Exhibit 99.1
News Release
| | For More Information Contact |
FOR IMMEDIATE RELEASE | | Darrell Lee, CFO/VP |
May 2, 2007 | | 763-493-6370 / www.mocon.com |
MOCON Announces Increased First Quarter Revenues
MINNEAPOLIS, MN, May 2, 2007 – MOCON, Inc. (NasdaqGM:MOCO) today reported its operating results for the quarter ended March 31, 2007.
Net sales for the first quarter 2007 were $6,876,000, an increase of 5 percent compared to $6,519,000 for the first quarter 2006. Income from continuing operations was $833,000 for the first quarter 2007, a 25 percent decrease compared to $1,113,000 for the first quarter 2006. Net income for the first quarter 2007 was $833,000, a 27 percent decrease compared to $1,135,000 in the first quarter 2006. Diluted net income per share was $0.15 in the first quarter 2007, a 29 percent decrease compared to $0.21 for the same period in 2006.
The increase in sales for the first quarter 2007 compared to the first quarter 2006 was primarily the result of increased sales of our gas analyzer product group. These products were sold primarily for well-logging, toxic gas monitoring in the workplace, and carbonated beverage industry applications. Our packaging products group also increased due to new product sales, specifically the Pac Check® series, as well as increased marketing efforts in our foreign markets.
The decrease in net income for the first quarter 2007 compared to the first quarter 2006 was due to increased costs in the current period relating to the opening of our Shanghai, China technical support office, increased product development expense, increased stock option expense, and increased foreign sales and marketing expenses. In addition, the first quarter 2006 included certain non-recurring items totaling approximately $164,000 which did not repeat in the first quarter 2007.
“We are pleased to report a 5 percent increase in total sales for the first quarter 2007. Our recent emphasis in Asia has resulted in increased foreign sales, which accounted for 53% of our first quarter sales. Our increased costs for research and development and sales and marketing were not unexpected, and are consistent with our plan to grow the Company’s revenues,” commented Robert L. Demorest, MOCON President and CEO.
MOCON is a leading provider of instrumentation and consulting and laboratory services to medical, pharmaceutical, food and other industries worldwide. See www.mocon.com for more information.
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements regarding our plan to grow the Company’s revenues, and other statements that can be identified by words such as “will,” “may,” “expect,” “believe,” “anticipate,” “estimate,” “continue,” or other similar expressions. All forward-looking statements speak only as of the date of this press release. MOCON undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. In addition to the risks and uncertainties of ordinary business operations and conditions in the general economy and the markets in which the Company competes, there are important factors that could cause actual results to differ materially from those anticipated by the forward-looking statements made in this press release. These factors include, but are not limited to, competition and technological change, worldwide economic and political stability, setbacks in product development programs, order cancellations, slower-than-anticipated customer acceptance of new products, dependence on certain key industries, risk associated with the Company’s acquisition strategy and international operations, and other factors set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006 and other documents MOCON files with or furnishes to the Securities and Exchange Commission.
MOCON’s shares are traded on the Nasdaq Global Market System under the symbol MOCO.
MOCON is a registered trademark of MOCON, Inc.; other trademarks are those of their respective holders.
MOCON, INC.
SUMMARY CONSOLIDATED FINANCIAL DATA
(in Thousands, Except Per Share Data)
INCOME STATEMENT DATA: (unaudited)
| | Quarters Ended March 31, | |
| | 2007 | | 2006 | |
Sales | | | | | |
Products | | $ | 6,487 | | $ | 6,081 | |
Consulting services | | 389 | | 438 | |
Total sales | | 6,876 | | 6,519 | |
| | | | | |
Cost of sales | | | | | |
Products | | 2,678 | | 2,475 | |
Consulting services | | 258 | | 226 | |
Total cost of sales | | 2,936 | | 2,701 | |
| | | | | |
Gross profit | | 3,940 | | 3,818 | |
| | | | | |
Selling, general and administrative expenses | | 2,229 | | 1,919 | |
Research and development expenses | | 535 | | 454 | |
Operating income | | 1,176 | | 1,445 | |
| | | | | |
Other income | | 127 | | 156 | |
Income from continuing operations before income taxes | | 1,303 | | 1,601 | |
| | | | | |
Income taxes | | 470 | | 488 | |
Income from continuing operations | | 833 | | 1,113 | |
| | | | | |
Gain from discontinued operations, net of tax | | — | | 22 | |
| | | | | |
Net income | | $ | 833 | | $ | 1,135 | |
| | | | | |
Basic net income per share: | | | | | |
Income from continuing operations | | $ | 0.15 | | $ | 0.21 | |
Gain from discontinued operations | | — | | — | |
Basic net income per share | | $ | 0.15 | | $ | 0.21 | |
| | | | | |
Basic weighted average shares outstanding | | 5,473 | | 5,405 | |
| | | | | |
Diluted net income per share: | | | | | |
Income from continuing operations | | $ | 0.15 | | $ | 0.21 | |
Gain from discontinued operations | | — | | — | |
Diluted net income per share | | $ | 0.15 | | $ | 0.21 | |
| | | | | |
Diluted weighted average shares outstanding | | 5,697 | | 5,405 | |
MOCON, INC.
SUMMARY CONSOLIDATED FINANCIAL DATA
(in Thousands)
BALANCE SHEET DATA: (unaudited)
| | March 31, | | December 31, | |
| | 2007 | | 2006 | |
Assets: | | | | | |
Cash and marketable securities | | $ | 12,003 | | $ | 12,259 | |
Accounts receivable, net | | 4,860 | | 4,552 | |
Inventories | | 3,494 | | 3,620 | |
Other current assets | | 588 | | 592 | |
Total current assets | | 20,945 | | 21,023 | |
Marketable securities, noncurrent | | 265 | | 377 | |
Property, plant and equipment, net | | 1,545 | | 1,557 | |
Other assets, net | | 3,907 | | 3,920 | |
| | | | | |
Total assets | | $ | 26,662 | | $ | 26,877 | |
| | | | | |
Liabilities and Stockholders’ Equity: | | | | | |
Total current liabilities | | $ | 3,960 | | $ | 4,817 | |
Total non-current liabilities | | 101 | | 100 | |
Stockholders’ equity | | 22,601 | | 21,960 | |
| | | | | |
Total liabilities and stockholders’ equity | | $ | 26,662 | | $ | 26,877 | |
