HEI, Inc. Announces Second Quarter 2013 Results
HEI, Inc. Announces Second Quarter 2013 Results
MINNEAPOLIS--(BUSINESS WIRE)-- HEI, Inc. (Pink Sheets: HEII) (http://www.heii.com) today announced its financial results for the Second quarter 2013, which ended June 29, 2013.
Sales for the Second quarter of 2013 were $13,018,000, compared to $9,648,000 for the Second quarter of 2012. The Company generated a net income of $678,000 for the Second quarter of 2013, compared to a net loss of ($351,000) for the Second quarter of 2012. Sales for the first six months of 2013 were $25,534,000, compared to $18,713,000 for the first six months of 2012. The Company generated a year-to-date net income of $1,314,000 for the first six months 2013 compared to a net loss of ($508,000) for the first six months of 2012.
Sales were up 35% in the Second quarter 2013 over the Second quarter 2012 as a result of increased sales in the Company's Victoria division while the Boulder and Tempe division's sales were comparable to Second quarter 2012. Gross margins improved to 17% of sales on a consolidated basis in the Second quarter 2013 compared to 10% in the Second quarter 2012 as a result of efficiencies related to the increased sales volumes and continued cost reduction initiatives.
"Our Victoria operation continues to grow with the large contracts relating to the military radio systems and other customer demand. We are also seeing operational improvements in the Victoria and Tempe plants with better flow and improving yields. Our focus on all the aspects of the business, including the balance sheet, has resulted in improvements in inventory turns and reductions in long-term debt that have had positive impacts on cash flow. We are pleased with the production volume gains and profitability achieved and we continue to focus on our sales efforts to build the long-term business at all of our operating divisions. We continue to be guardedly optimistic that our participation in programs with government contractors will continue uninterrupted and will be part of our continued growth," remarked HEI CEO, Mark B. Thomas.
HEI, Inc. designs, develops and manufactures ultra-miniature microelectronics, high density interconnect flexible and rigid-flex substrates, electromechanical hardware, and embedded software with complex user interface solutions for customers engaged in the medical, hearing, telecommunications, military, aerospace, and industrial markets. HEI provides its customers with a single point of contact that can take an idea from inception to a fully functional and cost effective product utilizing innovative design solutions and by the application of state-of-the-art materials, processes and manufacturing capabilities. | |
Corporate & HEI -Victoria (Microelectronics Contract Manufacturing) | 1495 Steiger Lake Lane, Victoria, MN 55386 |
HEI - Boulder (Contract Design, Development, and Medical Box Build) | 4801 North 63rd Street, Boulder, CO 80301 |
HEI - Tempe (Quick Turn and Production High Density Interconnect Flex and Rigid-Flex) | 610 South Rockford Drive, Tempe, AZ 85281 |
FORWARD LOOKING INFORMATION
Information in this news release, which is not historical, includes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. You can identify these statements by forward-looking words such as "may," "will," "expect," "anticipate," "believe," "intend," "estimate," "continue," and similar words. Statements contained in this press release, including the implementation of business strategies, growth of specific markets, improved results and estimated HEI revenue, cash flow and profits, are forward looking statements. All such forward-looking statements involve risks and uncertainties including, without limitation, adverse business and market conditions, the ability of HEI to secure and satisfy customers, the availability and cost of materials from HEI's suppliers, HEI's ability to satisfy financial or other obligations or covenants set forth in its financing agreements, adverse competitive developments, change in or cancellation of customer requirements, collection of receivables and outstanding debt, HEI's ability to control fixed and variable operating expenses, and other risks detailed in previous HEI SEC filings. Since HEI is no longer reporting to the SEC, readers are cautioned to weigh the potential for additional risk factors based on ongoing business activities and the current economic conditions. The information set forth herein should be read in light of such risks. We undertake no obligation to update these statements to reflect ensuing events or circumstances, or subsequent actual results.
HEI, INC. | ||||||||||
BALANCE SHEETS | ||||||||||
June 29, 2013 | December 29, 2012 | |||||||||
(In thousands, except share and per share data) | ||||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | - | $ | - | ||||||
Accounts receivable, net | 5,621 | 4,538 | ||||||||
Inventories, net | 4,638 | 5,454 | ||||||||
Deferred income taxes | 804 | 804 | ||||||||
Other current assets | 277 | 712 | ||||||||
Total current assets | 11,340 | 11,508 | ||||||||
Property and equipment: | ||||||||||
Land | 216 | 216 | ||||||||
Building and improvements | 4,337 | 4,337 | ||||||||
Fixtures and equipment | 29,447 | 28,554 | ||||||||
Accumulated depreciation and amortization | (27,863 | ) | (27,005 | ) | ||||||
Property and equipment, net | 6,137 | 6,102 | ||||||||
Security deposit | 230 | 230 | ||||||||
Other long-term assets | 203 | 205 | ||||||||
Total assets | $ | 17,910 | $ | 18,045 | ||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||
Current liabilities: | ||||||||||
Accounts payable | $ | 3,267 | $ | 3,129 | ||||||
Accrued liabilities | 1,283 | 1,019 | ||||||||
Customer deposit liabilities | 9 | 712 | ||||||||
Current maturities of long-term liabilities | 1,128 | 1,120 | ||||||||
Total current liabilities | 5,687 | 5,980 | ||||||||
Long-term liabilities: | ||||||||||
Deferred income taxes | 804 | 804 | ||||||||
Other long-term liabilities, less current maturities | 2,299 | 2,465 | ||||||||
Long-term debt, less current maturities | 4,483 | 5,583 | ||||||||
Total long-term liabilities, less current maturities | 7,586 | 8,852 | ||||||||
Total liabilities | 13,273 | 14,832 | ||||||||
Commitments and contingencies | ||||||||||
Shareholders' equity: | ||||||||||
Undesignated stock | - | - | ||||||||
Convertible preferred stock, $.05 par | 2 | 2 | ||||||||
Common stock, $.05 par | 513 | 513 | ||||||||
Additional paid-in capital | 28,751 | 28,641 | ||||||||
Accumulated deficit | (24,629 | ) | (25,943 | ) | ||||||
Total shareholders' equity | 4,637 | 3,213 | ||||||||
Total liabilities and shareholders' equity | $ | 17,910 | $ | 18,045 | ||||||
HEI, INC. | ||||||||||||||||
STATEMENTS OF OPERATIONS | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 29, 2013 | June 30, 2012 | June 29, 2013 | June 30, 2012 | |||||||||||||
(In thousands, except share and per share data) | ||||||||||||||||
Net sales | $ | 13,018 | $ | 9,648 | $ | 25,534 | $ | 18,713 | ||||||||
Cost of sales | 10,847 | 8,646 | 21,338 | 16,518 | ||||||||||||
Gross profit | 2,171 | 1,002 | 4,196 | 2,195 | ||||||||||||
17 | % | 10 | % | 16 | % | 12 | % | |||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 1,163 | 1,269 | 2,298 | 2,542 | ||||||||||||
Operating income (loss) | 1,008 | (267 | ) | 1,898 | (347 | ) | ||||||||||
Interest expense, net | (89 | ) | (85 | ) | (178 | ) | (176 | ) | ||||||||
Other income (expense), net | (222 | ) | - | (372 | ) | 14 | ||||||||||
Income (loss) before income taxes | 697 | (352 | ) | 1,347 | (509 | ) | ||||||||||
Income tax expense (benefit) | 19 | (1 | ) | 33 | (1 | ) | ||||||||||
Net income (loss) | $ | 678 | $ | (351 | ) | $ | 1,314 | $ | (508 | ) | ||||||
Income (loss) per common share: | ||||||||||||||||
Basic | $ | 0.07 | $ | (0.03 | ) | $ | 0.13 | $ | (0.05 | ) | ||||||
Diluted | $ | 0.06 | $ | (0.03 | ) | $ | 0.12 | $ | (0.05 | ) | ||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 10,276,995 | 10,120,000 | 10,272,532 | 10,120,000 | ||||||||||||
Diluted | 10,847,798 | 10,120,000 | 10,843,335 | 10,120,000 | ||||||||||||
HEI, Inc.
Mark B. Thomas, CEO, 952-443-2500
KEYWORDS: United States North America Minnesota
INDUSTRY KEYWORDS:
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