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| 8-K - 8-K - HURCO COMPANIES INC | v336864_8k.htm |
FOR IMMEDIATE RELEASE
Wednesday, March 6, 2013
HURCO REPORTS FIRST QUARTER RESULTS
INDIANAPOLIS, INDIANA, — March 6, 2013, Hurco Companies, Inc., (Nasdaq Global Select Market: HURC) today reported for its first fiscal quarter ended January 31, 2013, net income of $2,254,000, or $0.34 per diluted share, a decrease of $2,379,000, or 51%, when compared to net income of $4,633,000, or $0.71 per diluted share, for the first quarter of fiscal 2012. The decrease in net income was primarily due to a 14% reduction in reportable sales, resulting from a shift in the timing of shipments between quarters, particularly in Europe. However, orders during the first quarter of fiscal 2013 were 5% higher than in the corresponding period of fiscal 2012.
Sales and service fees for the first quarter of fiscal 2013 totaled $44,085,000, a decrease of $7,041,000 from the first quarter of fiscal 2012. The impact of foreign currency when translating sales to U.S. Dollars for financial reporting purposes was not material on the period-to-period comparison.
The following table sets forth net sales and service fees, and orders by geographic region for the first quarters of fiscal 2013 and 2012 (in thousands):
| Net Sales and Service Fees | Orders | |||||||||||||||||||||||||||||||
| Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||
| January 31, | January 31, | |||||||||||||||||||||||||||||||
| Amount | % | Amount | % | |||||||||||||||||||||||||||||
| 2013 | 2012 | Change | Change | 2013 | 2012 | Change | Change | |||||||||||||||||||||||||
| North America | $ | 16,252 | $ | 15,326 | $ | 926 | 6 | % | $ | 14,613 | $ | 14,383 | $ | 230 | 2 | % | ||||||||||||||||
| Europe | 24,670 | 29,919 | (5,249 | ) | -18 | % | 30,696 | 29,257 | 1,439 | 5 | % | |||||||||||||||||||||
| Asia Pacific | 3,163 | 5,881 | (2,718 | ) | -46 | % | 5,792 | 5,255 | 537 | 10 | % | |||||||||||||||||||||
| Total | $ | 44,085 | $ | 51,126 | $ | (7,041 | ) | -14 | % | $ | 51,101 | $ | 48,895 | $ | 2,206 | 5 | % | |||||||||||||||
Gross profit for the first quarter of fiscal 2013 was $12,916,000, or 29% of sales, compared to $16,484,000, or 32% of sales, for the prior year period. The decrease in gross profit was primarily a result of the decrease in sales.
Selling, general and administrative expenses were $8,920,000 for the first quarter of fiscal 2013, a decrease of $810,000, or 8%, from the first quarter of fiscal 2012. The decrease is primarily related to variable related costs including lower sales commissions and sales and marketing expenses. Selling, general and administrative expenses were 20% of sales and service fees during the first quarter of fiscal 2013 compared to 19% for the first quarter of fiscal 2012.
Cash and cash equivalents totaled $39,108,000 as of January 31, 2013, compared to $35,770,000 as of October 31, 2012. Working capital, excluding cash, was $86,612,000 as of January 31, 2013, compared to $88,239,000 as of October 31, 2012. The decrease in working capital, excluding cash, was primarily due to a decrease in accounts receivable during the first quarter of fiscal 2013. Inventory levels were relatively unchanged from October 31, 2012 to January 31, 2013.
Michael Doar, Chairman, Chief Executive Officer and President, stated, “I believe our rebranding initiative, which premiered last September in the United States at the International Manufacturing Technology Show, has had a positive impact throughout North America. The initiative energized our sales channels and existing customers, and attracted new customers. Our divisions throughout Asia and Europe will officially introduce the updated Hurco brand at key shows in their regions in the upcoming quarters. While we experienced good order activity in all regions, we continue to monitor the ongoing economic situation in Europe and the overall economic activity in China.
Hurco Companies, Inc. is an industrial technology company that designs and produces interactive computer controls, software and computerized machine tools for the worldwide metal cutting and metal forming industry. The end market for the Company's products consists primarily of independent job shops and short-run manufacturing operations within large corporations in industries such as aerospace, defense, medical equipment, energy, transportation and computer equipment. The Company is based in Indianapolis, Indiana, with manufacturing operations in Taiwan and China, and sells its products through direct and indirect sales forces throughout North America, Europe, and Asia. The Company has sales, application engineering support and service subsidiaries in China, England, France, Germany, India, Italy, Poland, Singapore, South Africa and the United States of America. Web Site: www.hurco.com
This news release contains forward looking statements which involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These factors include, among others, the cyclical nature of the machine tool industry, changes in general economic and business conditions that affect demand for our products, the risks of our international operations, changes in manufacturing markets, innovations by competitors, the ability to protect our intellectual property, fluctuations in foreign currency exchange rates, increases in prices of raw materials, quality and delivery performance by our vendors, changes in operations due to acquisitions or loss of key personnel, and governmental actions and initiatives including import and export restrictions and tariffs.
Contact: John G. Oblazney
Vice President & Chief Financial Officer
317-293-5309
| Hurco Companies, Inc. | ||||||||
| CONDENSED CONSOLIDATED STATEMENT OF INCOME | ||||||||
| (In thousands, except per-share data) | ||||||||
| Quarter Ended January 31, | ||||||||
| 2013 | 2012 | |||||||
| (unaudited) | ||||||||
| Sales and service fees | $ | 44,085 | $ | 51,126 | ||||
| Cost of sales and service | 31,169 | 34,642 | ||||||
| Gross profit | 12,916 | 16,484 | ||||||
| Selling, general and administrative expenses | 8,920 | 9,730 | ||||||
| Operating income | 3,996 | 6,754 | ||||||
| Interest expense | 65 | 24 | ||||||
| Interest income | 16 | 22 | ||||||
| Investment income | 11 | 6 | ||||||
| Other expense (income), net | 259 | (138 | ) | |||||
| Income before taxes | 3,699 | 6,896 | ||||||
| Provision for income taxes | 1,445 | 2,263 | ||||||
| Net income | $ | 2,254 | $ | 4,633 | ||||
| Earnings per common share | ||||||||
| Basic | $ | 0.35 | $ | 0.71 | ||||
| Diluted | $ | 0.34 | $ | 0.71 | ||||
| Weighted average common shares outstanding | ||||||||
| Basic | 6,447 | 6,441 | ||||||
| Diluted | 6,484 | 6,466 | ||||||
| OTHER CONSOLIDATED FINANCIAL DATA | ||||||||
| Quarter Ended January 31, | ||||||||
| Operating Data: | 2013 | 2012 | ||||||
| (unaudited) | ||||||||
| Gross margin | 29 | % | 32 | % | ||||
| SG&A expense as a percentage of sales | 20 | % | 19 | % | ||||
| Operating income as a percentage of sales | 9 | % | 13 | % | ||||
| Pre-tax income as a percentage of sales | 8 | % | 13 | % | ||||
| Effective Tax Rate | 39 | % | 33 | % | ||||
| Depreciation and amortization | 917 | 1,087 | ||||||
| Capital expenditures | 836 | 544 | ||||||
| Balance Sheet Data: | 1/31/2012 | 10/31/2012 | ||||||
| (unaudited) | ||||||||
| Working capital (excluding cash) | $ | 86,612 | $ | 88,239 | ||||
| Days sales outstanding (unaudited) | 51 | 38 | ||||||
| Inventory turns (unaudited) | 1.5 | 1.5 | ||||||
| Capitalization | ||||||||
| Total debt | $ | 3,216 | $ | 3,206 | ||||
| Shareholders' equity | 145,564 | 143,793 | ||||||
| Total | $ | 148,780 | $ | 146,999 | ||||
| Hurco Companies, Inc. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (In thousands, except share and per-share data) | ||||||||
| January 31, | October 31, | |||||||
| 2013 | 2012 | |||||||
| (Unaudited) | (Audited) | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 39,108 | $ | 35,770 | ||||
| Accounts receivable, net | 31,748 | 35,297 | ||||||
| Refundable taxes | 1,418 | 1,459 | ||||||
| Inventories, net | 91,513 | 91,320 | ||||||
| Deferred income taxes | 2,309 | 1,182 | ||||||
| Derivative assets | 132 | 708 | ||||||
| Other | 8,521 | 7,645 | ||||||
| Total current assets | 174,749 | 173,381 | ||||||
| Property and equipment: | ||||||||
| Land | 782 | 782 | ||||||
| Building | 7,326 | 7,352 | ||||||
| Machinery and equipment | 17,771 | 17,411 | ||||||
| Leasehold improvements | 3,548 | 3,467 | ||||||
| 29,427 | 29,012 | |||||||
| Less accumulated depreciation and amortization | (17,387 | ) | (16,933 | ) | ||||
| 12,040 | 12,079 | |||||||
| Non-current assets: | ||||||||
| Software development costs, less accumulated amortization | 3,921 | 3,969 | ||||||
| Other assets | 6,120 | 5,883 | ||||||
| $ | 196,830 | $ | 195,312 | |||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 29,741 | $ | 29,788 | ||||
| Derivative liabilities | 2,883 | 569 | ||||||
| Accrued expenses | 13,189 | 15,809 | ||||||
| Short-term debt | 3,216 | 3,206 | ||||||
| Total current liabilities | 49,029 | 49,372 | ||||||
| Non-current liabilities: | ||||||||
| Deferred income taxes | 910 | 903 | ||||||
| Deferred credits and other obligations | 1,327 | 1,244 | ||||||
| Total liabilities | 51,266 | 51,519 | ||||||
| Shareholders' equity: | ||||||||
| Preferred stock: no par value per share; 1,000,000 shares | - | - | ||||||
| authorized; no shares issued | ||||||||
| Common stock: no par value; $.10 stated value per share; 12,500,000 shares authorized; | ||||||||
| 6,515,911 and 6,502,298 shares issued; and 6,447,210 and 6,447,210 shares outstanding, | ||||||||
| as of January 31, 2013 and October 31, 2012, respectively | 645 | 645 | ||||||
| Additional paid-in capital | 53,663 | 53,415 | ||||||
| Retained earnings | 92,840 | 90,586 | ||||||
| Accumulated other comprehensive loss | (1,584 | ) | (853 | ) | ||||
| Total shareholders' equity | 145,564 | 143,793 | ||||||
| $ | 196,830 | $ | 195,312 | |||||