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
SECOND QUARTER AND SIX MONTHS 2006 FINANCIAL RESULTS
Tampa, Florida, August 10, 2006 —Reptron Electronics, Inc. (OTCBB: RPRN),an electronics manufacturing services company, today reported financial results for its second quarter ended June 30, 2006.
Reptron recorded second quarter 2006 net sales of $35.5 million, a 2.7% increase from the same period a year ago, and a 3.7% decrease from the first quarter of 2006. The Company recorded a second quarter 2006 net loss of $1.4 million, or $0.28 per fully diluted share. This compares to a $11.8 million loss, or $2.37 per fully diluted share, in the same period a year ago, which included 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.
For the six months ended June 30, 2006, net sales totaled $72.3 million, a 4.3% increase from the first six months of 2005. The Company recorded a net loss during the first six months of 2006 totaling $2.2 million, or $0.44 per fully diluted share. This compares to a $13.3 million net loss, or $2.66 per fully diluted share, during the first six months of 2005, which included 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.
“Our second quarter gross margins were negatively impacted by start-up costs associated with new projects for a significant customer in the medical industry,” stated Paul J. Plante, Reptron’s President and Chief Executive Officer. Plante continued, “While these costs hurt our near term gross margins, we believe they are necessary investments towards developing a large customer relationship that we anticipate should last a number of years. We believe these initial costs will reduce during the second half of 2006 which should improve our operating results.”
“During the quarter the Company posted its third consecutive quarter of year over year sales growth,” said Plante. “We believe this will continue into the third quarter of 2006,” concluded Plante.
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Reptron Reports Second Quarter 2006 Financial Results
August 10, 2006
Page Two
Reptron Electronics Inc. has scheduled a conference call for 9:00 a.m. (EST), August 11, 2006 to discuss the Company’s financial performance. Shareholders, members of the media and other interested parties may participate in the call by dialing 1-800-857-1738, or 1-210-839-8503 for international callers and entering pass code 1758971. This call is being web cast and can be accessed at the Company’s website atwww.reptron.com where it will be archived through September 11, 2006. A telephone replay of the call will be available through September 11, 2006 by dialing 1-888-568-0047 from the U.S., or 1-203-369-3893 from international locations and entering pass code 1758971.
About Reptron
Reptron Electronics, Inc. is an 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 original equipment manufacturers (“OEMs”) in a wide variety of industries. Reptron Outsource Manufacturing and Design 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: The ability of the Company to achieve profitable operations, 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; 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)
Three Months Ended June 30, 2006 | Three Months Ended June 30, 2005 | |||||||
Net Sales | $ | 35,455 | $ | 34,525 | ||||
Cost of goods sold | 32,140 | 30,932 | ||||||
Gross profit | 3,315 | 3,593 | ||||||
Selling, general and administrative expenses | 3,799 | 4,111 | ||||||
Impairment charges | — | 10,072 | ||||||
Operating loss | (484 | ) | (10,590 | ) | ||||
Other expense: | ||||||||
Interest expense, net | (924 | ) | (863 | ) | ||||
Reorganization costs | — | (2 | ) | |||||
Total other expense, net | (924 | ) | (865 | ) | ||||
Loss before income taxes | (1,408 | ) | (11,455 | ) | ||||
Income tax provision | — | 383 | ||||||
Net earnings (loss) | $ | (1,408 | ) | $ | (11,838 | ) | ||
Net loss per common share - basic and diluted | $ | (0.28 | ) | $ | (2.37 | ) | ||
Weighted average Common Stock equivalent shares outstanding - basic and diluted | 5,009,890 | 5,000,000 | ||||||
REPTRON ELECTRONICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
Six Months Ended June 30, 2006 | Six Months Ended June 30, 2005 | |||||||
Net Sales | $ | 72,257 | $ | 69,282 | ||||
Cost of goods sold | 64,881 | 61,867 | ||||||
Gross profit | 7,376 | 7,415 | ||||||
Selling, general and administrative expenses | 7,753 | 8,539 | ||||||
Impairment charges | — | 10,072 | ||||||
Operating loss | (377 | ) | (11,196 | ) | ||||
Other expense: | ||||||||
Interest expense, net | (1,858 | ) | (1,704 | ) | ||||
Reorganization costs | 10 | (6 | ) | |||||
Total other expense | (1,848 | ) | (1,710 | ) | ||||
Loss before income taxes | (2,225 | ) | (12,906 | ) | ||||
Income tax provision | — | 383 | ||||||
Net earnings (loss) | $ | (2,225 | ) | $ | (13,289 | ) | ||
Net loss per common share - basic and diluted | $ | (0.44 | ) | $ | (2.66 | ) | ||
Weighted average Common Stock equivalent shares outstanding - basic and diluted | 5,004,972 | 5,000,000 | ||||||
REPTRON ELECTRONICS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
June 30, 2006 | December 31, 2005 | |||||||
ASSETS | ||||||||
CURRENT ASSETS | ||||||||
Cash and cash equivalents | $ | 203 | $ | 230 | ||||
Restricted cash | 700 | 740 | ||||||
Account receivable - trade, net | 14,974 | 17,990 | ||||||
Inventories, net | 23,431 | 21,378 | ||||||
Prepaid expenses and other | 671 | 1,266 | ||||||
Total current assets | 39,979 | 41,604 | ||||||
PROPERTY, PLANT & EQUIPMENT –NET | 17,809 | 18,937 | ||||||
GOODWILL, NET | 2,100 | 2,100 | ||||||
OTHER INTANGIBLE ASSETS, NET | 2,918 | 3,230 | ||||||
DEFERRED INCOME TAX | 1,543 | 1,543 | ||||||
OTHER ASSETS | 31 | 83 | ||||||
TOTAL ASSETS | $ | 64,380 | $ | 67,497 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | ||||||||
CURRENT LIABILITIES | ||||||||
Accounts payable – trade | $ | 16,956 | $ | 15,008 | ||||
Accrued expenses | 5,123 | 5,613 | ||||||
Note payable to bank | 11,711 | 13,900 | ||||||
Current portion of long-term obligations | 315 | 315 | ||||||
Total current liabilities | 34,105 | 34,836 | ||||||
SENIOR SECURED NOTES | 30,000 | 30,000 | ||||||
LONG-TERM OBLIGATIONS, less current portion | 2,878 | 3,046 | ||||||
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 shares | 50 | 50 | ||||||
Additional paid-in capital | 15,732 | 15,725 | ||||||
Accumulated deficit | (18,385 | ) | (16,160 | ) | ||||
TOTAL SHAREHOLDERS’ EQUITY (DEFICIT) | (2,603 | ) | (385 | ) | ||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | $ | 64,380 | $ | 67,497 | ||||