year the Company has introduced several new products that have been
well received in the market and we plan to enter 2007 with a record
product portfolio that should aid in our organic growth. We also have
a fairly healthy cash balance that we hope will enable us to expand
our acquisition objectives and also to utilize it wisely for share
repurchases."
Alice Hughes Varisano, Chief Financial Officer, concluded, "The
third quarter of 2006 was the Company's fifth straight quarter of
record sales, pre tax profits, net income and earnings per share
(excluding special items). Sales increased 6.5% during the quarter and
14.6% for the first nine months compared to the same period last year.
Pre tax profits (excluding special items) increased 14% to $6.8
million for the third quarter and for the nine months ended September
30, 2006 increased 38.8% to $20.4 million compared to the same period
last year. Profits for the quarter increased 4.6% and for the nine
months 26.8% (excluding special items), less of an increase than pre
tax profits due to the effective tax rate increasing from 27% to 33%
in 2006. This increase in the tax rate was due in part to the
suspension of the R&D credit, non deductibility of certain merger
related costs, and the reduction of a tax exposure liability due to a
settlement in 2005 that did not reoccur in 2006. The Company generated
$9 million of cash during the first nine months, resulting in a cash
and investment balance of $59.0 million as of September 30, 2006; with
no debt. Year to date bookings at September 30, 2006 were $118
million, an increase of over 11% or $12.0 million over the same period
in the prior year. The backlog at the end of the third quarter 2006
was $36.5 million an increase of 16.0% or $5.0 million compared to
$31.5 million backlog for the third quarter 2005, which is quite
strong."
Excel and its wholly owned subsidiaries manufacture and market
photonics-based solutions, consisting of laser systems and
electro-optical components, primarily for industrial/commercial and
scientific applications.
-0-
*T
FINANCIAL SUMMARY
(unaudited and in thousands, except per share data)
FOR THE QUARTER FOR THE NINE MONTHS
ENDED SEPTEMBER 30 ENDED SEPTEMBER 30
(unaudited) (unaudited)
2006 2005 2006 2005
--------- --------- --------- ---------
Net Sales & Services $ 40,299 $ 37,842 $116,154 $101,352
Cost of Sales and Services $ 22,350 $ 19,803 $ 62,890 $ 53,068
--------- --------- --------- ---------
Gross Profit $ 17,949 $ 18,039 $ 53,264 $ 48,284
Operating Expenses:
Selling & Marketing $ 4,611 $ 5,027 $ 14,352 $ 14,094
General & Administrative $ 3,724 $ 3,536 $ 9,689 $ 9,496
Research and Development $ 3,527 $ 3,757 $ 10,807 $ 10,848
--------- --------- --------- ---------
Operating Income (without
merger, merger related &
deferred compensation
expenses) $ 6,087 $ 5,719 $ 18,416 $ 13,846
Merger, Merger Related and
Deferred Compensation Expense $ 3,085 $ 0 $ 5,069 $ 0
Interest Income $ 755 $ 337 $ 1,770 $ 794
Other Income (Expense) $ (43) $ (92) $ 230 $ 69
--------- --------- --------- ---------
Pre-Tax Income $ 3,714 $ 5,964 $ 15,347 $ 14,709
Provision for Income Taxes $ 1,226 $ 1,610 $ 5,002 $ 3,853
--------- --------- --------- ---------
Net Income $ 2,488* $ 4,354 $ 10,345* $ 10,856
========= ========= ========= =========
Net Income Per Common Share -
Diluted $ 0.20 $ 0.36 $ 0.83 $ 0.89
Weighted Average Common Shares
Outstanding - Diluted 12,522 12,259 12,505 12,243
*T
Reconciliation of GAAP to non-GAAP net income and EPS
-- Net income as reported under GAAP of $2,488 and $10,345,
excluding the merger, merger related and deferred compensation
expenses, net of tax effect, of approximately $2.1 million for
the three months ending September 29, 2006 (or .17 cents per
diluted share) and $3.4 million for the nine months ending
September 29, 2006 (or .27 cents per diluted share) would have
been $4,635 and $13,835 respectively (unaudited). EPS without
these charges would have been $0.36 and $1.10 per diluted
share for the three and nine months ending September 29, 2006,
respectively (unaudited).
-0-
*T
BALANCE SHEET & SELECTED FINANCIAL DATA
SEPTEMBER 29, 2006 DECEMBER 31, 2005
Cash $ 9,774 $ 16,303
Investments $ 49,150 $ 34,000
Accounts Receivable, net $ 26,044 $ 22,879
Inventories $ 36,497 $ 30,269
Other Current Assets $ 2,855 $ 3,013
------------------ -----------------
Total Current Assets $ 124,320 $ 106,464
Property, Plant & Equipment, net $ 25,158 $ 25,983
Other Non-Current Assets &
Goodwill $ 32,142 $ 31,591
------------------ -----------------
Total Assets $ 181,620 $ 164,038
================== =================
Accounts Payable $ 6,950 $ 4,829
Accrued Expenses and Other
Current Liabilities $ 9,013 $ 5,882
Income Taxes Payable $ 436 $ 1,097
------------------ -----------------
Total Current Liabilities $ 16,399 $ 11,808
Deferred Compensation $ 1,375 $ --
Other Non-Current Liabilities $ 3,478 $ 3,492
Minority Interest in Net Income
of Subsidiary $ 89 $ 48
Stockholders' Equity $ 160,279 $ 148,690
------------------ -----------------
Total Liabilities & Stockholders'
Equity $ 181,620 $ 164,038
================== =================
Working Capital $ 107,921 $ 94,656
Current Ratio 7.58 9.02
*T