EXHIBIT 99
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[ZOLTEK logo]
FOR IMMEDIATE RELEASE NASDAQ NMS SYMBOL: "ZOLT"
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ZOLTEK REPORTS CONTINUED STRONG GROWTH IN FIRST QUARTER
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ST. LOUIS, MISSOURI -- FEBRUARY 9, 2006 -- Zoltek Companies, Inc.
today reported continued strong growth in the first quarter of its 2006
fiscal year, combined with improved operating results.
For the quarter ended December 31, 2005, Zoltek's net sales
increased 36.6% to $16.7 million from $12.2 million in the first quarter of
fiscal 2005. Zoltek reported an operating loss from continuing operations of
$880,000, including approximately $460,000 in Sarbanes-Oxley compliance
charges, compared with a $1.4 million operating loss in the comparable
period in fiscal year 2005.
"We are pleased to report that the increased sales and improved
financial performance are largely due to the performance of the Abilene
plant after we made the necessary management changes that we previously
reported, " Zsolt Rumy, Zoltek's Chairman and Chief Executive Officer said.
"Our sales are still constrained by our carbon fibers capacity utilization,
which will continue to improve during subsequent quarters. We are also
adding substantial new capacity during the remainder of this fiscal year and
beyond."
"We are especially pleased to report that in the quarter ending
December 31, 2005 the Carbon Fiber Business Unit's operating profit was
$413,000 compared with a $1.6 million loss in the comparable period in
fiscal year 2005," added Rumy. "And perhaps our most significant achievement
is that in the month of December, Zoltek's operating profit was
approximately $400,000 on $6.2 million sales. We believe this is
representative of our expectations for improving our financial performance
during the remainder of fiscal 2006."
Rumy suggested that shareholders should continue to focus on the
Company's operating income (loss) line rather than its net income (loss)
line, which is more representative of the Company's operating performance.
Beginning in the second quarter of fiscal 2005, Zoltek adopted an accounting
method that treats much of the Company's debt as derivatives. As a result,
the Company's reported net results have been, and for the foreseeable future
will continue to be, subject to wide swings related to the Company's stock
price, which have a much greater effect than the impact of results from
operations on net income (loss). Rumy noted, for example, that the outsized
change in reported net results from the
[ZOLTEK logo]
Zoltek Reports Continued Strong Growth In First Quarter
Page 2
February 9, 2006
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fourth quarter of fiscal 2005 to the first quarter of fiscal 2006 - in going
from a net loss of $11.1 million to net income of $6.3 million - "did not
reflect underlying business fundamentals." However, Rumy said, the change
from an operating loss in the quarter for the Carbon Fibers Business Unit or
for the entire Company in the month of December to an operating profit " is
real and is important."
Zoltek Companies, Inc. will host a conference call to review first
quarter 2006 results and answer questions on Tuesday, February 14, 2006, at
10:00 am CT. The conference dial-in number is (719) 457-2640. The
confirmation code is 7007431. Individuals who wish to participate should
dial in five minutes prior to the scheduled start time.
Zoltek's annual meeting, open to all interested parties, will be
held at the Hilton St. Louis Frontenac on February 21, 2006 at 10:00 am CT.
The 2005 annual report is also available upon request, providing an in-depth
update on Zoltek's prospects and progress.
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 Continued Strong Growth In First Quarter
Page 3
February 9, 2006
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ZOLTEK COMPANIES, INC.
SUMMARY FINANCIAL RESULTS
(Amounts In Thousands Except Per Share Data)
(Unaudited)
Three Months Ended
December 31
2005 2004
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Net sales.......................................................................$ 16,721 $ 12,243
Cost of sales, excluding available unused capacity costs........................ 13,966 11,212
Available unused capacity costs................................................. - 525
Application and development costs............................................... 1,078 828
Operating loss from continuing operations....................................... (880) (1,396)
Interest expense and amortization of financing fees, debt discount and
beneficial conversion feature................................................. (2,778) (2,922)
Gain (loss) on value of warrants and conversion feature......................... 10,022 (25,518)
Income tax expense.............................................................. 97 115
Net income (loss) from continuing operations.................................... 6,255 (29,338)
Net income (loss) from discontinued operations, net of taxes.................... 33 (591)
Net income (loss)............................................................... 6,288 (29,929)
Net income (loss) per share:
Basic income (loss) per share:
Continuing operations................................................$ 0.31 $ (1.78)
Discontinued operations.............................................. 0.01 (0.04)
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Total.........................................................$ 0.32 $ (1.82)
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Diluted (income) loss per share:
Continuing operations................................................$ 0.03 $ (1.78)
Discontinued operations.............................................. 0.01 (0.04)
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Total.........................................................$ 0.04 $ (1.82)
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Weighted average common shares outstanding - basic.............................. 19,918 16,446
Weighted average common shares outstanding - diluted............................ 22,385 16,446