SOURCE:
Key Technology, Inc.
2008-08-07 07:00:00
Key Technology Announces 2008 Third Quarter Results
Record YTD Orders, Record Quarterly and YTD Revenues, and Record Third Quarter Backlog
WALLA WALLA, WA–(EMWNews – August 7, 2008) – Key Technology, Inc. (
announced sales and operating results for the third quarter of fiscal 2008
ended June 30, 2008.
Net sales for the three-month period ended June 30, 2008 totaled $35.8
million, compared to $31.0 million recorded in the same quarter last year.
Net earnings for the quarter were $3.0 million, or $0.53 per diluted share,
compared with $2.9 million, or $0.54 per diluted share, in the same period
a year ago.
Net sales for the nine months ended June 30, 2008 were $93.9 million
compared with $75.8 million for the comparable period in fiscal 2007. The
Company reported net earnings for the fiscal 2008 nine-month period of $5.2
million, or $0.95 per diluted share, compared to $5.1 million, or $0.95 per
diluted share, for the same nine-month period in fiscal 2007, which
included a $750,000 gain, or $0.14 per share, from the sale of the
Company’s 50% interest in its InspX joint venture.
Gross profit for the third quarter of fiscal 2008 was $15.0 million
compared to $12.5 million in the corresponding period last year. As a
percentage of net sales, gross profit in the third quarter of fiscal 2008
was 42.0%, compared to 40.2% in the same quarter of fiscal 2007. For the
2008 nine-month period, gross profit was $37.8 million compared to $29.5
million for the same period of fiscal 2007, or 40.3% and 39.0% as a
percentage of sales, respectively.
David Camp, President and CEO, commented, “We are very pleased with the
revenue growth of the Company. We realized strong revenue growth in North
America, Europe and Latin America, primarily due to increasing focus on
food quality in each of these geographic regions. Increased margins and
revenues have offset our anticipated and incurred operating expense
increases year to date. The growth in gross margins is primarily the
result of realized manufacturing efficiencies due to higher product
shipment volumes.”
Operating expenses for the quarter ended June 30, 2008 were $10.9 million,
or 30.5% of net sales, compared to $8.3 million, or 26.9% of net sales, in
the same quarter last year. Operating expenses for the nine months ended
June 30, 2008 were $31.2 million, or 33.2% of net sales, compared to $23.8
million, or 31.4% of net sales, for the corresponding period of fiscal
2007.
Camp further commented, “Our increase in operating expense as a percent of
net sales is primarily attributable to increases in sales expense, R&D
spending and our ERP project. The sales expenses have increased due to
higher sales and order volumes and a shift to an increased percentage of
orders from outside sales representatives with a higher commission
structure compared to orders received through direct employees. We
consciously increased R&D spending with the objective and focus of bringing
new products to the market sooner.”
New orders received during the third quarter were $30.7 million, compared
to $33.6 million in the same period last year. For the nine-month period,
new orders received were $105.1 million, compared to $89.2 million for the
same period in fiscal 2007. The Company’s backlog at the end of the third
quarter was $42.2 million, compared to $36.7 million one year ago.
David Camp concluded, “Our year-to-date orders were a new record for the
first nine months of any fiscal year, and our opportunity list continues to
be encouraging. We are pleased that we have been successful in reducing our
backlog during the third quarter by increasing our capacity, enabling us to
accelerate the delivery of products to our customers.”
Conference Call
The Company’s conference call discussion of the third quarter results can
be heard live on the Internet at 1:30 p.m. Pacific Time on Thursday, August
7. To access the call, go to
http://www.key.net/investors/investor-events/default.html at least fifteen
minutes prior to the call to download and install any necessary audio
software.
About Key Technology
Key Technology, Inc., headquartered in Walla Walla, Washington, is a
worldwide leader in the design and manufacture of process automation
systems for the food processing and industrial markets. The Company’s
products integrate electro-optical inspection and sorting, specialized
conveying and product preparation equipment, which allow processors to
improve quality, increase yield and reduce cost. Key has manufacturing
facilities in Washington, Oregon, and the Netherlands, and worldwide sales
and service coverage.
This release contains forward-looking statements within the meaning of the
“safe harbor” provisions of the Private Securities Litigation Reform Act of
1995. These statements are based on management’s current expectations or
beliefs and are subject to a number of factors and uncertainties that could
cause actual results to differ materially from those described in the
forward-looking statements. The forward-looking statements in this release
address future financial and operating results.
The following factors, among others, could cause actual results to differ
materially from those described in the forward-looking statements:
-- adverse economic conditions, particularly in the food processing
industry, either globally or regionally, may adversely affect the Company's
revenues;
-- competition and advances in technology may adversely affect sales and
prices;
-- failure of the Company's new products to compete successfully in
either existing or new markets;
-- the limited availability and possible cost fluctuations of materials
used in the Company's products could adversely affect the Company's gross
profits;
-- the inability of the Company to protect its intellectual property,
especially as the Company expands geographically, may adversely affect the
Company's competitive advantage; and
-- intellectual property-related litigation expenses and other costs
resulting from infringement claims asserted against the Company by third
parties may adversely affect the Company's results of operations and its
customer relations.
For a detailed discussion of these and other cautionary statements, please
refer to the Company’s filings with the Securities and Exchange Commission,
particularly Item 1A, “Risk Factors,” of the Company’s Annual Report on
Form 10-K for the fiscal year ended September 30, 2007.
Note: News releases and other information about Key Technology, Inc. can
be accessed at www.key.net.
-TABLES FOLLOW-
Key Technology, Inc. and Subsidiaries
Statement of Selected Operating Information
(Unaudited, in thousands, except per share data)
Three Months Ended Nine Months Ended
June 30, June 30,
------------------ -------------------
2008 2007 2008 2007
--------- -------- --------- ---------
Net sales $ 35,831 $ 31,019 $ 93,884 $ 75,793
Cost of sales 20,795 18,546 56,083 46,258
--------- -------- --------- ---------
Gross profit 15,036 12,473 37,801 29,535
Operating expenses
Selling and marketing 5,552 4,462 15,726 12,573
Research and development 1,984 1,175 5,958 4,018
General and administrative 3,083 2,365 8,532 6,233
Amortization of intangibles 327 327 981 981
--------- -------- --------- ---------
Total operating expenses 10,946 8,329 31,197 23,805
--------- -------- --------- ---------
Gain (loss) on sale of assets 13 (17) 44 21
--------- -------- --------- ---------
Earnings from operations 4,103 4,127 6,648 5,751
Gain on sale of investment in joint
venture --- --- --- 750
Other Income 252 327 1,066 859
--------- -------- --------- ---------
Earnings before income taxes 4,355 4,454 7,714 7,360
Income tax expense 1,392 1,515 2,468 2,247
--------- -------- --------- ---------
Net earnings 2,963 2,939 5,246 5,113
Net earnings per common share
- basic $ 0.54 $ 0.56 $ 0.97 $ 0.97
- diluted $ 0.53 $ 0.54 $ 0.95 $ 0.95
Shares used in per share
calculations - basic 5,461 5,288 5,417 5,247
Shares used in per share
calculations - diluted 5,574 5,408 5,533 5,363
Key Technology, Inc. and Subsidiaries
Selected Balance Sheet Information
(Unaudited, in thousands)
June 30, September 30,
2008 2007
------------- -------------
(in thousands)
Cash and cash equivalents $ 33,132 $ 27,880
Trade accounts receivable, net 16,118 14,020
Inventories 26,019 18,753
Total current assets 79,254 64,727
Property, plant and equipment, net 6,203 4,671
Goodwill and other intangibles, net 5,116 6,097
Total assets 90,650 75,497
Total current liabilities 31,460 23,781
Shareholders' equity $ 58,148 $ 50,393
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