Exhibit 99.1
Parlex Reports Financial Results for Fiscal Year 2005
METHUEN, Mass.--Sept. 15, 2005--Parlex Corporation (PRLX) today reported
financial results for the year ended June 30, 2005. Revenues from
continuing operations increased 27% to $105.9 million compared with $83.5
million for the same period in the previous year. On August 18, the Company
announced the sale of its Methuen, Massachusetts, Multilayer operations to
Amphenol Corporation (APH). The Multilayer operation was accounted for as a
discontinued operation for financial reporting purposes at June 30, 2005.
Operating income from continuing operations was $2.6 million for the year
compared to $2.2 million in the prior year. Net loss from continuing
operations for the year ended June 30, 2005 was $0.8 million versus $0.4
million for the same period of the prior year. The loss from discontinued
operations attributable to our Multilayer business was $10.7 million in
fiscal 2005 versus $7.7 million in fiscal 2004. The loss from discontinued
operations in fiscal 2005 includes a fourth quarter impairment charge on
assets held for sale totaling $5.4 million.
Net losses attributable to common shareholders including results from
discontinued operations totaled $11.8 million or ($1.83) per diluted share
for the year ended June 30, 2005 versus a net loss of $8.3 million or
($1.31) for the prior year. No tax benefit was recorded on U.S. net
operating losses in either year.
Peter J. Murphy, President and Chief Executive Officer of Parlex, stated
"Increased revenues of 27% from continued operations for FY05 were almost
entirely attributable to shipments from China where sales increased
approximately $17 million and represents approximately 50% of the $106
million in total revenues. End markets supporting fiscal 2005 growth
include computer peripherals, medical electronics, mobile phones, appliance
and automotive.
Parlex retains its strong position in the computer printer segment with
increased revenues of 40% resulting primarily from population of flexible
circuits with surface mount components utilizing our proprietary lead free
polysolder attachment process. The medical segment also achieved robust
growth as more customers increasingly show a preference for polymer thick
film technology utilizing unique inks and medical gels developed by Parlex.
Parlex previously announced the sale of certain assets related to its
multilayer operation to Amphenol Corporation. The transition of this
business is well underway and is expected to be complete before the end of
calendar year 2005."
On August 18, 2005, the Company announced that it had entered into a
definitive agreement to be acquired by Johnson Electric Holdings Limited.
The transaction is subject to Parlex Corporation shareholder approval and
other customary closing conditions, including regulatory approvals. Parlex
Corporation's Board of Directors unanimously approved the transaction and
has recommended to Parlex Corporation's shareholders that they approve the
transaction. Parlex has filed a preliminary Proxy statement detailing the
proposed transaction with the U.S. Securities and Exchange Commission
(SEC). Following approval for release by the SEC, proxy statements will be
made available to shareholders and other interested parties.
About Parlex
Parlex Corporation is a world leader in the design and manufacture of
flexible, interconnect products. Parlex produces custom flexible circuits
and laminated cables utilizing proprietary processes and patented
technologies, which are designed to satisfy the unique requirements of a
wide range of customers. Its manufacturing facilities are located in the
United States, China, Mexico and the United Kingdom.
Forward Looking Statements
This release contains "forward-looking statements" as defined under the
Federal Securities Laws. Actual results could differ materially from those
projected in the forward-looking statements as a result of certain risk
factors, including but not limited to: (i) further adverse changes in
general economic conditions; (ii) further delays or reductions in the
spending of the industry sectors we serve; (iii) the Company's ability to
effectively manage operating costs and increase operating efficiencies;
(iv) further declines in revenues; (v) insufficient, excess or obsolete
inventory; (vi) competitive factors, including but not limited to pricing
pressures, in the
flexible interconnect markets; (vii) component quality and availability;
(viii) rapid technological and market change and the transition to new
products; (ix) the relative and varying rates of product price and
component cost declines; (x) the effects of war or acts of terrorism,
including the effect on the economy generally, on particular industry
segments, on transportation and communication systems and on the Company's
ability to manage logistics in such an environment, including receipt of
components and distribution of products; (xi) the ability to attract and
retain highly qualified employees; (xii) the uneven pattern of quarterly
sales; (xiii) fluctuating currency exchange rates; (xiv) risks associated
with strategic investments and acquisitions; (xv) the Company's ability to
execute on its plans; and (xvi) other one-time events and other important
factors disclosed previously and from time to time in its filings with the
U.S. Securities and Exchange Commission.
PARLEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Years Ended
June 30, 2005 June 30, 2004
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<s> <c> <c>
REVENUES $105,857,189 $83,482,406
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COSTS AND EXPENSES:
Cost of products sold 86,878,201 67,079,379
Selling, general and administrative
expenses 16,369,391 14,219,677
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TOTAL COSTS AND EXPENSES 103,247,592 81,299,056
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OPERATING INCOME FROM CONTINUING
OPERATIONS 2,609,597 2,183,350
INTEREST AND OTHER EXPENSE (3,166,019) (2,510,796)
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LOSS FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES AND MINORITY INTEREST (556,422) (327,446)
INCOME TAX (PROVISION) BENEFIT (155,080) 55,001
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LOSS FROM CONTINUING OPERATIONS BEFORE
MINORITY INTEREST (711,502) (272,445)
MINORITY INTEREST (131,834) (155,380)
------------ -----------
LOSS FROM CONTINUING OPERATIONS (843,336) (427,825)
LOSS FROM DISCONTINUED OPERATIONS (NET OF
INCOME TAXES) (10,716,852) (7,738,102)
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NET LOSS (11,560,188) (8,165,927)
PREFERRED STOCK DIVIDENDS (268,127) (171,067)
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NET LOSS ATTRIBUTABLE TO COMMON
STOCKHOLDERS $(11,828,315) $(8,336,994)
============ ===========
BASIC AND DILUTED NET LOSS PER SHARE:
Loss from continuing operations $(0.17) $(0.09)
Loss from discontinued operations (1.66) (1.22)
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NET LOSS PER SHARE ATTRIBUTABLE TO COMMON
STOCKHOLDERS $(1.83) $(1.31)
============ ===========
WEIGHTED AVERAGE SHARES - BASIC AND
DILUTED 6,455,456 6,369,516
============ ===========
PARLEX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30, 2005 June 30, 2004
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<s> <c> <c>
ASSETS
Current Assets (includes $2,760,210 of
assets held for sale in 2005) $53,053,267 $46,757,099
Property, Plant & Equipment, Net 37,564,771 44,979,740
Goodwill and Other Assets - Net 3,020,803 3,513,392
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Total Assets $93,638,841 $95,250,231
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities $40,743,099 $33,657,528
Non-Current Liabilities 14,209,814 11,559,770
Minority Interest 702,797 570,963
Stockholders' Equity 37,983,131 49,461,970
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Total Liabilities & Stockholders' Equity $93,638,841 $95,250,231
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Contact:
Parlex Corporation
Jon Kosheff, 978-946-2591
Chief Financial Officer