Exhibit 99.1
13700 Reptron Blvd.· Tampa, FL 33626-3046· 813.854.2000
Contact: | Charles L. Pope | |
Chief Financial Officer | ||
(813) 854-2000 | ||
cpope@reptron.com |
FOR IMMEDIATE RELEASE
REPTRON ELECTRONICS, INC. REPORTS
THIRD QUARTER AND NINE MONTHS 2005 FINANCIAL RESULTS
Tampa, Florida, November 14, 2005 —Reptron Electronics, Inc. (OTCBB: RPRN),an electronics manufacturing services company, today reported financial results for its third quarter and nine months ended September 30, 2005.
Reptron recorded third quarter 2005 net sales of $32.6 million, a 5.2% decline from the same period a year ago and a 5.6% decline from the second quarter of 2005. The Company recorded a third quarter 2005 loss totaling $1.2 million, or $0.24 per fully diluted share, including employee severance charges of approximately $314,000. This compares to a $45,000 loss, or $0.01 per fully diluted share, in the same period a year ago, including activity from the 2003 discontinued operations and reorganization costs, which collectively resulted in net earnings of $45,000.
For the nine months ended September 30, 2005, net sales totaled $101.9 million, a 3.5% decrease from the first nine months of 2004 (eight months Reorganized Company combined with one month of the Predecessor Company). The Company recorded a loss during the first nine months of 2005 totaling $14.5 million, or $2.89 per fully diluted share, including a non-cash impairment charge to goodwill of approximately $10.1 million as well as an increase to the deferred tax asset valuation allowance of approximately $0.4 million. This compares to a $1.3 million loss from continuing operations, or $0.25 per fully diluted share, during the first nine months of 2004 (eight months Reorganized Company of $0.7 million combined with one month of the Predecessor Company of $0.6 million), excluding reorganization gain and expenses, net of related income tax effect. The earnings per share calculated for the period ending September 30, 2004 above are based only on the five million shares issued and outstanding of the reorganized company. During the first nine months of 2004, Reptron also recorded additional activity from its 2003 discontinued operations, reorganization costs and a reorganization gain on debt discharge net of the related income tax effect, which collectively resulted in net earnings of $1.6 million. These items, when combined with the results from continuing operations during the first nine months of 2004, resulted in net earnings of $391,000.
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Reptron Reports Third Quarter 2005 Financial Results
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“During the third quarter of 2005 we began to benefit from a comprehensive cost reduction effort initiated in the second quarter of the year,” stated Paul J. Plante, Reptron’s President and Chief Executive Officer. Plante continued, “Gross margins increased by 230 basis points and operating income improved when compared to the second quarter of 2005 despite a $1.9 million reduction in sales.”
Plante added, “We believe that our cost reduction effort combined with new customer additions and increasing demand from our legacy customers should result in additional operating performance improvement during the fourth quarter of 2005.”
As previously reported, Reptron sold certain identified assets of its electronic components distribution division on June 13, 2003. Additionally, the Company sold certain assets of its memory module division on October 27, 2003. The 2004 results have been adjusted to reflect the remaining operations while segregating and summarizing the electronic components distribution and memory module divisions as discontinued operations.
Reptron filed a voluntary petition for reorganization under Chapter 11 of the U.S. Bankruptcy Code on October 28, 2003. The Plan of Reorganization was confirmed by the U.S. Bankruptcy Court on January 14, 2004 and became effective on February 3, 2004 allowing the Company to emerge from bankruptcy. Expenses incurred through the reorganization process have been segregated and summarized as Reorganization Costs. Additionally, the difference between the fair market value of new common stock issued and new debt issued when compared to the debt discharged as outlined in the Plan of Reorganization has been summarized as a Reorganization Gain on Debt Discharge. Also, as a result of the reorganization, January 2004 operations are presented as “Predecessor” while the eight month period ended June 30, 2004 is presented as “Reorganized.” The accompanying financial tables provide financial information relative to these periods.
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Reptron Reports Third Quarter 2005 Financial Results
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Reptron Electronics Inc. has scheduled a conference call for 9:00 a.m. (EST), November 15, 2005 to discuss the Company’s financial performance. Shareholders, members of the media and other interested parties may participate in the call by dialing 1-888-889-6350, or 1-210-234-0030 for international callers and entering pass code 2136386. This call is being web cast and can be accessed at the Company’s website atwww.reptron.com where it will be archived through December 14, 2005. This web cast is also being distributed over CCBN’s Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN’s individual investor center atwww.fulldisclosure.com or by visiting any of the investor sites in CCBN’s Individual Investor Network. Institutional investors can access the call via CCBN’s password-protected event management site, StreetEvents (www.streetevents.com). A telephone replay of the call will be available through December 14, 2005 by dialing 1-866-363-4002 from the U.S., or 1-203-369-0205 from international locations and entering pass code 2136386.
About Reptron
Reptron Electronics, Inc. is a leading electronics manufacturing services company providing engineering services, electronics manufacturing services and display integration services. Reptron Manufacturing Services offers full electronics manufacturing services including complex circuit board assembly, complete supply chain services and manufacturing engineering services to OEMs in a wide variety of industries. Reptron Display and System Integration provides value-added display design engineering and system integration services to OEMs. For more information, please access www.reptron.com.
Safe Harbor statement under the Private Securities Litigation Reform Act of 1995:Certain of the above statements contained in this press release, are forward-looking statements that involve a number of risks and uncertainties.. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended. Factors that could cause actual results to differ materially include the following: Completion of bankruptcy proceedings, business conditions and growth in the Company’s industry and in the general economy; competitive factors; risks due to shifts in market demand; risks inherent with predicting revenue and earnings outcomes; uncertainties involved in implementing improvements in the manufacturing process; the ability of the Company to complete and integrate acquisitions; and the risk factors listed from time to time in the Company’s reports filed with the Securities and Exchange Commission as well as assumptions regarding the foregoing. The words “believe,” “estimate,” “expect,” “intend,” “anticipate,” “plan,” “appears,” and similar expressions and variations thereof identify certain of such forward-looking statements, which speak only as of the dates on which they were made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned that any such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Readers are cautioned not to place undue reliance on these forward-looking statements.
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REPTRON ELECTRONICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
Reorganized Company Three Months Ended September 30, 2005 | Reorganized Company Three Months Ended September 30, 2004 | |||||||
Net Sales | $ | 32,579 | $ | 34,378 | ||||
Cost of goods sold | 28,457 | 29,613 | ||||||
Gross profit | 4,122 | 4,765 | ||||||
Selling, general and administrative expenses | 4,301 | 4,110 | ||||||
Employee severance charges | 314 | — | ||||||
Operating income | (493 | ) | 655 | |||||
Other income (expense): | ||||||||
Interest expense, net | (856 | ) | (745 | ) | ||||
Reorganization costs | — | (62 | ) | |||||
Total other income (expense) | (856 | ) | (807 | ) | ||||
Loss before income taxes | (1,349 | ) | (152 | ) | ||||
Income tax provision | — | — | ||||||
Loss from continuing operations | (1,349 | ) | (152 | ) | ||||
Discontinued operations | ||||||||
Earnings (loss) from discontinued operations | 171 | 107 | ||||||
Income tax benefit | — | — | ||||||
Earnings (loss) on discontinued operations | 171 | 107 | ||||||
Net loss | $ | (1,178 | ) | $ | (45 | ) | ||
Net earnings (loss) from continuing operations per common share - basic and diluted: | $ | (.27 | ) | $ | (0.03 | ) | ||
Net earnings (loss) from discontinued operations per common share - basic and diluted: | $ | 0.03 | $ | 0.02 | ||||
Net loss per common share - basic and diluted | $ | (0.24 | ) | $ | (0.01 | ) | ||
Weighted average Common Stock equivalent shares outstanding - basic and diluted | 5,000,000 | 5,000,000 | ||||||
REPTRON ELECTRONICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
Reorganized Company Nine Months Ended September 30, 2005 | Predecessor Company One Month Ended January 31, 2004 | Reorganized Company Eight Months Ended September 30, 2004 | ||||||||||
Net Sales | $ | 101,861 | $ | 12,368 | $ | 93,154 | ||||||
Cost of goods sold | 90,324 | 11,479 | 81,253 | |||||||||
Gross profit | 11,537 | 889 | 11,901 | |||||||||
Selling, general and administrative expenses | 13,152 | 1,447 | 10,613 | |||||||||
Goodwill impairment charges | 10,072 | — | — | |||||||||
Operating income (loss) | (11,687 | ) | (558 | ) | 1,288 | |||||||
Other income (expense): | ||||||||||||
Interest expense, net | (2,560 | ) | (61 | ) | (1,923 | ) | ||||||
Reorganization gain on debt discharge | — | 3,517 | — | |||||||||
Reorganization costs | (6 | ) | (853 | ) | (78 | ) | ||||||
Total other income (expense) | (2,566 | ) | 2,603 | (2,001 | ) | |||||||
Earnings (loss) before income taxes | (14,253 | ) | 2,045 | (713 | ) | |||||||
Income tax provision | 383 | 777 | — | |||||||||
Earnings (loss) from continuing operations | (14,636 | ) | 1,268 | (713 | ) | |||||||
Discontinued operations | ||||||||||||
Earnings (loss) from discontinued operations | 171 | (507 | ) | 150 | ||||||||
Income tax benefit | — | 193 | — | |||||||||
Earnings (loss) on discontinued operations | 171 | (314 | ) | 150 | ||||||||
Net earnings (loss) | $ | (14,465 | ) | $ | 954 | $ | (563 | ) | ||||
Net earnings (loss) from continuing operations per common share - basic and diluted: | $ | (2.92 | ) | $ | 0.20 | $ | (0.14 | ) | ||||
Net earnings (loss) from discontinued operations per common share - basic and diluted: | $ | 0.03 | $ | (0.05 | ) | $ | 0.03 | |||||
Net earnings (loss) per common share - basic and diluted | $ | (2.89 | ) | $ | 0.15 | $ | 0.11 | |||||
Weighted average Common Stock equivalent shares outstanding - basic and diluted | 5,000,000 | 6,417,196 | 5,000,000 | |||||||||
REPTRON ELECTRONICS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
Reorganized Company September 30, 2005 | Reorganized Company December 31, 2004 | |||||||
ASSETS | ||||||||
CURRENT ASSETS | ||||||||
Cash and cash equivalents | $ | 132 | $ | 227 | ||||
Restricted Cash | 746 | 1,014 | ||||||
Account receivable - trade, net | 13,758 | 14,569 | ||||||
Inventories, net | 21,695 | 19,774 | ||||||
Prepaid expenses and other | 843 | 826 | ||||||
Total current assets | 37,174 | 36,410 | ||||||
PROPERTY, PLANT & EQUIPMENT – AT COST, NET | 19,605 | 21,770 | ||||||
GOODWILL, NET | 2,100 | 12,172 | ||||||
OTHER INTANGIBLE ASSETS, NET | 3,386 | 3,855 | ||||||
DEFERRED INCOME TAX | 1,543 | 1,902 | ||||||
OTHER ASSETS | 131 | 83 | ||||||
TOTAL ASSETS | $ | 63,939 | $ | 76,192 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | ||||||||
CURRENT LIABILITIES | ||||||||
Accounts payable – trade | $ | 16,257 | $ | 12,885 | ||||
Accrued expenses | 4,975 | 5,049 | ||||||
Note payable to bank | 9,629 | 10,431 | ||||||
Current portion of long-term obligations | 380 | 380 | ||||||
Total current liabilities | 31,241 | 28,745 | ||||||
SENIOR SECURED NOTES | 30,000 | 30,000 | ||||||
LONG-TERM OBLIGATIONS, less current portion | 3,077 | 3,361 | ||||||
SHAREHOLDERS’ EQUITY | ||||||||
Preferred Stock - authorized 15,000,000 shares of $.10 par value; no shares issued | — | — | ||||||
Common Stock - authorized 50,000,000 shares of $.01 par value; issued and outstanding, 5,000,000 and 5,000,000 shares, respectively | 50 | 50 | ||||||
Additional paid-in capital | 15,725 | 15,725 | ||||||
Accumulated deficit | (16,154 | ) | (1,689 | ) | ||||
TOTAL SHAREHOLDERS’ EQUITY (DEFICIT) | (379 | ) | 14,086 | |||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | $ | 63,939 | $ | 76,192 | ||||