Anaren Reports 1st Quarter Fiscal 2013 Results SYRACUSE, N.Y., Oct. 23, 2012 (GLOBE NEWSWIRE) -- Anaren, Inc. (Nasdaq:ANEN) today reported net sales for the fiscal 2013 first quarter ended September 30, 2012 of $39.1 million, up 0.9% from $38.7 million for the first quarter of last year. GAAP (U.S. generally accepted accounting principles) net income for the first quarter of fiscal 2013 was $2.9 million, or $0.21 per diluted share, compared to $2.5 million, or $0.17 per diluted share for the first quarter of last year. Non-GAAP diluted earnings per share, excluding non-cash equity based compensation and intangible asset amortization, was $0.27 for the first quarter of fiscal 2013 compared to non-GAAP diluted earnings per share of $0.23 for the first quarter of fiscal 2012. GAAP operating income for the first quarter of fiscal 2013 was $4.0 million, or 10.2% of net sales, compared to $3.6 million, or 9.3% of net sales for the first quarter of last year. Non-GAAP operating income for the first quarter of fiscal 2013, which excludes non-cash equity based compensation and intangible asset amortization, was $5.3 million, or 13.6% of net sales, up 9.4% from $4.8 million, or 12.5% of net sales for the first quarter of fiscal 2012. Income taxes for the first quarter of fiscal 2013 were $1.3 million, representing an effective tax rate of 32.0% compared to income tax expense of $1.1 million for the first quarter of fiscal 2012, representing an effective tax rate of 30.7%. The projected effective tax rate for fiscal 2013, absent one-time events, is expected to be approximately 32.0%. Lawrence A. Sala, Anaren's Chairman, President and CEO said, "We were pleased to see continuing sequential quarterly sales growth and improved profitability for the quarter. Non-GAAP operating incomeimproved more than 9% from first quarter fiscal year 2012 levels, as a result of both the higher sales volume and the actions taken last year to reduce operating expenses." During the first quarter of fiscal 2013, the Company generated $2.1 million in operating cash flow compared to $5.3 million in the first quarter of fiscal 2012. Additionally, during the current quarter the Company repurchased approximately 469,000 shares of its common stock for a total of $8.9 million and expended $1.3 million for capital additions. Non-operating cash receipts for the quarter included $1.4 million from the exercise of stock options and the Company borrowed $8.0 million under its revolving credit facility during the quarter to help fund stock repurchases. Cash, cash equivalents and marketable debt securities at September 30, 2012 were $45.6 million, up $1.7 million from $43.9 million at June 30, 2012. Wireless Group Wireless Group net sales for the quarter were $13.2 million, down 27.5% from the first quarter of fiscal 2012, due to the continuing softness in demand in the wireless infrastructure market. While current Wireless Group sales remain below the peak first quarter fiscal 2012 levels, demand for our Wireless infrastructure products has increased more than 29% from the low point in the third quarter of last year. New product investments for the quarter continued to be focused on expansion of the wireless infrastructure components and low power wireless Anaren Integrated Radio (AIR) module product lines. Customers that generated greater than 10% of Wireless Group net sales for the quarter were Arrow Electronics, Richardson, Huawei and Nokia. Space & Defense Group Space & Defense Group net sales for the quarter were $25.9 million, up 26.1% from the first quarter of fiscal 2012. This increase was driven mainly by higher shipments of passive ranging sub systems and hybrid electronic modules. The increase in net sales and improved operational execution during the quarter resulted in higher profitability for the Group. New orders for the quarter totaled $24.8 million and were driven largely by radar, passive ranging and satellite applications.Space & Defense Group order backlog at September 30, 2012 was approximately $104 million. Customers that generated greater than 10% of Space & Defense Group net sales for the quarter were Lockheed Martin, Northrop Grumman and Raytheon. Non-GAAP Financial Measures In addition to presenting financial results calculated in accordance with GAAP, Anaren's earnings release contains non-GAAP financial measures including: non-GAAP gross profit, non-GAAP operating income, non-GAAP net income and non-GAAP net income per diluted share. These non-GAAP measures are each adjusted from GAAP results to exclude certain non-cash items including equity based compensation and intangible asset amortization. The Company believes these non-GAAP financial measures provide useful information to both management and investors to help understand and compare business trends among reporting periods on a consistent basis.Additionally, these non-GAAP financial measurements are one of the primary indicators management uses for planning and forecasting in future periods.The presentation of this additional information should not be considered in isolation or as a substitute for results prepared in accordance with GAAP. Outlook For the second quarter of fiscal 2013, we anticipate comparable sales for both the Wireless and Space & Defense Groups compared to the first quarter levels.As a result, we expect net sales to be in the range of $37 to $41 million. We expect GAAP net earnings per diluted share to be in the range of $0.17 - $0.25, using an anticipated tax rate of approximately 32.0% and inclusive of approximately $0.05 -$0.06 per diluted share related to expected equity based compensation expense and amortization of intangibles assets.Non-GAAP net earnings per diluted share are expected to be in the range of $0.22 - $0.30 for the second quarter. Forward-Looking Statements The statements contained in this news release which are not historical information are "forward-looking statements." These and other forward-looking statements are based on management's current expectations and are subject to business, market and economic risks and uncertainties that could cause actual results to differ materially from those discussed.You are encouraged to review Anaren's filings with the Securities and Exchange Commission to learn more about the various risks and uncertainties facing Anaren's business and their potential impact on Anaren's revenue, earnings and stock price. Unless required by law, Anaren disclaims any obligation to update or revise any forward-looking statement. Conference Call Anaren will host a live teleconference, open to the public on the Anaren Investor Info, Live Webcast Web Site (www.anaren.com) on October 24 at 8:30 a.m. (ET).A replay of the conference call will be available at 11:30 a.m. (ET) beginning October 24, 2012 through 11:30 p.m. on October 31, 2012.To listen to the replay, interested parties may dial in the U.S. at 1-855-859-2056 and International at 1-404-537-3406.The passcode is 34844702.If you are unable to access the Live Webcast, the dial in number for the U.S. is 1-877-734-4580 and International is 1-678-905-9378. Company Background Anaren designs, manufactures and sells complex microwave components and subsystems for the wireless communications, satellite communications and defense electronics markets.For more information on Anaren's products, visit our Web site at www.anaren.com. The Anaren, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5360 ANAREN, INC. Condensed Consolidated Income Statements (in thousands except per share data) (unaudited) Three Months Ended September 30, 2012 September 30, 2011 Sales $39,062 $38,720 Cost of sales 24,647 24,196 Gross profit 14,415 14,524 36.9% 37.5% Operating expenses: Marketing 2,539 2,596 Research and development 3,334 3,924 General and administration 4,550 4,415 Total operating expenses 10,423 10,935 Operating income 3,992 3,589 10.2% 9.3% Other income (expense): Other income 223 140 Interest expense (18) (80) Total other income, net 205 60 Income before income tax expense 4,197 3,649 Income tax expense 1,343 1,120 Net income $2,854 $2,529 7.3% 6.5% Earnings per share: Basic $0.22 $0.18 Diluted $0.21 $0.17 Weighted average common shares outstanding: Basic 12,999 14,129 Diluted 13,676 14,803 ANAREN, INC. Condensed Consolidated Balance Sheets (in thousands) (unaudited) September 30, 2012 June 30, 2012 Assets: Cash, cash equivalents and short-term $35,990 $32,232 investments Receivables, less allowances 33,426 29,521 Inventories 36,854 36,443 Held for sale assets 4,359 -- Prepaid expenses and other assets 5,842 6,650 Total current assets 116,471 104,846 Securities held to maturity 9,622 11,657 Property, plant, and equipment, net 42,212 47,171 Goodwill 42,343 42,343 Other intangibles, net 7,515 7,770 Total assets $218,163 $213,787 Liabilities and Stockholders' Equity Liabilities: Accounts payable $7,615 $8,604 Accrued expenses 4,585 3,926 Customer advance payments 1,206 1,307 Other liabilities 2,334 2,068 Total current liabilities 15,740 15,905 Long-term debt obligation 8,000 -- Other non-current liabilities 12,139 12,379 Total liabilities 35,879 28,284 Stockholders' Equity: Common stock and additional paid-in capital 226,180 223,326 Retained earnings 145,980 143,126 Accumulated other comprehensive loss (3,056) (3,026) Less: cost of treasury shares (186,820) (177,923) Total stockholders' equity 182,284 185,503 Total liabilities and stockholders' equity $218,163 $213,787 ANAREN, INC. Reconciliation of GAAP and Non-GAAP Gross Profit, Operating Income, Net Income and Diluted Earnings Per Share (in thousands except per share data) (unaudited) Three Months Ended September 30, 2012 September 30, 2011 Sales $39,062 $38,720 GAAP gross profit $14,415 $14,524 Equity-based compensation expense (1) 239 194 Amortization of intangibles (2) 39 39 Non-GAAP gross profit $14,693 $14,757 % of sales 37.6% 38.1% GAAP operating income $3,992 $3,589 Equity-based compensation expense (1) 1,050 956 Amortization of intangibles (2) 255 298 Non-GAAP operating income $5,297 $4,843 % of sales 13.6% 12.5% GAAP net income $2,854 $2,529 Equity-based compensation expense (1) 1,050 956 Amortization of intangibles (2) 255 298 Tax effect (470) (451) Non-GAAP net income $3,689 $3,332 % of sales 9.4% 8.6% Diluted earnings per share GAAP diluted earnings per share $0.21 $0.17 Equity-based compensation expense (1) 0.08 0.06 Amortization of intangibles (2) 0.02 0.02 Tax adjustments (0.04) (0.02) Non-GAAP diluted earnings per share $0.27 $0.23 Weighted average common shares outstanding Diluted 13,676 14,803 1)These costs represent expense recognized in accordance with the share-based compensation accounting rules. 2)These costs represent amortization of intangible assets for the three months ended September 30, 2012 and 2011. ANAREN, INC. Reconciliation of GAAP and Non-GAAP Gross Profit, Operating Income, and Earnings Per Share (in thousands) (unaudited) The following table details the Non-GAAP, Non-Cash expenses related to equity-based compensation and intangible asset amortization by expense category. Three Months EndedSeptember 30, 2012 (in thousands) (unaudited) Equity Based Amortization Compensation of Intangibles Total Cost of sales $239 $39 $278 Marketing 86 -- 86 Research and 120 -- 120 development General and 605 216 821 administrative $1,050 $255 $1,305 Three Months Ended September 30, 2011 (in thousands) (unaudited) Equity Based Amortization Compensation of Intangibles Total Cost of sales $194 $39 $233 Marketing 65 -- 65 Research and 114 -- 114 development General and 583 259 842 administrative $956 $298 $1,254 ANAREN, INC. Condensed Consolidated Statement of Cash Flows (in thousands) (unaudited) Three Months Ended September 30, 2012 Cash flows from operating activities: Net income $2,854 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 1,909 Amortization 363 Deferred income taxes 105 Equity-based compensation 1,050 Receivables (3,906) Inventories (411) Accounts payable (989) Other assets and liabilities 1,088 Net cash provided by operating activities 2,063 Cash flows from investing activities: Capital expenditures (1,309) Proceeds from deposit on held for sale assets 200 Net maturities of held to maturity securities 5,415 Net cash provided by investing activities 4,306 Cash flows from financing activities: Proceeds from long-term debt obligation 8,000 Stock options exercised 1,352 Excess tax benefit from equity-based compensation 453 Purchase of treasury shares (8,897) Net cash provided by financing activities 908 Effect of exchange rates on cash (31) Net increase in cash and cash equivalents $7,246 Cash and cash equivalents at beginning of period $21,012 Cash and cash equivalents at end of period $28,258 CONTACT: George Blanton, CFO 315-362-0436 Joseph E. Porcello, VP-Accounting 315-362-0514 Anaren, Inc. Logo
Anaren Reports 1st Quarter Fiscal 2013 Results
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