Cyalume Technologies Announces 2011 Fourth Quarter and Year-End Financial Results
West Springfield, Mass., April 16, 2012 – Cyalume Technologies Holdings, Inc. (OTCBB:CYLU) today announced its financial results for the fourth quarter and fiscal year ended December 31, 2011. Cyalume reported 2011 revenues of $34.7 million, with net income of $0.3 million and fully diluted EPS of $0.02, compared to revenues of $38.0 million, net income of $2.6 million and fully diluted EPS of $0.15 for 2010. Adjusted EBITDA, defined as earnings before interest, taxes, depreciation, amortization, non-cash stock-based compensation, foreign currency gains and losses, and certain one-time gains or expenses, totaled $6.9 million for the year, compared to $10.7 million for 2010.
Results for the full year were adversely impacted from reduced purchases of chemical light products by the U.S. Military due to a stocking level drawdown attributed to national budget issues and uncertainties.
For the fourth quarter of 2011, revenues were $8.3 million with a net loss of $1.1 million compared to revenues of $8.2 million with net income of $0.1 million for the fourth quarter of 2010.
Investor Conference Call
A live internet broadcast of Cyalume’s conference call discussing quarterly and year-end results can be accessed via the investor relations page on Cyalume web site athttp://investor.cyalume.com/ on Tuesday, April 17, 2011 at 11:00 a.m. ET. To participate, callers should dial (877) 312-7507 or (253) 237-1164. Participants should ask for the "Cyalume Technologies Conference Call,” ID number: 63165293. A simultaneous webcast will also be available at:
http://investor.cyalume.com/eventdetail.cfm?eventid=111088
In addition, a replay of the conference call and transcript will be published shortly after the call on the investor relations page of the company website at: http://investor.cyalume.com/
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About Cyalume Technologies Holdings, Inc.
Cyalume Technologies designs and manufactures non-pyrotechnic tactical products and training solutions for the world's militaries and law enforcement agencies, as well as for certain safety markets. Cyalume is the exclusive supplier to the U.S. and NATO-country militaries for all of their chemical light needs and operates manufacturing facilities in the U.S. and France. Through its subsidiary Cyalume Specialty Products, Cyalume also manufactures all of its specialty chemical components for various markets. The company has strategic partnerships with Rheinmetall Waffe Munition, GmbH, General Dynamics, Fiocchi Ammunition and Nammo Talley.
The Cyalume Technologies Holdings, Inc. logo is available at: http://www.globenewswire.com/newsroom/prs/?pkgid=8101
Forward-Looking Statements
This press release and the accompanying scheduled investor conference call include forward-looking statements concerning sales and operating earnings. These forward-looking statements are based upon management's expectations and beliefs concerning future events. Forward-looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of the Company and which could cause actual results to differ materially from such statements. These risks and uncertainties include, but are not limited to: the effect of regional and global economic and industrial market conditions including our expectations concerning their impact on the markets we serve; the effect of conditions in the financial and credit markets and their impact on the Company and our customers and suppliers; the impact of the Company's cost reduction initiatives; the Company's ability to execute its business plan to meet its sales, operating income, cash flow and capital expenditure guidance; the impact on the Company's gross profit margins as a result of changes in product mix; the Company's vulnerability to industry conditions and competition; the effect of any interruption in the Company's supply of raw materials or a substantial increase in the price of raw materials; ongoing capital expenditures and investment in research and development; compliance with any changes in government regulations and environmental and health and safety laws; the effect on the Company's international operations of unexpected changes in legal and regulatory requirements, export restrictions, currency controls, tariffs and other trade barriers, difficulties in staffing and managing foreign operations, political and economic instability, difficulty in accounts receivable collection and potentially adverse tax consequences; the effect of foreign currency exchange rates as the Company's non-U.S. sales continue to increase; reliance for a significant portion of the Company's total revenues on a limited number of large organizations and the continuity of business relationships with major customers; the loss of key personnel; the nature and extent of military operations being conducted by customers.
Actual results and events may differ significantly from those projected in the forward-looking statements. Reference is made to Cyalume's filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2011, its quarterly reports on Form 10-Q, and other periodic filings, for a description of the foregoing and other factors that could cause actual results to differ materially from those in the forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
Cyalume Technologies Holdings, Inc.
Consolidated Statements of Income
(in thousands, except shares and per share information)
| | | For the Year | | | For the Year | |
| | | Ended | | | Ended | |
| | | December 31, | | | December 31, | |
| | | 2011 | | | 2010 | |
| Revenues | | $ | 34,703 | | | $ | 38,024 | |
| Cost of goods sold | | | 18,568 | | | | 18,857 | |
| Gross profit | | | 16,135 | | | | 19,167 | |
| | | | | | | | |
| Other expenses (income): | | | | | | | | |
| Sales and marketing | | | 4,402 | | | | 3,471 | |
| General and administrative | | | 6,135 | | | | 5,520 | |
| Research and development | | | 1,888 | | | | 1,663 | |
| Interest expense, net | | | 2,330 | | | | 2,559 | |
| Interest expense – related party | | | 43 | | | | 66 | |
| Amortization of intangible assets | | | 1,805 | | | | 1,794 | |
| Other income, net | | | (430 | ) | | | (184 | ) |
| Total other expenses | | | 16,173 | | | | 14,889 | |
| | | | | | | | | |
| Income (loss) before income taxes | | | (38 | ) | | | 4,278 | |
| Provision for (benefit from) income taxes | | | (365 | ) | | | 1,665 | |
| Net income | | $ | 327 | | | $ | 2,613 | |
| | | | | | | | | |
| Net income per common share: | | | | | | | | |
| Basic | | $ | .02 | | | $ | .17 | |
| Diluted | | $ | .02 | | | $ | .15 | |
| | | | | | | | | |
| Weighted average shares used to compute net income per common share: | | | | | | | | |
| Basic | | | 16,911,103 | | | | 15,483,243 | |
| Diluted | | | 18,470,638 | | | | 16,806,275 | |
Source: Financial statements from Form 10-K filed April 16, 2012.
Cyalume Technologies Holdings, Inc.
Consolidated Balance Sheets
(in thousands, except shares and per share information)
| | | December 31, | | | December 31, | |
| | | 2011 | | | 2010 | |
| Assets | | | | | | | | |
| Current assets: | | | | | | | | |
| Cash | | $ | 2,951 | | | $ | 4,086 | |
| Accounts receivable, net of allowance for doubtful accounts of $206 and $62, respectively | | | 3,339 | | | | 1,925 | |
| Inventories | | | 11,393 | | | | 9,920 | |
| Income taxes refundable | | | 38 | | | | — | |
| Deferred income taxes | | | 386 | | | | 931 | |
| Prepaid expenses and other current assets | | | 559 | | | | 429 | |
| Total current assets | | | 18,666 | | | | 17,291 | |
| | | | | | | | | |
| Property, plant and equipment, net | | | 10,417 | | | | 8,509 | |
| Goodwill | | | 55,329 | | | | 51,244 | |
| Other intangible assets, net | | | 22,007 | | | | 20,912 | |
| Due from related party | | | 3,721 | | | | — | |
| Restricted cash | | | 600 | | | | — | |
| Other noncurrent assets | | | 154 | | | | 286 | |
| Total assets | | $ | 110,894 | | | $ | 98,242 | |
| | | | | | | | | |
| Liabilities and Stockholders’ Equity | | | | | | | | |
| Current liabilities: | | | | | | | | |
| Current portion of notes payable | | $ | 1,592 | | | $ | 1,453 | |
| Accounts payable | | | 1,948 | | | | 2,185 | |
| Accrued expenses | | | 2,179 | | | | 2,362 | |
| Notes payable to related party | | | 250 | | | | — | |
| Current portion of capital lease obligation | | | 43 | | | | — | |
| Income tax payable | | | — | | | | 700 | |
| Total current liabilities | | | 6,012 | | | | 6,700 | |
| | | | | | | | | |
| Notes payable, net of current portion | | | 18,975 | | | | 22,715 | |
| Notes payable due to related parties, net of current portion | | | — | | | | 1,131 | |
| Line of credit due to related party | | | 755 | | | | — | |
| Deferred income taxes | | | 7,145 | | | | 8,147 | |
| Contingent consideration | | | 3,699 | | | | — | |
| Derivatives | | | 273 | | | | 365 | |
| Asset retirement obligation | | | 175 | | | | 166 | |
| Capital lease obligation, net of current portion | | | 30 | | | | — | |
| Contingent legal obligation | | | 3,627 | | | | — | |
| Total liabilities | | | 40,691 | | | | 39,224 | |
| | | | | | | | | |
| Commitments and contingencies | | | — | | | | — | |
| | | | | | | | | |
| Stockholders' equity | | | | | | | | |
| Preferred stock, $0.001 par value; 1,000,000 shares authorized, no shares issued or outstanding | | | — | | | | — | |
| Common stock, $0.001 par value; 50,000,000 shares authorized; 18,311,228 and 15,748,570 issued and outstanding, respectively | | | 18 | | | | 16 | |
| Additional paid-in capital | | | 100,334 | | | | 89,452 | |
| Accumulated deficit | | | (29,453 | ) | | | (29,780 | ) |
| Accumulated other comprehensive loss | | | (696 | ) | | | (670 | ) |
| Total stockholders’ equity | | | 70,203 | | | | 59,018 | |
| Total liabilities and stockholders' equity | | $ | 110,894 | | | $ | 98,242 | |
Source: Financial statements from Form 10-K filed April 16, 2012.
Cyalume Technologies Holdings, Inc.
Consolidated Statements of Cash Flows
(in thousands)
| | | For the Year | | | For the Year | |
| | | Ended | | | Ended | |
| | | December 31, | | | December 31, | |
| | | 2011 | | | 2010 | |
| Cash flows from operating activities: | | | | | | | | |
| Net income | | $ | 327 | | | $ | 2,613 | |
| Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | |
| Depreciation of property, plant and equipment | | | 1,150 | | | | 833 | |
| Amortization | | | 2,281 | | | | 2,142 | |
| (Benefit from) provision for deferred income taxes | | | (1,267 | ) | | | 948 | |
| Stock-based compensation expense | | | 1,207 | | | | 1,181 | |
| Other non-cash expenses | | | 304 | | | | 315 | |
| Changes in operating assets and liabilities: | | | | | | | | |
| Accounts receivable | | | (1,115 | ) | | | 1,295 | |
| Inventories | | | (37 | ) | | | (740 | ) |
| Prepaid expenses and other current assets | | | (125 | ) | | | 2 | |
| Accounts payable and accrued liabilities | | | (1,008 | ) | | | (561 | ) |
| Restricted cash | | | 150 | | | | — | |
| Income taxes payable, net | | | (778 | ) | | | 976 | |
| Net cash provided by operating activities | | | 1,089 | | | | 9,004 | |
| | | | | | | | | |
| Cash flows from investing activities: | | | | | | | | |
| Payments relating to business combinations, net of $222 cash acquired | | | (2,528 | ) | | | — | |
| Proceeds from disposal of long-lived assets | | | — | | | | 207 | |
| Purchases of long-lived assets | | | (1,323 | ) | | | (1,626 | ) |
| Net cash used in investing activities | | | (3,851 | ) | | | (1,419 | ) |
| | | | | | | | | |
| Cash flows from financing activities: | | | | | | | | |
| Net repayment of line of credit | | | — | | | | (3,200 | ) |
| Proceeds from notes payable and warrants | | | — | | | | 7,942 | |
| Principal payments on notes payable | | | (1,753 | ) | | | (9,890 | ) |
| Payments to reacquire and retire common stock | | | (134 | ) | | | — | |
| Net payments of debt issue costs | | | — | | | | (271 | ) |
| Proceeds from issuance of common stock | | | 3,432 | | | | — | |
| Principal payments on capital lease obligations | | | (4 | ) | | | — | |
| Net cash provided by (used in) financing activities | | | 1,541 | | | | (5,419 | ) |
| | | | | | | | | |
| Effect of exchange rate changes on cash | | | 86 | | | | (83 | ) |
| Net increase (decrease) in cash | | | (1,135 | ) | | | 2,083 | |
| Cash, beginning of period | | | 4,086 | | | | 2,003 | |
| Cash, end of period | | $ | 2,951 | | | $ | 4,086 | |
Source: Financial statements from Form 10-K filed April 16, 2012.
Cyalume Technologies Holdings, Inc.
Reconciliation of Net Income to Adjusted Net Income
(in thousands)
(unaudited)
| | | For the Year | | | For the Year | |
| | | Ended | | | Ended | |
| | | December 31, | | | December 31, | |
| | | 2011 | | | 2010 | |
| Net income | | $ | 327 | | | $ | 2,613 | |
| Amortization of intangible assets | | | 1,805 | | | | 1,794 | |
| Adjusted net income | | $ | 2,132 | | | $ | 4,407 | |
Cyalume Technologies Holdings, Inc.
Reconciliation of Net Income to Adjusted EBITDA
(in thousands)
(unaudited)
| | | For the Year | | | For the Year | |
| | | Ended | | | Ended | |
| | | December 31, | | | December 31, | |
| | | 2011 | | | 2010 | |
| Net income | | $ | 327 | | | $ | 2,613 | |
| Adjustments to arrive at EBITDA: | | | | | | | | |
| Interest expense, net | | | 2,373 | | | | 2,625 | |
Provision for (benefit from) income taxes
| | | (365 | ) | | | 1,665 | |
| Depreciation | | | 1,150 | | | | 833 | |
| Amortization of intangible assets | | | 1,805 | | | | 1,794 | |
| EBITDA | | | 5,290 | | | | 9,530 | |
| Adjustments to arrive at adjusted EBITDA: | | | | | | | | |
| Other one-time expenses (1) | | | 1,577 | | | | 1,155 | |
| Adjusted EBITDA | | $ | 6,867 | | | $ | 10,685 | |
| (1) | Non-cash stock-based compensation, foreign exchange (gains)/losses, amortization of inventory step-up and certain acquisition-related expenses. |
Cyalume Technologies Holdings, Inc.
Condensed Consolidated Statements of Income
(in thousands, except shares and per share information)
(unaudited)
| | | For the Three | | | For the Three | |
| | | Months Ended | | | Months Ended | |
| | | December 31, | | | December 31, | |
| | | 2011 | | | 2010 | |
| Selected Quarterly Financial Data | | | | | | | | |
| Revenues | | $ | 8,348 | | | $ | 8,165 | |
| Cost of goods sold | | | 4,955 | | | | 4,162 | |
| Gross profit | | | 3,393 | | | | 4,003 | |
Total other expenses
| | | 4,317 | | | | 3,831 | |
| Net income | | $ | (1,133 | ) | | $ | 92 | |
| | | | | | | | | |
| Reconciliation of Net Income to Adjusted Net Income | | | | | | | | |
| Net income | | | (1,133 | ) | | | 92 | |
| Amortization of intangible assets | | | 549 | | | | 441 | |
| Adjusted net income | | $ | (584 | ) | | $ | 533 | |
| | | | | | | | | |
| Reconciliation of Net Income to Adjusted EBITDA | | | | | | | | |
| Net income | | | (1,133 | ) | | | 92 | |
| Adjustments to arrive at EBITDA: | | | | | | | | |
| Interest expense, net | | | 567 | | | | 645 | |
Provision for income taxes
| | | 209 | | | | 80 | |
| Depreciation | | | 331 | | | | 256 | |
| Amortization of intangible assets | | | 549 | | | | 441 | |
| EBITDA | | | 523 | | | | 1,514 | |
| Adjustments to arrive at adjusted EBITDA: | | | | | | | | |
| Other one-time expenses (1) | | | 480 | | | | 249 | |
| Adjusted EBITDA | | $ | 1,003 | | | $ | 1,763 | |
| (1) | Non-cash stock-based compensation, foreign exchange (gains)/losses, amortization of inventory step-up and certain acquisition-related expenses. |
Contact
Aimee Gordon
Investor Relations
413-386-3434
agordon@cyalume.com
