Exhibit 99.1
HEI Announces Third Quarter Results
MINNEAPOLIS, July 13 /PRNewswire-FirstCall/ -- HEI, Inc. (Nasdaq: HEII)
( http://www.heii.com ) today announced results for its third quarter of
fiscal 2004, which ended May 29, 2004.
Net sales for the third quarter of fiscal 2004 were $11,131,000, as
compared with $12,517,000 for the third quarter of fiscal 2003. The net loss
for the third quarter was $1,029,000, or 12 cents per share fully diluted,
compared with a net loss of $1,311,000, or 19 cents per share fully diluted,
for the same period a year ago. The operating net loss for the third quarter
was partially offset by a litigation recovery of $687,000 from the judgment
against the Company's former Chairman of the Board, Chief Executive Officer
and President.
"Third quarter operating results showed a improvement over the previous
quarter with net sales up 11% and operating losses down by 65%," said Mack
Traynor, Chief Executive Officer and President. "A substantial portion of the
loss for the quarter was due to operating inefficiencies in the
Microelectronics operations. We continue to make steady progress in solving
the operational issues as demonstrated by an improvement in our margins from
4.5% to 10% from last quarter to this quarter. We expect continued margin
improvement in the upcoming quarter."
Traynor added, "We ended the quarter with a cash balance of $336,000,
restricted cash of $562,000 and debt capacity of $2,216,000. We continue to
pursue and have had success on our collection efforts against the judgments
received from the courts against our former Chairman, Chief Executive Officer
and President."
The Company will hold a conference call to discuss the Company's operating
results and business strategies on Tuesday, July 13, 2004 at 4:00 p.m. Eastern
Time (3:00 p.m. Central Time). This call is being web-cast and can be
accessed via the HEI web site at http://www.heii.com . The call will be
recorded and be available after the call at this same location on the web
page.
HEI, Inc.
Consolidated Statements of Operations (Unaudited)
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended
May 29, May 31, May 29, May 31,
2004 2003 2004 2003
Net sales $11,131 $12,517 $32,042 $26,151
Cost of sales 9,980 10,027 29,376 22,202
Gross profit 1,151 2,490 2,666 3,949
Operating expenses 2,830 2,927 8,984 6,884
Operating loss (1,679) (437) (6,318) (2,935)
Other income (expenses) 650 (876) 1,067 (888)
Loss before
income taxes (1,029) (1,313) (5,251) (3,823)
Income tax (expense)
benefit - 2 - 21
Net loss $(1,029) $(1,311) $(5,251) $(3,802)
Net loss per
common share
(basic and
diluted) $(0.12) $(0.19) $(0.70) $(0.59)
Weighted average
common shares
outstanding
(basic and
diluted) 8,310 7,029 7,533 6,488
HEI, Inc.
Consolidated Balance Sheets (Unaudited)
(In thousands)
May 29, 2004 August 31, 2003
Cash and cash equivalents $336 $806
Restricted cash 562 -
Accounts receivable, net 7,058 6,314
Inventories 6,924 6,864
Net property and equipment 8,264 9,900
Total assets 25,867 26,503
Line of credit 784 490
Current maturities of
long-term debt 367 397
Accounts payable 6,338 3,951
Long-term debt 1,912 2,555
Total shareholders' equity 11,551 13,191
HEI, Inc. designs, develops and manufactures microelectronics, subsystems,
systems, connectivity and software solutions for OEMs engaged in the medical
equipment and medical device, hearing, communications, and RFID industries.
HEI provides its customers with a single point of contact that can take an
idea from inception to a fully functional, cost effective and
manufacturability product utilizing innovative design solutions and by the
application of state-of-the-art materials, processes and manufacturing
capabilities.
Headquarters & Microelectronics PO Box 5000, 1495 Steiger Lake Lane,
Division Victoria, MN 55386
-Advanced Medical Division 4801 North 63rd Street,
Boulder CO 80301
-High Density Interconnect 610 South Rockford Drive,
Division Tempe, AZ 85281
RF Identification and Smart 1546 Lake Drive West,
Card Division Chanhassen, MN 55317
FORWARD-LOOKING INFORMATION
Information in this news release, which is not historical, includes
forward-looking statements made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Statements contained in
this press release, including the integration of the Advanced Medical
Division, the implementation of business strategies, growth of specific
markets, improved results and the estimated HEI revenue, cash flow and
profits, are forward-looking statements. All of such forward-looking
statements involve risks and uncertainties including, without limitation,
continuing adverse business and market conditions, the ability of HEI to
secure and satisfy customers, the availability and cost of materials from
HEI's suppliers, our ability to satisfy financial or other obligations or
covenants set forth in our banking agreements, adverse competitive
developments, change in or cancellation of customer requirements, the
integration of the Advanced Medical Division, collection of outstanding debt,
HEI's ability to succeed on the merits and defend against litigation, and
other risks detailed from time to time in HEI's SEC filings. We undertake no
obligation to update these statements to reflect ensuing events or
circumstances, or subsequent actual results.
SOURCE HEI, Inc.
-0- 07/13/2004
/CONTACT: Mack V. Traynor, CEO, or Doug Nesbit, CFO, both of HEI, Inc.,
+1-952-443-2500/
/Web site: http://www.heii.com /
(HEII)
CO: HEI, Inc.
ST: Minnesota
IN: CPR HRD STW
SU: ERN CCA