Exhibit 99.1
National Dentex Corporation Announces Fourth Quarter and Full Year 2004 Results
WAYLAND, Mass.--(BUSINESS WIRE)--Feb. 25, 2005--National Dentex
Corporation (NASDAQ: NADX), one of the largest owner/operators of
dental laboratories in the United States, today announced its results
for the fourth quarter and year ended December 31, 2004. Sales for the
quarter totaled $27,599,000 compared with $25,768,000 a year earlier.
Net income for the quarter was $708,000 or $.13 per share on a diluted
basis compared to $1,498,000 or $.28 per share on a diluted basis in
2003.
For the full year ended December 31, 2004, sales were $111,753,000
compared to $99,274,000 for the same period in 2004. Net income was
$5,450,000 or $1.00 per share on a diluted basis compared to
$5,757,000 or $1.10 per share on a diluted basis for the comparable
period of 2003.
Commenting on the past year, David Brown, President and CEO,
stated: "Fiscal year 2004 was a unique and challenging one for
National Dentex. Operationally we made significant progress,
increasing our gross profit by over $5,000,000. This improvement came
as we continued to focus our internal efforts on the training of our
technicians and sharing best production practices across our system.
We continued to invest in our Reliance(TM) brand as a way to
differentiate our products and services, making them more relevant and
valuable to our customers. In our fragmented and intensely competitive
industry our success at differentiating ourselves in a professional
manner will allow us to become a truly valued participant in the
dentist - laboratory relationship.
"The year also saw the Company under tremendous cost pressure
regarding the internal control compliance requirements of Section 404
of the Sarbanes - Oxley Act. This process, due to our structure of 40
locations across the country, proved to be extremely expensive. The
impact on the year's earnings was approximately $.13 per diluted
share, with most of that landing in the fourth quarter. We believe
that approximately 60% to 70% of these start up costs will not be
required in future years as we maintain the ongoing program. Despite
this overwhelming cost, it is a tribute to our Company as a whole, and
to our dedicated employees in particular, to have completed the
process so efficiently, successfully and without any material
weaknesses.
Mr. Brown continued: "Throughout the year we also continued to
generate positive leads in our acquisition program. We will continue
to pursue these and other leads and actively attempt to acquire
laboratories which enhance our reputation as the leading operator of
high quality dental laboratories in the United States. Our two most
recent acquisitions of D. H. Baker Dental Laboratory and Wornson -
Polzin Dental Laboratory, in addition to adding over $7 million of
annualized revenues, typify and augment National Dentex's reputation
for quality driven and customer focused dental laboratories."
National Dentex Corporation serves an active customer base of over
20,000 dentists through dental laboratories located in 29 states.
National Dentex's dental laboratories provide a full range of
custom-made dental prosthetic appliances, including dentures, crowns
and fixed bridges, and other dental specialties.
This press release contains forward-looking statements within the
meaning of the federal securities laws, including statements regarding
our future financial performance, acquisition activity, and
marketplace competitiveness, that are based on our current
expectations, beliefs, assumptions, estimates, forecasts and
projections about the industry and markets in which National Dentex
operates. The statements contained in this release are not guarantees
of future performance and involve certain risks, uncertainties and
assumptions that are difficult to predict. Therefore, actual outcomes
and results may differ materially from what is expressed in such
forward-looking statements. Important factors that may affect future
operating and financial results include the timing, duration and
effects of adverse changes in overall economic conditions, the
Company's ability to acquire and successfully operate additional
laboratories, governmental regulation of health care, trends in the
dental industry towards managed care, increases in labor, benefits and
material costs, product development risks, technological innovations,
and other risks indicated from time to time in the Company's filings
with the Securities and Exchange Commission.
National Dentex Corporation
Earnings Results
(In Thousands, except per share data)
Quarter Ended Twelve Months Ended
December 31, December 31,
-------------------- --------------------
2003 2004 2003 2004
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Net Sales $25,768 $27,599 $99,274 $111,753
Cost of Goods Sold 15,459 17,059 59,534 66,953
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Gross Profit 10,310 10,540 39,740 44,800
Operating Expenses 7,650 9,230 30,102 35,271
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Operating Income 2,660 1,310 9,638 9,529
Other Expense 78 117 296 404
Interest (Income) Expense - 14 (21) 42
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Income Before Tax 2,582 1,179 9,363 9,083
Income Taxes 1,084 471 3,606 3,633
-------------------- --------------------
Net Income $1,498 $708 $5,757 $5,450
==================== ====================
Weighted Average
Shares Outstanding:
- Basic 5,145 5,220 5,131 5,187
- Diluted 5,296 5,516 5,210 5,465
Net Income per Share:
- Basic $0.29 $0.14 $1.12 $1.05
- Diluted $0.28 $0.13 $1.10 $1.00
National Dentex Corporation
Selected Balance Sheet Data
(In thousands)
December 31, December 31,
2003 2004
------------ ------------
Cash and Equivalents $1,835 $2,216
Accounts Receivable - net 11,914 12,299
Current Assets 21,930 23,527
Current Liabilities 9,678 9,777
Working Capital 12,252 13,750
Total Assets 72,233 80,039
Long Term Obligations 2,415 3,088
Stockholders' Equity $60,140 $67,174
CONTACT: National Dentex Corporation
Richard F. Becker, 508-358-4422