EXHIBIT 99.1
| | |
| CONTACT: | | Joseph C. Berenato |
| | Chairman and Chief Executive Officer |
| | (310) 513-7209 |
FOR IMMEDIATE RELEASE
DUCOMMUN INCORPORATED REPORTS RESULTS
FOR THE FIRST QUARTER ENDED MARCH 29, 2008
LOS ANGELES, California (April 28, 2008) – Ducommun Incorporated (NYSE: DCO) today reported results for its first quarter ended March 29, 2008.
Sales for the first quarter of 2008 were $98.7 million, compared to $88.1 million for the first quarter of 2007. Net income for the first quarter of 2008 was $5.3 million, or $0.49 per diluted share, compared to net income of $3.8 million, or $0.37 per diluted share, for the comparable period last year.
Sales for the first quarter of 2008 increased 12% from the same period last year due to an increase in both military and commercial sales. The Company’s mix of business in the first quarter of 2008 was approximately 59% military, 39% commercial and 2% space, compared to 59% military, 38% commercial and 3% space in the first quarter of 2007.
Gross profit, as a percentage of sales, increased to 21.2% in the first quarter of 2008 from 21.0% in the first quarter of 2007. The gross profit increase was primarily attributable to an improvement in operating performance at Ducommun AeroStructures, partially offset by lower operating performance at Ducommun Technologies.
Selling, general and administrative (SG&A) expenses increased to $12.4 million, compared to $12.2 million in the first quarter of 2007.
Net income for the first quarter of 2008 increased 38% from the first quarter of 2007, primarily due to the reasons stated above and lower interest expense, partially offset by a higher effective tax rate in the first quarter of 2008. The Company’s effective tax rate for the first quarter of 2008 was 36.8%, compared to 32.1% for the first quarter of 2007.
Joseph C. Berenato, chairman and chief executive officer, stated, “Our strong operating performance this quarter reflects the broad strength of our markets and the benefits we continue to see from our Lean and Six Sigma activities. We continue to focus on improving our technological and operational capabilities through our use of Lean and Six Sigma. Our recent reorganization and financial results are indicative of our continuous improvement efforts.”
A teleconference with Joseph C. Berenato, the Company’s chairman and chief executive officer, will be held today at 7:30 AM PT (10:30 AM ET). To participate in the teleconference, please call 800-299-6183 (international 617-801-9713) approximately ten minutes prior to the conference time stated above. The participant passcode is 79011773. Mr. Berenato will be speaking on behalf of the company and anticipates the meeting and Q&A period to last approximately 40 minutes. This call is being webcast by Thomson/CCBN and can be accessed at Ducommun’s web site atwww.ducommun.com. Conference call replay will be available from the Company’s web site atwww.ducommun.com.
Founded in 1849, Ducommun Incorporated provides engineering and manufacturing services to the aerospace and defense industry.
The statements made in this press release include forward-looking statements that involve risks and uncertainties. The Company’s future financial results could differ materially from those anticipated due to the Company’s dependence on conditions in the airline industry, the level of new commercial aircraft orders, production rates for Boeing commercial aircraft, the C-17 and Apache helicopter rotor blade programs, the level of defense spending, competitive pricing pressures, manufacturing inefficiencies, start-up costs and possible overruns on new contracts, technology and product development risks and uncertainties, product performance, risks associated with acquisitions and dispositions of businesses by the Company, increasing consolidation of customers and suppliers in the aerospace industry, possible goodwill impairment, availability of raw materials and components from suppliers, and other factors beyond the Company’s control. See the Company’s Form 10-K for the year ended December 31, 2007 and Form 10-Q for the quarter ended March 29, 2008 for a more detailed discussion of these and other risk factors and contingencies.
[Financial Table Follows]
DUCOMMUN INCORPORATED AND SUBSIDIARIES
COMPARATIVE DATA
CONSOLIDATED INCOME STATEMENT
(In thousands, except per share amounts)
| | | | | | | | |
| | | Three Months Ended | |
| | | March 29, 2008 | | | March 31, 2007 | |
Sales and Service Revenues | | | | | | | | |
Product Sales | | $ | 84,309 | | | $ | 74,496 | |
Service Revenues | | | 14,349 | | | | 13,556 | |
| | | | | | | | |
Total | | | 98,658 | | | | 88,052 | |
| | | | | | | | |
Operating Costs and Expenses: | | | | | | | | |
Cost of Product Sales | | | 66,234 | | | | 58,770 | |
Cost of Service Revenues | | | 11,533 | | | | 10,805 | |
Selling, General & Administrative Expenses | | | 12,379 | | | | 12,226 | |
| | | | | | | | |
Total | | | 90,146 | | | | 81,801 | |
| | | | | | | | |
Operating Income | | | 8,512 | | | | 6,251 | |
Interest Expense | | | (203 | ) | | | (652 | ) |
Income Tax Expense | | | (3,057 | ) | | | (1,799 | ) |
| | | | | | | | |
Net Income | | $ | 5,252 | | | $ | 3,800 | |
| | | | | | | | |
Earnings Per Share: | | | | | | | | |
Basic Earnings Per Share | | $ | 0.50 | | | $ | 0.37 | |
Diluted Earnings Per Share | | $ | 0.49 | | | $ | 0.37 | |
Weighted Averaged Number of Common Shares Outstanding: | | | | | | | | |
Basic | | | 10,551 | | | | 10,301 | |
Diluted | | | 10,635 | | | | 10,391 | |
- more -
DUCOMMUN INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
| | | | | | | | |
| | | March 29,
2008 | | | December 31,
2007 | |
Assets | | | | | | | | |
Current Assets: | | | | | | | | |
Cash and cash equivalents | | | 13,151 | | | | 31,571 | |
Accounts receivable, less allowance for doubtful accounts | | | 47,402 | | | | 39,226 | |
Unbilled receivables | | | 7,353 | | | | 5,615 | |
Inventories | | | 73,623 | | | | 67,769 | |
Deferred income taxes | | | 8,034 | | | | 7,727 | |
Other current assets | | | 5,253 | | | | 5,328 | |
| | | | | | | | |
Total Current Assets | | | 154,816 | | | | 157,236 | |
Property and Equipment, Net | | | 57,187 | | | | 56,294 | |
Goodwill, Net | | | 106,632 | | | | 106,632 | |
Other Assets | | | 11,737 | | | | 12,314 | |
| | | | | | | | |
| | $ | 330,372 | | | $ | 332,476 | |
| | | | | | | | |
Liabilities and Shareholders’ Equity | | | | | | | | |
Current Liabilities: | | | | | | | | |
Current portion of long-term debt | | $ | 1,863 | | | $ | 1,859 | |
Accounts payable | | | 30,171 | | | | 33,845 | |
Accrued liabilities | | | 39,410 | | | | 43,829 | |
| | | | | | | | |
Total Current Liabilities | | | 71,444 | | | | 79,533 | |
Long-Term Debt, Less Current Portion | | | 22,903 | | | | 23,892 | |
Deferred Income Taxes | | | 5,643 | | | | 5,584 | |
Other Long-Term Liabilities | | | 10,608 | | | | 9,416 | |
| | | | | | | | |
Total Liabilities | | | 110,598 | | | | 118,425 | |
| | | | | | | | |
Commitments and Contingencies | | | | | | | | |
Shareholders’ Equity: | | | | | | | | |
Common Stock | | | 105 | | | | 105 | |
Additional paid-in-capital | | | 54,244 | | | | 53,444 | |
Retained earnings | | | 167,444 | | | | 162,192 | |
Accumulated other comprehensive loss | | | (2,019 | ) | | | (1,690 | ) |
| | | | | | | | |
Total Shareholders’ Equity | | | 219,774 | | | | 214,051 | |
| | | | | | | | |
| | $ | 330,372 | | | $ | 332,476 | |
| | | | | | | | |
###
