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FOR IMMEDIATE RELEASE EXHIBIT 99.1
CONTACT: Elan Yaish
Chief Financial Officer
Telephone: (631) 951-7060
Fax: (631) 951-7639
email: eyaish@mecnet.com
MANCHESTER REPORTS FISCAL FOURTH QUARTER AND YEAR END RESULTS
HAUPPAUGE, NEW YORK - October 28, 2004 - Manchester Technologies, Inc.
(NASDAQ NM: MANC), a leading distributor of display technology solutions and
plasma display monitors, today announced financial results for the fourth
quarter and fiscal year ended July 31, 2004.
On May 28, 2004, the Company sold its end-user information technology
fulfillment and professional services business to ePlus, inc., a leading
provider of Enterprise Cost Management, in an all cash transaction. The results
of operations for the end-user information technology fulfillment and
professional services business have been recorded as discontinued operations in
the accompanying consolidated statements of operations.
Revenue from continuing operations for the quarter was $40.1 million as
compared with $40.5 million for the comparable quarter last year. Income from
continuing operations for the quarter was $265,000 or $0.03 per diluted share as
compared with a loss from continuing operations of $206,000 or $0.03 per diluted
share reported a year ago. Weighted average common shares outstanding used for
the computation of diluted earnings per share were 8,310,000 and 7,990,000,
respectively.
Revenue from continuing operations for the fiscal year ended July 31, 2004
was $173.0 million as compared with $164.2 million for the fiscal year ended
July 31, 2003. Income from continuing operations for the fiscal year was $2.3
million or $0.28 per diluted share as compared with $2.6 million or $0.33 per
diluted share reported a year ago. Weighted average common shares outstanding
used for the computation of diluted earnings per share were 8,210,000 and
8,007,000, respectively.
Barry R. Steinberg, President and CEO of Manchester Technologies, Inc.,
stated, "While revenues in the quarter were slightly lower than last year, we
are pleased that our gross margins increased both in dollars and as a percentage
of revenues. The display technology market is expected to continue to grow and
we remain a dominant player in this market. As a result of the sale of our IT
product and service business, we are now able to focus all our efforts on
continuing to grow our display solutions business."
The Company ended the quarter with cash and cash equivalents of $16.9
million, working capital of $34.4 million, total assets of $71.6 million and
shareholders' equity of $42.1 million.
MANCHESTER TECHNOLOGIES, INC.
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About Manchester Technologies, Inc.
Manchester Technologies, Inc. is a distributor of display technology solutions
and plasma display monitors through its subsidiary Electrograph Systems, Inc.
and is a distributor of computer hardware, primarily to dealers and system
integrators. More information about the Company can be obtained by visiting the
Company's website located at http://www.e-manchester.com and the website of its
subsidiary at http://www.electrograph.com.
Statement Under the Private Securities Litigation Reform Act
This press release includes information that may constitute forward-looking
statements within the meaning of the federal securities laws. All statements
other than statements of historical fact, including, without limitation, those
with respect to Manchester Technologies, Inc.'s objectives, plans and strategies
set forth herein and those preceded by or that include the words "believes,"
"intends," "expects," "will," "plans," "anticipates," or similar expressions,
are forward-looking statements. These forward-looking statements speak only as
of the date of this press release. Manchester's actual results may differ
materially from the results discussed herein as a result of a number of unknown
factors, including, without limitation, there being no assurance that Manchester
will be successful in its efforts to focus on higher-margin products and
services, in identifying suitable acquisition candidates and in integrating
acquired companies, or in attracting and retaining highly skilled technical
personnel and sales representatives necessary to implement its growth
strategies, or that Manchester will not be adversely affected by continued
intense competition in the computer industry, continued deterioration in average
selling prices of personal computers and display technologies, a decrease in the
growth of the display technology market, a lack of product availability,
deterioration in relationships with major manufacturers, a loss or decline in
sales to any of its major customers, or any of the other risks set forth in
Manchester's Annual Report on Form 10-K for the year ended July 31, 2003, and
those set forth from time to time in Manchester's other filings with the
Securities and Exchange Commission. Manchester assumes no obligation to update
any of the information referenced in this press release. These documents are
available through the Company, or through the Securities and Exchange
Commission's Electronic Data Gathering Analysis and Retrieval system (EDGAR) at
www.sec.gov.
- Tables Follow-
Manchester Technologies, Inc. and Subsidiaries
Consolidated Statements of Operations
(in thousands, except per share amounts)
Three months ended Year ended
July 31, July 31,
2004 2003 2004 2003
---- ---- ---- ----
(Unaudited)
Revenue $40,097 $40,520 $173,040 $164,156
Cost of Revenue 36,642 37,240 156,354 147,672
------ ------ -------- -------
Gross profit 3,455 3,280 16,686 16,484
Selling, general and
administrative expenses 3,157 3,557 12,892 12,214
----- ----- ------ ------
Income (loss) from operations 298 (277) 3,794 4,270
Interest and other income (expense), net 146 (31) (20) 115
--- ---- ---- ---
Income (loss) from continuing operations
before income taxes 444 (308) 3,774 4,385
Income tax provision (benefit) 179 (102) 1,490 1,775
--- ---- ----- -----
Income (loss) from continuing operations 265 (206) 2,284 2,610
--- ---- ----- -----
Discontinued operations:
Loss from operations of
discontinued component (5,302) (3,411) (7,616) (8,005)
Income tax benefit (1,947) (970) (2,851) (2,807)
------ ---- ------- ------
Loss from discontinued operations (3,355) (2,441) (4,765) (5,198)
------- ------ ------ -----
Net loss $(3,089) $(2,647) $(2,481) $(2,588)
====== ====== ======== =======
Income (loss) per share from continuing operations
Basic $0.03 $(0.03) $0.28 $0.33
==== ===== ==== ====
Diluted $0.03 $(0.03) $0.28 $0.33
==== ====== ==== ====
Loss per share from discontinued operations
Basic $(0.41) $(0.31) $(0.59) $(0.65)
====== ===== ===== =====
Diluted $(0.41) $(0.31) $(0.59) $(0.65)
===== ===== ====== =====
Net loss per share
Basic $(0.38) $(0.33) $(0.31) $(0.32)
==== ===== ===== ======
Diluted $(0.38) $(0.33) $(0.31) $(0.32)
==== ===== ===== ======
Weighted average shares outstanding
Basic 8,117 7,990 8,077 7,990
===== ===== ===== =====
Diluted 8,310 7,990 8,210 8,007
===== ===== ===== =====
- Additional Tables Follow -
Manchester Technologies, Inc. and Subsidiaries
Consolidated Balance Sheets
(in thousands, except per share amounts)
July 31, July 31,
2004 2003
---- ---- -
Assets
Current assets:
Cash and cash equivalents $16,881 $ 8,553
Accounts receivable, net of allowance for doubtful accounts
of $2,848 and $1,426, respectively 15,530 35,117
Inventory 20,301 9,605
Deferred income taxes 1,212 603
Prepaid taxes 916 1,704
Prepaid expenses and other current assets 1,266 709
----- ------
Total current assets 56,106 56,291
Property and equipment, net 9,890 13,985
Goodwill, net 3,735 6,439
Deferred income taxes 1,728 757
Other assets 183 278
------- -------
Total assets $71,642 $77,750
====== ======
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued expenses $21,492 $24,752
Deferred service contract revenue - 666
Current portion of capital lease obligations 246 212
-------- --------
Total current liabilities 21,738 25,630
Deferred compensation payable 98 263
Capital lease obligations, net of current portion 7,683 7,923
----- -----
Total liabilities 29,519 33,816
------ ------
Commitments and contingencies
Shareholders' equity:
Preferred stock, $.01 par value; 5,000 shares
authorized, none issued - -
Common stock, $.01 par value; 25,000 shares
authorized, 8,163 and 7,990 shares issued
and outstanding 82 80
Additional paid-in capital 19,597 18,942
Deferred compensation - (13)
Retained earnings 22,444 24,925
------ ------
Total shareholders' equity 42,123 43,934
------ ------
Total liabilities and shareholders' equity $71,642 $77,750
====== ======
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