Measurement Specialties Announces FY05-Q4 and Fiscal Year Results
HAMPTON, Va., June 13 /PRNewswire-FirstCall/ -- Measurement
Specialties, Inc. (AMEX:MSS), a designer and manufacturer of
sensors and sensor-based consumer products, announced results for
the fourth quarter and fiscal year ended March 31, 2005. The
Company reported net income for the 12 months ended March 31, 2005
of $14.8 million, or $1.05 per diluted share, as compared to $21.6
million, or $1.54 per diluted share for the same period last year.
Pro forma net income from continuing operations for the 12 months
ended March 31, 2004 was $11.7 million, or $0.83 per diluted share.
FY04 pro forma net income, which is used in order to be comparable
with FY05 results, excludes one-time charges for non-cash equity
based compensation, legal settlement expenses, restructuring
charges, gain on the sale of assets and normalized tax provisions.
The effect of changes in tax planning strategies and the
finalization of the year end accounting for global tax accruals
accounted for the improvement in FY05 net income over previous
guidance. Please refer to the notes and reconciliation regarding
Non-GAAP financial measures contained in this release. Frank
Guidone, Company CEO commented, "Last year we established a
strategy to aggressively grow our Sensor division and position the
Company as a global sensor solutions provider; our FY05 results
were consistent with that strategy. Organically, we grew our Sensor
division 23% and completed six acquisitions throughout the year
that boosted total Sensor sales growth 53% over FY04. Companywide,
we grew sales and earnings 25% and 27% respectively as compared to
FY04 pro forma net income, and established a foundation for
accelerated growth in FY06. Consistent with our previous FY06
guidance, we anticipate growth in sales and earnings of
approximately 25% and 30%, respectively. We believe we are well
positioned in the market, and are pleased with the progress made in
FY05 toward our long-term vision and goals." For the three months
ended March 31, 2005, net sales increased 54.3% to $40.7 million,
as compared to $26.3 million for the three months ended March 31,
2004. For the three months ended March 31, 2005, net sales in the
Sensor division increased 73.4% to $28.6 million, as compared to
$16.5 million for the three months ended March 31, 2004, and net
sales in the Consumer Products division increased 22.4% to $12.1
million for the current fiscal quarter, as compared to $9.9 million
for the three months ended March 31, 2004. Gross margin for the
three months ended March 31, 2005 declined to 40.8%, as compared to
43.1% for the three months ended March 31, 2004. Gross margin in
the Sensor division declined to 47.2% for the three months ended
March 31, 2005, as compared to 51.6% for the same period last year,
largely due to automotive price concessions and sales mix shifting
to lower margin products in automotive and disposable medical
markets. Gross margin in the Consumer Products division declined to
25.2% for current fiscal quarter, as compared to 27% for the same
period last year. For the fiscal year ended March 31, 2005, net
sales increased 24.9% to $140.9 million, as compared to $112.8
million for the fiscal year ended March 31, 2004. For the fiscal
year ended March 31, 2005, net sales in the Sensor division
increased 53.1% to $92.3 million, as compared to $60.2 million for
the fiscal year ended March 31, 2004, while net sales in the
Consumer Products division decreased 7.4% to $48.7 million for the
fiscal year ended March 31, 2005, as compared to $52.6 million for
the fiscal year ended March 31, 2004. Gross margin for the fiscal
period declined to 42.1% as compared to 44.6% for the same period
last year. Gross margin in the Sensor division declined to 50.3% as
compared to 54% for fiscal 2004, while gross margin in the Consumer
Products division declined to 25.4% as compared to 32% for the same
period last year. The Company anticipates filing its Form 10-K for
the fiscal year ended March 31, 2005 on or before Tuesday, June
14th. Please refer to the Management's Discussion and Analysis of
Financial Condition and Results of Operations included in the
Company's Form 10-K filed for a more complete discussion of sales,
margin and expenses. The Company will host an investor conference
call on June 14th at 2 pm EDT to answer questions regarding the
quarterly and yearly results reported in our Annual Report on Form
10-K for fiscal year ended March 31, 2005. US dialers: (866)
253-6505; International dialers: (703) 639-1207. Interested parties
may also listen via the Internet at: http://www.vcall.com/. The
call will be available for replay for 30 days through AT&T by
dialing 800 475-6701 (US dialers), and entering access code 784985,
and on Vcall. About MSI. Measurement Specialties, Inc. designs and
manufactures sensors and sensor-based consumer products. The Sensor
division, also known as MSI Sensors, produces a wide variety of
sensors and transducers to measure precise ranges of physical
characteristics such as pressure, force, vibration, position, tilt,
flow and humidity. MSI Sensors uses multiple advanced technologies
-- including piezoresistive, electro-optic, electro-magnetic,
capacitive, application specific integrated circuits (ASICs),
micro-electromechanical systems (MEMS), piezoelectric polymers and
strain gauges -- to engineer sensors that operate precisely and
cost effectively. The Consumer division produces OEM bathroom
scales, Accutire(R) brand tire pressure gauges and other products.
Company Contact: Frank Guidone, CEO, (757) 766-4400 Investor
Contact: Aimee Boutcher or Daniel Boutcher, (973) 239-2878 This
release includes forward looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities and Exchange Act of 1934, as amended. Forward
looking statements may be identified by such words or phrases
"should," "intends," "is subject to," "expects," "will,"
"continue," "anticipate," "estimated," "projected," "may," "we
believe," "future prospects," or similar expressions. The
forward-looking statements above involve a number of risks and
uncertainties. Factors that might cause actual results to differ
include, but are not limited to, success of any reorganization;
ability to raise additional funds; conditions in the general
economy and in the markets served by the Company; competitive
factors, such as price pressures and the potential emergence of
rival technologies; interruptions of suppliers' operations
affecting availability of component materials at reasonable prices;
timely development and market acceptance, and warranty performance
of new products; success in integrating prior acquisitions; changes
in product mix, costs and yields, fluctuations in foreign currency
exchange rates; uncertainties related to doing business in Hong
Kong and China; and the risk factors listed from time to time in
the Company's SEC reports. The Company from time-to-time considers
acquiring or disposing of business or product lines.
Forward-looking statements do not include the impact of
acquisitions or dispositions of assets, which could affect results
in the near term. Actual results may differ materially. The Company
assumes no obligation to update the information in this issue.
Regulation G, "Conditions for Use of Non-GAAP Financial Measures",
promulgated under the Securities and Exchange Act of 1934, as
amended, define and prescribe the conditions for use of certain
non-GAAP financial information. We believe that certain of our
financial measures which meet the definition of a non-GAAP
financial measure are important supplemental information to
investors. The Company uses pro forma measures of operating income,
net income, and basic and diluted earnings per share. These pro
forma measures exclude non-cash equity based compensation from the
Company's statement of operations, as well as non-ordinary items
relating to litigation matters and restructuring charges. The
non-cash equity based compensation results from warrants issued to
Four Corners Capital Partners LP, a limited partnership of which
Mr. Guidone, our Chief Executive Officer, is a principal. Excluding
these items is useful for illustrating and explaining operating
results and comparisons to prior periods. These items are excluded
from our internal operating plans and measurement of financial
performance, and we believe this is an important measure for
investors to consider in order to better understand the trends in
our operating results. The warrants that comprise the non-cash
compensation have the same basic attributes of an incentive stock
option, for which the Company uses the intrinsic value method
allowed for under Financial Accounting Standards Board Statement
No. 148. Under the intrinsic value method, there is no charge to
the statement of operations for incentive stock options. Because of
the structure of the arrangement with Mr. Guidone, the Company was
not able to issue incentive stock options and, therefore, issued
warrants to Four Corners Capital Partners LP. Although the basic
attributes of the warrants issued are similar to those of incentive
stock options, the intrinsic value method is not acceptable under
generally accepted accounting principles for valuing warrants,
therefore resulting in the non-cash equity based compensation
charge. These non-GAAP financial measures are used in addition to
and in conjunction with the results presented in accordance with
GAAP. These non-GAAP financial measures should not be relied upon
to the exclusion of GAAP financial measures. These non-GAAP
financial measures provide an additional way of viewing aspects of
our operation that, when viewed with our GAAP results and the
accompanying reconciliation's to the corresponding GAAP financial
measures, provide an understanding of certain factors and trends
relating to our business. The company strongly encourages investors
to review our financial statements and publicly filed reports in
their entirety and to not rely on any single financial measure.
MEASUREMENT SPECIALTIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
For the Year Ended March 31, ($ in thousands, except per share
amounts) 2005 2004 2003 Net sales Sensor $92,268 $60,247 $52,326
Consumer 48,673 52,566 55,350 Net sales 140,941 112,813 107,676
Cost of goods sold 81,535 62,513 69,680 Gross profit 59,406 50,300
37,996 Operating expenses (income): Selling, general and
administrative 35,796 30,448 34,245 Non-Cash Equity based
Compensation (Selling, general and administrative) - 6,483 -
Litigation expense - 1,500 3,550 Research and development 3,468
3,468 3,594 Customer funded development (268) (4) (367)
Amortization of acquired intangibles 774 30 30 Restructuring costs
- 506 1,219 Total operating expenses 39,770 42,431 42,271 Operating
income (loss) 19,636 7,869 (4,275) Interest expense, net 637 323
2,057 Gain on sale of Assets - (1,424) (159) Other expense (income)
(77) (142) (333) Income (loss) from continuing operations before
income taxes 19,076 9,112 (5,840) Income tax 4,250 (12,262) 483
Income (loss) from continuing operations 14,826 21,374 (6,323)
Discontinued operations: Income (loss) from operations of
discontinued units (net of income tax benefit) - 212 (3,910) Gain
on disposition of discontinued units (net of income tax benefit) -
- 1,136 Income (loss) from discontinued units - 212 (2,774) Net
income (loss) $14,826 $21,586 $(9,097) Income (loss) per common
share - Basic Income (loss) from continuing operations $1.11 $1.73
$(0.53) Income (loss) from discontinued units - 0.02 (0.23) Net
income (loss) $1.11 $1.75 $(0.76) Income (loss) per common share -
Diluted Income (loss) from continuing operations $1.05 $1.53
$(0.53) Income (loss) from discontinued units - 0.01 (0.23) Net
income (loss) $1.05 $1.54 $(0.76) Weighted average shares
outstanding - Basic 13,392 12,333 11,911 Weighted average shares
outstanding - Diluted 14,095 13,997 11,911 MEASUREMENT SPECIALTIES,
INC. CONSOLIDATED STATEMENTS OF OPERATIONS For the Quarter Ended
March 31, ($ in thousands, except per share amounts) 2005 2004 2003
Net sales Sensor $28,564 $16,475 $12,192 Consumer 12,075 9,869
11,108 Net sales 40,639 26,344 23,300 Cost of goods sold 24,057
14,986 15,037 Gross profit 16,582 11,358 8,263 Operating expenses
(income): Selling, general and administrative 11,011 7,429 7,638
Non-Cash Equity based Compensation (Selling, general and
administrative) - 1,529 - Litigation expense - 1,100 3,550 Research
and development 892 858 1,030 Customer funded development (50) (4)
(7) Amortization of acquired intangibles 579 8 8 Restructuring
costs - (39) - Total operating expenses 12,432 10,881 12,219
Operating income (loss) 4,150 477 (3,956) Interest expense, net 392
1 286 Gain on sale of Assets - (1,424) (50) Other expense (income)
(26) (166) (372) Income (loss) from continuing operations before
income taxes 3,784 2,066 (3,820) Income tax (108) (13,034) 367
Income (loss) from continuing operations 3,892 15,100 (4,187)
Discontinued operations: Income (loss) from operations of
discontinued units (net of income tax benefit) - 100 - Gain on
disposition of discontinued units (net of income tax benefit) - -
226 Income (loss) from discontinued units - Net income (loss)
$3,892 $15,200 $(3,961) Income (loss) per common share - Basic
Income (loss) from continuing operations $0.29 $1.19 $(0.35) Income
(loss) from discontinued units - 0.01 - Net income (loss) $0.29
$1.20 $0.02 Income (loss) per common share - Diluted Income (loss)
from continuing operations $0.27 $1.07 $(0.35) Income (loss) from
discontinued units - 0.01 0.02 Net income (loss) $0.27 $1.08
$(0.33) Weighted average shares outstanding - Basic 13,532 12,620
11,917 Weighted average shares outstanding - Diluted 14,277 14,069
11,917 The following table shows the Company's non-GAAP results
reconciled to the Generally Accepted Accounting Principles ("GAAP")
Consolidated Statements of Operations. The Company's non-GAAP
results do not include non-cash compensation, legal settlement
expenses, restructuring charge, gain on the sale of assets and
adjustments to the tax provision. Please refer to the notes to the
Consolidated financial Statements in the Annual Report on Form 10-K
to be filed with the Securities and Exchange Commission during the
week June 13, 2005. For Three Months For Twelve Months Ended March
31, Ended March 31, 2005 2004 2005 2004 NET INCOME FROM CONTINUING
OPERATIONS BEFORE INCOME TAXES $3,785 $2,066 $19,076 $9,112
Non-cash equity based compensation - 1,529 - 6,483 SEC Settlement -
- - 1,000 Class action settlement - 1,100 - 1,100 Hibernia
litigation - - - (600) Restructuring charges - (39) - 506 Gain on
the sale of assets - (1,424) - (1,424) NON-GAAP INCOME FROM
CONTINUING OPERATIONS BEFORE INCOME TAXES $3,785 $3,232 $19,076
$16,177 For Three Months For Twelve Months Ended March 31, Ended
March 31, 2005 2004 2005 2004 NET INCOME $3,893 $15,200 $14,826
$21,586 Non-cash equity based compensation - 1,529 - 6,483 SEC
Settlement - - - 1,000 Class action settlement - 1,100 - 1,100
Hibernia litigation - - - (600) Restructuring charges - (39) - 506
Gain on the sale of assets - (1,424) - (1,424) Tax provision
adjustment (1) - (14,037) - (16,987) NON-GAAP NET INCOME BEFORE
DISCONTINUED OPERATIONS $3,893 $2,329 $14,826 $11,664 NON-GAAP
INCOME PER COMMON SHARE - BASIC: Non-GAAP Income before
discontinued operations $0.29 $0.18 $1.11 $0.95 Income from
discontinued units - 0.01 - $0.02 Non-GAAP Net income $0.29 $0.19
$1.11 $0.97 NON-GAAP INCOME PER COMMON SHARE - DILUTED Non-GAAP
Income before discontinued operations $0.27 $0.17 $1.05 $0.83
Income from discontinued units - 0.01 - 0.02 Non-GAAP Net income
$0.27 $0.18 $1.05 $0.85 Weighted Average Share Outstanding - Basic
13,532 12,620 13,392 12,333 Weighted Average Share Outstanding -
Diluted 14,277 14,069 14,095 13,997 Notes: (1) This non-GAAP
measure adjusts the Company's as reported tax credit for fiscal
year 2004 to provide for taxes at the expected effective rate of
27.9% for fiscal 2005, and includes adjustment for discontinued
operations. DATASOURCE: Measurement Specialties, Inc. CONTACT:
Frank Guidone, CEO of Measurement Specialties, Inc.,
+1-757-766-4400; or Investor: Aimee Boutcher or Daniel Boutcher,
both of Boutcher & Boutcher Investor Relations,
+1-973-239-2878, for Measurement Specialties, Inc. Web site:
http://www.msiusa.com/
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