Exhibit 99.1
HALIFAX ANNOUNCES FIRST QUARTER FINANCIAL RESULTS
"Net Income Increases Over Prior Year"
ALEXANDRIA, VA - August 6, 2008 - Halifax Corporation (AMEX:HX) today
announced its financial results for the quarter ended June 30, 2008.
Revenues for the first quarter of fiscal 2009 were $9.0 million
compared to $12.5 million for the same quarter last year. The decrease
in revenues was attributable to the termination of certain large
nationwide enterprise maintenance contracts, including the loss of a
large aeronautical manufacturing customer.
Gross Profit margin for this year's first quarter was $1.51 million, or
17% of revenues, versus $1.48 million, or 12% of revenues, for the same
period a year ago. The margin improvement was attributable to a more
profitable sales mix coupled with an aggressive cost containment
program.
The Company reported net income of $203,000, or $0.06 per basic and
diluted share as compared to $135,000, or $0.04 per basic and diluted
share for the first quarter of last year.
Charles McNew, President and Chief Executive Officer, stated, "We are
pleased with our improving profitability profile. We have worked
diligently to drive our costs down by utilization of a variable
workforce model and by taking actions to move away from business that
is dependent on major inventory investment and parts risk."
"Our cash flow is improving, we have a new long-term financing in place
and our borrowing levels remain low by historical standards."
"We are confident that our new service model, which has positioned the
Company as a leader in global supply chain solutions for the middle
market, is presenting a significant opportunity for a return to market
share expansion."
"In addition, we continue to develop a robust pipeline of new business
opportunities for both Enterprise Logistics Services and Field
Maintenance Solutions."
The Company will host a conference call for investors at 11 a.m. EDT on
Wednesday, August 6, 2008, to review the financial and operational
results for the quarter. The conference call phone number is 800-768-
5901 for U.S. callers and 212-231-2906 for international callers. The
conference call replay will be available from 1 p.m. EDT on Wednesday,
August 6, 2008, to 1 p.m. EDT on Thursday, August 7, 2008. The replay
number is 800-633-8284 for U.S. callers and 402-977-9140 for
international callers. The reservation number is 21390175.
Founded in 1967, Halifax Corporation is an enterprise logistics and
maintenance solutions company providing a wide range of technology
services to commercial and government customers throughout the United
States. The Company's principal products are enterprise logistics
solutions and high availability hardware maintenance services. More
information on Halifax can be found at www.hxcorp.com.
Certain statements made by the Company which are not historical facts
may be considered forward-looking statements, including, without
limitation, statements as to trends, management's beliefs, views,
expectations and opinions, which are based upon a number of assumptions
concerning future conditions that ultimately may prove to be
inaccurate. Such forward-looking statements are subject to risks and
uncertainties and may be affected by various factors described in the
Risk Factors section in the Company's Annual Report on Form 10-K that
may cause actual results to differ materially from those in the forward-
looking statements. For further information that could affect the
Company's financial statements, please refer to the Company's reports
filed with the Securities and Exchange Commission.
Halifax Corporation
Summary Financial Data
(In Thousands, except per share amounts)
Statement of operations For the three months ended
June 30,
2008 2007
Revenues $ 9,017 $ 12,461
Cost of services 7,504 10,979
Gross profit 1,513 1,482
Selling, marketing, general &
administrative 1,196 1,161
Operating income 317 321
Other income - 11
Interest expense (83) (192)
Income before income taxes 234 140
Income tax expense 31 5
Net income $ 203 $ 135
Earnings per common share -
basic and diluted $ 0.06 $ 0.04
Weighted average number of
common shares outstanding:
Basic 3,175 3,175
Diluted 3,175 3,181
Balance Sheets June 30, 2008 March 31, 2008
Current assets
Cash $ 709 $ 232
Trade accounts receivable, net 6,533 10,206
Inventory, net 3,149 3,240
Prepaid expenses and other
current assets 253 220
Total current assets 10,644 13,898
Property and equipment, net 921 1,001
Goodwill and intangibles, net 3,508 3,580
Other assets 103 111
Total assets $15,176 $18,590
Liabilities and stockholders'
equity
Current liabilities
Accounts payable and accrued
expenses $ 4,523 $ 5,280
Income tax payable 65 35
Deferred maintenance revenue 3,515 4,309
Bank debt 2,493 4,448
Auxillary line of credit - 60
Current portion of long-term debt 277 276
Total current liabilities 10,873 14,408
Other long-term debt 252 325
Subordinated debt - affiliate 1,000 1,000
Deferred income 84 99
Total liabilities 12,209 15,832
Stockholders' equity 2,967 2,758
Total liabilities and stockholders'
equity $15,176 $18,590