Full Press Release Details
| Contact: | Patrick Johnson, President & CEO | |
| (714) 241-4411 | ||
| For Immediate Release | Jim White, Investor Relations | |
| Kehoe, White & Co., Inc. | ||
| (562) 437-0655 |
PRO-DEX, INC. ANNOUNCES CONTINUED IMPROVEMENT IN
FIRST QUARTER FINANCIAL RESULTS
EARNINGS INCREASE 140% FROM SAME QUARTER LAST YEAR AND 6% FROM PREVIOUS
SANTA ANA, CA, October
28, 2004 - PRO-DEX, INC. (NASDAQ: PDEX) today announced improved financial
results for the quarter ended September 30, 2004. The Company reported
net income for the three months ended September 30, 2004 of $462,000 or $0.05
per share on a basic and diluted basis, as compared to a net income of $193,000
or $0.02 per share on a basic and diluted basis, for the three months ended
September 30, 2003. This represents an increase of 140% or $269,000 over the
first quarter last year and a sequential increase of $25,000 or 6% over the
previous quarter, producing the ninth consecutive increase in quarterly net
Commenting on the Company's financial
performance, Pro-Dex's President and CEO, Patrick Johnson said, "The first
quarter of fiscal 2005 was a continuation of the Company's recent history of improved
profit growth as sales of our core products remained stable and we continued to
increase the net profitability of the Company through improved gross margin and
continued expense control. At the end of last year, we consolidated the
Company's operations, merging our subsidiaries into the corporate parent and
eliminating the Company's historical 'holding company' business structure.
Along with this consolidation of the business has come a restructuring of our
Beaverton operations and the integration of our Product Development
capabilities, changes that we believe will enhance the Company's strategic
advantage in the market and our ability to rapidly grow the business in the
future. All of these operational changes were made while we continued to improve
the net profitability of the Company."
the three months ended September 30, 2004 decreased $196,000 or 5.6% to
$3,332,000, compared to the three months ended September 30, 2003. This
decrease in sales was primarily due to the conversion of revenue generated last
year from HealOzone product sales to royalty payments received this year. The
Company received $40,000 in royalty payments associated with sales of the
HealOzone product during the quarter ended September 30, 2004, revenue that is
reported as Other Income. During the first quarter of fiscal 2004, the Company
had $233,000 in sales of HealOzone product and no sales of that product in the
first quarter of the current year. Excluding the impact of these sales,
consolidated net sales for the three months ending September 30, 2004,
months ended September 30, 2004, the Company's consolidated gross profit
increased 21% or $319,000 compared to the same three months in the previous
year. Gross profit as a percentage of sales increased significantly to 55.8%
for the three months ended September 30, 2004 compared to 43.7% for the three
months ended September 30, 2003 and compared to a gross margin percentage of
53.3% for the previous quarter. "We're continuing to see the benefit of an
improved sales product mix and improved manufacturing efficiencies, which was
the primary focus of our management efforts last year," noted Mr. Johnson.
"Despite a decrease in total sales during the first quarter, we were able to
once again increase gross profit as a percent of sales, primarily due to the
increased proportion of sales coming from the motion control segment of our
business. Sales in this segment were up nearly 30% during the first quarter
Operating expenses decreased 3.6% to
$1,162,000 for the three months ended September 30, 2004 from $1,206,000 for
the three months ended September 30, 2003. On a sequential basis, operating
expenses decreased 6.8% compared to the previous quarter. This decrease was
due primarily to reduced expenses related to the Company's corporate
administration. Mr. Johnson stated, "During the
first quarter this year, we completed the transition to new auditors, which
resulted in decreased audit related expenses compared to last year. We also
renegotiated all of the Company's insurance coverage at the end of last fiscal
year, resulting in a significant cost savings without changing the breadth of
our overall insurance coverage. During the first quarter this year, we used
this savings in administrative expenses to increase our investment in R&D
activities and increase the bottom-line earnings of the Company."
Addressing the Company's on-going operations,
Mr. Johnson noted, "The first quarter of this fiscal year built on the solid
foundation we put into place with last year's improved financial performance.
Considering that we launched no new products during the first quarter and with
the loss of revenue from HealOzone product sales, we feel that increasing
bottom line earnings by 140% was an admirable achievement." Commenting on the
Company's near term prospects, Mr. Johnson said, "First quarter operations
resulted in an increase in our product development activities, which are
currently projected to result in three new product launches in the second
quarter and another three new product launches in the third quarter of the
fiscal year. We have also identified several new product development
opportunities that we believe will translate into new product sales for several
quarters in the future. Based on these developments, we want to reaffirm the
sales and earnings guidance we provided at the beginning of the fiscal year and
thank our shareholders for their continued support."
all others are invited to listen to a conference call discussing the first
quarter and fiscal 2005 outlook, today at 4:30 p.m. Eastern Time. The call will
be broadcast over the Internet and can be accessed by visiting the Company's
website at www.pro-dex.com. An online
replay will be available for 30 days. Additionally, a telephone replay will be
available one hour after the call for 48-hours by dialing (877) 519-4471 for
domestic callers and (973) 341-3080 for international callers; conference ID#
with operations in Santa Ana, California and Beaverton, Oregon, specializes in
bringing speed to market in the development and manufacture
of technology-based solutions that incorporate embedded motion control and
miniature rotary drive systems, serving the medical, dental, semi-conductor,
and scientific research markets. Pro-Dex's products are found in
hospitals, dental offices, medical engineering labs, scientific research
facilities and high tech manufacturing operations around the world.
For more information, visit the
Company's website at www.pro-dex.com.
herein concerning the Company's plans, growth and strategies may include
'forward-looking statements' within the context of the federal securities laws.
Statements regarding the Company's future events, developments and future
performance, as well as management's expectations, beliefs, plans, estimates or
projections relating to the future, are forward-looking statements within the
meaning of these laws. The Company's actual results may differ materially from
those suggested as a result of various factors. Interested parties should refer