Management Comments:
"Our sales for the fiscal quarter-ended July 31, 2007, increased 53% to $4.7 million as compared to $3.1 million for the same period in fiscal 2007. Net income increased 427% to $232,000 as compared to $44,000 for the same period in fiscal 2007. We continue our efforts to improve the profitability in the delivery of high-value "Classic Aviation" products.
We expensed $570,000, 12% of our sales, on product development. We feel this expenditure for the design and development engineering, testing, and certification of new products may stabilize our long-term revenues and enhance our profits.
Sales from Aircraft Modifications including modified aircraft decreased $147,000 (7.2%) from $2.0 million in the first quarter of fiscal year 2007 to $1.9 million in the current three months of fiscal 2008. Revenues from non RVSM modification services decreased $382,000 in the first three months of fiscal 2008. RVSM revenues increased by $235,000 in the first quarter of fiscal 2008, compared to the first quarter of fiscal 2007.
Sales from Avionics increased 711%, from $205,000 in first quarter of fiscal 2007, to $1.7 million in the current three months of fiscal 2008. This increase is directly related to sales of defense products. We believe this business segment will continue to increase in future years due to the addition of new fuel systems protection devices like the TSD, GFI, and other classic aviation defense products. Monitoring sales increased from $400,000 in first quarter of fiscal 2007 to $472,000 in the current three months of fiscal 2008, an increase of 17.9%. During the three months ended July 31, 2007, we maintained a relatively level volume of long-term contracts with municipalities. We continue to work hard to maintain our superior quality of work and customer service with reasonable pricing to overcome the competitive challenges. Revenues from Management Services related to gaming decreased 2.5% for the quarter compared to the same period last year. This decrease was due to the devastating flooding in Oklahoma, Kansas, and Missouri that caused the Stables to be shut down for seven days. As of September 1, 2007, our backlog is in excess of $10.4 million. This backlog reflects our product development efforts and the related potential results. Our challenge is to ship the backlog and further take advantage of these new products. However, because of our major investment in product development required to continue these new products, we may not always maintain smooth and continuous quarterly profits.
We continue into fiscal 2008 with the possibility of exciting projects," commented Clark D. Stewart, President of the Company.
Our Business:
Butler National Corporation operates in the Aerospace and Services business segments. The Aerospace segment focuses on the manufacturing of support systems for "Classic" commercial and military aircraft including the Butler National TSD for the Boeing 737 and 747 Classic aircraft, switching equipment for Boeing/Douglas Aircraft, weapon control systems for Boeing Helicopter and performance enhancement structural modifications for Learjet, Cessna, Dassault and Raytheon business aircraft. Services include electronic monitoring of water pumping stations, temporary employee services, Indian gaming services and administrative management services.
Forward-Looking Information:
The information set forth above may include "forward-looking" information as outlined in the Private Securities Litigation Reform Act of 1995. The Cautionary Statements and Risk Factors, filed by the Company as Exhibit 99 to the Company's Annual Report on Form 10-K and Section 1A of Form 10-K, are incorporated herein by reference and investors are specifically referred to such Cautionary Statements and Risk Factors for discussion of factors, which could affect the Company's operations, and forward-looking statements contained herein.
FOR MORE INFORMATION CONTACT:
Craig D. Stewart, Investor Relations
Butler National Corporation
19920 W. 161st Street
Olathe, KS 66062
Public Relations Phone: 214-663-5833
Phone Office: 913-780-9595
Phone Fax: 913-780-5088
Jim Drewitz, Public Relations
jim@jdcreativeoptions.com Direct Investor Relations
Phone office 830-669-2466 For more information, please visit the Company web site: www.butlernational.com
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