Exhibit 99.1
Ultralife Batteries Reports Second Quarter Results
Revenues Increase 65% to $35.2 Million
NEWARK, N.Y.--(BUSINESS WIRE)--Aug. 2, 2007--Ultralife Batteries,
Inc. (NASDAQ: ULBI) reported record revenues of $35.2 million for its
second quarter of 2007, an increase of 65% compared with $21.4 million
reported in the same three-month period in 2006. Operating income rose
more than three-fold to $1.7 million compared with $0.5 million a year
ago.
Second quarter revenues grew $13.8 million year-over-year due in
part to higher sales to international governments and defense
organizations, as well as the addition of communications accessories
sales from the McDowell acquisition which the company completed in
mid-2006. As a percentage of revenues, gross margin for the second
quarter of 2007 was 24%, up from 20% a year ago due to higher sales
and production volumes and a shift toward more highly engineered
products. Operating expenses totaled $6.9 million, which included $1.4
million of additional expenses and $0.6 million of intangible asset
amortization connected with last year's acquisitions. Excluding these
items, operating expenses rose $1.0 million over the $3.9 million
reported in the comparable quarter last year due to increased
corporate costs required to operate a larger, more diverse business.
Net interest expense was $0.6 million in the second quarter of 2007,
up from $0.2 million reported in the prior year due to the increased
debt to finance last year's acquisitions. Net income for the second
quarter of 2007 was $1.3 million, or $0.08 per diluted share, compared
with net income of $109,000, or $0.01 per share, for the same quarter
in 2006.
For the six-month period ended June 30, 2007, revenues totaled
$67.5 million compared to $39.7 million for the same period a year
ago. Operating income amounted to $2.3 million for the first half of
2007, an increase of $1.6 million over 2006. Net income for the first
half of 2007 was $1.3 million, or $0.08 per diluted share, compared to
$249,000, or $0.02 per share, for the same period last year.
"Second quarter results offer solid evidence of the success we
have achieved in diversifying the company's government/defense revenue
mix and in broadening the range of our product offering, coupled with
our commitment to improving operational efficiencies," said John D.
Kavazanjian, Ultralife's president and chief executive officer.
"Second quarter revenue marked the fourth consecutive quarter of
year-over-year growth and surpassed last quarter's record level. In
addition, we continued to drive gross margin expansion as we increased
the contribution of higher engineered products and improved
manufacturing efficiencies. Asset utilization also improved with
inventory levels and revolver borrowings down from the first quarter."
"To build on these positive trends in margins and asset
utilization, we are continuing to push for margin improvement in our
communications accessories business and for even better operational
efficiencies across the organization," continued Kavazanjian. "At the
same time, we are addressing an ever-widening set of growth
opportunities as demand for portable power in new and existing
applications is proliferating in both government/defense and
commercial markets. With an expanding portfolio of high performance
products, supported by our unrivaled product development capability
and engineering expertise, and an established global distribution
network, we are in an excellent position to translate these
opportunities into continued profitable revenue growth."
Outlook
Management is projecting revenue between $33 million and $36
million for its third quarter ending September 29, 2007, based on
current backlog, anticipated orders and anticipated delivery
schedules. Based on this revenue estimate, management anticipates
reporting operating income in the range of $1.2 million to $1.8
million, inclusive of approximately $1.0 million of non-cash expenses
related to stock-based compensation and intangible asset amortization.
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
defense, 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. Defense, commercial and retail 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: 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 August 2, 2007 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 2728461, during the period starting at 1:00
p.m. ET August 2 and ending at 1:00 p.m. ET August 9, 2007.
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 Ended Six-Month Periods Ended
June 30, July 1, June 30, July 1,
2007 2006 2007 2006
------------ ------------ ----------- -----------
Revenues:
Non-rechargeable
products $ 22,808 $ 18,458 $ 40,966 $ 34,103
Rechargeable
products 4,561 2,648 10,090 5,213
Communications
accessories 7,688 - 16,179 -
Technology
contracts 139 287 281 396
------------ ------------ ----------- -----------
Total revenues 35,196 21,393 67,516 39,712
Cost of products
sold:
Non-rechargeable
products 16,607 14,900 30,217 27,223
Rechargeable
products 3,618 1,859 7,785 3,728
Communications
accessories 6,237 - 13,208 -
Technology
contracts 117 257 188 414
------------ ------------ ----------- -----------
Total cost of
products sold 26,579 17,016 51,398 31,365
------------ ------------ ----------- -----------
Gross margin 8,617 4,377 16,118 8,347
Operating expenses:
Research and
development 1,688 884 3,302 1,844
Selling, general,
and administrative 5,212 3,032 10,508 5,814
------------ ------------ ----------- -----------
Total operating
expenses 6,900 3,916 13,810 7,658
------------ ------------ ----------- -----------
Operating income 1,717 461 2,308 689
Other income
(expense):
Interest income 18 40 32 85
Interest expense (604) (207) (1,261) (412)
Gain on insurance
settlement - 43 - 191
Miscellaneous 167 139 183 147
------------ ------------ ----------- -----------
Income before income
taxes 1,298 476 1,262 700
------------ ------------ ----------- -----------
Income tax provision-
current - 20 - 24
Income tax provision-
deferred - 347 - 427
------------ ------------ ----------- -----------
Total income taxes - 367 - 451
------------ ------------ ----------- -----------
Net income $ 1,298 $ 109 $ 1,262 $ 249
============ ============ =========== ===========
Earnings per share -
basic $ 0.09 $ 0.01 $ 0.08 $ 0.02
============ ============ =========== ===========
Earnings per share -
diluted $ 0.08 $ 0.01 $ 0.08 $ 0.02
============ ============ =========== ===========
Weighted average
shares outstanding -
basic 15,123 14,851 15,100 14,807
============ ============ =========== ===========
Weighted average
shares outstanding -
diluted 15,331 15,165 15,320 15,150
============ ============ =========== ===========
ULTRALIFE BATTERIES, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Per Share Amounts)
(unaudited)
- ----------------------------------------------------------------------
June 30, December 31,
ASSETS 2007 2006
-------- ------------
Current assets:
Cash and investments $553 $720
Trade accounts receivable, net 23,190 24,197
Inventories 30,554 27,360
Prepaid expenses and other current assets 2,897 3,603
-------- ------------
Total current assets 57,194 55,880
Property and equipment 19,396 19,396
Other assets
Goodwill, intangible and other assets 22,832 22,482
-------- ------------
Total Assets $99,422 $97,758
======== ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt and current portion of long-
term debt $13,110 $12,246
Accounts payable 14,480 15,925
Other current liabilities 8,479 9,639
-------- ------------
Total current liabilities 36,069 37,810
-------- ------------
Long-term liabilities:
Long-term debt and capital lease obligations 20,350 20,043
Other long-term liabilities 482 316
-------- ------------
Total long-term liabilities 20,832 20,359
-------- ------------
Shareholders' equity:
Common stock, par value $0.10 per share 1,586 1,578
Capital in excess of par value 136,071 134,736
Accumulated other comprehensive income 6 (321)
Accumulated deficit (92,764) (94,026)
-------- ------------
44,899 41,967
Less -- Treasury stock, at cost 2,378 2,378
-------- ------------
Total shareholders' equity 42,521 39,589
-------- ------------
Total Liabilities and Shareholders' Equity $99,422 $97,758
======== ============
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