Exhibit 99.1
PRESS RELEASE
RADYNE REPORTS SECOND QUARTER EPS OF 17 CENTS
PHOENIX, AZ - July 24, 2006 - Radyne Corporation (Nasdaq: RADN), today reported
net sales for the second quarter of 2006 were $34.6 million compared to second
quarter 2005 net sales of $20.6 million. The increase resulted from continued
growth in both the amplifier and the satellite electronics and broadcast
segments. During the second quarter of 2005, the Company completed its merger
with Xicom Technology. Consolidated sales for that quarter included only five
weeks of Xicom sales.
Net sales for the satellite electronics and broadcast segment increased by 18%
to $18.5 million during the second quarter of 2006 compared to the same period
one year ago. The second quarter of 2006 was the fourth consecutive quarter of
sequential sales growth for the Company's Xicom subsidiary. Xicom sales for the
quarter were $16.1 million compared to $14.9 million for the first quarter of
2006.
Net earnings, after taxes and interest, for the second quarter of 2006 were $3.2
million, or $0.17 per diluted share compared to earnings of $2.1 million, or
$0.12 per diluted share for the same quarter of 2005. Earnings from operations
increased 54% to $4.8 million during the second quarter of 2006 from $3.1
million for the second quarter of 2005. Reported second quarter 2006 earnings
included equity compensation expense which had the effect of reducing earnings
per diluted share by $0.02 compared to the year earlier period due to the
adoption of new accounting standards.
Bookings during the quarter were $34.1 million, a 53% increase over bookings of
$22.3 million in the second quarter of 2005. At the end of the second quarter of
2006, Radyne's consolidated backlog was $33.2 million compared to $29.8 million
at the end of the second quarter of 2005.
For the first six months of 2006, sales rose 92% to $65.8 million compared to
$34.3 million for the first six months of 2005. Earnings per diluted share for
the first six months of 2006 grew to $0.30 from $0.20 for the same period in
2005. Consolidated sales for the six months of 2005 included only five weeks of
Xicom sales.
"So far, 2006 has been a very good year for Radyne," commented Bob Fitting, CEO.
"With Xicom's growth and the current sales outlook for our satellite and
broadcast businesses, we expect to show significant year over year increases in
sales and profits."
For the first six months of 2006, Radyne's cash balance increased 47% to $24.9
million compared to $16.9 million at the beginning of 2006. Consolidated
Accounts Receivable increased to $22.3 million compared to $20.3 million at the
beginning of 2006. Consolidated Inventory was $21.7 million compared to $18.1
million at the beginning of 2006.
Radyne will be holding a conference call on Monday, July 24, 2006 at 4:30 p.m.
EDT to discuss its second quarter 2006 financial results and operational
highlights. The call is open to the public. The domestic dial in number is
1-866-578-5747 and the international dial in number is 617-213-8054. The
conference will also be accessible via the Internet at www.radn.com and
www.earnings.com.
ABOUT RADYNE CORPORATION
Radyne Corporation designs, manufactures, sells, integrates and installs
products, systems and software used for the transmission and reception of data
and video over satellite, troposcatter, microwave and cable communication
networks. The Company, through its Tiernan subsidiary, is a supplier of HDTV and
SDTV encoding and transmission equipment. The Xicom Technology subsidiary is a
producer of high power amplifiers for communications applications. Radyne is
headquartered in Phoenix, Arizona, has manufacturing facilities in Phoenix, San
Diego, and Santa Clara, and sales offices in Singapore, Beijing, Jakarta and the
United Kingdom. The Company also has sales and/or service centers in Sao Paulo,
Bangalore, Shanghai and Moscow. For more information, visit our web site at
www.radn.com. Additional information on Xicom is available at www.xicomtech.com.
CONTACT: Malcolm Persen, Chief Financial Officer, 602.437.9620
SAFE HARBOR PARAGRAPH FOR FORWARD-LOOKING STATEMENTS
This press release includes statements that constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 (the "Reform Act") and Radyne Corporation claims the protection of the
safe-harbor for forward-looking statements contained in the Reform Act.
Forward-looking statements involve risks, uncertainties and other factors that
may cause actual results, performance or achievements of Radyne Corporation and
its subsidiaries to be materially different from those expressed or implied by
such forward-looking statements. These forward-looking statements are often
characterized by the terms "may," "believes," "projects," "expects," "intends"
or "anticipates," and do not reflect historical facts. Specific forward-looking
statements contained in this press release include expectations for future
revenues, orders and backlog, cash flow and earnings per share and indications
that the Company will benefit from strong market demand for its new products.
There is no assurance that the Radyne sales will continue to grow or that the
Xicom acquisition will continue to provide desirable financial or strategic
results for the Company. We cannot guarantee that the Company will continue to
generate cash and asset fluctuations may be seasonal in nature and not an
indication of future results. There can be no assurance that the indicators that
the Company relies on to gauge future business prospects, such as backlog and
bookings, will accurately forecast future results.
Factors that may affect forward-looking statements and the Company's business
generally include but are not limited to the following: changes in demand for
the Company's products, product mix, the timing of customer orders and
deliveries, the impact of competitive products and pricing, constraints on
supplies of critical raw materials, excess or shortage of production capacity,
and other risks discussed from time to time in the Company's SEC filings and
reports. In addition, such statements could be affected by general industry and
market conditions and growth rates, and general domestic and international
economic conditions.
Forward-looking statements speak only as of the date the statement was made.
Radyne Corporation does not undertake and specifically declines any obligation
to update any forward-looking statements. In addition, the Company does not
endorse any projections regarding future performance that may be made by third
parties.
Financial Statements follow.
2
RADYNE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
Unaudited
JUNE 30, DECEMBER 31,
2006 2005
------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 24,886 $ 16,928
Accounts receivable - trade, net of allowance for
doubtful accounts of $467 and $804, respectively 22,321 20,337
Cost in excess of billings 218 -
Inventories 21,655 18,057
Deferred tax assets 3,017 3,010
Income tax receivable 1,021 -
Prepaid expenses and other assets 702 864
------------ ------------
Total current assets 73,820 59,196
Goodwill 29,950 30,333
Intangibles 6,137 6,706
Property and equipment, net 3,734 4,098
Other assets 254 295
------------ ------------
Total Assets $ 113,895 $ 100,628
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 5,194 $ 5,054
Accrued expenses 9,045 9,045
Customer advance payments 1,615 2,319
Current portion of long-term debt 1,000 1,000
Income taxes payable - 609
------------ ------------
Total current liabilities 16,854 18,027
Long-term debt, less current portion 3,250 3,750
Deferred tax liability 382 752
Deferred rent 226 413
Accrued stock option compensation 6 46
------------ ------------
Total liabilities 20,718 22,988
------------ ------------
STOCKHOLDERS' EQUITY:
Common stock; $.001 par value - authorized,
50,000,000 shares; issued and outstanding,
18,217,024 shares and 17,334,467 shares,
respectively 18 17
Additional paid-in capital 73,155 63,171
Retained earnings 19,999 14,450
Other comprehensive income 5 2
------------ ------------
Total stockholders' equity 93,177 77,640
------------ ------------
Total Liabilities and Stockholders' Equity $ 113,895 $ 100,628
============ ============
3
RADYNE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share data)
Unaudited
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
---------------------------- ----------------------------
2006 2005 2006 2005
------------ ------------ ------------ ------------
Net sales $ 34,633 $ 20,613 $ 65,826 $ 34,321
Cost of sales 20,203 10,973 38,506 17,556
------------ ------------ ------------ ------------
Gross profit 14,430 9,640 27,320 16,765
------------ ------------ ------------ ------------
OPERATING EXPENSES:
Selling, general and administrative 7,044 4,715 13,573 8,392
Research and development 2,617 1,832 5,340 3,330
------------ ------------ ------------ ------------
Total operating expenses 9,661 6,547 18,913 11,722
------------ ------------ ------------ ------------
Earnings from operations 4,769 3,093 8,407 5,043
OTHER (INCOME) EXPENSE:
Interest expense 68 54 146 80
Interest and other income (235) (238) (452) (488)
------------ ------------ ------------ ------------
Earnings before income taxes 4,936 3,277 8,713 5,451
Income tax expense 1,781 1,202 3,162 1,935
------------ ------------ ------------ ------------
Net earnings $ 3,155 $ 2,075 $ 5,551 $ 3,516
============ ============ ============ ============
EARNINGS PER SHARE:
Basic $ 0.18 $ 0.12 $ 0.31 $ 0.21
============ ============ ============ ============
Diluted $ 0.17 $ 0.12 $ 0.30 $ 0.20
============ ============ ============ ============
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic 18,012 16,727 17,786 16,601
============ ============ ============ ============
Diluted 18,800 17,410 18,674 17,337
============ ============ ============ ============
4
RADYNE CORPORATION
SEGMENT REPORTING
(in thousands)
Unaudited
THREE MONTHS ENDED JUNE 30, 2006
(in thousands)
Satellite
electronics
and
broadcast
equipment Amplifiers Corporate Total
------------ ------------ ------------ ------------
Net sales $ 18,487 $ 16,146 $ - $ 34,633
Operating income 6,989 1,700 (3,920) 4,769
============ ============ ============ ============
Depreciation and amortization $ 260 $ 604 $ - $ 864
============ ============ ============ ============
SIX MONTHS ENDED JUNE 30, 2006
(in thousands)
Satellite
electronics
and
broadcast
equipment Amplifiers Corporate Total
------------ ------------ ------------ ------------
Net sales $ 34,792 $ 31,034 $ - $ 65,826
Operating income 13,169 3,112 (7,874) 8,407
============ ============ ============ ============
Depreciation and amortization $ 525 $ 1,233 $ - $ 1,758
============ ============ ============ ============
Total assets $ 52,849 $ 61,046 $ - $ 113,895
============ ============ ============ ============
SOURCE Radyne Corporation
-0- 07/24/2006
/CONTACT: Malcolm Persen, Chief Financial Officer of Radyne Corporation,
+1-602-437-9620/
/Web site: http://www.xicomtech.com /
/Web site: http://www.radn.com /
5