Nu Horizons Electronics Corp.
70 Maxess Road, Melville, NY 11747
631-396-5000 Fax: 631-396-5060
Company Contact: Paul Durando
Nu Horizons Electronics Corp.
631-396-5000
FOR IMMEDIATE RELEASE
- ---------------------
NU HORIZONS REPORTS FINANCIAL AND OPERATING RESULTS FOR THE SECOND
QUARTER OF FISCAL YEAR 2005
MELVILLE, NY, September 30, 2004 --- Nu Horizons Electronics Corp. (Nasdaq/NM:
NUHC), a leading distributor of active and passive electronic components today
reported financial and operating results for the second quarter and six months
ended August 31, 2004.
Net sales for the quarter ended August 31, 2004 were $119.2 million compared to
$80.0 million for the comparable period last year, an increase of 49%. Net
income for the quarter was $1,186,000 or $0.07 per share on 16,884,147 basic
shares outstanding [$.07 per share on 17,663,839 diluted shares], compared to a
net loss of $(623,000) or $(0.04) per share on 16,681,145 basic and diluted
shares outstanding in the same period last year.
For the six months ended August 31, 2004, net sales increased to $237.4 million
from $152.8 million in the comparable period last year, an increase of 55%. Net
income for the first half of fiscal 2005 was $2,372,000 or $0.14 per share on
16,884,147 basic shares outstanding [$0.13 per share on 17,875,443 diluted
shares], compared with a net loss of $(1,454,000), or $(0.09) per share on
16,678,093 basic and diluted shares outstanding in the year-earlier period.
Arthur Nadata, chairman of the board and chief executive officer of Nu Horizons,
said, "Sales and net income, year over year and quarter over quarter, showed
substantial gains as our industry continued its recovery from the downturn
experienced a few years ago. While we were able to report a slight increase in
sequential sales for the quarter ended August 31, 2004, $119.2 million as
compared to $118.2 million for the quarter ended May 31, 2004, in practical
terms sales remained relatively flat after five quarters of substantial
sequential sales increases."
Nadata continued, "This slowing in our sequential rate of growth appears to be
an industry-wide phenomenon, which also coincides with the historically slower
sales activity in the summer period. The question is whether it is a temporary
pause or a more permanent slowing of industry growth. We believe that the next
six to nine months will result in a more modest sequential industry growth rate
than was experienced over the past eighteen months."
(more)
NUHC Reports Second Quarter Fiscal 2005 Results Page 2
Nadata concluded, "Our gross margins appear to have stabilized and have actually
improved modestly over the past two quarters. We believe that our overall sales
growth should continue to be positively impacted by our demand creation model
approach which should allow us to maintain margins as well as continue to
increase our market share although no assurances can be given in this regard."
A conference call to further discuss earnings will be held today at 4:15 pm ET.
The call can be accessed by dialing (800) 915 - 4836, (international, dial (973)
317 - 5319) and refer to the Nu Horizons call. A webcast of the call will be
available on line (both live and after the call, beginning at 7:00 pm ET) at
www.nuhorizons.com. A rebroadcast of the call will be available, beginning at
7:00 pm ET at (800) 428 - 6051 (international, dial (973) 709 - 2089)
confirmation code 307564. A transcript of the webcast will remain available on
the website for a period of twelve months, beginning one week after the call. In
connection with the conference call, Nu Horizons has posted on its website
certain information regarding its second quarter results.
About Nu Horizons Electronics Corp.
Nu Horizons is a leading distributor of high technology active components,
including analog, communications, discretes, optical, logic & peripherals,
memory, microcontrollers, system on chip (SOC), board level and computer system
products to a wide variety of commercial original equipment manufacturers
(OEMs). With sales facilities in thirty-three locations across North America and
Asia, and logistics centers in centralized locations throughout the globe, Nu
Horizons partners with a limited number of best-in-class suppliers to provide
in-depth product and solutions expertise to its customers. Information on Nu
Horizons and its services is available at www.nuhorizons.com. The Company does
not undertake any obligation to update its forward-looking statements.
Except for historical information contained herein, the matters set forth in
this news release are forward looking statements. When used in this press
release, words such as "anticipate," "believe," "estimate," "expect," "intend"
and similar expressions, as they relate to Nu Horizons or its management,
identify forward-looking statements. Such forward-looking statements are based
on the current beliefs of Nu Horizons' management, as well as assumptions made
by and information currently available to its management. Forward-looking
statements involve certain risks and uncertainties that could cause actual
results to differ from those in the forward looking-statements. Potential risks
and uncertainties include such factors as the level of business and consumer
spending for electronic products, the amount of sales of the Company's products,
the competitive environment within the electronics industry, the ability of the
Company to continue to expand its operations, the level of costs incurred in
connection with the Company's expansion efforts and the financial strength of
the Company's customers and suppliers. Investors are also directed to consider
other risks and uncertainties discussed in documents filed by the Company with
the Securities and Exchange Commission. Such statements reflect our current view
with respect to the future and are subject to these and other risks,
uncertainties and assumptions relating to Nu Horizons' financial condition,
results of operations, growth strategy and liquidity. The Company does not
undertake any obligation to update its forward-looking statements.
(Tables Follow)
NUHC Reports Second Quarter Fiscal 2005 Results Page 3
NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES
----------------------------------------------
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
-----------------------------------------------
(unaudited)
For the Six Months Ended For the Three Months Ended
------------------------------------- -------------------------------------
August 31, 2004 August 31, 2003 August 31, 2004 August 31, 2003
--------------- --------------- --------------- ---------------
NET SALES $ 237,407,958 $ 152,768,252 $ 119,231,880 $ 79,965,110
----------------- ----------------- ----------------- -----------------
COSTS AND EXPENSES:
Cost of sales 198,054,472 124,341,742 99,493,834 65,570,341
Operating expenses 34,434,691 30,755,068 17,250,611 15,401,486
Interest expense 785,686 77,588 452,992 57,066
Interest income (29,919) (101,217) (26,188) (92,313)
----------------- ----------------- ----------------- -----------------
233,244,930 155,073,181 117,171,249 80,936,580
----------------- ----------------- ----------------- ------------------
INCOME (LOSS) BEFORE PROVISION
FOR INCOME TAXES AND MINORITY
INTERESTS 4,163,028 (2,304,929) 2,060,631 (971,470)
Provision (credit) for income taxes 1,578,181 (1,017,601) 787,413 (432,497)
----------------- ----------------- ----------------- -----------------
INCOME (LOSS) BEFORE MINORITY INTERESTS 2,584,847 (1,287,328) 1,273,218 (538,973)
Minority interest in earnings of
subsidiaries 212,892 166,895 87,181 83,879
----------------- ----------------- ----------------- -----------------
NET INCOME (LOSS) $ 2,371,955 $ (1,454,223) $ 1,186,037 $ (622,852)
================= ================= ================= =================
NET INCOME (LOSS) PER COMMON SHARE:
Basic $ .14 $ (.09) $ .07 $ (.04)
================= ================= ================= =================
Diluted $ .13 $ (.09) $ .07 $ (.04)
================= ================= ================= =================
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING:
Basic 16,884,147 16,678,093 16,884,147 16,681,145
Diluted 17,875,443 16,678,093 17,663,839 16,681,145
NUHC Reports Second Quarter Fiscal 2005 Results Page 4
NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES
----------------------------------------------
CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------
August 31, February 29,
------------------- -------------------
2004 2004
(unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 10,230,728 $ 12,469,973
Accounts receivable - net of allowance for doubtful
accounts of $4,621,311 and $4,089,801 for August 31,
2004 and February 29, 2004, respectively 70,557,912 68,230,405
Inventories 116,618,873 68,729,081
Prepaid expenses and other current assets 1,528,897 794,086
-------------------- --------------------
TOTAL CURRENT ASSETS 198,936,410 150,223,545
PROPERTY, PLANT AND EQUIPMENT - NET 4,214,669 4,401,898
OTHER ASSETS:
Subordinated note receivable 2,000,000 2,000,000
Other assets 1,660,138 1,552,728
-------------------- --------------------
$ 206,811,217 $ 158,178,171
==================== ====================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 28,121,860 $ 21,479,465
Accrued expenses 4,196,978 5,250,006
-------------------- --------------------
TOTAL CURRENT LIABILITIES 32,318,838 26,729,471
-------------------- --------------------
LONG TERM LIABILITIES:
Revolving credit line 46,100,000 5,300,000
Deferred income taxes 390,566 280,495
-------------------- --------------------
TOTAL LONG-TERM LIABILITIES 46,490,566 5,580,495
-------------------- --------------------
MINORITY INTEREST IN SUBSIDIARIES 1,678,554 1,465,662
-------------------- --------------------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $1 par value, 1,000,000 shares
authorized; none issued or outstanding - -
Common stock, $.0066 par value, 50,000,000 shares
authorized; 16,884,147 and 16,859,766 shares issued
and outstanding for August 31, 2004 and February 29,
2004, respectively 111,435 111,275
Additional paid-in capital 44,054,608 43,934,877
Retained earnings 83,022,715 80,650,760
Other accumulated comprehensive income (loss) (865,499) (294,369)
-------------------- --------------------
TOTAL SHAREHOLDERS' EQUITY 126,323,259 124,402,543
-------------------- --------------------
$ 206,811,217 $ 158,178,171
==================== ====================