Exhibit 99.1
CONTACT:
Bell Industries, Inc.
Russell A. Doll/Mitchell I. Rosen
310-563-2355
PondelWilkinson Inc.
Roger S. Pondel/Angie H. Yang
310-279-5980
FOR IMMEDIATE RELEASE
BELL INDUSTRIES REPORTS 2004 THIRD QUARTER RESULTS
El Segundo, California — November 5, 2004 —Bell Industries, Inc. (AMEX:BI) today reported financial results for the three and nine-month periods ended September 30, 2004.
Consolidated net revenues for the 2004 third quarter totaled $39.5 million, compared with $39.6 million a year earlier. The company narrowed its net loss in the current third quarter to $314,000, or $0.04 per share, despite incurring a $700,000 charge in connection with an employment agreement for a former executive. Bell sustained a net loss of $510,000, or $0.06 per share, in the corresponding 2003 period. Before income taxes and excluding the charge, Bell recorded income of $417,000 in the 2004 third quarter, compared with a loss of $233,000 in 2003.
“Overall, we are pleased with the improved operating performance at each of our business units,” said Russell A. Doll, who recently was named acting president and chief executive officer of Bell Industries. “With our continued focus on delivering value-added products and services to our customers, we believe our businesses are well positioned to grow in an improving economic environment.”
Total revenues at the company’s largest operating unit, Bell Tech.logix Group (BTL), amounted to $25.8 million for the 2004 third quarter, compared with $25.9 million in the corresponding period last year. Product revenues at BTL increased to $18.6 million from $17.0 million in the prior-year third quarter, and revenues from services decreased to $7.2 million from $9.0 million last year, primarily reflecting the ending of an outsourcing engagement. Operating income for BTL improved to $177,000 from an operating loss of $49,000 in the year-ago period.
“BTL showed signs of improvement during the third quarter, with corporate spending on information technology products and services up somewhat, although still far from brisk,” said Doll, who also serves as president of BTL. “We are continuing to invest in people and infrastructure and have expanded on a regional basis, with the addition of new business development hires in Los Angeles, Philadelphia and Chicago, including a regional development executive. We intend to aggressively pursue new engagements, as BTL moves into its historically softer fourth and first quarters,” Doll said.
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Bell Industries, Inc.
2-2-2
Bell’s Recreational Products Group posted revenues of $11.9 million in the 2004 third quarter, compared with $12.2 million a year ago. Operating income rose slightly to $432,000 from $427,000 in the 2003 third quarter.
J.W. Miller (JWM), Bell’s electronic components operation, reported another quarter of strong sales gains, up 23 percent to $1.8 million from $1.5 million a year earlier. Benefiting from operating efficiencies, new product development and an improving industry environment, JWM’s operating income grew nearly three-fold to $335,000 in the current quarter from $115,000 in the prior-year three-month period.
For the first nine months of 2004, consolidated revenues for Bell Industries advanced six percent to $117.7 million from $111.0 million in the comparable 2003 period. Bell sharply narrowed its net loss to $186,000, or $0.02 per share, in the 2004 year-to-date period from a net loss of $1.2 million, or $0.14 per share, a year earlier. Excluding the $700,000 third quarter charge, net income would have totaled $514,000 for the 2004 period. Doll added, “The improved results for the year-to-date period reflect management’s continued commitment to controlling costs and maximizing operating efficiencies.”
At September 30, 2004, Bell’s balance sheet remained solid with no bank debt. The company had working capital of $18.3 million and cash of $11.1 million. Shareholders’ equity totaled $21.4 million, or $2.56 per share, at the end of the 2004 nine-month period.
About Bell Industries, Inc.
Bell Industries’ primary business, the Tech.logix Group, provides information technology lifecycle services, including planning, product sourcing, migration, support, and disposal services. Recurring support services include help desk, depot, and on-site expertise for desktop and mobile devices, business software applications, and network infrastructures. Bell also distributes after-market parts and accessories to the recreational vehicle market. In addition, Bell manufactures and distributes a variety of standard and custom magnetic components used in electronic applications for computer, medical and telecommunication equipment.
Certain matters discussed in this news release are forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from current trends. These include, but are not limited to, the effectiveness of developing new markets for the company’s services and penetrating new geographic markets, achieving growth based on new business development personnel joining the company, along with benefits from a stabilizing technology market and increased corporate spending on IT product, price competition, delays and costs associated with new client engagements, realizing business opportunities as the economy improves, and other factors described in the company’s public filings from time to time.
(Tables Follow)
Bell Industries, Inc.
Consolidated Operating Results
(In thousands, except per share data)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three months ended | | Nine months ended |
| | | September 30
| | September 30
|
| | | 2004
| | 2003
| | 2004
| | 2003
|
| Net revenues | | | | | | | | | | | | | | | | |
| Products | | $ | 32,300 | | | $ | 30,625 | | | $ | 94,645 | | | $ | 84,591 | |
| Services | | | 7,190 | | | | 8,953 | | | | 23,091 | | | | 26,439 | |
| | | |
| | | |
| | | |
| | | |
| |
| | | | 39,490 | | | | 39,578 | | | | 117,736 | | | | 111,030 | |
| | | |
| | | |
| | | |
| | | |
| |
| Costs and expenses | | | | | | | | | | | | | | | | |
| Cost of products sold | | | 26,445 | | | | 25,278 | | | | 77,833 | | | | 69,006 | |
| Cost of services provided | | | 5,687 | | | | 7,258 | | | | 18,419 | | | | 21,228 | |
| Selling and administrative | | | 6,980 | | | | 7,334 | | | | 21,002 | | | | 22,123 | |
| Interest, net | | | (39 | ) | | | (59 | ) | | | (107 | ) | | | (125 | ) |
| Special item (1) | | | 700 | | | | | | | | 700 | | | | | |
| | | |
| | | |
| | | |
| | | |
| |
| | | | 39,773 | | | | 39,811 | | | | 117,847 | | | | 112,232 | |
| | | |
| | | |
| | | |
| | | |
| |
| Loss before income taxes | | | (283 | ) | | | (233 | ) | | | (111 | ) | | | (1,202 | ) |
| Income tax expense | | | 31 | | | | 277 | | | | 75 | | | | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net loss | | $ | (314 | ) | | $ | (510 | ) | | $ | (186 | ) | | $ | (1,202 | ) |
| | | |
| | | |
| | | |
| | | |
| |
Basic and diluted share data | | | | | | | | | | | | | | | | |
| Net loss per share | | $ | (.04 | ) | | $ | (.06 | ) | | $ | (.02 | ) | | $ | (.14 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| Weighted average common stock | | | 8,378 | | | | 8,367 | | | | 8,375 | | | | 8,367 | |
| | | |
| | | |
| | | |
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| |
| | | | | | | | | | | | | | | | | |
| OPERATING RESULTS BY BUSINESS SEGMENT | | | | | | | | |
| Net revenues | | | | | | | | | | | | | | | | |
| Technology Solutions | | | | | | | | | | | | | | | | |
| Products | | $ | 18,629 | | | $ | 16,970 | | | $ | 50,530 | | | $ | 42,931 | |
| Services | | | 7,190 | | | | 8,953 | | | | 23,091 | | | | 26,439 | |
| | | |
| | | |
| | | |
| | | |
| |
| | | | 25,819 | | | | 25,923 | | | | 73,621 | | | | 69,370 | |
| Recreational Products | | | 11,878 | | | | 12,200 | | | | 38,049 | | | | 36,835 | |
| Electronic Components | | | 1,793 | | | | 1,455 | | | | 6,066 | | | | 4,825 | |
| | | |
| | | |
| | | |
| | | |
| |
| | | $ | 39,490 | | | $ | 39,578 | | | $ | 117,736 | | | $ | 111,030 | |
| | | |
| | | |
| | | |
| | | |
| |
| Operating income (loss) | | | | | | | | | | | | | | | | |
| Technology Solutions | | $ | 177 | | | $ | (49 | ) | | $ | (311 | ) | | $ | (1,269 | ) |
| Recreational Products | | | 432 | | | | 427 | | | | 1,540 | | | | 1,429 | |
| Electronic Components | | | 335 | | | | 115 | | | | 1,237 | | | | 735 | |
| Corporate costs | | | (566 | ) | | | (785 | ) | | | (1,984 | ) | | | (2,222 | ) |
| Special item (1) | | | (700 | ) | | | | | | | (700 | ) | | | | |
| | | |
| | | |
| | | |
| | | |
| |
| | | | (322 | ) | | | (292 | ) | | | (218 | ) | | | (1,327 | ) |
| Interest, net | | | 39 | | | | 59 | | | | 107 | | | | 125 | |
| Income tax expense | | | (31 | ) | | | (277 | ) | | | (75 | ) | | | | |
| | | |
| | | |
| | | |
| | | |
| |
| Net loss | | $ | (314 | ) | | $ | (510 | ) | | $ | (186 | ) | | $ | (1,202 | ) |
| | | |
| | | |
| | | |
| | | |
| |
| (1) | | Special item represents costs associated with an employment agreement for a former executive. |
Bell Industries, Inc.
Consolidated Condensed Balance Sheet
(In thousands)
(Unaudited)
| | | | | | | | | |
| | | September 30, | | December 31, |
| | | 2004
| | 2003
|
ASSETS | | | | | | | | |
| Current assets: | | | | | | | | |
| Cash and cash equivalents | | $ | 11,094 | | | $ | 12,203 | |
| Accounts receivable, net | | | 14,777 | | | | 16,164 | |
| Inventories | | | 10,555 | | | | 11,286 | |
| Prepaid expenses and other | | | 917 | | | | 689 | |
| | | |
| | | |
| |
| Total current assets | | | 37,343 | | | | 40,342 | |
| | | |
| | | |
| |
| Fixed assets, net | | | 3,463 | | | | 4,206 | |
| Other assets | | | 2,236 | | | | 2,085 | |
| | | |
| | | |
| |
| | | $ | 43,042 | | | $ | 46,633 | |
| | | |
| | | |
| |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | |
| Current liabilities: | | | | | | | | |
| Accounts payable | | $ | 9,573 | | | $ | 12,882 | |
| Accrued payroll and liabilities | | | 9,483 | | | | 9,634 | |
| | | |
| | | |
| |
| Total current liabilities | | | 19,056 | | | | 22,516 | |
| | | |
| | | |
| |
| Long-term liabilities | | | 2,548 | | | | 2,520 | |
| Shareholders’ equity | | | 21,438 | | | | 21,597 | |
| | | |
| | | |
| |
| | | $ | 43,042 | | | $ | 46,633 | |
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