Exhibit 99.1
Badger Meter Reports Record First Quarter;
Sales, earnings and earnings per share reach new highs
MILWAUKEE--(BUSINESS WIRE)--April 19, 2006--Badger Meter, Inc. (AMEX:BMI)
today reported record sales, earnings and earnings per share for the first
quarter ended March 31, 2006.
First Quarter Highlights
-- Net sales were a record $61,036,000 for the first quarter of 2006, a
12.1% increase from sales of $54,432,000 for the first quarter of
2005.
-- Net earnings were a record $4,231,000 for the first quarter of 2006, a
19.0% increase from earnings of $3,556,000 for the same period in the
prior year.
-- Diluted earnings per share were a record $0.59, a 15.7% increase from
earnings of $0.51 per diluted share for the first quarter of 2005.
"This was another record-breaking quarter for Badger Meter. First quarter
sales were not only the highest of any first quarter, but were also the highest
of any quarter in our history. In addition, first quarter earnings per share
equaled the previous all-time high set in the second quarter of last year," said
Richard A. Meeusen, chairman, president and chief executive officer of Badger
Meter.
"The strong first quarter performance was driven by our utility product
line, which recorded double-digit increases in sales of residential and
commercial water meters and systems. Overall, our utility products are
benefiting from the continued growth in automatic meter reading (AMR) systems.
Within this market, Orion(R), our proprietary radio-frequency mobile AMR system,
has become the star in the industry," said Meeusen.
Meeusen said the performance of the company's industrial product lines was
comparable to the first quarter of last year, excluding the results of the
operation in Nancy, France, which were again disappointing. "We are continuing
to explore our options for the future of the French business," he said.
"Gross margin dollars continued to improve in the first quarter, reflecting
the positive impact of the increased Orion sales and higher sales of commercial
water meters. We attribute Orion's strong acceptance in the market to the fact
that it was designed specifically for the water utility industry, in which AMR
electronics are exposed to more rigorous environmental conditions than electric
or gas units. Orion offers a number of other features that meet utility customer
needs including tamper and leak detection, data profiling and a unique
compatibility with a variety of AMR systems and networks, such as WiFi systems
and power line and broadband carriers," said Meeusen.
"Because of its attractive benefits, many customers are selecting Orion
over AMR products produced by other manufacturers. While Badger Meter continues
to market other manufacturers' products, we expect the current trend of
increasing Orion sales and decreasing sales of other manufacturers' products to
continue in future quarters. Since the increasing Orion sales are more than
offsetting the decline in these sales and because the proprietary Orion products
have a higher gross margin, we do not expect the reduction in these sales to
have a negative impact on our financial results," said Meeusen.
"We are pleased with the strong start to 2006. We believe the continuing
growth of automatic meter reading, combined with our innovative product line and
strong industry reputation, will continue to be a successful combination for
Badger Meter in the years ahead," he added.
About Badger Meter
Badger Meter is a leading marketer and manufacturer of flow measurement and
control technology, developed both internally and with other companies, as well
as the leader in providing digital connectivity to leading AMR technologies. Its
products are used to measure and control the flow of liquids in a variety of
applications.
Certain statements contained in this news release, as well as other
information provided from time to time by Badger Meter, Inc. (the "Company") or
its employees, may contain forward looking statements that involve risks and
uncertainties that could cause actual results to differ materially from those in
the forward looking statements. The words "anticipate," "believe," "estimate,"
"expect," "think," "should" and "objective" or similar expressions are intended
to identify forward looking statements. All such forward looking statements are
based on the Company's then current views and assumptions and involve risks and
uncertainties that include, among other things:
-- the continued shift in the Company's business from lower cost, local
read meters toward more expensive, value-added automatic meter reading
(AMR) systems;
-- the success or failure of newer Company products, including the
Orion(R) radio frequency mobile AMR system, the absolute digital
encoder (ADE(TM)) and the Galaxy(R) fixed network AMR system;
-- changes in competitive pricing and bids in both the domestic and
foreign marketplaces, and particularly in continued intense price
competition on government bid contracts for lower cost, local read
meters;
-- the actions (or lack thereof) of the Company's competitors;
-- changes in the Company's relationships with its alliance partners,
primarily its alliance partners that provide AMR connectivity
solutions, and particularly those that sell products that do or may
compete with the Company's products;
-- changes in the general health of the United States and foreign
economies, including housing starts in the United States and overall
industrial activity;
-- increases in the cost and/or availability of needed raw materials and
parts, including recent increases in the cost of brass housings as a
result of increases in the commodity prices for copper and zinc at the
supplier level and resin as a result of increases in petroleum and
natural gas prices;
-- the ability to improve operating results for foreign markets that have
experienced historical losses;
-- changes in foreign economic conditions, particularly currency
fluctuations between the United States dollar and the euro; and
-- changes in laws and regulations, particularly laws dealing with the
use of lead (which can be used in the manufacture of certain meters
incorporating brass housings) and Federal Communications Commission
rules affecting the use and/or licensing of radio frequencies
necessary for AMR products.
All of these factors are beyond the Company's control to varying degrees.
Shareholders, potential investors and other readers are urged to consider these
factors carefully in evaluating the forward looking statements and are cautioned
not to place undue reliance on such forward looking statements. The forward
looking statements made in this document are made only as of the date of this
document and the Company assumes no obligation, and disclaims any obligation, to
update any such forward looking statements to reflect subsequent events or
circumstances.
Badger Meter company news is available 24 hours a day, on-line at:
http://www.badgermeter.com.
BADGER METER, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
2006 2005
---- ----
Net sales $61,036,000 $54,432,000
Gross margin $21,112,000 $19,355,000
Earnings before income taxes $7,294,000 $6,028,000
Provision for income taxes $3,063,000 $2,472,000
Net earnings $4,231,000 $3,556,000
Earnings per share:
Basic $0.62 $0.53
Diluted $0.59 $0.51
Shares used in computation of:
Basic 6,845,164 6,701,667
Diluted 7,151,279 6,940,676
BADGER METER, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
Assets March 31, December 31,
------ 2006 2005
---- ----
(unaudited)
Cash $5,770,000 $4,403,000
Receivables 34,919,000 30,450,000
Inventories 32,936,000 31,970,000
Other current assets 6,567,000 5,741,000
------------ ------------
Total current assets 80,192,000 72,564,000
Net property, plant and equipment 44,318,000 43,870,000
Prepaid pension 17,274,000 17,726,000
Other long-term assets 5,260,000 5,127,000
Goodwill 6,667,000 6,580,000
------------ ------------
Total assets $153,711,000 $145,867,000
============ ============
Liabilities and Shareholders' Equity
------------------------------------
Short-term debt and current portion
long-term debt $15,668,000 $16,278,000
Payables 15,001,000 11,484,000
Accrued compensation and employee
benefits 4,633,000 6,436,000
Other liabilities 6,569,000 5,388,000
------------ ------------
Total current liabilities 41,871,000 39,586,000
Deferred income taxes 6,589,000 6,584,000
Long-term employee benefits and other 11,188,000 10,921,000
Long-term debt 15,675,000 15,360,000
Shareholders' equity 78,388,000 73,416,000
------------ ------------
Total liabilities and
shareholders' equity $153,711,000 $145,867,000
============ ============
CONTACT: Badger Meter, Inc.
Joan C. Zimmer, 414-371-5702