SBS Technologies, Inc. Reports Third Quarter Results

Third Quarter Sales Increased 62% and Net Income Increased 49%

Compared to Prior Year



Apr 17, 2001, 01:00 ET from SBS Technologies, Inc.

    ALBUQUERQUE, N.M., April 17 /PRNewswire/ -- SBS Technologies, Inc.
 (Nasdaq:   SBSE), a leading designer and manufacturer of embedded computer
 solutions for the telecommunications infrastructure, commercial and aerospace
 markets, today announced the results of its fiscal year 2001 third quarter and
 nine months ended March 31, 2001.
     Sales for the third quarter were $48.5 million, a 62% increase over the
 $29.9 million in sales for the third quarter of the prior fiscal year, and a
 1% decline compared to the $49.1 million in sales for the second quarter of
 the current fiscal year.  Net income for the quarter ended March 31, 2001 was
 $4.4 million, a 49% increase over the $2.9 million reported net income for the
 third quarter of the prior fiscal year, and a 12% decline compared to the
 $4.9 million reported net income for the second quarter of the current fiscal
 year.  Net income per common share -- assuming dilution increased 38% to
 $0.29, compared to $0.21 reported for the third quarter of fiscal 2000.  On a
 sequential basis, net income per common share -- assuming dilution decreased
 slightly from $0.32 reported for the preceding quarter.
     Sales for the nine months ended March 31, 2001 were $141.3 million, a 56%
 increase over the $90.3 million in sales for the nine months ended March 31,
 2000.  Net income for the nine months ended March 31, 2001 was $13.6 million,
 an increase of 36% over the $10.0 million for the nine months of the prior
 fiscal year.  Net income per common share -- assuming dilution for the nine
 months ended March 31, 2001 was $0.90, compared to $0.75 for the first nine
 months of the prior fiscal year.
     "We are pleased with our third quarter financial results, as the company
 continued to perform well during turbulent market conditions.  Our broad
 product line and diverse customer base has again proven to be a real asset.
 All three of our operating segments experienced good sales growth compared to
 last year's third quarter.  Although sales from our Communications Group were
 impacted by a slowdown from several telecommunications infrastructure
 customers, sales for this segment increased 109% over the third quarter of
 last year.  We enjoyed excellent growth from our Computer Group, as sales
 increased 40% over the prior year third quarter, with good growth from all
 product lines.  In addition, sales from our Aerospace Group increased 17%
 compared to last year's third quarter.  New order bookings exceeded quarterly
 sales for the seventh consecutive quarter.  Although we did remove a
 $5.1 million order from our backlog that was booked during the last fiscal
 year from one of our industrial customers, we ended the third quarter with a
 solid $66 million in total backlog," said Grahame Rance, President and Chief
 Executive Officer of SBS Technologies.
     "During the quarter we achieved 13 design wins, 7 by our Communications
 Group, 5 by our Computer Group, and 1 by our Aerospace Group.  I believe the
 company continues to be extremely strong and well positioned within its
 markets," Rance said.
 
 
     BUSINESS OUTLOOK
 
     The following statements are based on current expectations.  These
 statements are forward-looking, and actual results may differ materially.
 These statements do not include the potential impact of any business sales,
 mergers or acquisitions that may be completed after March 31, 2001.
     "The majority of our year-to-date growth compared to last year is due to
 our OEM production business with telecommunications infrastructure customers.
 We continue to be concerned about the slowing of the telecommunications
 portion of our market and how this slowing may affect the near-term growth of
 our company.  As a result, we remain cautious concerning the balance of this
 fiscal year.  Currently, we expect sales for the quarter ending June 30, 2001
 to be in the range of $44 million to $47 million, and net income per common
 share -- assuming dilution to be between $0.23 and $0.27.  This represents
 approximately a 20% increase in sales and earnings compared to the fourth
 quarter of last fiscal year.  We will update this guidance as appropriate,"
 Rance said.
     "I believe our long term outlook remains favorable.  Our customers'
 pressures on time-to-market and their trend toward outsourcing will continue.
 We provide the solutions that meet these needs.  Our strategy is to maximize
 our opportunities by focusing on scalable product lines and OEM production
 business.  We plan to supplement our current capabilities with both internal
 development and business acquisitions," Rance said.
     SBS will host a conference call to discuss further the results of the
 quarter at 4:45 p.m. Eastern Time, Tuesday, April 17, 2001.  To access the
 call, dial toll-free (888) 282-8354, or international dial (712) 257-3772.
 The passcode for the conference call is "SBS."  The call will also be webcast
 live, and later archived, from the Investor Relations section of the SBS web
 site at http://www.sbs.com.  An audio replay of the call is available by
 dialing (800) 925-3831.  There is no passcode for the replay.  The replay will
 be available following the conclusion of the call through May 15, 2001.
 
 
     ABOUT SBS TECHNOLOGIES, INC.
 
     SBS Technologies, Inc. (Nasdaq:   SBSE) is a leading designer and
 manufacturer of open-architecture, standard bus embedded computer components
 that enable system designers to create custom solutions specific to a unique
 application.  SBS embedded computer components are used by original equipment
 manufacturers (OEMs) in applications such as telecommunications base stations,
 routers, and optical networking equipment in the build-out of the
 telecommunications infrastructure; medical electronics; industrial automation
 and control equipment; and, aerospace devices.  SBS product lines include CPU
 boards, Wide Area Network (WAN) input/output (I/O) modules, general-purpose
 I/O modules, avionics modules and analyzers, computer interconnection and
 expansion units, and complete computer systems.
 
     This release contains forward-looking statements regarding future events
 or the future financial performance of SBS that are subject to a number of
 risks and other factors which could cause the actual results to differ
 materially from those contained in the forward-looking statements.  Among
 these factors are: business and economic conditions generally; a high degree
 of uncertainty and rapid change in the markets addressed by SBS' products;
 customer acceptance of and demand for SBS' products; SBS' ability to design,
 test and introduce new products on a timely basis; and the risk factors listed
 in SBS' Form 10-K for the year ended June 30, 2000 filed with the Securities
 and Exchange Commission on September 22, 2000.
 
 
                      SBS Technologies, Inc. and Subsidiaries
                            Consolidated Balance Sheets
                                    (Unaudited)
 
                        Assets                  March 31, 2001  June 30, 2000
 
     Current assets:
      Cash and cash equivalents                    $2,562,396      3,595,078
      Receivables, net                             32,763,938     29,164,257
      Inventories                                  48,063,345     30,492,779
      Deferred income taxes                         4,987,666      5,185,853
      Income tax receivable                         1,774,583      1,022,215
      Prepaid expenses                              1,196,410        856,399
      Other current assets                             65,971        431,776
       Total current assets                        91,414,309     70,748,357
 
     Property and equipment, net                   10,229,640      7,320,222
 
     Intangible assets, net                        47,689,492     54,961,154
 
     Other assets                                     617,413        130,524
 
       Total assets                              $149,950,854    133,160,257
 
          Liabilities and Stockholders' Equity
 
     Current liabilities:
      Notes payable                                $9,500,000     20,000,000
      Accounts payable                              6,480,226      5,556,479
      Accrued representative commissions              695,717        652,397
      Accrued salaries                              3,007,777      3,171,690
      Accrued compensated absences                  1,354,440      1,229,307
      Other current liabilities                     2,458,723      2,603,812
       Total current liabilities                   23,496,883     33,213,685
 
     Deferred income taxes                            434,017        932,809
 
       Total liabilities                           23,930,900     34,146,494
 
     Stockholders' equity:
      Common stock, no par value; 200,000,000
       shares authorized, 14,162,026 issued and
       outstanding at March 31, 2001, 13,302,144
       issued and outstanding at June 30, 2000     80,687,944     65,384,516
      Unearned compensation                          (499,219)            --
      Accumulated other comprehensive loss         (5,414,006)    (3,967,584)
      Retained earnings                            51,245,235     37,596,831
       Total stockholders' equity                 126,019,954     99,013,763
 
       Total liabilities and stockholders'
        equity                                   $149,950,854    133,160,257
 
 
                      SBS Technologies, Inc. and Subsidiaries
                       Consolidated Statements of Operations
                                    (Unaudited)
 
 
                      Nine Months Ended March 31   Three Months Ended March 31
                           2001          2000          2001          2000
 
     Sales             $141,284,944    90,341,358   48,490,181    29,888,637
 
     Cost of sales       74,171,601    42,064,813   25,862,695    14,314,636
      Gross Profit       67,113,343    48,276,545   22,627,486    15,574,001
 
     Selling, general
      and administrative
      expense            24,302,130    18,713,659    8,261,862     6,451,485
 
     Research and
      development
      expense            15,004,794    11,241,327    5,077,567     3,703,181
 
     Amortization of
      intangible assets   5,832,347     3,307,502    1,935,742     1,085,746
      Operating income   21,974,072    15,014,057    7,352,315     4,333,589
 
     Interest income
      (expense), net       (653,017)      272,485     (109,486)       97,698
 
     Foreign exchange
      losses               (140,176)      (92,359)     (76,936)      (62,377)
                           (793,193)      180,126     (186,422)       35,321
 
     Income before income
      taxes              21,180,879    15,194,183    7,165,893     4,368,910
 
     Income taxes         7,532,475     5,180,170    2,792,445     1,429,877
 
     Net income         $13,648,404    10,014,013    4,373,448     2,939,033
 
 
     Net income per
      common share            $0.99          0.82         0.31          0.23
 
     Net income per common
      share -- assuming
      dilution                $0.90          0.75         0.29          0.21
 
 

SOURCE SBS Technologies, Inc.
    ALBUQUERQUE, N.M., April 17 /PRNewswire/ -- SBS Technologies, Inc.
 (Nasdaq:   SBSE), a leading designer and manufacturer of embedded computer
 solutions for the telecommunications infrastructure, commercial and aerospace
 markets, today announced the results of its fiscal year 2001 third quarter and
 nine months ended March 31, 2001.
     Sales for the third quarter were $48.5 million, a 62% increase over the
 $29.9 million in sales for the third quarter of the prior fiscal year, and a
 1% decline compared to the $49.1 million in sales for the second quarter of
 the current fiscal year.  Net income for the quarter ended March 31, 2001 was
 $4.4 million, a 49% increase over the $2.9 million reported net income for the
 third quarter of the prior fiscal year, and a 12% decline compared to the
 $4.9 million reported net income for the second quarter of the current fiscal
 year.  Net income per common share -- assuming dilution increased 38% to
 $0.29, compared to $0.21 reported for the third quarter of fiscal 2000.  On a
 sequential basis, net income per common share -- assuming dilution decreased
 slightly from $0.32 reported for the preceding quarter.
     Sales for the nine months ended March 31, 2001 were $141.3 million, a 56%
 increase over the $90.3 million in sales for the nine months ended March 31,
 2000.  Net income for the nine months ended March 31, 2001 was $13.6 million,
 an increase of 36% over the $10.0 million for the nine months of the prior
 fiscal year.  Net income per common share -- assuming dilution for the nine
 months ended March 31, 2001 was $0.90, compared to $0.75 for the first nine
 months of the prior fiscal year.
     "We are pleased with our third quarter financial results, as the company
 continued to perform well during turbulent market conditions.  Our broad
 product line and diverse customer base has again proven to be a real asset.
 All three of our operating segments experienced good sales growth compared to
 last year's third quarter.  Although sales from our Communications Group were
 impacted by a slowdown from several telecommunications infrastructure
 customers, sales for this segment increased 109% over the third quarter of
 last year.  We enjoyed excellent growth from our Computer Group, as sales
 increased 40% over the prior year third quarter, with good growth from all
 product lines.  In addition, sales from our Aerospace Group increased 17%
 compared to last year's third quarter.  New order bookings exceeded quarterly
 sales for the seventh consecutive quarter.  Although we did remove a
 $5.1 million order from our backlog that was booked during the last fiscal
 year from one of our industrial customers, we ended the third quarter with a
 solid $66 million in total backlog," said Grahame Rance, President and Chief
 Executive Officer of SBS Technologies.
     "During the quarter we achieved 13 design wins, 7 by our Communications
 Group, 5 by our Computer Group, and 1 by our Aerospace Group.  I believe the
 company continues to be extremely strong and well positioned within its
 markets," Rance said.
 
 
     BUSINESS OUTLOOK
 
     The following statements are based on current expectations.  These
 statements are forward-looking, and actual results may differ materially.
 These statements do not include the potential impact of any business sales,
 mergers or acquisitions that may be completed after March 31, 2001.
     "The majority of our year-to-date growth compared to last year is due to
 our OEM production business with telecommunications infrastructure customers.
 We continue to be concerned about the slowing of the telecommunications
 portion of our market and how this slowing may affect the near-term growth of
 our company.  As a result, we remain cautious concerning the balance of this
 fiscal year.  Currently, we expect sales for the quarter ending June 30, 2001
 to be in the range of $44 million to $47 million, and net income per common
 share -- assuming dilution to be between $0.23 and $0.27.  This represents
 approximately a 20% increase in sales and earnings compared to the fourth
 quarter of last fiscal year.  We will update this guidance as appropriate,"
 Rance said.
     "I believe our long term outlook remains favorable.  Our customers'
 pressures on time-to-market and their trend toward outsourcing will continue.
 We provide the solutions that meet these needs.  Our strategy is to maximize
 our opportunities by focusing on scalable product lines and OEM production
 business.  We plan to supplement our current capabilities with both internal
 development and business acquisitions," Rance said.
     SBS will host a conference call to discuss further the results of the
 quarter at 4:45 p.m. Eastern Time, Tuesday, April 17, 2001.  To access the
 call, dial toll-free (888) 282-8354, or international dial (712) 257-3772.
 The passcode for the conference call is "SBS."  The call will also be webcast
 live, and later archived, from the Investor Relations section of the SBS web
 site at http://www.sbs.com.  An audio replay of the call is available by
 dialing (800) 925-3831.  There is no passcode for the replay.  The replay will
 be available following the conclusion of the call through May 15, 2001.
 
 
     ABOUT SBS TECHNOLOGIES, INC.
 
     SBS Technologies, Inc. (Nasdaq:   SBSE) is a leading designer and
 manufacturer of open-architecture, standard bus embedded computer components
 that enable system designers to create custom solutions specific to a unique
 application.  SBS embedded computer components are used by original equipment
 manufacturers (OEMs) in applications such as telecommunications base stations,
 routers, and optical networking equipment in the build-out of the
 telecommunications infrastructure; medical electronics; industrial automation
 and control equipment; and, aerospace devices.  SBS product lines include CPU
 boards, Wide Area Network (WAN) input/output (I/O) modules, general-purpose
 I/O modules, avionics modules and analyzers, computer interconnection and
 expansion units, and complete computer systems.
 
     This release contains forward-looking statements regarding future events
 or the future financial performance of SBS that are subject to a number of
 risks and other factors which could cause the actual results to differ
 materially from those contained in the forward-looking statements.  Among
 these factors are: business and economic conditions generally; a high degree
 of uncertainty and rapid change in the markets addressed by SBS' products;
 customer acceptance of and demand for SBS' products; SBS' ability to design,
 test and introduce new products on a timely basis; and the risk factors listed
 in SBS' Form 10-K for the year ended June 30, 2000 filed with the Securities
 and Exchange Commission on September 22, 2000.
 
 
                      SBS Technologies, Inc. and Subsidiaries
                            Consolidated Balance Sheets
                                    (Unaudited)
 
                        Assets                  March 31, 2001  June 30, 2000
 
     Current assets:
      Cash and cash equivalents                    $2,562,396      3,595,078
      Receivables, net                             32,763,938     29,164,257
      Inventories                                  48,063,345     30,492,779
      Deferred income taxes                         4,987,666      5,185,853
      Income tax receivable                         1,774,583      1,022,215
      Prepaid expenses                              1,196,410        856,399
      Other current assets                             65,971        431,776
       Total current assets                        91,414,309     70,748,357
 
     Property and equipment, net                   10,229,640      7,320,222
 
     Intangible assets, net                        47,689,492     54,961,154
 
     Other assets                                     617,413        130,524
 
       Total assets                              $149,950,854    133,160,257
 
          Liabilities and Stockholders' Equity
 
     Current liabilities:
      Notes payable                                $9,500,000     20,000,000
      Accounts payable                              6,480,226      5,556,479
      Accrued representative commissions              695,717        652,397
      Accrued salaries                              3,007,777      3,171,690
      Accrued compensated absences                  1,354,440      1,229,307
      Other current liabilities                     2,458,723      2,603,812
       Total current liabilities                   23,496,883     33,213,685
 
     Deferred income taxes                            434,017        932,809
 
       Total liabilities                           23,930,900     34,146,494
 
     Stockholders' equity:
      Common stock, no par value; 200,000,000
       shares authorized, 14,162,026 issued and
       outstanding at March 31, 2001, 13,302,144
       issued and outstanding at June 30, 2000     80,687,944     65,384,516
      Unearned compensation                          (499,219)            --
      Accumulated other comprehensive loss         (5,414,006)    (3,967,584)
      Retained earnings                            51,245,235     37,596,831
       Total stockholders' equity                 126,019,954     99,013,763
 
       Total liabilities and stockholders'
        equity                                   $149,950,854    133,160,257
 
 
                      SBS Technologies, Inc. and Subsidiaries
                       Consolidated Statements of Operations
                                    (Unaudited)
 
 
                      Nine Months Ended March 31   Three Months Ended March 31
                           2001          2000          2001          2000
 
     Sales             $141,284,944    90,341,358   48,490,181    29,888,637
 
     Cost of sales       74,171,601    42,064,813   25,862,695    14,314,636
      Gross Profit       67,113,343    48,276,545   22,627,486    15,574,001
 
     Selling, general
      and administrative
      expense            24,302,130    18,713,659    8,261,862     6,451,485
 
     Research and
      development
      expense            15,004,794    11,241,327    5,077,567     3,703,181
 
     Amortization of
      intangible assets   5,832,347     3,307,502    1,935,742     1,085,746
      Operating income   21,974,072    15,014,057    7,352,315     4,333,589
 
     Interest income
      (expense), net       (653,017)      272,485     (109,486)       97,698
 
     Foreign exchange
      losses               (140,176)      (92,359)     (76,936)      (62,377)
                           (793,193)      180,126     (186,422)       35,321
 
     Income before income
      taxes              21,180,879    15,194,183    7,165,893     4,368,910
 
     Income taxes         7,532,475     5,180,170    2,792,445     1,429,877
 
     Net income         $13,648,404    10,014,013    4,373,448     2,939,033
 
 
     Net income per
      common share            $0.99          0.82         0.31          0.23
 
     Net income per common
      share -- assuming
      dilution                $0.90          0.75         0.29          0.21
 
 SOURCE  SBS Technologies, Inc.