Exhibit 99.1
MEADE INSTRUMENTS CORPORATION
6001 OAK CANYON, IRVINE, CALIFORNIA 92618-5200 U.S.A.
(949) 451-1450 o FAX: (949) 451-1460 o WWW.MEADE.COM
Brent W. Christensen, CFO Philip Bourdillon/Eugene Heller
Meade Instruments Corp. Silverman Heller Associates
(949) 451-1450 (310) 208-2550
MEADE INSTRUMENTS CORP. REPORTS
SECOND-QUARTER FISCAL 2004 RESULTS
IRVINE, CALIF. - SEPTEMBER 18, 2003 - MEADE INSTRUMENTS CORP. (NASDAQ NM: MEAD)
today reported results for the second quarter of fiscal year 2004, ended August
31, 2003. The Company's fiscal year 2004 ends on February 29, 2004.
Net sales for the three months ended August 31, 2003 were $28.3 million versus
$24.0 million in the comparable period a year ago. Excluding non-cash charges
for the Company's ESOP, net income for the three months ended August 31, 2003
was $105,000, or $0.01 per diluted share, compared to ESOP-adjusted net income
of $253,000, or $0.02 per diluted share, for the comparable period a year ago.
Including ESOP charges, second-quarter 2004 net income was $40,000, or $0.00 per
diluted share, compared to $134,000, or $0.01 per diluted share, in the
comparable period a year ago.
Net sales for the six months ended August 31, 2003 were $52.8 million versus
$44.1 million in the comparable period a year ago. Excluding non-cash charges
for the Company's ESOP, net loss for the six months ended August 31, 2003 was
($525,000), or ($0.03) per share, compared to ESOP-adjusted net loss of
($98,000), or ($0.01) per share, for the comparable period a year ago. Including
ESOP charges, net loss for the six months ended August 31, 2003 was ($672,000),
or ($0.04) per share, compared to net loss of ($373,000), or ($0.02) per share,
in the comparable period a year ago.
Steven G. Murdock, president and CEO of Meade Instruments, said: "The Mars
opposition had a positive impact on second-quarter results, driving an increase
in sales of mid-priced and higher-priced telescopes. These increases, however,
were offset by a significant decrease in small telescope sales due, in part, to
conservative purchasing patterns by certain of our domestic dealers. Sales at
the Simmons subsidiary, acquired in October 2002, came in as expected at
approximately $8.0 million for the quarter.
"Second-quarter gross margins -- which decreased to 28.9% from 30.7% in the
prior year -- reflect price reductions on our higher-priced telescopes and
general sales mix variations," said Murdock.
"We continue to be optimistic about the remainder of the year and we reiterate
the Company's current expectation that net revenues for fiscal 2004 will be $130
million to $140 million and net income per diluted share, excluding ESOP
expense, will be $0.13 to $0.23.," concluded Murdock.
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Meade Instruments is a leading designer and manufacturer of optical products
including telescopes and accessories for the beginning to serious amateur
astronomer. Meade offers a complete line of binoculars that address the needs of
everyone from the casual observer to the serious sporting or birding observer.
Meade also offers a complete line of riflescopes under the Simmons(R), Weaver(R)
and Redfield(R) brand names. The Company distributes its products worldwide
through a network of specialty retailers, mass merchandisers and domestic and
foreign distributors. Additional information on Meade is available at
www.meade.com.
"SAFE-HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: THIS NEWS RELEASE CONTAINS COMMENTS AND FORWARD-LOOKING STATEMENTS BASED
ON CURRENT PLANS, EXPECTATIONS, EVENTS, AND FINANCIAL AND INDUSTRY TRENDS THAT
MAY AFFECT THE COMPANY'S FUTURE OPERATING RESULTS AND FINANCIAL POSITION
EXPECTATIONS, INCLUDING NET SALES AND ESOP ADJUSTED NET INCOME PER DILUTED SHARE
FOR FISCAL 2004. SUCH STATEMENTS INVOLVE RISKS AND UNCERTAINTIES WHICH CANNOT BE
PREDICTED OR QUANTIFIED AND WHICH MAY CAUSE FUTURE ACTIVITIES AND RESULTS OF
OPERATIONS TO DIFFER MATERIALLY FROM THOSE DISCUSSED ABOVE. SUCH RISKS AND
UNCERTAINTIES INCLUDE, WITHOUT LIMITATION: ANY SIGNIFICANT DECLINE IN GENERAL
ECONOMIC CONDITIONS OR UNCERTAINTIES AFFECTING CONSUMER SPENDING; ANY GENERAL
DECLINE IN DEMAND FOR THE COMPANY'S PRODUCTS; ANY LOSS OF, OR FAILURE TO
REPLACE, ANY SIGNIFICANT PORTION OF THE SALES MADE TO ANY SIGNIFICANT CUSTOMER
OF THE COMPANY; THE OCCURRENCE OF UNANTICIPATED OR HIGHER THAN EXPECTED
OPERATING COSTS; THE RISKS AND UNCERTAINTIES ASSOCIATED WITH A MANUFACTURING AND
DISTRIBUTION COMPANY, SUCH AS LATER THAN EXPECTED PRODUCT INTRODUCTIONS OR
MATERIALS SHORTAGES; THE SUCCESSFUL INTEGRATION OF SIMMONS INTO THE COMPANY'S
EXISTING OPERATIONS; THE INHERENT RISKS AND LIABILITIES RELATED TO THE SALE OF
RIFLESCOPES; THE RISK THAT RIFLESCOPE SALES COULD BE ADVERSELY AFFECTED BY
EXISTING OR FURTHER REGULATION OR LEGISLATION RELATING TO THE USE OR SALE OF
SUCH PRODUCTS OR RELATED PRODUCTS, SUCH AS FIREARMS; THE RISKS AND UNCERTAINTIES
ASSOCIATED WITH LITIGATION; THE INHERENT RISKS ASSOCIATED WITH INTERNATIONAL
SALES, AS WELL AS THE OTHER RISKS AND UNCERTAINTIES PREVIOUSLY SET FORTH IN THE
COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. THE HISTORICAL
RESULTS ACHIEVED ARE NOT NECESSARILY INDICATIVE OF FUTURE PROSPECTS OF THE
COMPANY. FOR ADDITIONAL INFORMATION, REFER TO THE COMPANY'S FILINGS WITH THE
SECURITIES AND EXCHANGE COMMISSION. THE COMPANY UNDERTAKES NO OBLIGATION TO
PUBLICLY UPDATE OR REVISE ANY FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF
NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.
(Financial Data Follow)
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MEADE INSTRUMENTS CORP.
INCOME STATEMENT DATA
(Unaudited)
(000s omitted, except share and per share data)
Three Months Ended August 31, Six Months Ended August 31,
-------------------------------- ---------------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------
Net sales ............................................ $ 28,284 $ 24,035 $ 52,775 $ 44,088
Cost of sales ........................................ 20,123 16,653 38,881 30,519
------------- ------------- ------------- -------------
Gross profit ...................................... 8,161 7,382 13,894 13,569
Selling expenses ..................................... 4,258 3,066 7,585 6,081
General and administrative expenses .................. 3,026 2,936 5,695 5,723
ESOP expense ......................................... 125 178 294 428
Research and development expenses .................... 455 750 989 1,480
------------- ------------- ------------- -------------
Operating income (loss) ........................... 297 452 (669) (143)
Interest expense ..................................... 220 196 436 435
------------- ------------- ------------- -------------
Income (loss) before income taxes .................... 77 256 (1,105) (578)
Income tax provision (benefit) ....................... 37 122 (433) (205)
------------- ------------- ------------- -------------
Net income (loss) .................................... $ 40 $ 134 $ (672) $ (373)
============= ============= ============= =============
Per share information:
Net income (loss)-- basic and diluted ................ $ 0.00 $ 0.01 $ (0.04) $ (0.02)
Weighted average common shares
outstanding-- basic ............................... 18,876,000 15,162,000 18,832,000 15,107,000
============= ============= ============= =============
Weighted average common shares
outstanding-- diluted ............................. 19,026,000 15,468,000 18,832,000 15,107,000
============= ============= ============= =============
Reconciliation of Net income (loss), excluding ESOP charges, to Net income
(loss), including ESOP charges (000s omitted, except per share data):
Three Months Ended Six Months Ended
August 31, August 31,
-------------------------------- ---------------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------
Net income (loss) .................................... $ 40 $ 134 $ (672) $ (373)
ESOP expense, net of tax ............................. 65 119 147 275
------------- ------------- ------------- -------------
Net income (loss) excluding ESOP, net of tax ......... $ 105 $ 253 $ (525) $ (98)
============= ============= ============= =============
Per share information:
Net income (loss)-- diluted .......................... $ 0.00 $ 0.01 $ (0.04) $ (0.02)
ESOP expense, net of tax ............................. 0.01 0.01 0.01 0.01
------------- ------------- ------------- -------------
Net income (loss) excluding ESOP-- diluted ........... $ 0.01 $ 0.02 $ (0.03) $ (0.01)
============= ============= ============= =============
Management believes net income, excluding ESOP expense, net of tax is a
supplemental financial measure commonly used by management and industry analysts
to evaluate the Company's financial performance. The ESOP expense is a non-cash
expense related to the allocation of Company stock to participants in its
Employee Stock Ownership Plan. The expense related to the ESOP stock allocation
is based on the market value of the allocated stock. The market value of the
Company's stock has fluctuated significantly over the last several years.
Excluding the ESOP expense, net of tax, eliminates the volatility introduced
into the income statement by the market value expense of the ESOP allocation.
Given the possibility for volatility in the future share price of the Company's
stock, the Company is unable to provide guidance with respect to future net
income including ESOP charges.
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