Bell Industries, Inc. John A. Fellows/Mitchell I. Rosen 310-563-2355
PondelWilkinson Inc. Roger S. Pondel/Angie H. Yang 310-279-5980
BELL INDUSTRIES POSTS HIGHER NET INCOME FOR 2005 THIRD QUARTER
El Segundo, California – November 8, 2005 – Bell Industries, Inc. (AMEX:BI) today reported financial results for the three and nine months ended September 30, 2005.
For the 2005 third quarter, net income totaled $423,000, equal to $0.05 per diluted share. This compares with a net loss of $314,000, or $0.04 per share, in the prior-year period. Consolidated net revenues for the quarter amounted to $39.2 million, compared with $39.5 million a year earlier. Third quarter results for 2005 and 2004 include severance charges of $325,000 and $700,000, respectively, for former executives.
For the year-to-date period, net income totaled $694,000, or $0.08 per diluted share, versus a net loss of $186,000, or $0.02 per share, for the corresponding 2004 period. Consolidated net revenues amounted to $105.2 million for the current nine-month period, compared with $117.7 million a year earlier.
John A. Fellows, who recently was elected president and chief executive officer after serving on Bell’s board of directors since May 2005, commented, “While I’m confident in the level of talent within our different business groups, I’m even more encouraged by what we’ll be able to accomplish in the days ahead now that we are succinctly focused on becoming the recognized leader in each of our respective markets.”
For the 2005 third quarter, Bell’s largest operating unit, the Tech.logix Group (BTL), posted net revenues of $25.0 million, compared with $25.8 million in the prior-year period. Product sales amounted to $17.2 million, compared with $18.6 million in the 2004 third quarter. Services revenues advanced 8% to $7.8 million in the 2005 third quarter from $7.2 million a year earlier, reflecting continued strength in BTL’s reverse logistics and depot repair business. Benefiting from cost containment efforts and the revenue increase in reverse logistics and depot repair business, operating income for the division increased to $418,000 for the 2005 third quarter from $177,000 in the prior-year period.
At Bell’s Recreational Products Group, net revenues for the 2005 third quarter rose modestly to $12.1 million from $11.9 million last year. Operating income increased to $478,000 from $432,000 in the same period a year ago.
Net revenues at Bell’s electronic components operation, J.W. Miller, grew 18% to $2.1 million in the third quarter of 2005 from $1.8 million a year earlier. Operating income increased 40% to $468,000 from $335,000 a year ago.
Bell continues to maintain a strong balance sheet with no bank debt. At September 30, 2005, cash and cash equivalents totaled $12.0 million, and net working capital amounted to $19.9 million, compared with $10.8 million and $19.1 million, respectively, at December 31, 2004. Shareholders’ equity totaled $21.6 million, or $2.55 per share, compared with $20.8 million, or $2.47 per share, at December 31, 2004.
About Bell Industries, Inc.
Bell’s primary business, the Tech.logix Group, offers a comprehensive portfolio of technology products and managed lifecycle services, including planning, product sourcing, deployment and disposal, and support services. Support services include help desk support, desk side support, technical maintenance services, and reverse logistics and depot services. Bell also distributes after-market parts and accessories to the recreational vehicle market and manufactures and sells standard and custom magnetic components used in electronic applications for computer, medical, lighting and telecommunication equipment.
Forward-Looking Statements
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, future accomplishments, as well as other factors described in the company’s public filings from time to time.
1
Bell Industries, Inc. Consolidated Operating Results (In thousands, except per share data) (Unaudited)
Three months ended
Nine months ended
September 30
September 30
2005
2004
2005
2004
Net revenues
Products
$
31,424
$
32,300
$
82,804
$
94,645
Services
7,772
7,190
22,438
23,091
39,196
39,490
105,242
117,736
Costs and expenses
Cost of products sold
25,436
26,445
65,684
77,833
Cost of services provided
6,185
5,687
18,032
18,419
Selling and administrative
6,905
6,980
20,628
21,002
Interest, net
(93
)
(39
)
(181
)
(107
)
Special items (1)
325
700
325
700
38,758
39,773
104,488
117,847
Income (loss) before income taxes
438
(283
)
754
(111
)
Income tax expense
15
31
60
75
Net income (loss)
$
423
$
(314
)
$
694
$
(186
)
Basic and diluted share data
Net income (loss)
Basic
$
.05
$
(.04
)
$
.08
$
(.02
)
Diluted
$
.05
$
(.04
)
$
.08
$
(.02
)
Weighted average common stock
Basic
8,460
8,378
8,458
8,375
Diluted
8,479
8,378
8,502
8,375
OPERATING RESULTS BY BUSINESS SEGMENT
Net revenues
Technology Solutions
Products
$
17,182
$
18,629
$
39,305
$
50,530
Services
7,772
7,190
22,438
23,091
24,954
25,819
61,743
73,621
Recreational Products
12,122
11,878
37,433
38,049
Electronic Components
2,120
1,793
6,066
6,066
$
39,196
$
39,490
$
105,242
$
117,736
Operating income (loss)
Technology Solutions
$
418
$
177
$
(42
)
$
(311
)
Recreational Products
478
432
1,530
1,540
Electronic Components
468
335
1,403
1,237
Corporate costs
(694
)
(566
)
(1,993
)
(1,984
)
Special items (1)
(325
)
(700
)
(325
)
(700
)
345
(322
)
573
(218
)
Interest, net
93
39
181
107
Income tax expense
(15
)
(31
)
(60
)
(75
)
Net income (loss)
$
423
$
(314
)
$
694
$
(186
)
(1) Special item in 2005 represents costs associated with a severance agreement for a former executive. Special item in 2004 represents costs associated with an employment agreement for another former executive.
Bell Industries, Inc. Consolidated Condensed Balance Sheet (In thousands) (Unaudited)
September 30
December 31
2005
2004
ASSETS
Current assets:
Cash and cash equivalents
$
11,955
$
10,801
Accounts receivable
15,680
11,455
Inventories
10,181
14,364
Prepaid expenses and other
2,235
1,813
Total current assets
40,051
38,433
Fixed assets, net
3,137
3,139
Other assets
3,374
3,617
$
46,562
$
45,189
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
11,363
$
11,170
Accrued payroll and liabilities
8,827
8,178
Total current liabilities
20,190
19,348
Long-term liabilities
4,807
5,025
Shareholders’ equity
21,565
20,816
$
46,562
$
45,189
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