EXHIBIT 99
----------
[ZOLTEK logo]
FOR IMMEDIATE RELEASE NASDAQ NMS SYMBOL: "ZOLT"
- --------------------- -------------------------
ZOLTEK REPORTS STRONG CARBON FIBER GROWTH IN 2005
-------------------------------------------------
ST. LOUIS, MISSOURI -- JANUARY 3, 2006 -- Zoltek Companies, Inc.
today reported results for the 2005 fiscal year, ended September 30.
Zoltek's net sales increased from $39.8 million in fiscal 2004 to
$60.2 million in fiscal 2005, an increase of 51%. Despite sharply increased
sales and booming demand for Zoltek's low-cost, high-performance carbon
fibers, the operating loss from continuing operations widened from $5.7
million in fiscal 2004 to $8.1 million in fiscal 2005. Increased revenues
from resumption of production at Zoltek's Abilene, Texas facility were more
than offset by considerable costs incurred for restarting a facility that
had been idle for several years.
"The carbon fiber-led revolution in building materials that we
predicted over a dozen years ago is now well and truly underway," said Zsolt
Rumy, Zoltek's Chairman and Chief Executive Officer. "Zoltek is no longer
alone in championing this revolution. We have been joined by a powerful
group of companies: our best customers. As a result, we expect to ship
increasing volumes of Zoltek-made carbon fibers in fiscal 2006, 2007 and
2008. Our customers have agreed to price increases as well, which will
enhance our margins as well as our revenues in the year ahead."
Rumy said that difficulties in restarting operations in Abilene
were primarily "people-related, not technical." "We've had a hard time
finding and training qualified workers and managers at a site that had been
dormant for four years," Rumy said. "Without them, we could not duplicate
the success of our production lines in Hungary, even though the process
technology is identical." Rumy noted that Zoltek recently had moved some of
its most experienced managers from Hungary to Abilene, and now has three of
the five lines installed in Abilene running at their targeted production
rates. The other two lines are operational, and their production levels will
increase as additional workers are recruited and trained. The full effect of
improved Abilene production and the new lines is expected to show
significant operating improvements during the second quarter of fiscal 2006
and continue throughout the balance of the year.
He said that Zoltek was on schedule in carrying out the second
stage of a major expansion plan centered at its facility in Hungary - at
which two new carbon fiber lines became operational in late 2005. Over the
course of 2006, Zoltek expects to raise its total rated capacity from
9 million pounds
[ZOLTEK logo]
Zoltek Reports Strong Carbon Fiber Growth in 2005
Page 2
January 3, 2006
- ------------------------------------------------------------------------------
to 19 million pounds per year. After that doubling, Zoltek expects to almost
double capacity again in 2007.
Additional information with respect to Zoltek's results of
operations and financial condition for the fiscal year ended September 30,
2005 is contained in its annual report on Form 10-K which has been filed
with the Securities and Exchange Commission.
Due to the Company's recent holiday and management traveling
schedules, Zoltek Companies, Inc. will host a conference call to review
fourth quarter/fiscal year-end 2005 results and answer questions on Tuesday,
January 10, 2006, at 10:00 am CT. The conference dial-in number is (719)
457-2730. The confirmation code is 2107419. Individuals who wish to
participate should dial in five minutes prior to the scheduled start time.
FOR FURTHER INFORMATION CONTACT:
ZSOLT RUMY, CEO OR KEVIN SCHOTT, CFO
3101 MCKELVEY ROAD
ST. LOUIS, MO 63044
(314) 291-5110
This press release contains forward-looking statements, which are based upon
the current expectations of the Company. Because these forward-looking
statements are inherently subject to risks and uncertainties, there are a
number of factors that could cause the Company's plans, actions and actual
results to differ materially. Among these factors are the Company's ability
to: re-activate its formerly idle manufacturing facilities on a timely and
cost-effective basis, to meet current order levels for carbon fibers;
successfully add new capacity for the production of carbon fiber and
precursor raw material; execute plans to exit its specialty products
business and reduce costs; achieve profitable operations; raise new capital
and increase its borrowing at acceptable costs; manage changes in customers'
forecasted requirements for the Company's products; continue investing in
application and market development; manufacture low-cost carbon fibers and
profitably market them; and penetrate existing, identified and emerging
markets. The timing and occurrence (or non-occurrence) of transactions and
events that determine the future effect of these factors on the Company, as
well as other factors, may be beyond the control of the Company. The Company
undertakes no obligation to update any forward-looking statement to reflect
events or circumstances after the date of this press release.
[ZOLTEK logo]
Zoltek Reports Strong Carbon Fiber Growth in 2005
Page 3
January 3, 2006
- ----------------------------------------------------------------------------------------------------------------------------
ZOLTEK COMPANIES, INC.
SUMMARY FINANCIAL RESULTS
(Amounts In Thousands Except Per Share Data)
(Unaudited)
Three Months Ended
September 30
2005 2004
-------------------------
Net sales........................................................................................ $ 16,010 $ 10,628
Cost of sales, excluding available unused capacity costs......................................... 14,924 9,025
Available unused capacity costs.................................................................. 594 824
Application and development costs................................................................ 837 780
Operating loss from continuing operations........................................................ (3,649) (873)
Interest expense and amortization of financing fees, debt discount and
beneficial conversion feature.................................................................. (1,864) (2,218)
Loss on value of warrants and conversion feature................................................. (4,650) (3,973)
Income tax expense............................................................................... 277 110
Net loss from continuing operations.............................................................. (10,512) (7,255)
Net loss from discontinued operations, net of taxes.............................................. (629) (2,916)
Net loss......................................................................................... (11,141) (10,171)
Net loss per share:
Basic and diluted loss per share:
Continuing operations................................................................... $ (0.58) $ (0.44)
Discontinued operations................................................................. $ (0.03) $ (0.18)
-------- --------
Total.............................................................................. $ (0.61) $ (0.62)
======== ========
Weighted average common shares outstanding....................................................... 18,050 16,429
Fiscal Year Ended
September 30
2005 2004
-------------------------
Net sales........................................................................................ $ 60,204 $ 39,827
Cost of sales, excluding available unused capacity costs......................................... 56,836 33,401
Available unused capacity costs.................................................................. 2,347 4,466
Application and development costs................................................................ 3,324 3,070
Operating loss from continuing operations........................................................ (8,149) (5,714)
Interest expense and amortization of financing fees, debt discount and
beneficial conversion feature.................................................................. (11,469) (6,006)
Loss on value of warrants and conversion feature................................................. (16,574) (4,920)
Income tax expense............................................................................... 708 434
Net loss from continuing operations.............................................................. (38,674) (17,203)
Net loss from discontinued operations, net of taxes.............................................. (1,719) (5,604)
Net loss......................................................................................... (40,393) (22,807)
Net loss per share:
Basic and diluted loss per share:
Continuing operations................................................................... $ (2.14) $ (1.05)
Discontinued operations................................................................. $ (0.09) $ (0.35)
-------- --------
Total.............................................................................. $ (2.23) $ (1.40)
======== ========
Weighted average common shares outstanding....................................................... 18,050 16,372