Exhibit 99.1
Conference call: | | Today, Friday, April 28, 2006 at 11:00 a.m. EDT |
Webcast / Replay URL: | | www.ballantyne-omaha.com/investor_relations/ or www.fulldisclosure.com |
Dial-in number: | | 800-741-0104 |
The replay will be available on the Internet for 90 days.
NEWS ANNOUNCEMENT | | FOR IMMEDIATE RELEASE |
BALLANTYNE OF OMAHA REPORTS FIRST QUARTER EPS OF $0.07
ON REVENUE OF $12.4 MILLION
OMAHA, Nebraska (April 28, 2006) Ballantyne of Omaha, Inc. (Amex: BTN), a manufacturer of motion picture projection and specialty lighting equipment, today reported financial results for the first quarter (Q1) ended March 31, 2006.
2006 First Quarter Results
Net revenues in Q1 2006 were $12.4 million, a 1% decline from net revenue of $12.5 million in the year-ago first quarter, reflecting lower demand for theatre equipment partially due to the changing industry environment where theatre owners evaluate their capital expenditures plans relative to the purchase of new or used film projectors or digital equipment. Gross profit in Q1 2006 was $3.3 million, or 26.8% of net revenues, nearly matching Q1 2005 gross profit of $3.4 million, or 27.1% of net revenues. Total Q1 2006 selling and administrative expenses rose 8.8% to $2.1 million reflecting a 14.7% increase in administrative expense that more than offset a small decline in selling expense. The $175,000 year-over-year rise in administrative expense was primarily due to employee severance costs incurred as a result of planned work force reductions as well as for legal expenses to settle a lawsuit, Sarbanes-Oxley compliance costs and compensation costs partially offset by lower bonus expense. Reflecting these items, net income in Q1 2006 amounted to $915,000, or $0.07 per diluted share, compared to net income of $942,000, or $0.07 per diluted share, in Q1 2005. Per share results for the first quarters of 2006 and 2005 are based on a weighted average number of diluted shares outstanding of 13,947,291 and 13,840,719, respectively.
John P. Wilmers, President and Chief Executive Officer of Ballantyne, commented, “Ballantyne turned in a solid performance in the first quarter in the face of industry changes as theater owners anticipate the transition to digital cinema. Sales of lighting equipment rose from last year’s first quarter, but a 3% decline in theater product sales offset the gains and resulted in the slight reduction in revenue compared to last year. The Company’s strong cash flow in the first quarter further strengthened our balance sheet, and Ballantyne ended the quarter with negligible long-term debt and over $22 million of cash and cash equivalents.
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“Our announcement today that we have entered into a letter of intent to acquire National Cinema Service Corp. (NCSC) represents an important strategic and financial development for Ballantyne. NCSC creates an immediate platform for Ballantyne to offer film and digital projector maintenance, repair, equipment installations, site surveys and other theatre services. In addition, while the acquisition of NCSC is expected to be modestly accretive to Ballantyne’s earnings upon closing, longer-term we believe there will be significant growth opportunities as we market NCSC’s industry-leading service capabilities through our industry relationships.”
About Ballantyne of Omaha
Ballantyne is a leading U.S. supplier of commercial motion picture equipment including digital cinema and in-theater advertising products. The Company also supplies specialty projection equipment utilized by major theater chains and location-based entertainment providers and manufactures specialty entertainment lighting products used at top arenas, television and motion picture production studios, theme parks and architectural sites around the world.
Except for the historical information in this press release, it includes forward-looking statements that involve risks and uncertainties, including but not limited to, quarterly fluctuations in results; customer demand for the Company’s products; the development of new technology for alternate means of motion picture presentation; domestic and international economic conditions; the management of growth; and other risks detailed from time to time in the Company’s Securities and Exchange Commission filings. Actual results may differ materially from management’s expectations.
CONTACT: | | |
Brad French | | Joseph Jaffoni, David Collins |
Chief Financial Officer | | Jaffoni & Collins Incorporated |
402/453-4444 | | 212/835-8500; btn@jcir.com |
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Ballantyne of Omaha, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
| | Three Months Ended
March 31, | |
| | 2006 | | 2005 | |
| | | | | |
Net revenues | | $ | 12,433,338 | | $ | 12,511,869 | |
Cost of revenues | | 9,102,371 | | 9,117,278 | |
Gross profit | | 3,330,967 | | 3,394,591 | |
| | | | | |
Selling & administrative expenses: | | | | | |
Selling | | 734,523 | | 739,412 | |
Administrative | | 1,369,684 | | 1,194,412 | |
Total selling & administrative exp. | | 2,104,207 | | 1,933,824 | |
| | | | | |
Income from operations | | 1,226,760 | | 1,460,767 | |
| | | | | |
Other income (expense), net | | 18,880 | | (29,519 | ) |
| | | | | |
Income before interest and taxes | | 1,245,640 | | 1,431,248 | |
| | | | | |
Net interest income | | 158,163 | | 63,496 | |
| | | | | |
Income before income taxes | | 1,403,803 | | 1,494,744 | |
| | | | | |
Income tax expense | | (489,055 | ) | (552,830 | ) |
Net income | | $ | 914,748 | | $ | 941,914 | |
| | | | | |
Earnings per share | | | | | |
| | | | | |
Basic | | $ | 0.07 | | $ | 0.07 | |
Diluted | | $ | 0.07 | | $ | 0.07 | |
| | | | | |
Weighted average shares outstanding: | | | | | |
Basic | | 13,440,500 | | 13,050,733 | |
Diluted | | 13,947,291 | | 13,840,719 | |
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Selected Balance Sheet Items:
| | March 31,
2006 | | December 31,
2005 | |
| | (Unaudited) | | | |
Cash and cash equivalents | | $ | 22,049,763 | | $ | 19,628,348 | |
Accounts receivable, net | | 6,587,272 | | 7,821,085 | |
Inventories, net | | 11,209,687 | | 9,942,065 | |
Current portion of long-term debt | | 28,239 | | 27,761 | |
Long-term debt | | 7,367 | | 14,609 | |
Accounts payable and accrued expenses | | 7,277,042 | | 6,675,923 | |
Total stockholders’ equity | | $ | 41,317,923 | | $ | 39,997,505 | |
Selected Cash Flow Statement Items:
| | Quarter Ended March 31, | |
| | 2006 | | 2005 | |
| | (Unaudited) | | | |
Net income | | $ | 914,748 | | $ | 941,914 | |
Depreciation and amortization | | 279,934 | | 291,471 | |
Net cash provided by operating activities | | 2,173,008 | | 1,952,153 | |
Capital expenditures | | (118,776 | ) | (83,020 | ) |
Net cash used in investing activities | | (118,776 | ) | (83,020 | ) |
Net cash provided by financing activities | | 367,183 | | 218,304 | |
Net increase in cash & cash equivalents | | 2,421,415 | | 2,087,437 | |
Cash & cash equivalents at beginning of period | | 19,628,348 | | 14,031,984 | |
Cash & cash equivalents at end of period | | $ | 22,049,763 | | $ | 16,119,421 | |
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