Exhibit 99.1
TECHNOLOGY RESEARCH CORPORATION
ANNOUNCES RESULTS FOR FIRST FISCAL QUARTER
CLEARWATER, FLORIDA, August 1, 2005 -- Technology Research Corporation (“TRC”), (NASDAQ-TRCI),
today announced revenues and earnings for its first fiscal quarter ended June 30, 2005. Revenues were $10,576,750,
compared to $7,130,944 for the same quarter last year, an increase of 48%. Net income for the current quarter was
$292,835, compared to $673,670 for the same quarter last year, a decrease of 57%. Basic and diluted earnings for
the current quarter were $.05 per share, compared to basic earnings of $.12 per share and diluted earnings of $.11
per share for the same quarter last year.
Jerry Kendall, President and CEO commented, “We had a good start to our 2006 fiscal year with 7.9% growth in our
core commercial business and additional revenues of $3.85 million which were generated by the seasonal room air
conditioner (“RAC”) market, a market which was not present a year ago. While we accomplished excellent revenue
growth, the additional revenues did not generate a higher level of net income. Product mix plus higher than anticipated
costs were the major factors that impacted the bottom line.” Kendall added, “In looking forward to the remaining
three quarters of fiscal 2006, the Company will continue to pursue revenue growth while making the necessary changes
to improve net income.”
Commercial revenues for the quarter ended June 30, 2005 increased $4,153,440, compared to the same quarter in the
prior year, and military revenues decreased $655,003. Royalty income decreased $52,631. The increase in commercial
revenues was primarily attributed to RAC product shipments, and to a lesser extent product expansion into retail stores.
The Company expects continued growth in its commercial revenues in fiscal 2006 with seasonal low revenues expected
in its second quarter ending September 30, 2005. The decrease in military revenues resulted from a delay in certain
follow-on releases of existing contracts for control devices related to the Tactical Quiet Generator (“TQG”) programs.
In addition, certain direct military orders could not be placed until June, when the Department of Defense released
supplemental spending for its fiscal 2005 year. The Company expects military sales in fiscal 2006 to remain comparable
to fiscal 2005. Royalties decreased as the result of a minimum royalty payment during the prior year’s quarter by Applica,
Inc. in the amount of $50,000 which did not occur in the current quarter. The Company does not expect to record any
significant royalties in fiscal 2006.
The first quarter dividend of $.015 per share was paid on July 22, 2005 to shareholders of record on June 30, 2005. The
Company’s annual dividend is $.06 per share.
TRC is an internationally recognized leader in electrical safety products that prevent electrocution and electrical fires and
protect against serious injury from electrical shock. Based on its core technology in ground fault sensing, products are
designed to meet the needs of the consumer, commercial and industrial markets worldwide. The Company also supplies
power monitors and control equipment to the United States Military and its prime contractors.
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Some of the statements in
this report constitute forward-looking statements, within the meaning of the Private Securities Litigation Reform
Act of 1995 and the Securities Exchange Act of 1934. These statements are related to future events, other future
financial performance or business strategies, and may be identified by terminology such as "may," "will," "should,"
"expects," "scheduled," "plans," "intends," "anticipates," "believes," "estimates," "potential," or "continue," or
the negative of such terms, or other comparable terminology. These statements are only predictions. Actual events
as well as results may differ materially. In evaluating these statements, you should specifically consider the factors
described throughout this report. We cannot be assured that future results, levels of activity, performance or goals
will be achieved.
TECHNOLOGY RESEARCH CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
& #160; Three-months ended
& #160; June 30 June 30 March 31
& #160; 2005 2004 2005
Operating revenues:
Commercial $ 7,927,421 3,773,981 12,191,321
Military 2,649,329 3,304,332 3,255,177
Royalties - 52,631 81,583
& #160; 10,576,750 7,130,944 15,528,081
Operating expenses:
Cost of sales 8,283,552 4,509,416 12,530,375
Selling, general, and administrative 1,375,076 1,156,798 1,484,891
Research, development and engineering 487,404 466,471 501,059
& #160; 10,146,032 6,132,685 14,516,325
Operating income 430,718 998,259 1,011,756
Interest and sundry income (40,271) 7,220 (37,188)
Income before income taxes 390,447 1,005,479 974,568
Income taxes 97,612 331,809 116,687
Net income $ 292,835 673,670 857,881
60;======= ======= =======
Net income per common share:
Basic $ .05 .12 .15
Diluted $ .05 .11 .15
Weighted average number of common shares outstanding:
Basic 5,774,375 5,745,850 5,762,563
Diluted 5,841,212 5,977,941 5,891,856
Dividends paid $ .015 .015 .015
TECHNOLOGY RESEARCH CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
0; *
& #160; June 30 March 31
ASSETS 2005 2005
Current assets:
Cash and cash equivalents $ 284,553 815,411
Short-term investments 489,634 487,072
Accounts receivable, net 10,196,725 13,114,548
Inventories 11,978,912 11,460,302
Prepaid expenses and other current assets 398,492 514,922
Deferred income taxes 488,413 488,413
Total current assets 23,836,729 26,880,668
Property, plant and equipment 13,828,650 13,560,106
Less accumulated depreciation 8,405,118 8,089,950
Net property, plant and equipment 5,423,532 5,470,156
Other assets 71,738 96,004
$ 29,331,999 32,446,828
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term debt $ 2,660,200 3,000,000
Trade accounts payable 5,341,900 7,970,920
Accrued expenses 1,076,296 1,327,944
Dividends payable 100,224 100,175
Income taxes payable 9,851 112,239
Total current liabilities 9,188,471 12,511,278
Long-term debt 2,350,000 2,350,000
Deferred income taxes 378,143 378,143
Total liabilities 11,916,614 15,239,421
Stockholders' equity:
Common stock 2,956,151 2,955,641
Additional paid-in capital 8,484,493 8,483,237
Retained earnings 6,014,886 5,808,674
Treasury stock, 21,500 shares at cost (40,145) (40,145)
Total stockholders' equity 17,415,385 17,207,407
$ 29,331,999 32,446,828
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* The condensed consolidated balance sheet is derived from the Companys audited balance sheet as of that date.
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