Ultralife Corporation Reports First Quarter Results

Ultralife Corporation Reports First Quarter Results

NEWARK, N.Y., May 2, 2013 (GLOBE NEWSWIRE) -- Ultralife Corporation
(Nasdaq:ULBI) reported an operating profit from continuing operations of $0.4
million on revenue of $21.0 million for the quarter ended March 31, 2013. For
the first quarter of 2012, the company reported an operating loss from
continuing operations of $1.3 million on revenue of $27.5 million.

"Through solid execution in the face of ongoing softness in our Battery &
Energy Products business, we delivered our third consecutive profitable
quarter, consistent with our internal expectations, and reversed last year's
operating loss," said Michael D. Popielec, Ultralife's president and chief
executive officer. "Despite the budget pressures confronted by our U.S.
government/defense customers, our plans to diversify our revenue by driving
international and commercial opportunities are proceeding, and we are still
planning for modest revenue gains in our Battery & Energy Products business in
2013. Revenue for our Communications Systems business grew by 7% and we expect
year-over-year growth to continue throughout 2013 based on our opportunity
funnel and anticipated timing of pending projects.As a result, with an
efficient and profitable business model and strong cash generation, we remain
well positioned to realize operating leverage gains on revenue growth during
2013."

First Quarter 2013 Financial Results

Discontinued operations for the first quarter of 2013 include the final
settlement of our obligation to return our former UK facility back to its
original condition per a previous contractual commitment.For the first
quarter of 2012 discontinued operations include the operating results of
RedBlack which was sold in the third quarter of 2012.All revenue, gross
margin and operating expense amounts presented below represent results from
continuing operations.

Revenue was $21.0 million, compared to $27.5 million for the first quarter of
2012, a 24% decline, reflecting an increase of $0.5 million in Communications
Systems sales offset by a $7.0 million decrease in Battery & Energy Products
sales. As a result of continued new business development, the mix of sales
from international customers increased to 46% from 37% for the first quarter
last year. Battery & Energy Products sales were $13.1 million, compared to
$20.1 million last year, a 35% decline, reflecting for the most part the
continued slowdown in U.S. government and defense order rate for rechargeable
and non-rechargeable batteries and charger systems.Communications Systems
sales were $8.0 million, compared to $7.4 million for the same period last
year, an increase of 7%, reflecting the fulfillment of large orders for
amplifiers from international defense customers and continued demand for
amplifiers from the U.S. government.

Gross profit was $6.4 million, or 30.3% of revenue, compared to $6.6 million,
or 24.0% of revenue, for the same quarter a year ago. The 630 basis point
increase reflected productivity gains in both businesses and a higher mix of
Communications Systems sales. Battery & Energy Products' gross margin was
23.7%, compared to 19.6% last year, an increase of 410 basis points due to
productivity improvements resulting from our lean processes and improved
9-volt margins which partially offset lower overhead absorption on volume
declines. Communications Systems' gross margin was 41.2%, an increase of 550
basis points over the 35.7% gross margin reported last year, which resulted
from higher volumes and productivity improvements.

Operating expenses decreased by 24% to $6.0 million, compared to $7.9 million
a year ago, reflecting across-the-board actions taken to align spending with
revenue. As a result, operating expenses were 28.6% of revenue, compared to
28.7% for the year earlier period.

The combination of higher gross margin and essentially flat operating expenses
as a percentage of revenue resulted in a $1.7 million improvement in operating
income to $0.4 million, compared to an operating loss of $1.3 million last
year, despite lower revenue.Operating margin for the first quarter of 2013
was 1.8%.

Net income from continuing operations was $0.2 million, or $0.01 per share,
compared to a net loss of $1.4 million, or $0.08 per share, for the first
quarter of 2012.Net income from discontinued operations was $0.3 million, or
$0.02 per share, for the first quarter of 2013 versus a net loss of $.1
million, or $0.01 per share, for the first quarter of 2012.

Outlook

Management reiterated its outlook for 2013 and continues to expect low- to
mid-single digit revenue growth reflecting strong growth in Communications
Systems sales and modest gains in the Battery & Energy Products business,
despite continued constraints on U.S. government spending.Based on this
outlook for revenue growth, ongoing productivity improvements and plans to
continue prudently investing in new product development, management expects to
increase operating profitability for the year and to generate a mid-single
digit operating margin.

Management cautions that the timing of orders and shipments may cause
variability in quarterly results.

About Ultralife Corporation

Ultralife Corporation serves its markets with products and services ranging
from portable power solutions to communications and electronics systems.
Through its engineering and collaborative approach to problem solving,
Ultralife serves government, defense and commercial customers across the
globe.

Headquartered in Newark, New York, the company's business segments include:
Battery & Energy Products and Communications Systems. Ultralife has operations
in North America, Europe and Asia. For more information, visit
www.ultralifecorp.com.

Conference Call Information

Ultralife will hold its first quarter earnings conference call today at 10:00
AM ET. To participate, please call (800) 915-4836, identify yourself and ask
for the Ultralife call. The conference call will also be broadcast live over
the Internet in the Events & Presentations section of the company's website at
http://investor.ultralifecorporation.com. To listen to the call, please go to
the web site at least fifteen minutes early to download and install any
necessary audio software. For those who cannot listen to the live webcast, a
replay of the webcast will be available shortly after the call at the same
location.

This press release may contain forward-looking statements based on current
expectations that involve a number of risks and uncertainties. The potential
risks and uncertainties that could cause actual results to differ materially
include: potential reductions in U.S. military spending, uncertain global
economic conditions and acceptance of our new products on a global basis. The
Company cautions investors not to place undue reliance on forward-looking
statements, which reflect the Company's analysis only as of today's date. The
Company undertakes no obligation to publicly update forward-looking statements
to reflect subsequent events or circumstances. Further information on these
factors and other factors that could affect Ultralife's financial results is
included in Ultralife's Securities and Exchange Commission (SEC) filings,
including the latest Annual Report on Form 10-K.


ULTRALIFE CORPORATION
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Per Share Amounts)
(unaudited)
                                                                
                                                                
                                                       March 31, December 31,
ASSETS                                                  2013      2012
                                                                
Current assets:                                                  
Cash and cash equivalents                              $8,908  $10,078
Trade accounts receivable, net                         17,280   20,913
Inventories                                           28,281   30,370
Prepaid expenses and other current assets              2,570    2,461
Total current assets                                   57,039    63,822
                                                                
Property and equipment                                  11,778   12,415
                                                                
Other assets:                                                    
Goodwill, intangible and other assets                  23,425    21,481
                                                                
Total Assets                                            $92,242 $97,718
                                                                
LIABILITIES AND SHAREHOLDERS' EQUITY                             
                                                                
Current liabilities:                                             
Short-term debt and current portion of long-term debt $--    $--
Accounts payable                                       8,710    11,357
Other current liabilities                              5,072    8,535
Total current liabilities                              13,782    19,892
                                                                
Long-term liabilities:                                           
Other long-term liabilities                            4,506    4,370
                                                                
Shareholders' equity:                                            
Ultralife equity:                                               
Common stock, par value $0.10 per share                1,886     1,886
Capital in excess of par value                         173,993   173,791
Accumulated other comprehensive loss                   (747)     (620)
Accumulated deficit                                    (93,449)  (93,878)
                                                       81,683    81,179
Less --- Treasury stock, at cost                       7,658     7,658
Total Ultralife equity                                 74,025    73,521
Noncontrolling interest                                (71)     (65)
Total shareholders' equity                             73,954    73,456
                                                                
Total Liabilities and Shareholders' Equity              $92,242 $97,718



ULTRALIFE CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands, Except Per Share Amounts)
(Unaudited)
                                                               
                                                               
                                                   Three-Month Periods Ended
                                                               
                                                   March 31,    April 1,
                                                   2013         2012
                                                               
Revenues:                                                       
Battery & energy products                          $13,053    $20,082
Communications systems                             7,966       7,419
Total revenues                                      21,019       27,501
                                                               
Cost of products sold:                                          
Battery & energy products                          9,953       16,139
Communications systems                             4,687       4,769
Total cost of products sold                         14,640      20,908
                                                               
Gross profit                                        6,379       6,593
                                                               
Operating expenses:                                             
Research and development                           1,369       2,139
Selling, general, and administrative               4,635       5,743
Total operating expenses                            6,004       7,882
                                                               
Operating income (loss)                             375         (1,289)
                                                               
Other income (expense):                                         
Interest income                                    2           1
Interest expense                                   (90)        (104)
Miscellaneous                                      (25)        52
Income (loss) from continuing operations before     262          (1,340)
income taxes
                                                               
Income tax provision-current                        38          79
Income tax provision-deferred                       60          12
Total income taxes                                 98          91
                                                               
Net income (loss) from continuing operations        164         (1,431)
                                                               
Discontinued operations:                                        
Income (loss) from discontinued operations, net of 264         (71)
tax
                                                               
Net income (loss)                                   428         (1,502)
                                                               
Net (income) loss attributable to noncontrolling    6           --
interest
                                                               
Net income (loss) attributable to Ultralife         $434       $(1,502)
                                                               
Other comprehensive income (loss):                              
Foreign currency translation adjustments           (127)       148
                                                               
Comprehensive income (loss) attributable to         $307       $(1,354)
Ultralife
                                                               
                                                               
Net income (loss) attributable to Ultralife common              
shareholders - basic
Continuing operations                              $0.01      $(0.08)
Discontinued operations                            $0.02      $(0.01)
Total                                              $0.02      $(0.09)
Net income (loss) attributable to Ultralife common              
shareholders - diluted
Continuing operations                              $0.01      $(0.08)
Discontinued operations                            $0.02      $(0.01)
Total                                              $0.02      $(0.09)
                                                               
Weighted average shares outstanding - basic         17,457      17,358
Weighted average shares outstanding - diluted       17,478      17,358

CONTACT: Company Contact:
         Ultralife Corporation
         Philip Fain
         (315) 210-6110
         pfain@ulbi.com
        
         Investor Relations Contact:
         Lippert/Heilshorn & Associates
         Jody Burfening
         (212) 838-3777
         jburfening@lhai.com

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