Exhibit 99
Contact: Daniel C. Dunn
Chief Financial Officer
314/771-2400
Allied Healthcare Reports Strong Fourth Quarter,
Flat Net Income for Fiscal 2007 vs. 2006
- | Company improves margins to offset higher material prices. |
- | Cash position increases by $1 million in the year. |
ST. LOUIS, September 7, 2007 - Allied Healthcare Products, Inc. (NASDAQ: AHPI) reported that its net income increased 38 percent to $869,000, or 11 cents per share, during its fourth quarter ending June 30, 2007, versus $629,000, or 8 cents per share, for the fourth quarter last year.
Despite its stronger fourth quarter, Allied experienced flat net income of $1,641,600, or 21 cents per share, compared to $1,648,600, or 21 cents per share, for the prior fiscal year.
Fourth quarter sales decreased by about 3 percent, or $417,000, compared to the last quarter of the prior year. However, lower costs and expenses more than offset the sales decline, producing a solid increase in net income despite income tax expenses for the fourth quarter of 2007 that were $606,000 higher than for the fourth quarter of 2006. The 2006 fourth quarter benefited from a settlement and resolution of state tax contingencies.
For fiscal year 2007, Allied sales declined about $1.04 million, or 2 percent, compared to 2006. Lower costs for 2007 offset the decline.
Higher prices for raw materials such as copper, brass and zinc increased costs about 5.4 percent in fiscal 2006. Despite competitive pricing pressures, Allied was able to selectively increase prices during 2007. These increases, combined with programs to cut costs, resulted in improved margins for Allied.
“We are far from satisfied with flat results for 2007,” said Earl Refsland, president and chief executive officer. Refsland said the company would continue to hold the line on costs in 2008 and work to increase domestic and international sales with new products.
A weaker U.S. dollar helped boost international orders for Allied by almost 9 percent over 2006, and Refsland said that he expects this positive effect to continue to help the company in 2008.
Despite increases in inventory and capital expenditures in 2007, the company increased its cash balance by about $1 million, Refsland said.
Allied Healthcare Products, Inc. is a leading manufacturer of respiratory care products, medical gas equipment and emergency medical products used in a wide range of hospital and alternate care settings.
“SAFE HARBOR” STATEMENT: Statements contained in this release that are not historical facts or information are “forward-looking statements.” Words such as “believe,” “expect,” “intend,” “will,” “should,” and other expressions that indicate future events and trends identify such forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause the outcome and future results of operations and financial condition to be materially different than stated or anticipated based on the forward-looking statements. Such risks and uncertainties include both general economic risks and uncertainties, risks and uncertainties affecting the demand for and economic factors affecting the delivery of health care services, and specific matters which relate directly to the Company’s operations and properties as discussed in its periodic filings with the Securities and Exchange Commission. The Company cautions that any forward-looking statement contained in this report reflects only the belief of the Company or its management at the time the statement was made. Although the Company believes such forward-looking statements are based upon reasonable assumptions, such assumptions may ultimately prove inaccurate or incomplete. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement was made.
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ALLIED HEALTHCARE PRODUCTS, INC.CONSOLIDATED STATEMENT OF OPERATIONS(UNAUDITED)
Three months ended, | Twelve months ended, | ||||||||||||
June 30, | June 30, | ||||||||||||
2007 | 2006 | 2007 | 2006 | ||||||||||
Net sales | $ | 14,045,798 | $ | 14,462,919 | $ | 56,500,974 | $ | 57,545,589 | |||||
Cost of sales | 10,061,519 | 11,161,944 | 42,028,125 | 43,292,746 | |||||||||
Gross profit | 3,984,279 | 3,300,975 | 14,472,849 | 14,252,843 | |||||||||
Selling General and administrative expenses | 2,765,157 | 2,918,066 | 12,051,500 | 12,112,624 | |||||||||
Income from operations | 1,219,122 | 382,909 | 2,421,349 | 2,140,219 | |||||||||
Interest income | (28,719 | ) | (17,002 | ) | (110,790 | ) | (52,988 | ) | |||||
Other, net | 10,710 | 8,904 | (23,839 | ) | 37,758 | ||||||||
(18,009 | ) | (8,098 | ) | (134,629 | ) | (15,230 | ) | ||||||
Income before provision | |||||||||||||
for income taxes | 1,237,131 | 391,007 | 2,555,978 | 2,155,449 | |||||||||
Provision for income taxes | 368,019 | (238,345 | ) | 914,400 | 506,845 | ||||||||
Net income | $ | 869,112 | $ | 629,352 | $ | 1,641,578 | $ | 1,648,604 | |||||
Net income per share - Basic | $ | 0.11 | $ | 0.08 | $ | 0.21 | $ | 0.21 | |||||
Net income per share - Diluted | $ | 0.11 | $ | 0.08 | $ | 0.20 | $ | 0.20 | |||||
Weighted average common shares | |||||||||||||
Outstanding - Basic | 7,883,577 | 7,852,077 | 7,875,982 | 7,840,858 | |||||||||
Weighted average common shares | |||||||||||||
Outstanding - Diluted | 8,111,872 | 8,081,626 | 8,085,375 | 8,066,311 | |||||||||
ALLIED HEALTHCARE PRODUCTS, INC. CONSOLIDATED BALANCE SHEET (UNAUDITED) |
June 30, 2007 | June 30, 2006 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 3,638,870 | $ | 2,696,324 | |||
Accounts receivable, net of allowances | |||||||
of $460,000 and $430,000, respectively | 7,251,767 | 7,429,355 | |||||
Inventories, net | 12,999,472 | 11,491,305 | |||||
Other current assets | 275,254 | 224,853 | |||||
Total current assets | 24,165,363 | 21,841,837 | |||||
Property, plant and equipment, net | 10,677,000 | 11,252,934 | |||||
Goodwill | 15,979,830 | 15,979,830 | |||||
Other assets, net | 496,127 | 255,845 | |||||
Total assets | $ | 51,318,320 | $ | 49,330,446 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 3,040,313 | $ | 3,208,699 | |||
Deferred income taxes | 882,001 | 689,942 | |||||
Deferred revenue | 465,000 | 465,000 | |||||
Other accrued liabilities | 2,508,820 | 2,834,495 | |||||
Total current liabilities | 6,896,134 | 7,198,136 | |||||
Deferred revenue | 1,937,500 | 1,472,500 | |||||
Commitments and contingencies | |||||||
Stockholders' equity: | |||||||
Preferred stock; $0.01 par value; 1,500,000 shares | |||||||
authorized; no shares issued and outstanding | - | - | |||||
Series A preferred stock; $0.01 par value; 200,000 shares | |||||||
authorized; no shares issued and outstanding | - | - | |||||
Common stock; $0.01 par value; 30,000,000 shares | |||||||
authorized; 10,187,069 shares issued at June 30, 2007 | |||||||
and 10,155,569 shares issued at June 30, 2006; 7,883,577 | |||||||
outstanding at June 30, 2007 and 7,852,077 | |||||||
shares outstanding June 30, 2006 | 101,871 | 101,556 | |||||
Additional paid-in capital | 47,441,163 | 47,258,182 | |||||
Retained earnings | 15,673,080 | 14,031,500 | |||||
Less treasury stock, at cost; 2,303,492 shares at | |||||||
June 30, 2007 and June 30, 2006 | (20,731,428 | ) | (20,731,428 | ) | |||
Total stockholders' equity | 42,484,686 | 40,659,810 | |||||
Total liabilities and stockholders' equity | $ | 51,318,320 | $ | 49,330,446 |