Exhibit 99.1
[BOSTON ACOUSTICS LOGO]
FOR IMMEDIATE RELEASE | Moses Gabbay | |
Moses@bostona.com | ||
Contact: Boston Acoustics, Inc | ||
978-538-5000 | Debby Ricker-Rosato | |
DRicker@bostona.com |
Boston Acoustics Announces First Quarter Results
Peabody, Massachusetts, August 5, 2004 — Boston Acoustics, Inc. (NASDAQ:BOSA) today announced its financial results for the first quarter of the 2005 fiscal year, which ended on June 26, 2004.
Net sales for the quarter remained stable at $12.6 million compared to the same period a year ago. Net income increased to approximately $461,000 from approximately $216,000, and diluted earnings per share increased to $.11 per share compared to $.05 per share for the same period a year ago.
During the quarter, the Company, in partnership with Visteon Corporation, continued ramping up shipments of its premium audio systems to the Chrysler Group. In April 2004, the Company began delivery of automotive systems for the Dodge Magnum vehicles in addition to continuing delivery of systems for the Chrysler 300 vehicles, which began in January 2004.
The OEM/Multimedia segment sales were insignificant in the quarter and are expected to be immaterial in fiscal 2005. As a result, the Company will no longer report these sales as a separate operating segment.
President and CEO Moses Gabbay stated, “We are pleased with the results of this quarter, which reflect the implementation of our strategic plan to diversify and expand our product channels. We have increased our investment in sales and marketing and are using a multi pronged approach aimed at growing sales. First, a new segment of consumers are experiencing the Boston Sound™ through our OEM automotive initiative, specifically, the widely acclaimed Chrysler 300 and Dodge Magnum vehicles. This positive impact will widen in the fall with the release of the new 2005 Jeep Grand Cherokee. Second, the custom installation market and the appetite for our custom product continue to strengthen, and we expect this trend to continue. Third, we are experiencing double digit growth in international sales, realizing the benefits from the transformation of our international sales process and team.”
Gabbay added, “The continued execution of our sales strategy, our greater investment in marketing, the timely introduction of market-demanded products, combined with our persistent focus on overall operational efficiencies will enable Boston to grow future earnings.”
Three Months Ended | ||||||
June 26, 2004 | June 28, 2003 | |||||
Net Sales | $ | 12,619,951 | $ | 12,597,197 | ||
Cost of Goods Sold | 7,131,958 | 8,017,458 | ||||
Gross Profit | 5,487,993 | 4,579,739 | ||||
Selling and Marketing Expenses | 2,619,638 | 2,141,390 | ||||
General and Administrative Expenses | 1,030,172 | 1,111,307 | ||||
Engineering and Development Expenses | 1,206,654 | 1,119,561 | ||||
Total Operating Expenses | 4,856,464 | 4,372,258 | ||||
Income from Operations | 631,529 | 207,481 | ||||
Interest Income, net | 5,901 | 15,106 | ||||
Other Income, net | 46,297 | 92,200 | ||||
Income before Provision for Income Taxes | 683,727 | 314,787 | ||||
Provision for Income Taxes | 223,000 | 99,000 | ||||
Net Income | $ | 460,727 | $ | 215,787 | ||
Basic Earnings per Share | $ | .11 | $ | .05 | ||
Diluted Earnings per Share | $ | .11 | $ | .05 | ||
Weighted Average Shares Outstanding | ||||||
Basic | 4,166,845 | 4,400,276 | ||||
Diluted | 4,190,446 | 4,400,372 |
Boston Acoustics Announces First Quarter Results – Page 2
Consolidated Balance Sheets
June 26, 2004 | March 27, 2004 | |||||
Assets | ||||||
Current Assets | ||||||
Cash and cash equivalents | $ | 7,517,713 | $ | 7,552,054 | ||
Accounts receivable, net | 8,434,948 | 8,202,044 | ||||
Inventories | 11,705,370 | 12,240,838 | ||||
Deferred income taxes | 2,492,000 | 2,492,000 | ||||
Prepaid income taxes | 471,000 | 480,000 | ||||
Prepaid expenses and other current assets | 831,070 | 956,142 | ||||
Total current assets | 31,452,101 | 31,923,078 | ||||
Property and Equipment, net | 10,548,828 | 10,874,343 | ||||
Other Assets, net | 1,163,209 | 1,160,710 | ||||
Total assets | $ | 43,164,138 | $ | 43,958,131 | ||
Liabilities and Stockholders’ Equity | ||||||
Current Liabilities | ||||||
Accounts payable | $ | 6,769,811 | $ | 7,322,535 | ||
Accrued payroll & related expenses | 684,366 | 523,234 | ||||
Dividends payable | 354,182 | 354,182 | ||||
Current maturity of line of credit | 9,477 | 309,394 | ||||
Other accrued expenses | 1,521,844 | 1,730,873 | ||||
Total current liabilities | 9,339,680 | 10,240,218 | ||||
Stockholders’ Equity | 33,824,458 | 33,717,913 | ||||
Total liabilities and stockholders’ equity | $ | 43,164,138 | $ | 43,958,131 | ||
Boston Acoustics, Inc. provides audio solutions for home entertainment, automobiles and personal computers. Founded in 1979, Boston Acoustics is located in Peabody, Massachusetts.
Certain statements in this press release contain certain forward-looking statements concerning Boston Acoustics’ operations, economic performance and financial condition. Such forward-looking statements are based on a number of assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Boston Acoustics to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that could cause such differences include, but are not limited to, those discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended March 27, 2004. The words “believe,” “expect,” “anticipate,” “intend,” and “plan” and similar expressions identify forward-looking statements, which speak only as of the date the statement was made.
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