For further information, please contact:
Glenn L. Purple
Vice President-Finance
Tel: (860) 677-2603
FOR IMMEDIATE RELEASE
EDAC TECHNOLOGIES REPORTS SECOND CONSECUTIVE QUARTERLY PROFIT
FARMINGTON, Conn., August 3, 2004 -- EDAC Technologies Corporation (OTC Bulletin
Board: EDAC.OB), a designer and manufacturer of tools, fixtures, jet engine
components, injection molds and spindles, today reported results for the second
quarter of 2004.
Sales for the second quarter of 2004 were $8,767,000 and net income was $264,000
or $0.06 per diluted share versus sales of $7,138,000 and net income of
$7,228,000 or $1.60 per diluted share for the second quarter of 2003. The second
quarter of 2003 benefited from a gain of $7,253,000 from debt restructuring.
Without the gain, the net loss for the quarter ended June 28, 2003 would have
been $25,000.
For the six months ended July 3, 2004, sales were $16,073,000 and net income was
$553,000 (including a gain of $250,000 from debt forgiveness) or $0.12 per
diluted share versus sales of $13,247,000 and net income of $6,737,000 or $1.50
per diluted share for the six months ended June 28, 2003. Without the $7,253,000
gain on debt restructuring, the net loss for the six months ended June 28, 2003
would have been $516,000.
Commenting on the second quarter, Dominick A. Pagano, President and Chief
Executive Officer, said, "Our increase in sales from $7,138,000 to $8,767,000
was due to increased sales to our machine tool and aerospace customers. This
plus the improved efficiency and hard work of our employees resulted in
increases in our operating profit of $314,000 for the quarter as compared to the
second quarter of 2003, and $854,000 for the first six months in the current
year compared with the first half of 2003. This was the second consecutive
quarter that EDAC has generated a positive net income exclusive of gains on debt
restructuring, since the fourth quarter of 2001. Sales backlog was approximately
$19,800,000 at the end of the second quarter, up from $18,000,000 at the start
of the fiscal year. Our liquidity has improved significantly by an agreement
with our largest aerospace customer that provided for a $1.8 million advance
payment in July for inventory previously put on hold. With our debt now at a
seven year low, we are better positioned to pursue opportunities in all of our
product lines and remain optimistic about our future."
ABOUT EDAC TECHNOLOGIES CORPORATION
EDAC Technologies Corporation is a diversified manufacturing company primarily
offering (i) design and manufacturing services for the aerospace industry in
such areas as jet engine parts, special tooling, equipment, gauges and
components used in the manufacture, assembly and inspection of jet engines (ii)
high-precision fixtures, gauges, dies and molds and (iii) the design,
manufacture and repair of precision spindles, which are an integral part of
numerous machine tools found in virtually every manufacturing environment.
Cautionary Statement Regarding Forward Looking Statements - This press release
contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. The Company uses words such as "plans," seeks,"
"projects," "expects," "believes," "may," "anticipates," "estimates," "should,"
and similar expressions to identify these forward looking statements. These
statements are subject to risks and uncertainties and are based upon the
Company's beliefs and assumptions. There are a number of important factors that
may affect the Company's actual performance and results and the accuracy of its
forward-looking statements, many of which are beyond the control of the Company
and are difficult to predict. These important factors include, without
limitation, factors which could affect demand for the Company's products and
services such as general economic conditions and economic conditions in the
aerospace industry and the other industries in which the Company competes;
competition from the Company's competitors; and the Company's ability to enter
into satisfactory financing arrangements. These and other factors are described
in the Company's annual and quarterly reports filed from time to time with the
Securities and Exchange Commission. In addition, the forward-looking statements
included in this press release represent the Company's expectations and beliefs
as of the date of this release. The Company anticipates that subsequent events
and developments may cause these expectations and beliefs to change. However,
while the Company may elect to update these forward-looking statements at some
point in the future, it specifically disclaims any obligation or intention to do
so.
EDAC TECHNOLOGIES CORPORATION
FINANCIAL HIGHLIGHTS
For the three months ended For the six months ended
-------------------------------- --------------------------------
July 3, June 28, July 3, June 28,
2004 2003 2004 2003
------------ ------------ ------------ ------------
Sales $ 8,766,891 $ 7,137,812 $ 16,073,384 $ 13,247,145
Cost of sales 7,697,022 6,253,856 14,159,015 11,985,572
------------ ------------ ------------ ------------
Gross profit 1,069,869 883,956 1,914,369 1,261,573
Selling, general and
and administrative
expenses 634,617 762,631 1,272,286 1,473,561
------------ ------------ ------------ ------------
Income (loss)
from operations 435,252 121,325 642,083 (211,988)
Non-operating income
(expense):
Interest (163,221) (177,415) (322,314) (346,933)
Gain on debt forgiveness -- -- 250,000 --
Gain on debt restructuring -- 7,253,203 -- 7,253,203
Other -- 31,294 -- 43,213
------------ ------------ ------------ ------------
Income before
income taxes 272,031 7,228,407 569,769 6,737,495
Provision for income taxes 8,000 -- 17,000 --
------------ ------------ ------------ ------------
Net income $ 264,031 $ 7,228,407 $ 552,769 $ 6,737,495
============ ============ ============ ============
Income per common share data:
Basic $ 0.06 $ 1.64 $ 0.12 $ 1.53
========= ========= ========= =========
Diluted $ 0.06 $ 1.60 $ 0.12 $ 1.50
========= ========= ========= =========
Weighted average shares outstanding:
Basic 4,444,438 4,415,803 4,444,438 4,415,881
Diluted 4,633,146 4,514,220 4,625,185 4,480,779
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