UNA Unova

UNOVA, Inc. (NYSE:UNA); -- Intermec Product and Service Revenues up 13.3% year-over-year to $196.5 million -- EPS $0.09 from continuing operations -- Intermec Operating Profit from Product and Service Revenues of $16.0 million up 31% over prior-year quarter -- Intermec Product and Service Operating Margins increased 15.5% over prior-year quarter -- Sale of Cincinnati Lamb operations completed UNOVA, Inc. (NYSE:UNA) today announced financial results for its fiscal first quarter which ended April 3, 2005. UNOVA reported first quarter revenues of $196.5 million and earnings from continuing operations of $5.4 million, or $0.09 per diluted share, compared to 2004 first quarter revenues of $193.0 million and earnings from continuing operations of $15.7 million, or $0.25 per diluted share. The prior year's first quarter includes Intellectual Property (IP) settlement revenue and operating profit of $19.7 million and $15.8 million, respectively. Including the impact of discontinued operations, the net income for the first quarter of 2005 was $3.5 million, or $0.06 per diluted share compared to net income of $10.5 million, or $0.17 per diluted share in the prior year's first quarter, respectively. Intermec operating profits from product and service revenues increased by 31 percent to $16.0 million for the first quarter of 2005, compared to $12.3 million for the same prior year period. Operating margins for Intermec product and service revenues were 8.2 percent in the first quarter of 2005, compared to 7.1 percent for the prior-year quarter. "For nearly four years now, we have achieved or exceeded the operating forecast for our Intermec operations that we provided at the beginning of each quarter," said Larry Brady, Chairman and CEO. "We are encouraged by this continuing strength and growth of our business, along with our strategic progress in repositioning our company. These results are particularly notable following the record level of shipments in the fourth quarter." All major Intermec product and service revenue categories achieved double digit growth over the comparable 2004 quarter. This was attributable to Systems and Solutions revenue growth of 11 percent, Services growth of 12 percent and Printer and Media growth of 16 percent over the comparable prior-year period. Geographically, North America revenues achieved an increase of 11 percent over the comparable prior-year period. Revenues in Europe, Mid-East and Africa (EMEA) increased 11 percent, Latin America revenues increased 34 percent and revenues in Asia Pacific increased 30 percent. Corporate and other expenditures of $5.9 million for the first quarter of 2005 included expense for outside resources and independent audit fees of $1.3 million related to compliance with the internal control provisions of Sarbanes-Oxley Section 404 and the year end audit. Corporate and other expenditures for the first quarter of 2004 were $3.1 million and included the reversal of a $2.0 million legal accrual due to a favorable ruling in an Intellectual Property dispute during the quarter. The sale of the Cincinnati Lamb operations was concluded at the end of the first quarter of 2005. The loss from discontinued operations, net of tax, for the quarter was ($1.9) million, compared to ($5.2) million in the first quarter of 2004. In March of 2005, the Company retired $100 million of its bonds and thus removed the cash restriction of $50 million required under the Company's credit agreements. The Company's cash and cash equivalent position at the end of the first quarter was $155.2 million. About UNOVA UNOVA is a leader in global supply chain solutions and in the development, manufacture and integration of wired and wireless automated data collection, Intellitag(R) RFID (radio frequency identification), mobile computing systems, bar code printers and label media. The company's products and services are used by customers in many industries to improve productivity, quality and responsiveness of business operations, from supply chain management and enterprise resource planning to field sales and service. www.unova.com (Forward-looking Statement) Certain forward-looking statements in this release (as defined by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934) relate to matters that are not historical facts. They include, but are not limited to, statements about the Company's ability to continue to improve profit of its business segments, reduce expenses, improve efficiency, leverage its research and development investment to drive significant future revenue, complete its divestiture of its IAS businesses and the ability to continue operational improvement and year over year growth. Such forward-looking statements involve and are dependent upon certain risks and uncertainties. These include, but are not limited to, other risks and uncertainties described more fully in the Company's filings on Form 10-K and 10-Q with the Securities and Exchange Commission. UNOVA, Inc. First Quarter Fiscal Year 2005 -- Earnings Conference Call UNOVA, Inc. will hold a conference call on May 4, 2005 at 5 p.m. Eastern (2 p.m. Pacific) to review financial results from its first quarter of fiscal year 2005. The call will be hosted by UNOVA Chief Executive Officer, Larry D. Brady; Chief Financial Officer, Michael E. Keane; Intermec President, Thomas O. Miller, Industrial Automation Systems President, Robert T. Smith and Kevin McCarty, UNOVA Director of Investor Relations. The dial-in number for participants is 888-889-1955 (US); 312-470-0046 (International) (Pass code is "UNOVA"). The call also will be broadcast live on the Internet under the investor information section of the UNOVA web site at www.unova.com. -0- *T UNOVA, INC. (Unaudited, amounts in thousands except per share amounts) Quarter Ended ------------------- April 3, March 31, 2005 2004 -------- -------- CONSOLIDATED STATEMENTS OF OPERATIONS (Preliminary) Revenues Product and Service Revenues $196,495 $173,355 Intellectual Property Settlements - 19,650 -------- -------- Total Revenues 196,495 193,005 Costs and Expenses Cost of product and service revenues 113,633 99,470 Cost of intellectual property settlements - 3,857 Selling, general and administrative 72,756 64,755 -------- -------- Total Costs and Expenses 186,389 168,082 -------- -------- Operating Profit From Continuing Operations 10,106 24,923 Other Income (Expense) Interest, net (2,126) (3,068) Foreign currency exchange, net (15) (420) -------- -------- Total Other Income (Expense) (2,141) (3,488) Earnings From Continuing Operations Before Taxes 7,965 21,435 Provision for income taxes 2,553 5,709 -------- -------- Earnings From Continuing Operations 5,412 15,726 Loss from discontinued operations, net of tax (1,932) (5,244) -------- -------- Net Earnings $ 3,480 $ 10,482 ======== ======== Basic Earnings (Loss) per Share Continuing operations $ 0.09 $ 0.26 Discontinued operations (0.03) (0.09) -------- -------- Net earnings per share $ 0.06 $ 0.17 ======== ======== Diluted Earnings (Loss) per Share Continuing operations $ 0.09 $ 0.25 Discontinued operations (0.03) (0.08) -------- -------- Net earnings per share $ 0.06 $ 0.17 ======== ======== Shares Used in Computing Earnings (Loss) per Share Basic 61,093 60,188 Diluted 62,813 62,126 SELECTED SEGMENT INFORMATION (Preliminary) Revenues from Continuing Operations Product Related Revenues $161,943 $142,606 Service and Service Related Revenues 34,552 30,749 Intellectual Property Settlements 19,650 --------- -------- Total Revenues $196,495 $193,005 ======== ======== Operating Profit (Loss) From Continuing Operations Intermec Operating Profit $ 16,040 $ 28,046 Corporate and Other (5,934) (3,123) -------- -------- Operating Profit From Continuing Operations $ 10,106 $ 24,923 ======== ======== UNOVA, INC. CONSOLIDATED BALANCE SHEETS (Preliminary) (Unaudited, amounts in thousands) April 3, Dec. 31, 2005 2004 --------- ---------- Assets Current Assets: Cash and cash equivalents $ 155,150 $ 217,899 Restricted cash 50,000 Accounts receivable, net 162,184 157,833 Inventories 93,165 80,854 Net deferred tax assets 58,730 81,769 Assets held for sale 14,196 19,748 Current assets of discontinued operations 52,214 211,116 Other current assets 9,987 8,831 --------- ---------- Total Current Assets 545,626 828,050 Property, Plant and Equipment, Net 30,462 30,375 Other Intangibles, Net 3,972 4,072 Net Deferred Tax Assets 192,127 134,978 Long Term Assets of Discontinued Operations 20,504 21,238 Other Assets 59,868 53,964 --------- ---------- Total Assets $ 852,559 $1,072,677 ========= ========== Liabilities and Shareholders' Investment Current Liabilities: Accounts payable and accrued expenses $ 176,902 $ 160,001 Payroll and related expenses 24,510 30,077 Current portion of long-term debt 8,500 108,500 Current liabilities of discontinued operations 31,327 130,257 --------- ---------- Total Current Liabilities 241,239 428,835 Long-term Debt 100,000 100,000 Other Long-term Liabilities 86,751 86,220 Long Term Liabilities of Discontinued Operations 12,112 46,388 Shareholders' Investment: Common stock 611 611 Additional paid-in capital 706,235 703,416 Accumulated deficit (303,215) (306,695) Accumulated other comprehensive loss 8,826 13,902 --------- ---------- Total Shareholders' Investment 412,457 411,234 --------- ---------- Total Liabilities and Shareholders' Investment $ 852,559 $1,072,677 ========= ========== UNOVA, INC. CONSOLIDATED STATEMENT OF CASH FLOWS (Preliminary) (Unaudited, amounts in thousands) Quarter Ended April 3, 2005 Cash and Cash Equivalents at Beginning of Period $ 217,899 Cash Flows from Operating Activities: Net earnings from continuing operations 5,412 Adjustments to reconcile net earnings to net cash used in operating activities: Depreciation and amortization 2,313 Loss on sale of business 34,723 Change in net deferred tax asset (34,110) Changes in working capital and other operating activities (8,602) --------- Net Cash Used in Operating Activities of Continuing Operations (264) --------- Cash Flows from Investing Activities: Capital expenditures (2,624) Other investing activities 6,152 --------- Net Cash Provided by Investing Activities of Continuing Operations 3,528 --------- Cash Flows from Financing Activities: Repayment of long-term obligations (100,000) Decrease in restricted cash 50,000 Stock options exercised 1,269 Other financing activities (302) --------- Net Cash Used in Financing Activities of Continuing Operations (49,033) --------- Net Cash Used in Continuing Operations (45,769) Net Cash Used in Operating Activities of Discontinued Operations (17,221) Net Cash Provided by Investing Activities of Discontinued Operations 241 --------- Resulting Decrease in Cash and Cash Equivalents (62,749) --------- Cash and Cash Equivalents at End of Period $ 155,150 ========= *T