Exhibit 99.8
[LOGO] SPACEHAB, Inc.
601 13/th/ Street NW, Suite 900 South
Washington, DC 20005
1.202.488.3500
fax: 1.202.488.3100
www.spacehab.com
FOR IMMEDIATE RELEASE
SPACEHAB REPORTS FINANCIAL RESULTS FOR FIRST QUARTER FISCAL YEAR 2004
Highlights
.. Quarterly revenues reported of $18.9 million
.. Net income of $0.7 million for the quarter
.. Consolidated Company backlog of $106.7 million
.. Cash plus short-term investments at quarter end of $11.5 million
Washington, D.C., November 6, 2003 - SPACEHAB, Incorporated (NASDAQ/NMS: SPAB),
a leading provider of commercial space services, today announced financial
results for the Company's first quarter of fiscal year 2004 ended September 30,
2003.
First Quarter Results
Revenues for the first fiscal quarter of 2004 declined to $18.9 million from
$26.8 million for the first quarter of 2003. Gross profit increased this quarter
to $5.3 million, or 28% of revenue, compared to $5.2 million, or 19% of revenue,
for the same period a year ago. First quarter results were impacted by a shift
in the business mix including reduced operations associated with NASA's
grounding of the space shuttle and a significant reduction in the business base
of the SPACEHAB Government Services unit.
The Company reported net income of $0.7 million, or $0.05 per basic and diluted
share for the first quarter, compared to a net loss of $0.1 million, or ($0.01)
per basic and diluted share for the same period a year ago. SPACEHAB reported
first quarter income from operations of $2.4 million compared to $1.8 million in
the same period last fiscal year, a result of lower selling, general, and
administrative expenses.
As a result of reductions in employee headcount and management's continuing cost
reduction efforts, first quarter selling, general, and administrative expenses
continued to decline. First quarter fiscal year 2004 EBITDA (earnings before
interest, taxes, depreciation, amortization, and other non-cash charges) was
$3.8 million compared to $4.8 million for the same quarter last year.
Liquidity
The combined cash, cash equivalents, and short-term investments at September 30,
2003 were $11.5 million. During the first quarter, SPACEHAB repaid $1.9 million
of debt obligations.
In July 2003 the Company submitted a detailed claim in draft to NASA in the
amount of $87.0 million seeking recovery of the uninsured portion of the
Company's investment in its Research Double Module that was lost in the Columbia
space shuttle disaster. The claim is in the process of being revised to
incorporate the findings of the Columbia Accident Investigation Board and will
be re-filed with NASA. The Company believes it has a basis for recovery of the
loss from NASA but there can be no assurances
as to the timing or the amount, if any, to be received from the claim. Upon
resolution of the claim, any proceeds from NASA would be recorded in the period
in which the claim is resolved.
Subsequent to quarter end, Boeing notified the Company's subsidiary, Astrotech
Space Operations (Astrotech), that effective October 1, 2003 Boeing would
exercise its right to terminate its payload processing contract with Astrotech.
Under the contract termination provision, Boeing is obligated to pay Astrotech
$17.5 million. Astrotech will use the proceeds from the termination payment to
service the mortgage on Astrotech's Titusville, Florida facility and repay funds
used to complete construction of the unique five-meter class Spacecraft
Processing Facility (SPF). Astrotech's SPF mortgage is approximately $16.5
million as of September 30, 2003. The contract termination will reduce
Astrotech's backlog by $34.9 million to $15.0 million as of October 1, 2003.
The Company's consolidated backlog as of October 1, 2003 is equal to $106.7
million, reflecting the reduction in Astrotech's backlog due to the contract
termination detailed above.
Update of Ongoing Operations
"Over the last year, we have focused on our core businesses and made the hard
decisions required to streamline our organization to ensure that we sustain a
competitive posture within our market," said Michael E. Kearney, President and
Chief Executive Officer. "This quarter's results under challenging conditions
demonstrate that we are now beginning to realize the benefits of that
initiative," concluded Mr. Kearney.
The SPACEHAB Flight Services (SFS) business unit continues to support people
working and living in space. The Company concluded negotiations with NASA for an
equitable adjustment on the STS-116 (12A.1) and STS-118 (13A.1) missions due to
launch delays associated with the temporary grounding of the space shuttle
fleet. This adjustment, which provides additional revenue to the Company for
these missions, covers a period from May 2003 through November 2003. SPACEHAB is
updating its proposal and will seek to negotiate additional contract
modifications to cover the period from December 2003 through the current
expected launch dates of these two missions, April 2005 and August 2005,
respectively. The proposal includes the addition of a new Integrated Cargo
Carrier mission, STS-121 (ULF1.1), targeted for launch in November 2004.
SPACEHAB also concluded equitable adjustment negotiations through December 2003
with Boeing for delays in the STS-114 mission. The Company is in the process of
submitting a new equitable adjustment proposal for the period from January 2004
through the currently expected launch in September 2004.
SPACEHAB Government Services (SGS) continues to provide critical services to
NASA including stowage integration and configuration management services for the
International Space Station (ISS). On November 5, 2003, NASA notified SPACEHAB
that it was not awarded the ISS Mission Integration contract. Additionally, the
Boeing team's bid for the Cargo Missions contract, of which SGS was a
subcontractor, was not selected for contract award. The Company is awaiting word
from NASA regarding the other ISS procurement for which SGS, as a subcontractor
to ARES Corporation, submitted a proposal in the last fiscal year.
Astrotech supported two successful missions this quarter. The Echostar
IX/Telstar 13 spacecraft, manufactured by Space Systems/Loral, was launched on
August 7, 2003 onboard a Zenit 3-SL booster from the Sea Launch platform Odyssey
in the central Pacific Ocean. Following this success, Astrotech supported the
tenth Sea Launch Company mission on September 30, 2003 with the launch of the
Galaxy 13/Horizons-1 communications satellite.
Non-GAAP Financial Measures
This announcement includes financial measures computed in accordance with
Generally Accepted Accounting Principles in the United States (GAAP), as well as
EBITDA, which is included as an additional non-GAAP measure of Company
performance. EBITDA includes components that are significant in understanding
and assessing our results of operations and cash flows. EBITDA should not be
construed as a substitute for net income, determined in accordance with GAAP, as
an indicator of operating performance, nor does EDITDA represent cash flow from
operating activities. Management believes that EBITDA is relevant and useful
information and is disclosing this information to permit a more comprehensive
analysis of our operating performance, as an additional meaningful measure of
performance and liquidity, and to provide additional information with respect to
our ability to meet future debt service, capital expenditure and working capital
requirements. The accompanying table presents the calculation of EBITDA.
Conference Call
SPACEHAB will host a conference call on November 6, 2003 at 10:00 a.m. Eastern
time to discuss the first quarter earnings release. To participate on the call,
please register with Darren Barker at 818.382.9706. To participate via the
Internet, visit the Investor Relations section of the SPACEHAB website at
www.spacehab.com. A taped replay will be available immediately following the
conference call and accessible via access code 19959117 until 11:59 p.m. Eastern
time on November 7, 2003 at 800.252.6030 (domestic calls) or 402.220.2491
(international calls). An audio archived webcast of the conference call will be
available on the Company website for 90 days.
About SPACEHAB, Incorporated
With approximately $100 million in annual revenue, SPACEHAB, Incorporated
(www.spacehab.com) is a leading provider of commercial space services. The
Company develops, owns, and operates habitat and laboratory modules and cargo
carriers aboard NASA's Space Shuttles for space station resupply and research
purposes. Its Government Services business unit provides Space Station and Space
Shuttle support services including orbiter crew compartment integration,
stowage, and configuration management to NASA's Johnson Space Center in Houston.
SPACEHAB's Astrotech subsidiary provides commercial satellite processing
services at facilities in California and Florida. Additionally, through The
Space Store, Space Media provides space merchandise to the public and space
enthusiasts worldwide (www.thespacestore.com).
The statements in this document may contain "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Such statements are subject to risks and
uncertainties that could cause actual results to differ materially from those
projected in the statements. In addition to those risks and uncertainties
discussed herein, such risks and uncertainties include, but are not limited to,
whether the Company will fully realize the economic benefits under its U.S.
National Aeronautics and Space Administration ("NASA") and other customer
contracts, whether NASA and other customers will continue to utilize the
Company's habitat modules and related commercial space assets, whether plans to
complete the International Space Station ("ISS") are fulfilled, continued
availability and use of the U.S. Space Shuttle system, technological
difficulties, product demand and market acceptance risks, the effect of economic
conditions, uncertainty in government funding, the impact of competition, delays
and uncertainties in future space shuttle and ISS programs, resolution of the
Company's indemnification claim with NASA arising from the loss of the Columbia
orbiter and its crew during the STS-107 mission, and other risks described in
reports filed by the Company with the Securities and Exchange Commission. The
Company assumes no obligation to update these forward-looking statements.
For more information contact:
Darren E. Barker Julia A. Pulzone
Vice President Chief Financial Officer
Investor Relations International SPACEHAB, Inc.
Phone 818.382.9706 Phone 202.488.3500
Fax 818.382.9701 Toll free 888.647.9543
dbarker@irintl.com pulzone@hqspacehab.com
Tables follow
SPACEHAB, INCORPORATED AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Operations
Three Months
(In thousands, except share data) Ended September 30,
------------------------------------
2003 2002
---------------- ---------------
Revenue $ 18,850 $ 26,812
Costs of revenue 13,527 21,634
---------------- ---------------
Gross profit 5,323 5,178
---------------- ---------------
Operating expenses
Selling, general and administrative 2,932 3,414
Research and development - 14
---------------- ---------------
Total operating expenses 2,932 3,428
---------------- ---------------
Income from operations 2,391 1,750
Interest expense (1,740) (1,859)
Interest and other income, net 33 9
---------------- ---------------
Income (loss) before income taxes 684 (100)
Income tax (expense) benefit (18) 6
---------------- ---------------
Net income (loss) $ 666 $ (94)
================ ===============
Income (loss) per share:
Net income (loss) per share - basic $ 0.05 $ (0.01)
================ ===============
Shares used in computing net income
(loss) per share - basic 12,370,955 12,154,465
================ ===============
Net income (loss) per share - diluted $ 0.05 $ (0.01)
================ ===============
Shares used in computing net income (loss) per share - diluted 13,745,450 12,154,465
================ ===============
SPACEHAB, INCORPORATED AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures
Three Months
(in thousands) Ended September 30,
-------------------------
2003 2002
---------- ----------
GAAP Net income (loss) $ 666 $ (94)
Income tax (expense) benefit 18 (6)
Interest expense 1,740 1,859
Interest and other income, net (33) (9)
Depreciation and amortization 1,417 3,011
--------- ----------
EBITDA $ 3,808 $ 4,761
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SPACEHAB, INCORPORATED AND SUBSIDIARIES
Selected Financial Data by Segment
(in thousands)
Three Months Ended September 30, 2003
Income (Loss)
before
Revenue Income Taxes
---------------------------
SPACEHAB Flight Services $ 11,777 $ (107)
SPACEHAB Government Services 3,533 (238)
Astrotech Space Operations 3,373 1,062
Space Media 167 (33)
---------------------------
$ 18,850 $ 684
===========================
Three Months Ended September 30, 2002
Income (Loss)
before
Revenue Income Taxes
---------------------------
SPACEHAB Flight Services $ 12,367 $ (1,006)
SPACEHAB Government Services 11,475 670
Astrotech Space Operations 2,846 318
Space Media 124 (82)
---------------------------
$ 26,812 $ (100)
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