Exhibit 99.1
Ultralife Batteries Reports Third Quarter Results
NEWARK, N.Y.--(BUSINESS WIRE)--Nov. 9, 2006--Ultralife Batteries,
Inc. (NASDAQ: ULBI) reported an operating loss of $2.1 million on
revenues of $23.7 million for the third quarter ended September 30,
2006. In comparison, the company reported an operating loss of $1.5
million on revenues of $15.7 million for the same period last year.
Subsequent to announcing preliminary third quarter results on October
26, the company adjusted third quarter revenue to reflect a final
review of shipments at McDowell and updated its estimate of intangible
amortization expense.
Third quarter revenue growth reflects increases in 9-volt sales
and higher commercial business, particularly from the automotive
telematics market, as well as the addition of McDowell Research and
ABLE New Energy, which were acquired on July 3 and May 19,
respectively, of this year. As a percentage of revenues, gross margins
were 17% compared with 15% in the same quarter last year. Operating
expenses of $6.1 million included $0.4 million in stock-based
compensation expense, $0.5 million in intangible amortization, and
$1.4 million in added operating costs from the newly-acquired
companies. For the same period last year, operating expenses amounted
to $3.9 million. Net loss for the third quarter of 2006 was $1.7
million, or $0.11 per common share, compared to a net loss of $1.3
million, or $0.09 loss per common share, for the third quarter of
2005.
For the nine-month period ended September 30, 2006, revenues
totaled $63.4 million compared to $52.7 million for the same period
last year. The company reported an operating loss of $1.4 million,
including $1.0 million in stock-based compensation expense and $0.5
million of intangible amortization, compared to an operating loss of
$3.0 million for the first nine months of 2005. Net loss for the first
three quarters of 2006 was $1.4 million, or $0.10 per share, compared
to a net loss for the same period last year of $4.3 million, or $0.30
per share.
"Revenues for the third quarter are indicative of the success we
are having in progressing opportunities in our commercial business and
in diversifying our government/military business," said John D.
Kavazanjian, Ultralife's president and chief executive officer. "Since
reporting preliminary third quarter results, we have satisfied
ourselves that the handful of issues which had a bearing on the
quarter's performance are substantially behind us."
"As we move forward in the fourth quarter, the initiatives we are
implementing to enhance operations at McDowell and ABLE should benefit
our bottom line performance," concluded Kavazanjian. "In addition,
through increased coordination of sales and marketing functions we are
making progress toward integrating both McDowell and ABLE into our
core business and organizing ourselves to optimally leverage a
broadened product portfolio and wider array of growth opportunities.
Based on our backlog of contract awards and our pipeline for new
business, we remain comfortable with the revenue outlook for the
fourth quarter we provided on October 26. The combination of our
augmented growth strategy and stabilized cost structure will give us a
solid foundation on which to drive the company's earnings power in
2007."
Outlook
For the fourth quarter of 2006, management expects revenues of
approximately $35 million, resulting in revenues for the full year in
the range of $100 million. Operating income for the fourth quarter is
projected to range between $2.5 million and $3.0 million, including
non-cash charges for stock based compensation expense and intangible
amortization, which are assumed to be $0.5 million and $0.4 million,
respectively.
About Ultralife Batteries, Inc.
Ultralife is a global provider of high-energy power solutions and
communications accessories for diverse applications. The company
develops, manufactures and markets a wide range of non-rechargeable
and rechargeable batteries, charging systems and accessories including
power supplies, amplifiers, amplified speakers, equipment mounts, case
equipment and integrated communication systems for markets including
military, commercial and consumer portable electronics. Through its
portfolio of standard products and engineered solutions, Ultralife is
at the forefront of providing the next generation of power systems and
accessories. Commercial, retail and government customers include
General Dynamics, Philips Medical Systems, General Motors, Energizer,
Kidde Safety, Lowe's, Radio Shack and the national defense agencies of
the United States, United Kingdom, Germany, Australia and New Zealand,
among others.
Ultralife's headquarters, principal manufacturing and research
facilities are in Newark, New York, near Rochester. Ultralife's three
other operating units are: Ultralife Batteries (UK) Ltd., in Abingdon,
England; McDowell Research in Waco, Texas; and ABLE New Energy in
Shenzhen, China. Detailed information on Ultralife is available at:
www.ultralifebatteries.com.
This press release may contain forward-looking statements based on
current expectations that involve a number of risks and uncertainties.
The potential risks and uncertainties that could cause actual results
to differ materially include: addressing the process of U.S. military
procurement, worsening global economic conditions, increased
competitive environment and pricing pressures, disruptions related to
restructuring actions and delays. Further information on these factors
and other factors that could affect Ultralife's financial results is
included in Ultralife's Securities and Exchange Commission (SEC)
filings, including the latest Annual Report on Form 10-K.
Conference Call Information
Investors are invited to listen to a live webcast of the
conference call at 10:00 a.m. ET on November 9, 2006 at
http://investor.ultralifebatteries.com. To listen to the live call,
please go to the web site at least fifteen minutes early to download
and install any necessary audio software. For those who cannot listen
to the live broadcast, a replay of the webcast will be available
shortly after the call at the same location for 90 days. Investors may
also listen to a telephone replay of the conference call by dialing
888-203-1112, Reservation #3984741, during the period starting at 1:00
p.m. ET November 9 and ending at 1:00 p.m. ET November 16, 2006.
Ultralife(R) is a registered trademark of Ultralife Batteries,
Inc.
ULTRALIFE BATTERIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
(Unaudited)
- ----------------------------------------------------------------------
Three-Month Periods Nine-Month Periods
Ended Ended
September October September October
30, 1, 30, 1,
2006 2005 2006 2005
---------- -------- --------- --------
Revenues:
Non-rechargeable products $16,998 $12,805 $51,101 $43,305
Rechargeable products 3,463 2,286 8,676 7,676
Communications accessories 3,046 - 3,046 -
Technology contracts 218 601 614 1,677
---------- -------- --------- --------
Total revenues 23,725 15,692 63,437 52,658
Cost of products sold:
Non-rechargeable products 14,598 10,994 41,821 35,845
Rechargeable products 3,066 1,830 6,794 6,730
Communications accessories 1,942 - 1,942 -
Technology contracts 138 508 552 1,495
---------- -------- --------- --------
Total cost of products sold 19,744 13,332 51,109 44,070
---------- -------- --------- --------
Gross margin 3,981 2,360 12,328 8,588
Operating expenses:
Research and development 1,239 969 3,083 2,874
Selling, general, and
administrative 4,367 2,902 10,181 8,745
Amortization of intangible
assets 512 - 512 -
---------- -------- --------- --------
Total operating expenses 6,118 3,871 13,776 11,619
---------- -------- --------- --------
Operating income /(loss) (2,137) (1,511) (1,448) (3,031)
Other income (expense):
Interest income 19 44 104 162
Interest expense (451) (220) (863) (593)
Gain on insurance settlement - - 191 -
Miscellaneous 39 (9) 186 (203)
---------- -------- --------- --------
Income/(loss) before income
taxes (2,530) (1,696) (1,830) (3,665)
---------- -------- --------- --------
Income tax provision/(benefit)-
current (4) 5 20 3
Income tax provision/(benefit)-
deferred (828) (385) (401) 637
---------- -------- --------- --------
Total income taxes (832) (380) (381) 640
---------- -------- --------- --------
Net Income/(Loss) $(1,698) $(1,316) $(1,449) $(4,305)
========== ======== ========= ========
Earnings/(Loss) per share -
basic $(0.11) $(0.09) $(0.10) $(0.30)
========== ======== ========= ========
Earnings/(Loss) per share -
diluted $(0.11) $(0.09) $(0.10) $(0.30)
========== ======== ========= ========
Weighted average shares
outstanding - basic 14,987 14,642 14,867 14,497
========== ======== ========= ========
Weighted average shares
outstanding - diluted 14,987 14,642 14,867 14,497
========== ======== ========= ========
ULTRALIFE BATTERIES, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Per Share Amounts)
(unaudited)
- ----------------------------------------------------------------------
September 30, December 31,
ASSETS 2006 2005
------------- ------------
Current assets:
Cash and investments $1,345 $3,214
Trade accounts receivable, net 18,453 10,965
Inventories 22,949 19,446
Prepaid expenses and other current assets 5,819 5,737
------------- ------------
Total current assets 48,566 39,362
Property and equipment 19,663 19,931
Other assets 44,003 21,464
------------- ------------
Total Assets $112,232 $80,757
============= ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt and current portion of
long-term debt $8,736 $7,715
Accounts payable 10,295 5,218
Other current liabilities 8,274 5,450
------------- ------------
Total current liabilities 27,305 18,383
------------- ------------
Long-term liabilities:
Long-term debt and capital lease
obligations 20,052 25
Other long-term liabilities 156 242
------------- ------------
Total long-term liabilities 20,208 267
------------- ------------
Shareholders' equity:
Common stock, par value $0.10 per share 1,576 1,547
Capital in excess of par value 134,078 130,530
Accumulated other comprehensive income (570) (1,054)
Accumulated deficit (67,987) (66,538)
------------- ------------
67,097 64,485
Less -- Treasury stock, at cost 2,378 2,378
------------- ------------
Total shareholders' equity 64,719 62,107
------------- ------------
Total Liabilities and Shareholders' Equity $112,232 $80,757
============= ============
CONTACT: Ultralife Batteries, Inc.
Robert W. Fishback, 315-332-7100
bfishback@ulbi.com
or
Investor Relations:
Lippert/Heilshorn & Associates, Inc.
Jody Burfening, 212-838-3777
jburfening@lhai.com