BETHEL, Conn., Feb. 13 /PRNewswire-FirstCall/ -- Memry Corporation reported today that revenue for the second fiscal quarter ended December 31, 2005 rose 28% to $12,649,000, compared with $9,877,000 reported in the comparable quarter a year ago. Including a one-time charge for separation expenses, the company reported a net loss of ($236,000), or ($0.01) per diluted share, compared with net income of $406,000, or $0.01 per diluted share in the comparable quarter a year ago. The company reported a negligible operating loss ($12,000) versus operating income of $930,000 in last year’s second quarter.
Revenues for the first six months of the fiscal year rose 33% to $25,316,000 from $18,989,000 in the first six months of FY ’05. Including a charge for separation expenses of $1,130,000, net income decreased by $845,000 to $265,000, or $0.01 per diluted share in the first six months of FY ’06, compared with $1,110,000, or $0.04 per diluted share for the same period in FY ’05. Operating income for the six months of FY ’06 was $1,165,000, compared with $2,057,000 in the first six months of FY ’05.
Second quarter operating results were negatively impacted by separation charges of $1.13 million related to the retirement of the former chief executive officer.
Robert Belcher, acting CEO and chief financial officer of Memry, said, “The revenue increase was boosted by the inclusion of polymer product revenues for the full fiscal quarter. But we also had good gains in revenues from sales of Nitinol products, which rose 7% in the quarter to $8,839,000 and for the first six months increased 4% to $18,054,000. Our Nitinol business benefited from increases in sales of super-elastic tube and tube-based stent components as well as increased revenue from prototype development. These gains were partially offset by slippage in shipments of arch wire and microcoil products. Polymer segment revenue for the quarter was $3,895,000 and $7,375,000 for the six months ended December 31, 2005.
“Gross margin in the quarter improved slightly from 38.7% to 39.2%, reflecting the higher level of revenue in the quarter from our polymer business, which has a higher gross margin than the nitinol segment. Operating expenses increased by $2.1 million during the quarter, with $1.13 million of that increase attributable to the one-time expense associated with the retirement of our chief executive officer, and the balance of the increase due to additional costs associated with supporting the incremental Putnam revenues, expenses associated with our adoption of SFAS No. 123(R) of $184,000 and additional legal, accounting and personnel costs.
“Our balance sheet continues to be strong, and we had a healthy cash position at the end of the quarter of $5.4 million.
“We remain optimistic about the second half of fiscal 2006. We recently entered into a three-year contract extension agreement with one of our major customers, and we anticipate several of the new product programs we have been working on to begin generating meaningful revenue and profits as we move through this calendar year,” Belcher said.
A copy of the financial statements follows.
The company will host a conference call to discuss second quarter results tomorrow, February 14, at 11 a.m. Eastern. To participate in this call, dial (866) 278-7933 any time after 10:55 a.m. Eastern. International callers should dial (800) 500-7045.
About Memry Corporation
Memry Corporation provides design, engineering, development and manufacturing services to the medical device and other industries using the company’s proprietary shape memory alloy and polymer extrusion technologies. Medical device products include stent components, catheter components, guidewires, laparoscopic surgical sub-assemblies and orthopedic instruments as well as complex, multi-lumen, multi-layer polymer extrusions used for guidewires, catheters, delivery systems and various other high-end interventional medical devices.
An investment profile on Memry may be found at http://www.hawkassociates.com/memry/profile.htm .
For more information, contact Memry’s Acting CEO and Chief Financial Officer Robert P. Belcher at (203) 739-1100, e-mail: Robert_Belcher@memry.com , or Frank Hawkins or Julie Marshall, Hawk Associates, at (305) 451-1888, e-mail: info@hawkassociates.com . Detailed information about Memry Corporation can be found at http://www.memry.com . Copies of Memry Corporation press releases, SEC filings, current price quotes, stock charts and other valuable information for investors may be found at http://www.hawkassociates.com and http://www.americanmicrocaps.com .
This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under the company’s control, which may cause actual results, performance or achievements of the company to be materially different from the results, performance or other expectations implied by these forward-looking statements. These factors include, but are not limited to, those detailed in the company’s periodic filings with the Securities and Exchange Commission.
Memry Corporation and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) December 31, June 30, 2005 2005 ASSETS Current Assets Cash and cash equivalents $5,433,000 $4,141,000 Accounts receivable, less allowance for doubtful accounts 5,900,000 5,846,000 Inventories 5,506,000 4,948,000 Deferred tax asset 1,391,000 1,391,000 Prepaid expenses and other current assets 452,000 288,000 Total current assets 18,682,000 16,614,000 Property, Plant, and Equipment 21,489,000 19,897,000 Less accumulated depreciation (12,574,000) (11,527,000) 8,915,000 8,370,000 Other Assets Intangible assets, less accumulated amortization 7,507,000 7,842,000 Goodwill 14,146,000 13,946,000 Cash collateral deposits -- 1,500,000 Deferred financing costs, less accumulated amortization 410,000 465,000 Investment 409,000 -- Note receivable -- 407,000 Deferred tax asset 3,200,000 3,508,000 Other assets 148,000 148,000 Total other assets 25,820,000 27,816,000 TOTAL ASSETS $53,417,000 $52,800,000 LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities Accounts payable and accrued expenses $6,126,000 $5,453,000 Notes payable 2,111,000 2,615,000 Income tax payable 66,000 204,000 Total current liabilities 8,303,000 8,272,000 Notes payable, less current maturities 8,367,000 8,759,000 Other non-current liabilities 112,000 -- Stockholders’ Equity Common stock 288,000 286,000 Additional paid-in capital 54,492,000 53,893,000 Accumulated deficit (18,145,000) (18,410,000) Total stockholders’ equity 36,635,000 35,769,000 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $53,417,000 $52,800,000 Memry Corporation and Subsidiaries Condensed Consolidated Statements of Operations For the Three Months Ended December 31, 2005 and 2004 (Unaudited) 2005 2004 Revenues $12,649,000 $9,877,000 Cost of revenues 7,694,000 6,051,000 Gross profit 4,955,000 3,826,000 Operating expenses Research and development 605,000 513,000 General, selling and administration, including separation charges of $1,130,000 in the three months ended December 31, 2005 4,236,000 2,318,000 Amortization of intangible assets 126,000 65,000 4,967,000 2,896,000 Operating income (loss) (12,000) 930,000 Interest Expense (331,000) (303,000) Income 55,000 39,000 (276,000) (264,000) Income (loss) before income taxes (288,000) 666,000 (Benefit from) provision for income taxes (52,000) 260,000 Net income (loss) $(236,000) $406,000 Basic earnings (loss) per share $(0.01) $0.01 Diluted earnings (loss) per share $(0.01) $0.01 Memry Corporation and Subsidiaries Condensed Consolidated Statements of Operations For the Six Months Ended December 31, 2005 and 2004 (Unaudited) 2005 2004 Revenues $25,316,000 $18,989,000 Cost of revenues 15,612,000 11,663,000 Gross profit 9,704,000 7,326,000 Operating expenses Research and development 1,258,000 993,000 General, selling and administration, including separation charges of $1,130,000 in the six months ended December 31, 2005 7,029,000 4,178,000 Amortization of intangible assets 252,000 98,000 8,539,000 5,269,000 Operating income 1,165,000 2,057,000 Interest Expense (652,000) (317,000) Income 98,000 79,000 (554,000) (238,000) Income before income taxes 611,000 1,819,000 Provision for income taxes 346,000 709,000 Net income $265,000 $1,110,000 Basic earnings per share $0.01 $0.04 Diluted earnings per share $0.01 $0.04
Memry Corporation
CONTACT: Robert P. Belcher, CEO and Chief Financial Officer, MemryCorporation, +1-203-739-1100, or Robert_Belcher@memry.com; or Frank Hawkinsor Julie Marshall, both of Hawk Associates, +1-305-451-1888, orinfo@hawkassociates.com, for Memry
