SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
November 7, 2006
Date of report (Date of earliest event reported)
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EXCEL TECHNOLOGY, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-19306 11-2780242
(State or Other Juris- (Commission File No.) (IRS Employer
diction of Incorporation) Identification No.)
41 Research Way, East Setauket, NY 11733
(Address of principal executive offices, including zip code)
(631) 784-6175
(Registrant's telephone number, including area code)
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under
any
of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On November 7, 2006 the Registrant announced results for its third
quarter ended September 29, 2006. A copy of the press release is attached
as an exhibit.
Use of Non-GAAP Financial Information
To supplement Excel's consolidated financial statements presented in
accordance with GAAP, Excel uses non-GAAP measures of certain components
of financial performance, including net income and earnings per diluted
share, which are adjusted from results based on GAAP to exclude merger,
merger related and one-time deferred compensation expenses("special
items") associated with the now terminated merger with Coherent. The
presentation of non-GAAP financial results is not meant to be considered
in isolation or as a substitute for, or superior to, GAAP results.
Investors should be aware that non-GAAP measures have inherent material
limitations as an analytical tool and should be read only in conjunction
with the company's consolidated financial statements prepared in
accordance with GAAP. These non-GAAP financial measures may also be
different from non-GAAP financial measures used by other companies. These
non-GAAP adjustments are provided to enhance the user's overall
understanding of Excel's current financial performance and its prospects
for the future. Specifically, Excel believes the non-GAAP results provide
useful information to both management and investors by excluding certain
expenses and charges that Excel believes are not indicative of its
operational performance.
ITEM 9.01. Financial Statements and Exhibits.
(d) Exhibits
99.1 Press Release of Excel Technology, Inc., issued
November 7, 2006.
Signatures
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Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
Date: November 7, 2006
EXCEL TECHNOLOGY, INC.
By: /s/ Antoine Dominic
.......................................
Antoine Dominic
President and Chief Executive Officer
(Principal Executive Officer)
FOR IMMEDIATE RELEASE Contact: J. Donald Hill, Chairman
or
Investor Relations
631-784-6175
EXCEL TECHNOLOGY ANNOUNCES THIRD QUARTER RESULTS
RECORD SALES, PROFITS* AND EPS*
QUARTERLY RESULTS
Record Sales - $40.3 million for Q3 2006 vs $37.8 million
for Q3 2005, (6.5% increase)
Record Pretax Profit - $6.8*million for Q3 2006 vs $6.0 for Q3 2005
(14.0% increase)
Record Profits - $4.6* million for Q3 2006 vs $4.4 million
for Q3 2005, (4.6% increase)
Record EPS - $0.36* for Q3 2006 vs. $0.36 for Q3 2005
per diluted share
Y T D RESULTS
Record Sales - $116.2 million for 2006 vs $101.4 million
for 2005,(14.6% increase)
Record Pretax Profit - $20.4* million for 2006 vs $14.7 for 2005
(38.8% increase)
Record Profits - $13.8* million for 2006 vs $10.9 million
for 2005, (26.8% increase)
Record EPS - $1.10* for 2006 vs. $0.89 for 2005 per
diluted share, (23.6% increase)
* WITHOUT MERGER, MERGER RELATED AND ONE-TIME DEFERRED COMPENSATION
EXPENSES ("SPECIAL ITEMS"), NET OF TAXES
EAST SETAUKET, N.Y., November 7, 2006 - Excel Technology, Inc. (NASDAQ:
XLTC) announced record quarterly results for the period ended September
29, 2006. Sales for the quarter were $40.3 million and pretax income
was $3.7 million and net income was $2.5 million ($0.20 per diluted
share), which included $2.1 million (net of taxes) of special items.
Excluding the $2.1 million (net of taxes) of special items ($0.17 per
diluted share), the Company's pretax profit was $6.8 million and net
income was $4.6 million ($0.36 per diluted share).
Sales: The Company realized record sales of $40.3 million, an increase
of 6.5% or $2.5 million, for the three months ended September 29, 2006
and $116.2 million, an increase of 14.6% or $14.8 million, for the nine
months ended September 29, over the comparable periods in 2005.
Pretax Profits: Pretax profits, excluding special items was $6.8
million for the third quarter of the year as compared to $6.0 million in
the same period last year, an increase of 14%. For the nine months
ended September 29, 2006 pretax profits, excluding special items were
$20.4 million compared to $14.7 for the same period in 2005, an increase
of 38.8%.
Profits: Net income, excluding special items was $4.6 million for the
third quarter of this year as compared to $4.4 million in the same
period last year, an increase of 4.6%. For the nine months ended
September 2006, net income, excluding special items was $13.8 million
compared to $10.9 million for the same period in 2005, an increase of
26.8%.
EPS: Net income per share, including special items, is $0.20 per
diluted share for the quarter and $0.83 per diluted share for the nine
months ending September 29, 2006. Net income per share, excluding
special items, was $0.36 on a diluted basis for the quarter ended
September 29, 2006, and $0.36 per share on a diluted basis reported for
the same period in 2005. For the nine months ended September 29, 2006,
net income per share, excluding special items, was $1.10 on a diluted
basis in 2006 compared to $0.89 on a diluted basis for 2005, a 23.6%
increase.
Antoine Dominic, Chief Executive Officer, stated "We are quite pleased
with our quarter and year to date results considering that we achieved
these results while having to work within the framework of the merger
contract, the uncertainty in the market and lack of new efforts to
further expand our market presence due to the pending merger. Now that
the merger is officially terminated, we are committed to growing Excel
by expanding our product portfolio and markets organically and through
acquisitions. Our year to date sales growth of 14.6% was good because
it was all organic. However, our year to date pre-tax income growth of
38.8% (excluding special items) was even more satisfying as we increased
our operational efficiencies. We need to continue our emphasis on
organic growth as the ratio of sales increase to profitability is far
greater as evidenced this year. During the year the Company has
introduced several new products that have been well received in the
market and we plan to enter 2007 with a record product portfolio that
should aid in our organic growth. We also have a fairly healthy cash
balance that we hope will enable us to expand our acquisition objectives
and also to utilize it wisely for share repurchases."
Alice Hughes Varisano, Chief Financial Officer, concluded, "The third
quarter of 2006 was the Company's fifth straight quarter of record
sales, pre tax profits, net income and earnings per share (excluding
special items). Sales increased 6.5% during the quarter and 14.6% for
the first nine months compared to the same period last year. Pre tax
profits (excluding special items) increased 14% to $6.8 million for the
third quarter and for the nine months ended September 30, 2006 increased
38.8% to $20.4 million compared to the same period last year. Profits
for the quarter increased 4.6% and for the nine months 26.8% (excluding
special items), less of an increase than pre tax profits due to the
effective tax rate increasing from 27% to 33% in 2006. This increase in
the tax rate was due in part to the suspension of the R&D credit, non
deductibility of certain merger related costs, and the reduction of a
tax exposure liability due to a settlement in 2005 that did not reoccur
in 2006. The Company generated $9 million of cash during the first nine
months, resulting in a cash and investment balance of $59.0 million as
of September 30, 2006; with no debt. Year to date bookings at September
30, 2006 were $118 million, an increase of over 11% or $12.0 million
over the same period in the prior year. The backlog at the end of the
third quarter 2006 was $36.5 million an increase of 16.0% or $5.0
million compared to $31.5 million backlog for the third quarter 2005,
which is quite strong."
Excel and its wholly owned subsidiaries manufacture and market
photonics-based solutions, consisting of laser systems and electro-
optical components, primarily for industrial/commercial and scientific
applications.
FINANCIAL SUMMARY
(unaudited and in thousands, except per share data)
FOR THE QUARTER FOR THE NINE MONTHS
ENDED SEPTEMBER 30 ENDED SEPTEMBER 30
(unaudited) (unaudited)
2006 2005 2006 2005
........ ........ ........ ........
Net Sales & Services $ 40,299 $ 37,842 $116,154 $101,352
Cost of Sales and Services $ 22,350 $ 19,803 $ 62,890 $ 53,068
........ ........ ........ ........
Gross Profit $ 17,949 $ 18,039 $ 53,264 $ 48,284
Operating Expenses:
Selling & Marketing $ 4,611 $ 5,027 $ 14,352 $ 14,094
General & Administrative $ 3,724 $ 3,536 $ 9,689 $ 9,496
Research and Development $ 3,527 $ 3,757 $ 10,807 $ 10,848
........ ........ ........ ........
Operating Income (without merger,
merger related & deferred
compensation expenses) $ 6,087 $ 5,719 $ 18,416 $ 13,846
Merger, Merger Related and Deferred
Compensation Expense $ 3,085 $ 0 $ 5,069 $ 0
Interest Income $ 755 $ 337 $ 1,770 $ 794
Other Income (Expense) $ (43) $ (92) $ 230 $ 69
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Pre-Tax Income $ 3,714 $ 5,964 $ 15,347 $ 14,709
Provision for Income Taxes $ 1,226 $ 1,610 $ 5,002 $ 3,853
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Net Income $ 2,488* $ 4,354 $ 10,345* $ 10,856
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Net Income Per
Common Share - Diluted $ 0.20 $ 0.36 $ 0.83 $ 0.89
Weighted Average Common
Shares Outstanding - Diluted 12,522 12,259 12,505 12,243
Reconciliation of GAAP to non-GAAP net income and EPS
Net income as reported under GAAP of $2,488 and $10,345, excluding the
merger, merger related and deferred compensation expenses, net of tax
effect, of approximately $2.1 million for the three months ending
September 29, 2006 (or .17 cents per diluted share) and $3.4 million for
the nine months ending September 29, 2006 (or .27 cents per diluted
share) would have been $4,635 and $13,835 respectively (unaudited).
EPS without these charges would have been $0.36 and $1.10 per diluted
share for the three and nine months ending September 29, 2006,
respectively (unaudited).
BALANCE SHEET & SELECTED FINANCIAL DATA
SEPTEMBER 29, 2006 DECEMBER 31, 2005
Cash $ 9,774 $ 16,303
Investments $ 49,150 $ 34,000
Accounts Receivable, net $ 26,044 $ 22,879
Inventories $ 36,497 $ 30,269
Other Current Assets $ 2,855 $ 3,013
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Total Current Assets $ 124,320 $ 106,464
Property, Plant & Equipment, net $ 25,158 $ 25,983
Other Non-Current Assets & Goodwill $ 32,142 $ 31,591
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Total Assets $ 181,620 $ 164,038
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Accounts Payable $ 6,950 $ 4,829
Accrued Expenses and
Other Current Liabilities $ 9,013 $ 5,882
Income Taxes Payable $ 436 $ 1,097
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Total Current Liabilities $ 16,399 $ 11,808
Deferred Compensation $ 1,375 $ --
Other Non-Current Liabilities $ 3,478 $ 3,492
Minority Interest in Net Income
of Subsidiary $ 89 $ 48
Stockholders' Equity $ 160,279 $ 148,690
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Total Liabilities & Stockholders' Equity $ 181,620 $ 164,038
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Working Capital $ 107,921 $ 94,656
Current Ratio 7.58 9.02