Exhibit 99.1
NEWS RELEASE
For Release on May 12, 2004 Contact: Mark H. Cosmez II
4:00 PM (ET) (925) 328-4656 Vice President, Finance/Chief Financial Officer
Giga-tronics Reports Fourth Quarter and FY 2004 Results
SAN RAMON, CA - Giga-tronics Incorporated (NASDAQ/NMS: GIGA) reported
today that the net loss in the fourth quarter of fiscal year 2004 decreased 28%
to $1,712,000 or $0.36 per fully diluted share compared to $2,387,000 or $0.51
per fully diluted share for the fourth quarter of last year. For the fiscal year
ended March 27, 2004, the net loss decreased 37% to $6,821,000 or $1.45 per
share fully diluted versus $10,762,000 or $2.31 per fully diluted share for the
same period a year ago.
Loss from continuing operations for the fourth quarter was $1,727,000 or
$0.37 per fully diluted share compared to a loss from continuing operations of
$1,101,000 or $0.24 per fully diluted share for the same period a year ago.
Giga-tronics elected to discontinue the operations at its Dymatix division
during the first quarter of FY2004.
For the 2004 fiscal year, the net loss from continuing operations was
$4,444,000 or $0.94 per fully diluted share versus a net loss from continuing
operations of $8,426,000 or $1.81 per fully diluted share last year. Net sales
from continuing operations were $3,295,000 in the fourth quarter of fiscal 2004
versus $4,730,000 in the fourth quarter of fiscal 2003. Net sales for fiscal
year 2004 decreased 16% from the prior year to $17,491,000 from $20,822,000.
New orders from continuing operations have increased over the last three
quarters. Orders from continuing operations increased 61% in the fourth quarter
of FY 2004 from the same quarter a year ago. Our book-to-bill ratio in the
fourth quarter of fiscal 2004 was 1.58 compared to 0.68 in the fourth quarter of
fiscal 2003.
Orders booked in the fourth quarter from continuing operations were
$5,210,000 compared to $3,232,000 last year and for the 2004 fiscal year were
$17,109,000 compared to $16,348,000 a year ago. Backlog at quarter end was $16.4
million (approximately $7.5 million is shippable within one year) as compared to
$16.7 million (approximately $7.7 million shippable within one year) in the
fourth quarter of the prior year.
Cash and cash equivalents at March 27, 2004 was $2,752,000 compared to
$5,005,000 as of March 29, 2003. Based on current operations, Giga-tronics
believes that it has sufficient cash and cash equivalents to fund its cash needs
for approximately five to eight quarters. To operate beyond that term, the
Company must either earn additional cash from operations, obtain a line of
credit or obtain additional funds from other sources.
During the fourth quarter of fiscal 2004, Giga-tronics consummated the
sale of Dymatix, which had been discontinued during the first quarter. Under the
terms of the sale, the Company will receive $300,000, of which $50,000 was paid
at closing, $50,000 is to be paid in May 2004 and $200,000 is to be paid in
quarterly installments over two years. The Company may receive additional
earn-out payments based on a percentage of sales on a monthly basis over the
next two years.
Giga-tronics will host a conference call today at 4:30 PM ET to discuss
the fourth quarter and full fiscal year results. To participate in the call,
dial 612-332-0345. The call will also be broadcast over the internet at
www.gigatronics.com under "Corporate Info/Investor Relations". The conference
call discussion reflects management's views as of May 12, 2004 only.
Giga-tronics produces instruments, subsystems and sophisticated microwave
components that have broad applications in both defense electronics and wireless
telecommunications.
Giga-tronics is a publicly held company, traded on the NASDAQ National
Market under the symbol "GIGA".
This press release contains forward-looking statements concerning
profitability, backlog and shipments. Actual results may differ significantly
due to risks and uncertainties, such as future orders, cancellations or
deferrals, disputes over performance and the ability to collect receivables. For
further discussion, see Giga-tronics' annual report on Form 10-K for the fiscal
year ended March 29, 2003 Part I, under the heading "Certain Factors Which May
Adversely Affect Future Operations or an Investment in Giga-tronics" and Part
II, under the heading "Management's Discussion and Analysis of Financial
Conditions and Results of Operations".
GIGA-TRONICS INCORPORATED
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands except share data) March 27, 2004 March 29, 2003
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ASSETS
Current assets
Cash and cash equivalents $ 2,752 $ 5,005
Notes receivable 253 6
Trade accounts receivable, net 1,959 3,325
Inventories 6,920 10,244
Income tax refund receivable -- 100
Prepaid expenses 271 488
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TOTAL CURRENT ASSETS 12,155 19,168
Property and equipment 17,054 18,189
Less accumulated depreciation and amortization 15,803 15,915
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Property and equipment, net 1,251 2,274
Other assets 327 433
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TOTAL ASSETS $ 13,733 $ 21,875
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 1,686 $ 1,809
Accrued commissions 293 249
Accrued payroll and benefits 889 1,038
Accrued warranty 548 859
Customer advances 58 796
Obligations under capital lease 10 76
Other current liabilities 674 644
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TOTAL CURRENT LIABILITIES 4,158 5,471
Obligations under capital lease, net of current portion -- 10
Deferred rent 379 434
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TOTAL LIABILITIES 4,537 5,915
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Shareholders' equity
Preferred stock of no par value
Authorized 1,000,000 shares; no shares outstanding
at March 27, 2004 and March 29, 2003 -- --
Common stock of no par value;
Authorized 40,000,000 shares; 4,724,896 shares at
March 27, 2004 and 4,693,080 shares at
March 29, 2003 issued and outstanding 12,752 12,695
Retained earnings (loss) (3,556) 3,265
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TOTAL SHAREHOLDERS' EQUITY 9,196 15,960
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 13,733 $ 21,875
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GIGA-TRONICS INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended Twelve Months Ended
------------------ -------------------
March 27, 2004 March 29, 2003 March 27, 2004 March 29, 2003
-------------- -------------- -------------- --------------
NET SALES $ 3,295 $ 4,730 $ 17,491 $ 20,822
Cost of sales 2,927 3,523 12,755 14,635
------------ ------------ ------------ ------------
GROSS PROFIT 368 1,207 4,736 6,187
Product development 952 977 3,766 4,321
Selling, general and administrative 1,140 1,403 5,413 6,071
Amortization of intangibles -- 4 -- 20
------------ ------------ ------------ ------------
Operating expenses 2,092 2,384 9,179 10,412
------------ ------------ ------------ ------------
OPERATING LOSS (1,724) (1,177) (4,443) (4,225)
Other expense, net -- (38) (4) (163)
Interest income (expense), net (3) 14 7 60
------------ ------------ ------------ ------------
LOSS FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES (1,727) (1,201) (4,440) (4,328)
Provision (benefit) for income taxes -- (100) 4 4,098
------------ ------------ ------------ ------------
LOSS FROM CONTINUING OPERATIONS $ (1,727) $ (1,101) $ (4,444) $ (8,426)
Income (loss) on discontinued operations,
net of income taxes 15 (1,286) (2,377) (2,336)
------------ ------------ ------------ ------------
NET LOSS $ (1,712) $ (2,387) $ (6,821) $ (10,762)
============ ============ ============ ============
BASIC AND DILUTED NET LOSS PER SHARE:
From continuing operations $ (0.37) $ (0.24) $ (0.94) $ (1.81)
On discontinued operations 0.01 (0.27) (0.51) (0.50)
------------ ------------ ------------ ------------
Basic and diluted net loss per share $ (0.36) $ (0.51) $ (1.45) $ (2.31)
============ ============ ============ ============
Shares used in per share calculation:
Basic and dilutive 4,717 4,682 4,704 4,663
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