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
SECOND QUARTER FISCAL 2005
BLUE BELL, Pa., August 26, 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 its second quarter ended July 31, 2004. Net income for the
quarter was $3.2 million, or 13 cents per diluted share, compared to $3.6
million or 14 cents per diluted share in the prior year's second quarter. Net
sales for the quarter were $94.4 million, a 16.0% increase from the prior year's
second quarter sales of $81.4 million.
For the six months ended July 31, 2004, net income was $5.2 million, or 20 cents
per diluted share, compared to $6.4 million, or 25 cents per diluted share, in
the prior year's comparable period. Net sales for the period were $180.2
million, a 13.5% increase from the prior year's comparable period sales of
$158.7 million.
The acquisitions of Datel, Inc. and Celab, Ltd., completed during the second
quarter, added $7.4 million of sales to the second quarter and year-to-date
results.
Wade H. Roberts, Jr., president and chief executive officer of the company,
said, "C&D Technologies continued to gain sales momentum during the second
quarter, with all three of its operating divisions growing organically. In
addition, we are pleased with the initial financial performance of Datel and
Celab, with each acquisition contributing to earnings during the quarter.
However, the price of lead continued to negatively affect financial performance
in the Motive Power and Standby Power divisions, and we estimate that lead
pricing reduced earnings per share by approximately 16 cents during the quarter
compared to last year's second quarter."
C&D Technologies' second quarter operating results by reporting segment were as
follows:
Standby Power - Sales increased 3.6% in the quarter, to $61.5 million from $59.4
million in the prior year's second quarter. The increase was driven by increased
sales to the UPS market. Operating income was $5.8 million, compared to $8.3
million in the year-ago quarter. The Standby Power Division continued to
experience high raw material costs (principally lead), as well as plant
transition expenses during the second quarter, the latter, associated with the
start-up of production at the Reynosa, Mexico plant acquired last year. These
combined costs negatively impacted the current quarter's operating income by a
total of approximately $5.9 million.
Power Electronics - Sales increased 89.7% during the quarter to $19.0 million,
from $10.0 million in the prior year's second quarter. The revenue increase
reflected $7.4 million from acquisitions closed during the quarter, as well as
improved demand for DC to DC products. Operating income in the second quarter
was $2.9 million, compared to an operating loss of $391,000 in the second
quarter of fiscal 2004. Excluding the acquisition-related revenues mentioned
above, Power Electronics Division revenues for the quarter were $11.7 million,
an increase of 16.2% from the second quarter of fiscal 2004.
Motive Power - Sales increased 16.1% in the second quarter to $13.9 million,
from $12.0 million in the prior year's second quarter, as both battery and
charger sales improved. The division's operating loss was $2.0 million, compared
to an operating loss of $1.6 million in the prior year's quarter. Motive Power's
operating loss was also negatively affected by increased raw material costs and
the plant transition expenses, previously referred to, which increased the
division's current quarter operating loss by approximately $1.8 million.
In commenting on the outlook for the third quarter, Mr. Roberts stated, "Thus
far in fiscal 2005, sales growth has been solid. We continue to be hit hard by
raw material pricing as well as the anticipated plant startup costs. However,
overall, financial results improved from the previous quarter, and we expect
this trend to continue into the next quarter, as the transition costs to our
Reynosa, Mexico facility wind down. Accordingly, we are projecting diluted
earnings per share in the range of 13 to17 cents for the third quarter based on
the assumption that lead pricing does not worsen."
C&D Technologies will hold a conference call on Friday, August 27, 2004 at 9:00
AM Eastern Daylight Time to discuss these results in detail. To participate,
please call 706-679-4521 approximately five 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 September 10, 2004. Please
call 800-642-1687 (706-645-9291 for international callers) and enter pin number
9566142 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 15 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 August 27, 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, 2004), 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 Six months ended
July 31, July 31,
Summary of earnings 2004 2003 2004 2003
------------------- ---- ---- ---- ----
Net sales $94,421 $81,364 $180,226 $158,732
Gross profit 19,527 19,078 36,068 36,070
Selling, general and
administrative expenses 9,667 10,524 19,701 19,694
Research and development
expenses 3,187 2,335 5,856 4,746
Operating income 6,673 6,219 10,511 11,630
Income before income taxes
and minority interest 5,367 5,605 8,358 10,300
Net income before minority
interest 3,235 3,531 5,119 6,489
Net income 3,212 3,580 5,216 6,402
Basic earnings per share 0.13 0.14 0.21 0.25
Diluted earnings per share 0.13 0.14 0.20 0.25
Weighted average shares
outstanding:
Basic 25,306 25,555 25,352 25,601
Diluted 25,424 25,656 25,504 25,707
Other financial data
Operating cash flow $10,018 $7,929 * $12,646 $17,254 *
Depreciation and amortization 5,692 5,628 11,209 11,440
* Reclassified for comparative purposes
C&D TECHNOLOGIES, INC. AND SUBSIDIARIES
SELECTED FINANCIAL INFORMATION (CONT.)
(Dollars in thousands)
(Unaudited)
Selected Balance July 31, January 31,
----------------
Sheet data 2004 2004
---------- ---- ----
Total cash $ 12,141 $ 12,306
Total assets 482,515 385,950
Total debt 96,034 19,620
Total equity 272,622 269,533