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Exhibit 99.1
NEWS RELEASE
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15301 w. 109th Street, Lenexa, KS 66219 Phone: 913-647-0158 Fax: 913-647-0132
FOR IMMEDIATE RELEASE:
Contact: Karl B. Gemperli
(913) 647-0158, Phone
(913) 647-0132, Fax
investorrelations@elecsyscorp.com
ELECSYS CORPORATION REPORTS FOURTH QUARTER AND YEAR END FINANCIAL RESULTS
Lenexa, Kansas (July 23, 2004) - Elecsys Corporation (AMEX: ASY), today
announced its financial results for the fourth quarter and fiscal year ending
April 30, 2004.
Fourth quarter 2004 results:
Sales for the quarter ended April 30, 2004 were $2,505,000, a decrease
of $613,000 or 20%, from sales of $3,118,000 for the same period in fiscal 2003.
The decrease was primarily the result of decreases in sales in the electronic
hybrids product line as a result of our largest customer moving the manufacture
of its product to an offshore production facility used by its parent company.
This decrease was slightly offset by increases in sales during the period in the
electronic assembly and LCD resale product lines as compared to the comparable
period a year ago. We expect to experience an increase in sales for the first
half of fiscal 2005 as compared to the first half of fiscal 2004, as we continue
to aggressively pursue customer opportunities that include electronic assembly
and electronic hybrid products for new customers and new products for existing
customers.
Gross margin was $853,000 or 34% of sales for the three-month period
ended April 30, 2004, as compared to $1,041,000 or 33% of sales for the
three-month period ended April 30, 2003. This slight increase in gross margin
percentage for the current period reflected a favorable product mix combined
with a decrease in sales for the period. We expect that gross margins over the
next few quarters will decrease from the percentage achieved during this period
and should continue near the average margin level of 28% achieved during the
fiscal year.
Operating expenses for the three-month period ended April 30, 2004 were
$566,000, a decrease of $173,000, or 23%, from the same period in fiscal 2003
when expenses totaled $739,000, excluding asset acquisition expenses. We believe
that operating expenses will continue near their current levels over the next
few quarters and we will continue our efforts to control and minimize corporate
expenditures and manage operating costs.
Operating income for the three-month period ending April 30, 2004 was
$287,000, as compared to operating income of $166,000 for the comparable period
in the prior fiscal year, which included $136,000 of asset acquisition expenses.
As a result, net income was $248,000, or $0.09 per fully diluted share,
for the quarter, as compared to net income of $97,000, or $0.03 per fully
diluted share, for the comparable
period of the prior year.
Fiscal year 2004 results:
Sales for the fiscal year ended April 30, 2004 were $10,612,000, a
decrease of $679,000 or 6% from $11,291,000 for fiscal year 2003.
Gross margin for the fiscal year ended April 30, 2004 was 28%, or
$2,973,000, compared to 32%, or $3,621,000, for the fiscal year ended April 30,
2003.
Operating expenses were $2,767,000. In the fiscal year ended April 30,
2003, these expenses totaled $3,226,000 and included $381,000 of asset
acquisition related expenses.
Operating income for fiscal 2004 was $206,000 as compared to operating
income of $395,000 for the prior fiscal year.
Net income for the fiscal year ended April 30, 2004, amounted to
$23,000, or $0.01 per fully diluted share as compared to a net loss of
$1,404,000, or $(0.50) per fully diluted share, for the fiscal year ended April
30, 2003, which included the $1,618,000 charge for goodwill impairment as a
result of the adoption of Statement of Financial Accounting Standards No. 142,
Goodwill and Other Intangible Assets, on May 1, 2002.
Karl B. Gemperli, Chief Executive Officer, stated, "We are extremely
pleased with the financial results for the fourth quarter even though our
results for the year fell short of our expectations. The achievement of these
results after the loss of a major customer, in a difficult economic environment,
is a tribute to the talent and dedication of our people." Gemperli continued,
"During the second half of the fiscal year, we adopted a more focused sales
approach and streamlined our operations to reduce our fixed operating costs.
This enabled us to significantly improve our bottom-line performance and achieve
profitability for the year, our top priority. While the business environment
remains challenging, our specialized capabilities are providing numerous new
customer opportunities and we expect improved results in fiscal 2005."
Elecsys Corporation, through its wholly owned subsidiary DCI, Inc., is a
designer, manufacturer, and integrator of custom electronic interface solutions
for original equipment manufacturers ("OEMs") in the medical, aerospace,
communications and industrial product industries. The Company has specialized
capabilities to design and efficiently manufacture custom electronic assemblies
which integrate a variety of interface technologies such as custom liquid
crystal displays, light emitting diode displays, and keypads with circuit boards
and other electronic components. The Company becomes an extension of the OEM's
organization by providing key expertise that enables rapid development and
manufacture of electronic products from product conception through volume
production. For more information, visit our websites at www.elecsyscorp.com and
www.dciincorporated.com.
Safe-Harbor statement: The discussions set forth in this press release may
contain forward-looking comments based on current expectations that involve a
number of risks and uncertainties. Actual results could differ materially from
those projected or suggested in the forward-looking comments. The difference
could be caused by a number of factors, including, but not limited to the
factors and conditions that are described in Elecsys Corporation's SEC filings,
including the Form 10-KSB for the year ended April 30, 2004. The reader is
cautioned that Elecsys Corporation does not have a policy of updating or
revising forward-looking statements and thus he or she should not assume that
silence by management of Elecsys Corporation over time means that actual events
are bearing out as estimated in such forward-looking statements.
Elecsys Corporation and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended April 30, Year Ended April 30,
2004 2003 2004 2003
---- ---- ---- ----
Sales $2,505 $3,118 $10,612 $11,291
Cost of products sold 1,652 2,077 7,639 7,670
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Gross margin 853 1,041 2,973 3,621
Selling, general and administrative
expenses 566 739 2,767 2,845
Asset acquisition related expenses -- 136 -- 381
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Total operating expenses 566 875 2,767 3,226
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Operating income 287 166 206 395
Other income (expense):
Interest expense (46) (70) (226) (187)
Other income, net -- 1 4 6
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Income before income
taxes and cumulative effect of
accounting change 241 97 (16) 214
Income tax benefit 7 -- 39 --
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Income before cumulative
effect of accounting change 248 97 23 214
Cumulative effect of accounting
change -- -- -- (1,618)
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Net income (loss) $248 $97 $ 23 $(1,404)
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Income (loss) per share
information:
Basic and diluted
Income per share before
cumulative effect of accounting
change $0.09 $0.03 $0.01 $ 0.08
Cumulative effect of accounting
Change -- -- -- (0.58)
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Net income (loss) per share $0.09 $0.03 $0.01 $(0.50)
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Weighted average common shares outstanding:
Basic 2,791 2,791 2,791 2,791
Diluted 2,835 2,857 2,860 2,823
