EXHIBIT 99.1
FOR IMMEDIATE RELEASE CONTACT: MICHAEL BURKE
NASDAQ: IMGC EXEC. VP & CFO
CONTACT: CATHY YUDZEVICH
IR MANAGER
(518) 782-1122
INTERMAGNETICS REPORTS SOLID INCREASES
IN Q2 REVENUE, NET INCOME
o MRI MAGNET, MEDICAL DEVICE SALES REMAIN STRONG
o COMPANY ON TRACK TO MEET FY 2006 GROWTH PROJECTIONS
LATHAM, NY, JANUARY 3, 2006--INTERMAGNETICS GENERAL CORPORATION (NASDAQ: IMGC)
today reported that second-quarter normalized net income from operations
increased 25 percent to $8.5 million, or $0.30 per diluted share, from $6.8
million, or $0.24 per diluted share, a year earlier. Reported net income
increased to $6.8 million, or $0.24 per diluted share, from $4.1 million or
$0.15 per diluted share. Revenues for the quarter ended November 27, 2005,
climbed about 18 percent to $78.1 million from $66.2 million.
For the first six months of fiscal 2006, normalized net income rose to $14.5
million, or $0.51 per diluted share, from the prior-year period's $11.2 million,
or $0.40 per diluted share. Reported six-month net income was $11.9 million, or
$0.42 per diluted share, compared with $9.4 million, or $0.34 per diluted share.
Revenue increased to $149.1 million from $117.7 million.
"Our operating segments continued to deliver strong performance during the
second quarter," said Glenn H. Epstein, chairman and chief executive officer.
"Our technology and product leadership within the overall MRI market remains the
cornerstone of our ongoing business, and we believe we remain on target to meet
our previously forecasted sales growth of greater than 15 percent, with earnings
increasing more than 20 percent compared with normalized continuing operations
last fiscal year."
CONFERENCE CALL TOMORROW
The company will discuss its second-quarter results, as well as other
developments during a conference call Wednesday, January 4, 2006, beginning at
11 a.m. EST. The call will be broadcast live and archived over the Internet
through the company's website http://www.intermagnetics.com under the Investor
Relations section. The domestic dial-in number for the live call is
877-407-8037. The international dial-in number is 201-689-8037. No conference
code is required for the live call. The company will also make available a
digital replay beginning 2 p.m. EST January 4, 2006, through 11:59 p.m. January
16, 2006, by dialing 201-612-7415--account number 249. Callers should select
conference number 181831.
-More-
INTERMAGNETICS (www.intermagnetics.com) draws on the financial strength,
operational excellence and technical leadership in the market of Magnetic
Resonance Imaging (MRI) as well as its expanding businesses within Medical
Devices that encompass Invivo Diagnostic Imaging (focusing on MRI components &
imaging sub-systems) and Invivo Patient Care (focusing on monitoring & other
patient care devices). Intermagnetics is also a prominent participant in
superconducting applications for Energy Technology. The company has a more than
30-year history as a successful developer, manufacturer and marketer of
superconducting materials, high-field magnets, medical systems & components and
other specialized high-value added devices.
SAFE HARBOR STATEMENT: The statements contained in this press release that are
not historical fact are "forward-looking statements" which involve various
important assumptions, risks, uncertainties and other factors. These
forward-looking statements are based on currently available competitive,
financial and economic data and management's views and assumptions regarding
future events. Such forward-looking statements are inherently uncertain and are
subject to risks, including but not limited to: the company's ability to meet
the performance, quality and price requirements of our customers, develop new
products and maintain gross margin levels through continued production cost
reductions and manufacturing efficiencies; the ability of the company's largest
customer to maintain and grow its share of the market for MRI systems; the
company's ability to invest sufficient resources in and obtain third-party
funding for its HTS development efforts and avoid the potential adverse impact
of competitive emerging patents; as well as other risks and uncertainties set
forth herein and in the company's Annual Report on Forms 10-K and 10-Q. The
company has provided supplemental non-GAAP financial tables to provide
shareholders and prospective shareholders additional information to understand
the company's normalized quarterly operations. These tables contain certain
estimated pro-forma calculations that we believe provide helpful information
regarding our operations. Except for the company's continuing obligation to
disclose material information under federal securities law, the company is not
obligated to update its forward-looking statements even though situations may
change in the future. The company qualifies all of its forward-looking
statements by these cautionary statements.
-Tables Follow-
INTERMAGNETICS GENERAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands, Except Per Share Amounts)
(Unaudited)
Three Months Ended Six Months Ended
------------------------------ -------------------------------
November 27, November 28, November 27, November 28,
2005 2004 2005 2004
------------ ------------ ------------- ------------
Revenues $ 78,112 $ 66,175 $ 149,128 $ 117,699
Cost of revenues 42,952 34,946 82,822 63,354
---------- ---------- ---------- ----------
Gross margin 35,160 31,229 66,306 54,345
Product research and development 7,635 6,188 14,971 11,147
Selling, general and administrative:
Stock based compensation 3,153 3,441 5,229 4,568
Other selling, general and administrative 13,433 14,807 26,140 25,487
Amortization of intangible assets 1,267 1,673 2,664 3,057
Impairment of intangible assets 913 913
---------- ---------- ---------- ----------
25,488 27,022 49,004 45,172
---------- ---------- ---------- ----------
Operating income 9,672 4,207 17,302 9,173
Interest and other income 1,033 211 1,187 412
Interest and other expense (945) (1,117) (1,591) (2,129)
Gain on litigation settlement 600
Adjustment to gain on prior period sale of division 648 648 1,094
---------- ---------- ---------- ----------
Income from continuing operations before income taxes 10,408 3,301 18,146 8,550
Provision for income taxes 3,570 934 6,224 2,756
---------- ---------- ---------- ----------
INCOME FROM CONTINUING OPERATIONS 6,838 2,367 11,922 5,794
Discontinued operations:
Income from operations of discontinued subsidiary 2,708 5,594
Provision for income taxes 941 1,942
---------- ---------- ---------- ----------
INCOME FROM DISCONTINUED OPERATIONS - 1,767 - 3,652
---------- ---------- ---------- ----------
NET INCOME $ 6,838 $ 4,134 $ 11,922 $ 9,446
========== ========== ========== ==========
Basic Net Income per Common Share:
Continuing operations $ 0.24 $ 0.09 $0.42 $0.22
Discontinued operations 0.06 $0.13
---------- ---------- ---------- ----------
Basic Net Income per Common Share $ 0.24 $ 0.15 $0.42 $0.35
========== ========== ========== ==========
Diluted Net Income per Common Share:
Continuing operations $ 0.24 $ 0.09 $0.42 $0.21
Discontinued operations 0.06 $0.13
---------- ---------- ---------- ----------
Diluted Net Income per Common Share $ 0.24 $ 0.15 $0.42 $0.34
========== ========== ========== ==========
Shares:
Basic 28,169,367 27,979,535 28,156,526 27,334,721
========== ========== ========== ==========
Diluted 28,659,027 28,478,513 28,636,899 27,801,185
========== ========== ========== ==========
INTERMAGNETICS GENERAL CORPORATION
RECONCILING STATEMENTS OF OPERATIONS
(Dollars in Thousands, Except Per Share Amounts)
(Unaudited)
Three Months Ended Six Months Ended
------------------------------ ------------------------------
Normalized Operations without Acquisition, November 27, November 28, November 27, November 28,
Integration, Sale and Non-cash items: 2005 2004 2005 2004
------------- ------------- -------------- --------------
Revenues $ 78,112 $ 66,175 $ 149,128 $ 117,699
Cost of revenues 42,952 34,873 82,822 63,143
----------- ---------- ---------- ----------
Gross margin 35,160 31,302 66,306 54,556
Product research and development 7,635 6,188 14,971 11,129
Selling, general and administrative 13,433 13,200 26,140 23,518
Amortization of intangible assets 1,267 1,673 2,664 3,057
----------- ---------- ---------- ----------
22,335 21,061 43,775 37,704
----------- ---------- ---------- ----------
Operating income 12,825 10,241 22,531 16,852
Interest and other income 1,033 211 1,187 412
Interest and other expense (945) (588) (1,591) (1,163)
----------- ---------- ---------- ----------
Income from continuing operations before income taxes 12,913 9,864 22,127 16,101
Provision for income taxes 4,429 3,048 7,590 4,942
----------- ---------- ---------- ----------
INCOME FROM CONTINUING OPERATIONS $ 8,484 $ 6,816 $ 14,537 $ 11,159
=========== ========== ========== ==========
Earnings per Common Share:
Basic $0.30 $0.24 $0.52 $0.41
=========== ========== ========== ==========
Diluted $0.30 $0.24 $0.51 $0.40
=========== ========== ========== ==========
Shares:
Basic 28,169,367 27,979,535 28,156,526 27,334,721
=========== ========== ========== ==========
Diluted 28,659,027 28,478,513 28,636,899 27,801,185
=========== ========== ========== ==========
Three Months Ended Six Months Ended
------------------------------ ------------------------------
November 27, November 28, November 27, November 28,
Reconciliation of Financial Statements to GAAP Equivalent: 2005 2004 2005 2004
------------- ------------- -------------- --------------
Pro-forma net income $ 8,484 $ 6,816 $ 14,537 $ 11,159
Stock based compensation (3,153) (3,441) (5,229) (4,568)
Gain on litigation settlement 600
Acquisition and integration related charges (1,680) (2,198)
Impairment of intangible assets (913) (913)
Interest burden (529) (966)
Adjustment to gain on prior period sale of division 648 648 1,094
Provision for taxes relating to pro-forma adjustments 859 2,114 1,366 2,186
Income from discontinued operations 1,767 3,652
----------- ---------- ---------- ----------
As Reported Net Income $ 6,838 $ 4,134 $ 11,922 $ 9,446
=========== ========== ========== ==========
* This table is included to provide shareholders' and prospective shareholders'
additional information to understand the Company's normalized quarterly and
annual performance.
INTERMAGNETICS GENERAL CORPORATION
Condensed Consolidated Balance Sheets
(Dollars in Thousands)
(Unaudited)
November 27, May 29,
2005 2005
------------ --------
ASSETS
CURRENT ASSETS
Cash and short-term investments $ 10,054 $ 6,970
Trade accounts receivable 66,328 60,682
Costs and estimated earnings in
excess of billings on uncompleted contracts 1,823 718
Inventories 56,766 40,265
Prepaid expenses and other 9,163 8,665
--------- ---------
TOTAL CURRENT ASSETS 144,134 117,300
PROPERTY, PLANT AND EQUIPMENT, net 45,186 42,974
GOODWILL, INTANGIBLE AND OTHER ASSETS 229,247 229,374
--------- ---------
$ 418,567 $ 389,648
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Current portion of long-term debt $ 212 $ 12,404
Accounts payable 15,309 22,136
Salaries, wages and related items 9,618 11,691
Customer advances and deposits 1,162 1,951
Product warranty reserve 3,445 4,073
Income tax payable 1,360 3,305
Other liabilities and accrued expenses 7,763 10,189
--------- ---------
TOTAL CURRENT LIABILITIES 38,869 65,749
LONG-TERM DEBT, less current portion 58,559 19,885
NOTE PAYABLE 5,000 5,000
DEFERRED INCOME TAXES 20,135 19,618
DERIVATIVE LIABILITY 52
DEFERRED COMPENSATION OBLIGATION 8,047 4,338
SHAREHOLDERS' EQUITY 287,957 275,006
--------- ---------
$ 418,567 $ 389,648
========= =========
INTERMAGNETICS GENERAL CORPORATION
SUMMARY OF PERFORMANCE AGAINST GOALS
Six Months Ended
---------------------------------------------
November 27, 2005 November 28, 2004 Goal
----------------- ------------------ --------
Gross Margin (1) 44% 46% 45%
Operating Income:
Percent of Sales (1) (2) 15% 14% 15%
Percent of Net Operating Assets (1) (2) 42% 45% 50%
Return on Equity (1) (2) 10% 9% 15%
Working Capital Efficiency (Working
capital, less cash divided by net sales) (1) (2) 20% 14% 15%
(1) Based on normalized data; (2) Based on annualized data
SEGMENT DATA
Three Months Ended
-----------------------------------------------------------------------------
November 27, 2005
-----------------------------------------------------------------------------
(Dollars in Thousands) Magnetic Resonance Medical Energy
Imaging Devices Technology Total
-------------------- ---------- -------------- -----------
Net revenues to external customers:
Magnet systems $34,549 $34,549
Patient Monitors & RF Coils $40,727 40,727
Other $2,836 2,836
--------- -------- -------- ---------
Total 34,549 40,727 2,836 78,112
Segment operating income (loss) 9,154 5,146 (1,475) 12,825
Total assets $137,119 $269,706 $11,742 $418,567
November 28, 2004
-----------------------------------------------------------------------------
(Dollars in Thousands) Magnetic Resonance Medical Energy
Imaging Devices Technology Total
-------------------- ---------- -------------- -----------
Net revenues to external customers:
Magnet systems $29,506 $29,506
Patient Monitors & RF Coils $33,644 33,644
Other $3,025 3,025
--------- -------- -------- ---------
Total 29,506 33,644 3,025 66,175
Segment operating income (loss) 6,611 5,375 (1,745) 10,241
Total assets $126,371 $243,019 $11,602 $380,992
Six Months Ended
-----------------------------------------------------------------------------
November 27, 2005
-----------------------------------------------------------------------------
Magnetic Resonance Medical Energy
Imaging Devices Technology Total
-------------------- ---------- -------------- -----------
Net revenues to external customers:
Magnet systems $62,664 $62,664
Patient Monitors & RF Coils $80,593 80,593
Other $5,871 5,871
--------- -------- -------- ---------
Total 62,664 80,593 5,871 149,128
Segment operating income (loss) 15,958 9,793 (3,220) 22,531
Total assets $137,119 $269,706 $11,742 $418,567
November 28, 2004
-----------------------------------------------------------------------------
Magnetic Resonance Medical Energy
Imaging Devices Technology Total
-------------------- ---------- -------------- -----------
Net revenues to external customers:
Magnet systems $53,608 $53,608
Patient Monitors & RF Coils $59,516 59,516
Other $4,575 4,575
--------- -------- -------- ---------
Total 53,608 59,516 4,575 117,699
Segment operating income (loss) 10,973 9,726 (3,847) 16,852
Total assets $126,371 $243,019 $11,602 $380,992
Three Months Ended
-----------------------------------------------
November 27, 2005 November 28, 2004
------------------- -------------------
Reconciliation of income before income taxes:
Operating income from reportable segments $ 12,825 $ 10,241
Non-cash stock based compensation (3,153) (3,441)
Acquisition and integration related items (1,680)
Impairment of intangible assets (913)
-------- --------
Net Operating Profit 9,672 4,207
Interest and other income 1,033 211
Interest and other expense (945) (1,117)
Adjustment to gain on prior period sale of division 648
-------- --------
Income before income taxes $ 10,408 $ 3,301
======== ========
Six Months Ended
-----------------------------------------------
November 27, 2005 November 28, 2004
--------------------- -------------------
Reconciliation of income before income taxes:
Operating income from reportable segments $ 22,531 $16,852
Non-cash stock based compensation (5,229) (4,568)
Acquisition and integration related items (2,198)
Impairment of intangible assets (913)
-------- --------
Net Operating Profit 17,302 9,173
Interest and other income 1,187 412
Interest and other expense (1,591) (2,129)
Gain on litigation settlement 600
Adjustment to gain on prior period sale of division 648 1,094
-------- -------
Income before income taxes $ 18,146 $ 8,550
======== =======
Reconciliation of Metrics to GAAP Equivalent:
Six Months Ended
November 27, 2005
---------------------------------------------------------
Operating
Income as a
Gross Percent of Return on
Margin Sales Equity
---------- ------------- ----------
As Reported GAAP Equivalent 44% 11% 8%
Effect of non-cash related charges and
and non-recurring gains 4% 2%
Effect of averaging
--- --- ---
Pro-forma metrics 44% 15% 10%
Six Months Ended
November 28, 2004
---------------------------------------------------------
Operating
Income as a
Gross Percent of Return on
Margin Sales Equity
---------- ------------- ----------
As Reported GAAP Equivalent 46% 8% 8%
Impact of excluding Polycold (3%)
Effect of acquisition, integration, non-cash related charges
and other non-recurring charges and credits 6% 4%
Effect of averaging
--- --- ---
Pro-forma metrics 46% 14% 9%
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