1400 Union Meeting Road
Blue Bell, PA 19422
Phone: 215-619-2700
Shareholder Contacts:
Stephen E. Markert, Jr. of C&D: 215-619-7835
Joseph Crivelli of Gregory FCA, for C&D: 610-642-8253
C&D TECHNOLOGIES REPORTS EARNINGS FOR
FOURTH QUARTER FY 2004
BLUE BELL, Pa., March 15, 2004 -- C&D Technologies, Inc. (NYSE: CHP), a leading
North American producer and marketer of electrical power storage and conversion
products used in telecommunications and industrial applications, today announced
financial results for the fourth quarter ended January 31, 2004. Net income for
the quarter was $4.3 million, or 17 cents per share, compared to $5.3 million or
21 cents per share in the prior year's fourth quarter, when the effective tax
rate was 19.3% (4.5 cents per share), which reflected a one-time state tax
refund. Net sales for the quarter were $81.2 million, a 2% increase from the
prior year's fourth quarter sales of $79.8 million.
For the fiscal year ended January 31, 2004, net income was $14.9 million, or 58
cents per share, versus $19.3 million, or 74 cents per share in the prior year.
Sales for the year were $324.8 million versus $335.7 million for the fiscal year
ended January 31, 2003.
"Despite the challenges faced during fiscal 2004, we accomplished a number of
important outcomes," stated Wade H. Roberts, Jr., president and chief executive
officer of the company. "We remained solidly profitable, continued to strengthen
the company's balance sheet, generated $41.4 million of cash from operations,
and completed the acquisition of a large, modern, manufacturing facility (and
associated battery technology) in Reynosa, Mexico that will provide a platform
for economic production and future growth. C&D Technologies remains well
positioned as demand for reliable power increases and end markets improve."
C&D Technologies' fiscal 2004 fourth quarter operating results from its
reporting segments were as follows:
Dynasty - Sales increased 26% in the quarter to $28.2 million from $22.3 million
in the prior year's fourth quarter. This increase was primarily due to an
increase in orders from UPS equipment OEMs coupled with a modest improvement in
the cable TV equipment market. Operating income for the segment increased 49% to
$4.7 million from $3.2 million in the fourth quarter of fiscal 2003.
Power Electronics - Sales increased 14% during the quarter to $10.6 million from
$9.2 million in the prior year's fourth quarter. The revenue increase reflected
increased demand for DC to DC converters and compact PCI products. Operating
income in the fourth quarter was $1.7 million, which included a benefit of
approximately $1 million, primarily related to year-end physical inventory
adjustments and a decrement in the LIFO valuation. This compares to an operating
loss of $809,000 in the fourth quarter of fiscal 2003, that included a charge of
$1.3 million for the reorganization of certain manufacturing operations.
Motive Power - Sales decreased 7% in the fourth quarter to $12.9 million from
$13.9 million in the prior year's fourth quarter. The division's operating loss
narrowed to $523,000, from $1.6 million in last year's fourth quarter, after
including the benefit of approximately $1 million of favorable adjustments
primarily related to year-end physical inventory adjustments and a decrement in
the LIFO valuation. The fourth quarter of fiscal 2003 included a one-time gain
of $837,000 related to a facility sale partially offset by a goodwill write-off
of $496,000.
Powercom - Sales decreased 14% to $29.6 million compared with $34.3 million in
last year's fourth quarter primarily due to the difficult market for
telecom-related backup power. Operating income for the quarter decreased to $2.0
million. The principal items driving the decline were lower volume, higher lead
prices and Reynosa start-up expenses. These were partially offset by
approximately $800,000 of favorable year-end adjustments. Earnings in the fourth
quarter of fiscal 2003 amounted to $7.8 million inclusive of a one-time gain of
$773,000 related to a facility sale.
In commenting on the outlook for fiscal 2005, Mr. Roberts indicated: "During
2005, we anticipate additional start-up expenses, including severance and moving
costs of approximately $2.0 to $2.5 million. There may also be potential,
non-cash, asset impairments related to our existing Huguenot and / or Leola
facilities in fiscal 2005, although we cannot, with certainty, predict the
magnitude or timing of such outcomes. In addition, the price of lead has almost
doubled over the past twelve months and stands at an approximately 14-year high.
We anticipate the above particulars will adversely affect C&D's profitability in
the near term. Specifically, in the first quarter, we expect revenues to
increase modestly and to generate diluted earnings per share of between 5 and 8
cents per share. We have launched pricing initiatives to at least partially
offset rising lead prices."
C&D Technologies will hold a conference call on March 16, 2004 at 9:00 AM
Eastern Standard Time to discuss these results in detail. To participate, please
call (706) 679-4521 approximately 5 minutes before the conference call start
time. A replay of the conference call will be available at approximately 12:00
PM and will remain available until midnight on March 30, 2004. Please call (800)
642-1687 or (706) 645-9291 and enter pin number 6133348 to access the replay.
A simultaneous webcast of the conference call may be accessed at the investor
relations section of our website at www.cdtechno.com. To listen to the live
call, please go to the web site at least fifteen minutes early to register,
download and install any necessary audio software. An archive of the conference
call will be available approximately two hours after the conference call ends
and will remain available on the company's website until March 16, 2005.
This press release may contain forward-looking statements (within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934) which are based on management's current expectations and
are subject to uncertainties and changes in circumstances. Words and expressions
reflecting something other than historical fact are intended to identify
forward-looking statements, but are not the exclusive means of identifying such
statements. Factors that appear with the forward-looking statements, or in the
company's Securities and Exchange Commission filings (including, without
limitation, the company's annual report on Form 10-K for the fiscal year ended
January 31, 2003, or the quarterly reports filed on Form 10-Q thereafter), could
cause the company's actual results to differ materially from those expressed in
any forward-looking statements made herein.
C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
SELECTED FINANCIAL INFORMATION
(In thousands, except for per share data)
(Unaudited)
Three months ended Year ended
January 31, January 31,
Summary of earnings 2004 2003 2004 2003
- ------------------- ---- ---- ---- ----
Net sales $81,222 $79,754 $324,824 $335,745
Gross profit 20,953 19,043 76,679 78,699
Selling, general and
administrative expenses 10,668 8,328 40,459 35,136
Research and development
expenses 2,438 2,154 9,542 9,509
Operating income 7,847 8,561 26,678 34,054
Income before income taxes
and minority interest 6,887 6,652 23,769 28,797
Net income before minority
interest 4,338 5,365 14,974 19,383
Net income 4,286 5,336 14,891 19,292
Basic earnings per share 0.17 0.21 0.58 0.75
Diluted earnings per share 0.17 0.21 0.58 0.74
Weighted average shares
outstanding
Basic 25,450 25,704 25,537 25,818
Diluted 25,758 25,877 25,732 26,025
Other financial data
Operating cash flow $ 8,206 $ 6,975 $ 41,378 $ 55,150
Depreciation and amortization 5,501 5,418 22,534 23,740
C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
SELECTED FINANCIAL INFORMATION (CONT.)
(Dollars in thousands)
(Unaudited)
Selected Balance January 31, January 31,
----------------
Sheet data 2004 2003
---------- ---- ----
Total cash $ 12,306 $ 12,966
Total assets 385,950 382,156
Total debt 19,620 39,919
Total equity 269,533 258,274