Filed by GenRad, Inc.
Pursuant to Rule 425 under the Securities Act of
1933, as amended, and Deemed Filed Pursuant to Rule 14a-12
Under the Securities Exchange Act of 1934, as amended
Subject Company: GenRad, Inc.
Commission File No.: 001-08045
FOR RELEASE
7 A.M. THURSDAY, AUGUST 2, 2001
Contact
Richard M. Miles
978-589-7144
GenRad Reports Second Quarter 2001 Results
WESTFORD, MA, August 2, 2001 - GenRad, Inc., [NYSE: GEN], a global leader in
electronics testing and manufacturing solutions, today reported results for its
second fiscal quarter in 2001.
Separately today, GenRad announced that it had signed an agreement to be
acquired by Teradyne, Inc. [NYSE: TER]. It also announced that it was seeking a
buyer for its Diagnostic Solutions line of business.
GenRad reported that revenues for the second quarter ended June 30, 2001, were
$54.5 million, compared with revenues of $87.3 million for the same period in
2000. The company reported a net loss, before special items, of $13.8 million,
or $0.48 per share, compared with net income, before special items, of $1.6
million, or $0.06 per share in 2000.
During the second quarter, the company recorded special charges for a provision
for excess inventory of $11.9 million and a long-lived asset impairment of
intangible assets related to its Autodiagnos and Mastertech acquisitions of
$28.2 million. These charges result in an additional after tax loss of $24.8
million, or $0.87 per share, for a total net loss of $38.6 million, or $1.35 per
share. For comparison, in the second quarter of 2000, an after tax
reorganization charge of $2.6 million, or $0.10 per share, resulted in a total
net loss of $1.0 million, or $0.04 per share.
The company recorded two special items during the quarter, both largely the
result of the company's decision to discontinue the development of the GTE3200
automotive diagnostics aftermarket product within the Diagnostics Solutions line
of business. As a result of this decision and the current and projected softness
in the electronics manufacturing market sector, the company recorded additional
provisions for anticipated excess and obsolete inventories. This charge, which
totaled $11.9 million,
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adversely impacted the cost of revenue of the automotive diagnostics aftermarket
product line and various manufacturing test product lines.
In addition, in accordance with the provisions of Statement of Financial
Accounting Standard No.121 "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed of", the company recorded a long-lived
asset impairment of goodwill and other intangibles related to its Autodiagnos
and Mastertech acquisitions, components of the Diagnostic Solutions line of
business. The impairment was initiated due to the discontinued GTE3200 product
development noted above.
This charge, which totaled $28.2 million, adversely impacts both cost of revenue
by $6.4 million and operating expenses by $21.8 million.
Revenues for the six months ended June 30, 2001 were $116.9 million, compared
with $153.7 million in the same period of 2000. The company reported a net loss,
before special items, of $23.8 million, or $0.83 per share, compared with net
income, before special items, of $3.9 million, or $0.14 per share. In addition
to the second quarter special charges noted above, the company had additionally
recorded an after tax special charge of $1.9 million in the first quarter of
2001 and a $15.8 million special benefit in the first quarter of 2000.
CONFERENCE CALL INFORMATION
The transactions as well as the earnings results will be discussed during the
second quarter conference call at 10:00 a.m. this morning. It can be accessed by
dialing 800-219-6110 in the U.S., or 303-262-2211 from outside the U.S. The
audio portion of the conference call can be accessed through GenRad's website at
www.genrad.com.
ABOUT GENRAD, INC.
GenRad Inc. [NYSE: GEN] a global leader in electronics testing and production
solutions serving the world's leading original equipment [OEM] and electronics
manufacturing services [EMS] markets. GenRad's customers manufacture a wide
range of advanced technology products ranging from computer, telecommunications
and broadband networking devices to wireless products and enterprise hardware.
With 37 offices in 22 countries, GenRad is comprised of four business units,
each providing integrated hardware, software and service solutions.
o Process Solutions focuses on in-circuit test, x-ray test and re-work
solutions enhanced by extensive software solutions providing total
production line management.
o Functional Solutions focuses on functional test platforms for
manufacturers of telecommunications, computers and automotive
electronics.
o Diagnostic Solutions focuses on service bay and manufacturing solutions
for transportation OEMs and independent service providers.
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o Support and Services focuses on maintenance programs, on-site and
remote support, and training to help customers optimize their hardware
and software solutions.
Founded in 1915, GenRad employs about 1,300 people with worldwide headquarters
in Westford, MA, USA. Listed on the New York Stock Exchange since 1978, GenRad's
Web address is www.GenRad.com.
SAFE HARBOR STATEMENT
Statements made in this press release which are not historical, including
statements regarding future performance; product capabilities and markets are
forward looking statements and as such are subject to a number of risks. Factors
that may cause results to differ materially from those projected are discussed
in GenRad's Annual Report on Form 10-K for the fiscal year ending December 30,
2000 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2001
under the section "Management's Discussion and Analysis of Financial Conditions
and Results of Operations - Factors That May Affect Future Results."
REQUIRED SEC FILING
This communication may be deemed to be solicitation material in respect of the
proposed acquisition of GenRad by Teradyne, pursuant to an Agreement and Plan of
Merger, dated as of August 1, 2001, by and between GenRad and Teradyne. This
filing is being made in connection with Regulation of Takeovers and Security
Holder Communications [Release No. 33-7760] promulgated by the Securities and
Exchange Commission [SEC]. GenRad and its directors and executive officers may
be deemed to be participants in the solicitation of proxies in respect of the
transactions contemplated by the Agreement and Plan of Merger.
Information concern any direct or indirect interest in the proposed merger of
GenRad's directors and executive officers, including their beneficial ownership
of GenRad common stock and the terms of change of control or similar
arrangements with certain of GenRad's executive officers, may be found in
GenRad's proxy statement filed with the SEC under Schedule 14A on April 6, 2001.
The proxy statement is available for free both on the SEC's Web site
[http://www.sec.gov] or by contacting Investor Relations at GenRad at
978-589-7000.
In connection with the proposed merger, Teradyne will file a registration
statement on Form S-4 with the SEC. Shareholders of GenRad and other investors
are encouraged to read the registration statement, including the proxy
statement-prospectus that will be part of the registration statement, because it
will contain important information about the merger. After the registration
statement is filed with the SEC, it will be available for free, both on the
SEC's Web site [http://www.sec.gov] and from Teradyne and GenRad.
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GENRAD CONTACT
Richard M. Miles
Vice President Global Communications
GenRad, Inc.
978-589-7144
milesr@genrad.com
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