EXHIBIT 99.1
[POWELL INDUSTRIES, INC. LOGO] PRESS RELEASE
Contacts: Don R. Madison, CFO
Powell Industries, Inc.
713-947-4422
Ken Dennard / kdennard@drg-e.com
Karen Roan / kroan@drg-e.com
DRG&E / 713-529-6600
POWELL INDUSTRIES REPORTS
FISCAL 2003 SECOND QUARTER RESULTS
HOUSTON -- MAY 29, 2003 -- Powell Industries, Inc. (NASDAQ: POWL), a leading
manufacturer of equipment and systems for the management and control of
electrical energy and other critical processes, today announced results for the
fiscal 2003 second quarter ended April 30, 2003.
Revenues for the second quarter of 2003 were $64.2 million compared to
revenues of $80.3 million for the second quarter of 2002. Second quarter net
income from continuing operations was $2.0 million, or $0.19 per diluted share,
compared to $4.5 million, or $0.42 per diluted share, for the second quarter of
fiscal 2002. The decline in revenue and net income in the quarter was a result
of further deterioration in the electrical products markets the company serves.
Powell generated $17.9 million in free cash flow (defined as total cash flow
from operations of $18.8 million less all capital expenditures of $0.9 million)
in the second quarter.
Revenues for the first six months of fiscal 2003 were $135.8 million
compared to revenues of $156.8 million for the first six months of fiscal 2002.
Net income including the effect of a change in accounting principle of $510,000
for the adoption of Statement of Financial Accounting Standards (SFAS) No. 142,
"Goodwill and Other Intangible Assets," for the first six months was $4.5
million, or $0.43 per diluted share, versus $8.2 million, or $0.77 per diluted
share. Excluding the effect of a change in accounting principle, net income was
$5.1 million, or $0.47 per diluted share, compared to $8.2 million, or $0.77
per diluted share.
"Overall, business conditions remain depressed and competitive
pressure intense; however, there is some optimism that market conditions have
stabilized," stated Thomas W. Powell, chairman and chief executive officer.
"We are pleased that we were recently awarded a contract from the Port
Authority of New York & New Jersey to design and build Intelligent
Transportation Systems for the Holland and Lincoln Tunnels, which added
approximately $37 million to our backlog in the second quarter."
The Electrical Power Products segment recorded revenues of $58.2
million in the second quarter compared to $75.1 million in the second quarter
a year ago. Second quarter income from continuing operations before income
taxes for Electrical Power Products totaled $3.0 million versus $7.3 million
in last year's second quarter.
Process Control Systems revenues for the second quarter were $6.0
million compared to $5.2 million in last year's second quarter. Income from
continuing operations before income taxes for Process Control Systems totaled
$0.2 million versus a loss of $0.2 million a year ago.
The company's order backlog as of April 30, 2003, was $203.0 million,
compared to $168.5 million at the end of the first fiscal quarter of 2003 and
$221.7 million at the end of the second fiscal quarter one year ago. New orders
placed during the second quarter totaled $98.7 million versus $50.7 million in
the first quarter of 2003 and $88.7 million in the second quarter a year ago.
OUTLOOK
The following statements are based on the current expectations of the
company. These statements are forward looking and actual results may differ
materially as further elaborated in the last paragraph below.
Powell Industries expects fiscal third quarter earnings to range
between $0.13 and $0.18 per diluted share and full year 2003 earnings
from continuing operations to range between $0.60 and $0.75 per
diluted share. Full year 2003 revenue is expected to range between
$240 million and $250 million and free cash flow,
defined as total cash flow from operations less all capital
expenditures, is expected to range between $20 million and $25
million.
CONFERENCE CALL
Powell Industries has scheduled a conference call for Thursday, May
29, 2003, at 11:00 a.m. eastern time. To participate in the conference call,
dial (303) 262-2076 at least 10 minutes before the call begins and ask for the
Powell Industries conference call. A replay of the call will be available
approximately two hours after the live broadcast ends and will be accessible
until Thursday, June 5, 2003. To access the replay, dial (303) 590-3000 using a
passcode of 539481.
Investors, analysts and the general public will also have the
opportunity to listen to the conference call over the Internet by visiting
www.drg-e.com. To listen to the live call on the web, please visit the web site
at least fifteen minutes before the call begins to register, download and
install any necessary audio software. For those who cannot listen to the live
web cast, an archive will be available shortly after the call and will remain
available for approximately 30 days at www.drg-e.com.
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Powell Industries, Inc., headquartered in Houston, TX, designs,
manufactures and services equipment and systems for the management and control
of electrical energy and other critical processes. Powell provides products and
services to the transportation, environmental, industrial and utility
industries. For more information, please visit www.powellind.com.
-----------------
Any forward-looking statements in the preceding paragraphs of this release are
made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that such forward
looking statements involve risks and uncertainty in that actual results may
differ materially from those projected in the forward looking statements. In
the course of operations, we are subject to certain risk factors, including but
not limited to competition and competitive pressures, sensitivity to general
economic and industrial conditions, international political and economic risks,
availability and price of raw materials and execution of business strategy. For
further information, please refer to the Company's filings with the Securities
and Exchange Commission, copies of which are available from the Company without
charge.
- Tables to follow -
POWELL INDUSTRIES, INC. & SUBSIDIARIES
- -------------------------------------------------------------------------------
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED SIX MONTHS ENDED
APRIL 30, APRIL 30,
(UNAUDITED) (UNAUDITED)
2003 2002 2003 2002
---- ---- ---- ----
(In thousands, except per share data)
REVENUES........................................................ $64,201 $80,286 $135,781 $156,773
Cost of goods sold.............................................. 52,077 63,019 109,425 123,915
------ ------ ------- -------
Gross profit.................................................... 12,124 17,267 26,356 32,858
Selling, general & administrative expenses...................... 8,909 9,917 18,318 19,338
------- ------- ------- -------
Income from operations before interest and income taxes......... 3,215 7,350 8,038 13,520
Interest expense................................................ 81 320 167 676
Interest income................................................. (88) (57) (180) (108)
------- ------- ------- -------
Income from continuing operations before income taxes
and cumulative effect of change in accounting principle ..... 3,222 7,087 8,051 12,952
Income tax provision............................................ 1,204 2,573 2,999 4,703
------- ------- -------- -------
INCOME FROM CONTINUING OPERATIONS BEFORE CUMULATIVE
EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE....................... $2,018 $4,514 $5,052 $8,249
Cumulative effect of change in accounting principle, net of tax. $ --- $ --- $ (510) $ ---
------- ------- ------- ------
NET INCOME...................................................... $2,018 $ 4,514 $4,542 $8,249
======= ======= ======= ======
Net earnings per common share:
Basic:
Earnings from continuing operations...............................$ 0.19 $ 0.43 $ 0.48 $ 0.79
Cumulative effect of change in accounting principle.......... --- --- (0.05) ---
--------- --------- --------- --------
Net earnings................................................. $ 0.19 $ 0.43 $ 0.43 $ 0.79
======== ======== ======== ========
Diluted:
Earnings from continuing operations.......................... $ 0.19 $ 0.42 $ 0.47 $ 0.77
Cumulative effect of change in accounting principle.......... --- --- (0.04) ---
--------- -------- -------- -------
Net earnings................................................. $ 0.19 $ 0.42 $ 0.43 $ 0.77
======== ======== ======= ========
Weighted average number of common
shares outstanding............................................ 10,580 10,457 10,577 10,452
====== ====== ====== ======
Weighted average number of common and
common equivalent shares outstanding.......................... 10,657 10,685 10,665 10,676
====== ====== ====== ======
SELECTED FINANCIAL DATA:
Capital Expenditures............................................ $ 962 $3,517 $2,802 $9,037
======= ====== ====== ======
Depreciation and amortization................................... $1,232 $1,142 $2,499 $2,315
====== ====== ====== ======
POWELL INDUSTRIES, INC. & SUBSIDIARIES
- ------------------------------------------------------------------------------
CONDENSED CONSOLIDATED BALANCE SHEETS
April 30, October 31,
2003 2002
---- ----
(In thousands) (Unaudited)
Assets:
Current assets.......................................................... $137,196 $138,499
Property, plant & equipment (net) ...................................... 45,277 45,020
Other assets............................................................ 5,550 6,124
-------- --------
Total assets..................................................... $188,023 $189,643
======== ========
Liabilities & stockholders' equity:
Current liabilities..................................................... $45,634 $52,033
Long-term debt and capital lease obligations, net of
current maturities............................................... 7,233 7,264
Deferred & other long-term liabilities.................................. 2,142 2,139
Stockholders' equity.................................................... 133,014 128,207
--------- ---------
Total liabilities and stockholders' equity....................... $188,023 $189,643
======== ========
POWELL INDUSTRIES, INC. & SUBSIDIARIES
- ------------------------------------------------------------------------------
BUSINESS SEGMENTS
THREE MONTHS ENDED SIX MONTHS ENDED
APRIL 30, APRIL 30,
(UNAUDITED) (UNAUDITED)
2003 2002 2003 2002
---- ---- ---- ----
(In thousands)
Revenues:
Electrical Power Products........................... $58,153 $75,104 $123,714 $146,231
Process Control Systems............................. 6,048 5,182 12,067 10,542
------- ------- -------- --------
Total revenues...................................... $64,201 $80,286 $135,781 $156,773
======= ======= ======== ========
Income (loss) from continuing operations before income taxes and cumulative
effect of change in accounting principle:
Electrical Power Products........................... $2,993 $7,319 $7,606 $12,961
Process Control Systems............................. 229 (232) 445 (9)
------- -------- -------- --------
Total income from continuing operations before income taxes
and cumulative effect of change in accounting principle $3,222 $7,087 $8,051 $12,952
======= ======== ======== ========
April 30, October 31,
2003 2002
---- ----
(Unaudited)
Assets:
Electrical Power Products............................................... $139,274 $156,584
Process Control Systems................................................. 14,330 14,937
Corporate............................................................... 34,419 18,122
-------- --------
Total assets..................................................... $188,023 $189,643
======== ========
Backlog:
Electrical Power Products............................................... $132,760 $151,632
Process Control Systems................................................. 70,234 37,721
--------- --------
Total backlog.................................................... $202,994 $189,353
======== ========