4Godnwv
17 years ago
Restructuring Plan Yields Early Positive Results:
IRVINE, Calif., Jan. 14, 2008 (PRIME NEWSWIRE) -- Meade Instruments Corp. (Nasdaq:MEAD), a leading designer and manufacturer of optical products, including telescopes, riflescopes, binoculars and microscopes, today announced its financial results for the third quarter of fiscal 2008 ended November 30, 2007.
The Company reported +6% growth in quarterly net sales over the same period last year, with $51.4 million in revenue versus $48.5 million in the prior year period. The increase in revenues from a year ago was achieved despite the closure of Discovery Channel Stores retail locations, one of the Company's top customers with over $2 million in revenue during the third quarter of the prior fiscal year. During the third quarter of fiscal 2008, the Company saw particular strength in its domestic business with increases in shipments of low-end telescopes during the quarter, revenue from the new product mySKY(tm), and continued recovery of riflescopes. Gross riflescope revenue increased 19% versus the prior year period as the Company continued to be sufficiently stocked with its most popular models after resolving its supply chain difficulties earlier in the year.
"We are very pleased to report that our turnaround efforts began to yield results in the form of higher revenue and lower operating costs during the third quarter," said Steve Muellner, President and Chief Executive Officer of Meade. "Achieving a +6% revenue increase following the loss of a major customer was a significant accomplishment. We believe our recent top line success stems from four sources: new customers, the repair of our past supply chain difficulties, our new product offering and finally the Euro/U.S. Dollar exchange rate. More importantly, however, we continue to plant seeds for revenue growth next year. We expect to see continued recovery in our riflescope business and we expect to see additional success for our entry level telescopes in fiscal 2009."
Mr. Muellner continued, "In addition to the increase in revenue, we are especially proud of the significant improvements in our pro-forma operating results, driven predominantly by our restructuring activities over this past year. We consolidated facilities, reduced headcount and lowered the Company's overall operating cost structure. With SG&A costs now at more appropriate levels, our focus going forward will shift to improving gross margins. To this end, and as announced earlier in the third quarter, we are eliminating Meade's manufacturing operations in the United States and moving them to lower-cost international locations, further lowering our operating cost structure with the goal of achieving net annualized cost savings of approximately $10 million. We are currently on track with our manufacturing transition plan and expect to meet the commitments we communicated to our customers and distributors. We believe that the expected improvements in our gross margin will make the Company more competitive and will be evident in next fiscal year's financial results."
The Company's GAAP operating income for the third quarter ended November 30, 2007 was $0.4 million and net loss was $0.07 per share. Pro-forma operating income for the same period was $3.7 million and net income was $0.07 per share. The difference between the GAAP and pro-forma results reflects the add-back of restructuring costs related to the closure of the Company's last remaining U.S. manufacturing facility of approximately $0.4 million and the add-back of an inventory impairment of $3.0 million that was related to management's decision to reduce the number of SKUs and close manufacturing operations in the U.S. as well as other adjustments to inventory. The Company believes that the restructuring costs and inventory write-downs are not part of normal operations and that excluding these costs results in a better indicator of the Company's underlying financial performance; the pro-forma results are also a metric used by management to assess the progress of the Company's turnaround.
Mr. Muellner concluded, "We believe that our pro-forma performance this quarter is a solid indicator of our progress and a base upon which we will be able to drive further improvements at the top line and in the gross margin as we enter the next fiscal year."
TELECONFERENCE
The Company's management will host a conference call today at 5:00 p.m. Eastern Time/ 2:00 p.m. Pacific Time to discuss its third quarter 2008 results and the business outlook. There will be a simultaneous web cast.
Interested parties may participate in the conference call by dialing 800-240-2430 (international dial-in 303-262-2130). The live webcast of the conference call may be accessed by visiting the Investor Relations section of the Meade website at http://www.meade.com.
A telephonic replay of the conference call will be available through January 21, 2008 by dialing 800-405-2236 (international dial-in 303-590-3000) and entering passcode 11106820#. The webcast will be archived on the Company's website for 90 days.
ABOUT MEADE INSTRUMENTS
Meade Instruments is a leading designer and manufacturer of optical products including telescopes and accessories for the beginning to serious amateur astronomer. Meade offers a complete line of binoculars that address the needs of everyone from the casual observer to the serious sporting or birding observer. Meade also offers a complete line of riflescopes under the Simmons(r), Weaver(r) and Redfield(r) brand names. The Company distributes its products worldwide through a network of specialty retailers, mass merchandisers and domestic and foreign distributors. Additional information on Meade is available at www.meade.com.
"Safe-Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This news release contains comments and forward-looking statements based on current plans, expectations, events, and financial and industry trends that may affect the Company's future operating results and financial position, including, without limitation, the Company's expectation that it will realize $10 million in annual cost savings; the expectation for significantly further recovery in riflescopes in fiscal 2009; the expectation for additional telescope placements in fiscal 2009; the expectation that the Company is on track for its manufacturing transfer plan; the Company's expectation that it will meet its commitments to customers; the Company's expectation for revenue and gross margin improvements in fiscal 2009 compared with fiscal 2008; and the Company's belief that the current quarter results are an indicator of the progress of the turnaround. Such statements involve risks and uncertainties which cannot be predicted or quantified and which may cause future activities and results of operations to differ materially from those discussed above. Such risks and uncertainties include, without limitation: the Company's ability to execute on its restructuring initiatives and achieve the stated goal of $10 million in annual savings and the potential need for further restructuring activities; the Company's ability to move its manufacturing operations out of the United States without meaningful disruption to its supply chain and relationships with customers of those products; the Company's assessment of the potential need for further inventory write-downs; the Company's ability to monetize the new and/or improved customer relationships in the form of incremental revenue; as well as the other risks and uncertainties previously set forth in the Company's filings with the Securities and Exchange Commission. The historical results achieved are not necessarily indicative of future prospects of the Company. For additional information, please refer to the Company's filings with the Securities and Exchange Commission.
MEADE INSTRUMENTS CORP.
STATEMENT OF OPERATIONS DATA
(Unaudited)
(in thousands, except per share data)
Three Months Ended Nine Months Ended
November 30, November 30,
------------------ ------------------
2007 2006 2007 2006
-------- -------- -------- --------
Net sales $ 51,441 $ 48,498 $ 85,256 $ 85,829
Cost of sales 42,789 38,189 72,477 69,160
-------- -------- -------- --------
Gross profit 8,652 10,309 12,779 16,669
Selling expenses 5,001 5,502 10,169 13,284
General and administrative
expenses 2,383 3,866 7,932 10,905
Research and development
expenses 437 467 1,446 1,173
Restructuring Costs 365 -- 365 --
ESOP expense 57 79 192 229
-------- -------- -------- --------
Operating income (loss) 409 395 (7,325) (8,922)
Interest expense 555 277 880 492
-------- -------- -------- --------
Income (loss) before income
taxes (146) 118 (8,205) (9,414)
Income tax expense 1,476 1,299 1,638 1,276
Net loss ($1,622) ($1,181) ($9,843) ($10,690)
======== ======== ======== ========
Per share information:
Net loss -- basic and
diluted ($0.07) ($0.06) ($0.47) ($0.55)
======== ======== ======== ========
Weighted average common
shares outstanding
-- basic and diluted 22,973 19,641 20,916 19,585
======== ======== ======== ========
MEADE INSTRUMENTS CORP.
PROFORMA INCOME STATEMENTS
(Unaudited)
(in thousands)
Q3
--------------------
2008 2007
-------- --------
Net sales $ 51,441 $ 48,498
Cost of sales 39,839 38,189
-------- --------
Gross profit 11,602 10,309
22.6% 21.3%
Selling expense 5,001 5,344
General and Administrative expense 2,383 3,246
Research and development 437 467
ESOP expense 57 79
-------- --------
Total operating expenses 7,878 9,136
Operating income 3,724 1,173
Interest expense 555 277
Income before income taxes 3,169 896
Provision for income taxes 1,476 1,299
-------- --------
Net income (loss) 1,693 (403)
======== ========
MEADE INSTRUMENTS CORP.
PROFORMA INCOME STATEMENTS
(Unaudited)
(in thousands)
Q3 FY 2008
---------------------------------------
GAAP Adjustments (1) Proforma
-------- ----------------- ----------
Net sales $ 51,441 $ 51,441
Cost of sales 42,789 (2,950) 39,839
-------- ----------
Gross profit 8,652 11,602
16.8% 22.6%
Selling expense 5,001 5,001
General and
Administrative expense 2,383 2,383
Research and
development 437 437
Restructuring costs 365 (365) --
ESOP expense 57 57
-------- ----------
Total operating
expenses 8,243 7,878
Operating income 409 3,724
Interest expense 555 555
Income before income
taxes (146) 3,169
Provision for income
taxes 1,476 1,476
-------- ----------
Net income (loss) ($1,622) $1,693
======== ==========
Q3 FY 2007
---------------------------------------
GAAP Adjustments (2) Proforma
-------- ----------------- ----------
Net sales $ 48,498 $ 48,498
Cost of sales 38,189 38,189
-------- ----------
Gross profit 10,309 10,309
21.3% 21.3%
Selling expense 5,502 (158) 5,344
General and
Administrative expense 3,866 (620) 3,246
Research and development 467 467
ESOP expense 79 79
-------- ----------
Total operating expenses 9,914 9,136
Operating income 395 1,173
Interest expense 277 277
Income before income
taxes 118 896
Provision for income
taxes 1,299 1,299
-------- ----------
Net income (loss) ($1,181) ($403)
======== ==========
(1) Excludes inventory write down of $3.0 million for excess ad
obsolete inventory and $365,000 in restructuring costs
recognized during the quarter ended November 30, 2007.
(2) Excludes severance costs of $158,000 and $620,000 in legal and
audit fees related to the Company's restatement of its financial
statements.
MEADE INSTRUMENTS CORP.
PRELIMINARY BALANCE SHEET DATA
(Unaudited)
(in thousands)
November 30, February 28,
2007 2007
--------- ---------
ASSETS
Current assets:
Cash $ 190 $ 4,048
Accounts receivable, net 37,914 12,445
Inventories 24,947 25,289
All other current assets 720 443
Long-term assets 12,805 12,904
--------- ---------
$ 76,576 $ 55,129
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Bank lines of credit $ 21,816 $ 860
Accounts payable 13,243 8,551
Accrued liabilities and other current
liabilities 4,819 7,010
Income taxes payable 1,411 1,415
Long-term debt and other obligations 2,690 2,817
Total stockholders' equity 32,597 34,476
--------- ---------
$ 76,576 $ 55,129
========= =========
CONTACT: Meade Instruments Corp.
Paul Ross, CFO
949-451-1450
Fax: 949-451-1460
The Piacente Group, Inc.
Brandi Piacente
212-481-2050
brandi@tpg-ir.com
Source: PrimeNewswire (January 14, 2008 - 4:01 PM EST)
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www.quotemedia.com
4Godnwv
17 years ago
Meade Instruments Announces Further Restructuring
Q3 Actions Expected to Save $10 Million Annually
IRVINE, Calif., Nov. 1, 2007 (PRIME NEWSWIRE) -- Meade Instruments Corp. (Nasdaq:MEAD), a leading designer and manufacturer of optical products, including telescopes, riflescopes, binoculars and microscopes, today announced that it has taken further steps to reduce its cost structure and accelerate its turnaround strategy.
The Company has undertaken a plan to reduce the number of SKUs (i.e. variations) on its high-end telescope products to improve efficiency and profitability, and it will transfer manufacturing and assembly of all high-end telescopes from its manufacturing operations in Irvine, California to lower cost locations. Production of the Company's remaining high-end telescope SKUs will be manufactured and assembled in the Company's current production operation in Mexico or by its contract manufacturing partners in China. The Company expects that the manufacturing operations in Irvine, California will be closed during the fourth fiscal quarter ended February 28, 2008. The Company further expects that its Mexico operations will be manufacturing certain higher-volume of the remaining SKUs during the fourth quarter of fiscal 2008 and it has developed a timeline for adding new SKUs to production during the first and second quarters of fiscal 2009.
In connection with the closure of the Irvine, California production operations, and in combination with the headcount reductions previously announced during the third quarter of fiscal 2008, the Company is reducing its U.S. employee base by 60%, or approximately 120 employees. These employees consist primarily of manufacturing, selling and administrative personnel. The combination of these headcount reductions along with other expense reductions initiated in the third quarter are expected to save the Company approximately $10 million annually, net of additional headcount costs in Mexico.
The Company expects to incur total cash restructuring charges of approximately $0.5 million related to severance costs for headcount reductions initiated in the third quarter, which will primarily be paid during the third and fourth quarters of fiscal 2008. In addition, the Company is currently analyzing its inventory position and other long-term assets in light of the SKU reduction and any resulting non-cash write-downs are also expected to be included in its third fiscal quarter results.
"We previously announced that we would be following a parallel path and would continue with the restructuring of the Company in addition to evaluating strategic alternatives," commented Steve Muellner, President and Chief Executive Officer of Meade. "This latest action demonstrates management's continued commitment to delivering value to our shareholders via the turnaround plan. We believe that transferring the remainder of our manufacturing operations to lower-cost areas will enable the Company to compete more effectively with its competitors and at the same time enhance gross and operating margins."
ABOUT MEADE INSTRUMENTS
Meade Instruments is a leading designer and manufacturer of optical products including telescopes and accessories for the beginning to serious amateur astronomer. Meade offers a complete line of binoculars that address the needs of everyone from the casual observer to the serious sporting or birding observer. Meade also offers a complete line of riflescopes under the Simmons(r), Weaver(r) and Redfield(r) brand names. The Company distributes its products worldwide through a network of specialty retailers, mass merchandisers and domestic and foreign distributors. Additional information on Meade is available at www.meade.com.
"Safe-Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This news release contains comments and forward-looking statements based on current plans, expectations, events, and financial and industry trends that may affect the Company's future operating results and financial position, including, without limitation, the Company's expectation that its Irvine, California manufacturing operations will be closed by the end of fourth fiscal quarter ended February 28, 2008; the Company's expectation that it will begin manufacturing high-volume telescope products during the fourth fiscal quarter of 2008 and adding additional SKUs to production in fiscal 2009; the Company's expectation that it will realize approximately $10 million in net cost savings resulting from the restructuring activities and that charge incurred will be $0.5 million; the Company's expectation that any inventory or other write-downs will occur will be recorded in the third quarter of fiscal 2008; and the Company's expectation that the restructuring will allow it to compete more effectively with its competitors while also delivering enhanced gross and operating margins. Such statements involve risks and uncertainties which cannot be predicted or quantified and which may cause future activities and results of operations to differ materially from those discussed above. Such risks and uncertainties include, without limitation: the Company's ability to execute on its restructuring initiatives and the potential need for further restructuring activities; the Company's ability to move its manufacturing operations out of California without meaningful disruption to its supply chain and relationships with customers of those products; the Company's ability to operate with a significantly reduced headcount; as well as the other risks and uncertainties previously set forth in the Company's filings with the Securities and Exchange Commission. The historical results achieved are not necessarily indicative of future prospects of the Company. For additional information, please refer to the Company's filings with the Securities and Exchange Commission.
CONTACT: Meade Instruments Corp.
Paul Ross, CFO
949-451-1450
Fax: 949-451-1460
The Piacente Group, Inc.
Brandi Piacente
212-481-2050
brandi@tpg-ir.com
Source: PrimeNewswire (November 1, 2007 - 4:44 PM EDT)
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www.quotemedia.com
4Godnwv
17 years ago
Meade Instruments Engages Robert W. Baird & Co. for Review of Strategic Alternatives
IRVINE, Calif., Oct. 30, 2007 (PRIME NEWSWIRE) -- Meade Instruments Corp. (Nasdaq:MEAD), a leading designer and manufacturer of optical products, including telescopes and riflescopes, today announced that it has engaged Robert W. Baird & Co. to assist in the Company's previously announced evaluation of strategic alternatives to maximize shareholder value, which may include a sale of the Company. Robert W. Baird will serve as financial advisor to the special committee formed by the Board of Directors to conduct a review and develop recommendations for the full Board to consider.
Steve Muellner, President and Chief Executive Officer of Meade, commented, "We continue to execute on our restructuring and growth initiatives, as well as develop new plans for achieving a successful turnaround of the Company. We believe that the strength of our brands is the foundation for a growing and profitable company. Therefore, in order to unlock the inherent value of these brands for its shareholders in a timely manner, the Company is pursuing a parallel path and exploring all strategic options. We are pleased that the special committee has chosen a financial advisor as a step in this process."
In making the announcement, the Company cautioned that there can be no assurance that the exploration of strategic alternatives will result in any financial or business transaction. The Company does not currently plan to provide interim updates on the special committee's work and does not expect to report on the strategic alternatives process until the full Board of Directors has considered and pursued recommendations made to it by the special committee. A timetable for completion of the strategic alternatives review and the Board's consideration of the results has not been established; however, the special committee and its financial advisor are commencing work immediately.
ABOUT MEADE INSTRUMENTS
Meade Instruments is a leading designer and manufacturer of optical products including telescopes and accessories for the beginning to serious amateur astronomer. Meade offers a complete line of binoculars that address the needs of everyone from the casual observer to the serious sporting or birding observer. Meade also offers a complete line of riflescopes under the Simmons(r), Weaver(r) and Redfield(r) brand names. The Company distributes its products worldwide through a network of specialty retailers, mass merchandisers and domestic and foreign distributors. Additional information on Meade is available at www.meade.com.
"Safe-Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This news release contains comments and forward-looking statements based on current plans, expectations, events, and financial and industry trends that may affect the Company's future operating results and financial position, including, without limitation, management's beliefs that the Company's brands are the foundation of a growing and profitable company. Such statements involve risks and uncertainties which cannot be predicted or quantified and which may cause future activities and results of operations to differ materially from those discussed above. Such risks and uncertainties include, without limitation: the Company's ability to execute on its restructuring and growth initiatives and the potential need for further restructuring activities; the achievement of a successful turnaround; the ability of the Company to consummate a strategic alternative, if at all, related to all or a portion of the Company's businesses; the ability of the Company to secure a premium valuation related to any strategic alternative; as well as the other risks and uncertainties previously set forth in the Company's filings with the Securities and Exchange Commission. For additional information, please refer to the Company's filings with the Securities and Exchange Commission.
CONTACT: Meade Instruments Corp.
Paul Ross, CFO
949-451-1450
Fax: 949-451-1460
The Piacente Group, Inc.
Brandi Piacente
212-481-2050
brandi@tpg-ir.com
Source: PrimeNewswire (October 30, 2007 - 4:30 PM EDT)
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www.quotemedia.com
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