NU
HORIZONS
NU HORIZONS ELECTRONICS CORP.
70 Maxess Road Melville, NY 11747
631-396-5000 Fax: 631-396-5060
Company Contact: Andrew Barwicki
Nu Horizons Electronics Corp.
631-396-5000
FOR IMMEDIATE RELEASE
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NU HORIZONS REPORTS FINANCIAL AND OPERATING RESULTS
FOR THE SECOND QUARTER OF FISCAL YEAR 2006
MELVILLE, NY, October 5, 2005--- 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, 2005.
Net sales for the quarter ended August 31, 2005 increased to $128.2 million as
compared to $119.2 million for the comparable period last year. Net income for
the quarter was $820,000 or $0.05 per share on 16,907,397 average basic shares
outstanding ($0.05 per share on 17,367,115 diluted shares) as compared to a net
income of $1,186,000 or $0.07 per share on 16,884,147 average basic shares
outstanding ($0.07 per share on 17,663,839 diluted shares) for the second
quarter of the prior year. Sequentially, net sales for the quarter ended August
31, 2005 increased $6.8 million from $121.4 million or 5% and net income
increased from $475,000 to $820,000.
For the six months ended August 31, 2005, net sales increased to $249.6 million
from $237.4 million in the comparable period last year, an increase of 5%. Net
income for the first half of fiscal 2006 was $1,294,975 or $0.08 per share on
16,907,397 basic shares outstanding ($0.07 per share on 17,429,854 diluted
shares), compared to a net income of $2,371,955 or $0.14 per share on 16,884,147
basic shares outstanding ($0.13 per share on 17,875,443 diluted shares) in the
same period last year.
Arthur Nadata, Chairman of the Board and Chief Executive Officer states,
"Notwithstanding our decline in earnings compared to the prior comparable
period, our second quarter results reflect organic sales growth stemming in part
from our global initiatives. The steps we took to enhance our line card,
combined with our investments in additional personnel to support expanded
supplier relationships, have improved and strengthened our position in the
distribution channel. We anticipate the recent additions to our line card and
the expansion of certain partnership agreements in Asia will broaden our
customer base and make it possible for us to enter new market segments."
Mr.Nadata concluded, "We continue to see business opportunities primarily
resulting from the industry trend to design in North America with production in
Asia. We expect this business trend to continue to grow and we believe our
ability to capitalize on it is one of our key competitive advantages. Our sales
in Asia for the first six months of fiscal 2006 increased to $59 million as
compared to $49 million for the prior year's fiscal period, an increase of 20%.
Overseas sales continue to produce positive results, providing 27% of our global
consolidated sales for the first six months of fiscal 2006."
NUHC Reports Second Quarter Fiscal 2006 Results Page 2
A conference call to further discuss earnings will be held today at 4:15 pm ET.
The call can be accessed by dialing 1-800-289-0572, (international, dial
1-913-981-5543). A rebroadcast of the call will be available beginning at 7:00
pm ET at (888)-203-1112 (international, dial 1- 719-457-0820) Please refer to
confirmation code 9845270. A webcast of the call will also be available, online
(both live and after the call), at www.nuhorizons.com.
ABOUT NU HORIZONS ELECTRONICS CORP.
Nu Horizons is a leading global distributor of advanced technology active
components and system solutions, including analog, clock and timing devices,
communications, computer products, discretes, flat panel display solutions,
interface, logic, memory, microcontrollers and microprocessors, opto electronics
and power, to a wide variety of commercial original equipment manufacturers
(OEMs). With sales facilities in forty-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 http://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 Follows)
NUHC Reports Second Quarter Fiscal 2006 Results Page 3
NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES
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CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
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(UNAUDITED)
For the Six Months Ended For the Three Months Ended
------------------------------------- --------------------------------------
August 31, 2005 August 31, 2004 August 31, 2005 August 31, 2004
---------------- ---------------- ---------------- ----------------
NET SALES $ 249,685,079 $ 237,407,958 $ 128,265,045 $ 119,231,880
---------------- ---------------- ---------------- ----------------
COSTS AND EXPENSES:
Cost of sales 209,571,426 198,054,472 107,564,231 99,493,834
Operating expenses 36,554,040 34,434,691 18,599,943 17,250,611
---------------- ---------------- ---------------- ----------------
246,125,466 232,489,163 126,164,174 116,744,445
---------------- ---------------- ---------------- ----------------
OPERATING INCOME
3,559,613 4,918,795 2,100,871 2,487,435
---------------- ---------------- ---------------- ----------------
OTHER (INCOME) EXPENSE
Interest expense 1,392,487 785,686 731,004 452,992
Interest income (174,364) (29,919) (113,248) (26,188)
---------------- ----------------- ---------------- ----------------
1,218,123 755,767 617,756 426,804
---------------- ---------------- ---------------- ----------------
INCOME BEFORE PROVISION FOR
INCOME TAXES AND MINORITY
INTERESTS 2,341,490 4,163,028 1,483,115 2,060,631
Provision for income taxes 832,612 1,578,181 502,843 787,413
---------------- ---------------- ---------------- ----------------
INCOME BEFORE MINORITY INTERESTS 1,508,878 2,584,847 980,272 1,273,218
Minority interest in earnings of
subsidiaries 213,903 212,892 159,844 87,181
---------------- ---------------- ---------------- ----------------
NET INCOME $ 1,294,975 $ 2,371,955 $ 820,428 $ 1,186,037
================ ================ ================ ================
NET INCOME PER COMMON SHARE:
Basic $ .08 $ .14 $ .05 $ .07
================ ================ ================ ================
Diluted $ .07 $ .13 $ .05 $ .07
================ ================ ================ ================
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING:
Basic 16,907,397 16,884,147 16,907,397 16,884,147
Diluted 17,429,854 17,875,443 17,367,115 17,663,839
NUHC Reports Second Quarter Fiscal 2006 Results Page 4
NU HORIZONS ELECTRONICS CORP. AND SUBSIDIARIES
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CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------
August 31, February 28,
2005 2005
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(unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 8,236,407 $ 7,024,203
Accounts receivable - net of allowance for doubtful accounts
of $5,126,303 and $4,581,812 for August 31, 2005 and
February 28, 2005, respectively 79,290,441 79,679,565
Inventories 90,444,634 81,696,415
Prepaid expenses and other current assets 3,070,639 1,782,872
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TOTAL CURRENT ASSETS 181,042,121 170,183,055
PROPERTY, PLANT AND EQUIPMENT - NET 3,813,581 3,928,058
OTHER ASSETS:
Subordinated note receivable 2,000,000 2,000,000
Other assets 1,608,835 1,688,187
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$ 188,464,537 $177,799,300
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 23,214,042 $ 20,251,746
Accrued expenses 4,240,189 4,446,226
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TOTAL CURRENT LIABILITIES 27,454,231 24,697,972
LONG TERM LIABILITIES:
Revolving credit line 28,000,000 22,800,000
Deferred income taxes 2,224,278 1,168,766
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TOTAL LONG-TERM LIABILITIES 30,224,278 23,968,766
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MINORITY INTEREST IN SUBSIDIARIES $ 1,413,558 $ 1,199,655
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COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $1 par value, 1,000,000 shares authorized; none
issued or outstanding - -
Common stock, $.0066 par value, 50,000,000 shares authorized;
16,907,397 and 16,891,647 shares issued and outstanding for
August 31, 2005 and February 28, 2005, respectively 111,589 111,485
Additional paid-in capital 44,163,810 44,089,809
Retained earnings 85,019,144 83,724,169
Other accumulated comprehensive income (loss) 77,927 7,444
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TOTAL SHAREHOLDERS' EQUITY 129,372,470 127,932,907
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$ 188,464,537 $177,799,300
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