Exhibit 99.1
NEWS RELEASE
FOR IMMEDIATE DISTRIBUTION
FEBRUARY 9, 2005
SUBJECT: FINANCIAL RESULTS
| Contact: | Peter Zentz |
| Corporate Communications Manager |
| or |
| Frank Dunne, Vice President, CFO & Treasurer |
| (508) 563-1000 |
Benthos Announces First Quarter 2005 Profit on Sales Increase of 31%
NORTH FALMOUTH, MASSACHUSETTS, FEBRUARY 9, 2005…BENTHOS, INC. (NASDAQ: BTHS) today reported financial results for the first quarter of fiscal year 2005 ended December 31, 2004. Net sales for the quarter were $5,019,000, an increase of 31.3% from sales of $3,823,000 in the first quarter of the previous fiscal year. Net income for the quarter was $161,000, or $0.10 per diluted share, compared to a net loss of $187,000, or ($0.14) per share, in the first quarter of fiscal 2004.
In the Undersea Systems Division, first quarter 2005 sales were $3,424,000, a 39.7% increase compared to sales of $2,451,000 in the same period last year. Sales in the TapTone Package Inspection Systems Division in the first quarter of fiscal 2005 were $1,595,000, a 16.3% increase from sales of $1,372,000 in the first quarter of fiscal 2004.
Commenting on today’s announcement, Ronald L. Marsiglio, Benthos President and CEO, said, “We are pleased to report a strong first quarter and good start to fiscal 2005. Sales in both of our Divisions are up over the prior year’s first quarter, and gross profit as a percent of sales was 41.0% compared to 37.7% in the same period of fiscal 2004.”
Marsiglio continued, “The Undersea Systems Division is showing steady growth and we continue to receive significant orders. These include a $1 million order for GeoPoint™ hydrophones announced in early January, as well as another recent order of approximately $750,000 for additional GeoPoint hydrophones. These hydrophones are used for offshore oil and gas exploration, a market sector that remains active for Benthos.”
“In addition, Canada Border Services Agency (formerly Canada Customs and Revenue Agency) has recently ordered another fiveStingray remotely operated vehicle (ROV) systems to be added to the fleet of five systems that were put into use throughout Canada in March 2004. The units have proven to be highly successful in finding and identifying objects illegally attached to ship hulls below the water line and will continue to be used by the Canada Border Services Agency in port and harbor security operations. TheStingray ROV is an inspection class ROV well-suited for these applications.”
“During the quarter, a C3D™ swath bathymetry system was delivered to the U.S. Navy. This marks the first sale of the C3D system in the United States and is another sign of progress in gaining industry acceptance of this exciting new technology.”
“The TapTone Package Inspection Systems Division is off to a good start in fiscal 2005. Leading the way are the new TapTone 500 force and compression leak detection systems. These systems are designed for the inspection of carbonated and liquid nitrogen dosed beverage containers, as well as non-pressurized flexible plastic containers. TapTone products now cover the full spectrum of food, beverage, dairy, pharmaceutical and chemical processors’ inspection needs.”
Marsiglio concluded, “While the timing of large orders may cause some unevenness in quarterly sales, we believe Benthos is on track for another solid year of improvement.”
Benthos, Inc., through its Undersea Systems Division, designs, manufactures, sells and services a variety of oceanographic products for underwater tasks; and through its TapTone Package Inspection Systems Division makes systems for testing consumer packages made of glass, metal or plastic. The common stock of the Company is traded on the Nasdaq SmallCap market under the symbol BTHS. For more information, Benthos can be found on the Internet at www.benthos.com.
Forward Looking Statements
The statements in this news release relating to plans, strategies, economic performance and trends and other statements that are not descriptions of historical facts are “forward-looking statements” within the meaning of the Federal Securities Laws. Forward-looking statements are based on management’s current assumptions and expectations, which are inherently subject to risks and uncertainties and are difficult to predict. Actual results could differ materially from those currently anticipated due to a number of factors which include: the timing of large project orders, competitive factors, shifts in customer demand, government spending, economic cycles, availability of financing, regulatory changes and other factors. More information about these factors is contained in the Company’s filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results or outcomes may vary materially from those described herein as anticipated, believed, estimated, expected or intended. The Company undertakes no obligation to publicly review or update any forward-looking information, whether as a result of future developments, newly acquired information or other matters.
Benthos, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except per share amounts)
(unaudited)
| Assets | December 31, 2004 | September 30, 2004 | ||||||
Current Assets: | ||||||||
Cash and Cash Equivalents | $ | 650 | $ | 241 | ||||
Accounts Receivable, Net | 2,497 | 3,565 | ||||||
Inventories | 3,033 | 3,149 | ||||||
Prepaid Expenses and Other Current Assets | 127 | 168 | ||||||
Total Current Assets | 6,307 | 7,123 | ||||||
Property, Plant and Equipment, Net | 1,265 | 1,189 | ||||||
Goodwill | 576 | 576 | ||||||
Acquired Intangible Assets, Net | 158 | 218 | ||||||
Other Assets, Net | 33 | 35 | ||||||
| $ | 8,339 | $ | 9,141 | |||||
Liabilities and Stockholders’ Investment | ||||||||
Current Liabilities: | ||||||||
Current Portion of Long-Term Debt | $ | 279 | $ | 279 | ||||
Accounts Payable | 740 | 1,217 | ||||||
Accrued Expenses | 1,141 | 1,558 | ||||||
Customer Deposits | 260 | 302 | ||||||
Total Current Liabilities | 2,420 | 3,356 | ||||||
Long-Term Debt, Net of Current Portion | 186 | 256 | ||||||
Stockholders’ Investment: | ||||||||
Common stock, $.06 2/3 Par Value – | 112 | 111 | ||||||
Capital in Excess of Par Value | 1,690 | 1,648 | ||||||
Retained Earnings | 4,562 | 4,401 | ||||||
Treasury Stock, at Cost– 270 shares at | (631 | ) | (631 | ) | ||||
Total Stockholders’ Investment | 5,733 | 5,529 | ||||||
| $ | 8,339 | $ | 9,141 | |||||
Benthos, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
(unaudited)
| Quarter Ended | ||||||||
| December 31, 2004 | December 31, 2003 | |||||||
Net Sales | $ | 5,019 | $ | 3,823 | ||||
Cost of Sales | 2,969 | 2,381 | ||||||
Gross Profit | 2,050 | 1,442 | ||||||
Selling, General and Administrative Expenses | 1,298 | 1,183 | ||||||
Research and Development Expenses | 477 | 370 | ||||||
Amortization of Acquired Intangibles | 60 | 60 | ||||||
Income (Loss) from Operations | 215 | (171 | ) | |||||
Interest Expense | (8 | ) | (16 | ) | ||||
Income (Loss) before Income Taxes | 207 | (187 | ) | |||||
Provision for Income Taxes | 46 | — | ||||||
Net Income (Loss) | $ | 161 | $ | (187 | ) | |||
Basic Earnings (Loss) Per Share | $ | 0.12 | $ | (0.14 | ) | |||
Diluted Earnings (Loss) Per Share | $ | 0.10 | $ | (0.14 | ) | |||
Weighted Average Number of Shares Outstanding | 1,398 | 1,383 | ||||||
Weighted Average Number of Shares Outstanding, assuming dilution | 1,598 | 1,383 | ||||||