INDIANAPOLIS, Nov. 14, 2008 (GLOBE NEWSWIRE) -- Bell Industries, Inc. (Pink Sheets:BIUI) today reported financial results for its third quarter and nine months ended September 30, 2008.
Revenues from continuing operations for the 2008 third quarter were $33.8 million, down 7.3% from $36.4 million a year ago, with $1.8 million of the decrease in revenues related to the company's Technology Solutions Group and $869,000 of the decrease related to its Recreational Products Group. The company incurred a loss from continuing operations of $169,000, or $0.02 per share, for the 2008 third quarter. This reflects an improvement over the prior-year third quarter loss from continuing operations of $594,000, or $0.07 per share. Bell achieved net income in the 2008 third quarter of $31,000, or $0.00 per share, including income from discontinued operations of $200,000, equal to $0.02 per share. This compares with a net loss of $1.8 million, or $0.20 per share, including a loss from discontinued operations of $1.2 million, or $0.13 per share, for the 2007 third quarter.
The company sold SkyTel's automated vehicle location business to SkyGuard LLC for $7.0 million in February 2008 and completed the sale of the balance of its SkyTel division to Velocita Wireless LLC in June 2008 for $7.5 million. As a result of these transactions, the SkyTel division has been reflected as a discontinued operation in the company's results of operations for the three and nine month periods ended September 30, 2008 and 2007.
For the first nine months of 2008, revenues from continuing operations were $83.0 million, down 15.7% from $98.5 million a year ago, with $11.8 million of the decrease in revenues related to the company's Technology Solutions Group and $3.7 million related to its Recreational Products Group. The company incurred a loss from continuing operations of $2.3 million, or $0.26 per share, for the year-to-date period. This reflects a significant improvement over the prior-year first nine months loss from continuing operations of $6.7 million, or $0.77 per share. Bell incurred a net loss for the 2008 first nine months of $3.9 million, or $0.45 per share, including a loss from discontinued operations of $1.7 million, equal to $0.19 per share. This compares with a net loss of $8.1 million, or $0.94 per share, including a loss from discontinued operations of $1.4 million, equal to $0.17 per share.
The Technology Solutions Group posted revenues of $22.8 million for the 2008 third quarter, compared with $24.6 million in the 2007 third quarter. This decline is related to several factors, including the decision to cease acting as an authorized reseller for a certain hardware product line, the timing of completion of certain projects and a focus on improving gross profits. Operating income for the 2008 third quarter amounted to $398,000, increasing by approximately $540,000 over the prior-year third quarter. This increase is attributed to the closure of the unprofitable Springfield call center, improved operational efficiencies on several service engagements and reductions in overhead costs.
Bell's Recreational Products Group reported revenues of $11.0 million for the 2008 third quarter, compared with $11.8 million in the 2007 third quarter. The company attributed the decrease in revenues primarily to lower sales in the marine and recreational vehicle product lines, which is attributed to a decline in general economic conditions, including significantly higher gas prices compared with the 2007 third quarter. Operating income for the 2008 third quarter totaled $341,000, down by $233,000 from the prior-year period operating income of $574,000. The reduction in operating income is primarily due to a $249,000 increase in bad debt expense during the third quarter of 2008 resulting from a decline in the financial strength of the recreational product dealership base, including the closure of a small number of dealers, as general economic conditions have deteriorated.
"We are pleased to see the ongoing improvement in the results of our technology business and remain focused on enhancing the profitability and cash flows for this business," said Kevin J. Thimjon, president and chief financial officer of Bell Industries. "While we continue to look for operating efficiencies in our recreational products business to mitigate the negative impacts of the current economic conditions, we are maintaining our commitment to provide our customers with a high level of product selection and service."
Bell's corporate costs for the 2008 third quarter of $1.1 million were flat to the third quarter of 2007.
About Bell Industries, Inc.
Bell Industries is comprised of two operating units, Bell's Technology Solutions Group and its Recreational Products Group. The company's Technology Solutions Group offers a comprehensive portfolio of customizable and scalable technology solutions ranging from information technology asset lifecycle management services to reverse logistics and mobile/wireless solutions. The Recreational Products Group is a wholesale distributor of aftermarket parts and accessories for the recreational vehicles and other leisure-related vehicle markets, including marine, snowmobile, cycle and ATV.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements, including, but not limited to the focus on improving profitability and cash flows, continuing to look for operating efficiencies and providing our customers with a high level of product selection and service, are based upon current expectations and speak only as of the date hereof. Actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including uncertainties as to the nature of the company's industry, including changing customer demand, the impact of competitive products and pricing, dependence on existing management and general economic conditions. Bell Industries' Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K, and other SEC filings discuss some of the important risk factors that may affect the business, results of operations and financial condition. The company undertakes no obligation to revise or update publicly any forward-looking statements for any reason.
Bell Industries, Inc.
Consolidated Operating Results
(In thousands, except per share data)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
------------------ ------------------
2008 2007 2008 2007
-------- -------- -------- --------
Net revenues:
Products $ 27,561 $ 29,601 $ 62,860 $ 72,664
Services 6,208 6,826 20,151 25,815
-------- -------- -------- --------
Total net revenues 33,769 36,427 83,011 98,479
-------- -------- -------- --------
Costs and expenses:
Cost of products sold 23,080 24,996 51,353 60,584
Cost of services provided 4,442 4,537 14,128 17,686
Selling, general and
administrative expense 6,584 7,519 18,445 28,831
Interest expense, net 225 -- 671 --
Loss on extinguishment of
debt -- -- 1,053 --
Gain on sale of assets -- (39) -- (2,012)
-------- -------- -------- --------
Total costs and expenses 34,331 37,013 85,650 105,089
-------- -------- -------- --------
Loss from continuing
operations before provision
for (benefit from) income
taxes (562) (586) (2,639) (6,610)
Provision for (benefit from)
income taxes (393) 8 (360) 40
-------- -------- -------- --------
Loss from continuing
operations (169) (594) (2,279) (6,650)
Discontinued operations:
Income (loss) from
discontinued operations,
net of tax 200 (1,166) (1,162) (1,440)
Loss on sale of discontinued
operations, net of tax -- -- (500) --
-------- -------- -------- --------
Income (loss) from
discontinued operations, net
of tax 200 (1,166) (1,662) (1,440)
-------- -------- -------- --------
Net income (loss) $ 31 $ (1,760) $ (3,941) $ (8,090)
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Share and per share data
Basic:
Loss from continuing
operations $ (0.02) $ (0.07) $ (0.26) $ (0.77)
Income (loss) from
discontinued operations 0.02 (0.13) (0.19) (0.17)
-------- -------- -------- --------
Net income (loss) $ 0.00 $ (0.20) $ (0.45) $ (0.94)
======== ======== ======== ========
Weighted average common
shares outstanding 8,650 8,650 8,650 8,627
======== ======== ======== ========
Diluted
Loss from continuing
operations $ (0.00) $ (0.07) $ (0.26) $ (0.77)
Income (loss) from
discontinued operations 0.00 (0.13) (0.19) (0.17)
-------- -------- -------- --------
Net income (loss) $ 0.00 $ (0.20) $ (0.45) $ (0.94)
======== ======== ======== ========
Weighted average common
shares outstanding 35,000 8,650 8,650 8,627
======== ======== ======== ========
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OPERATING RESULTS BY BUSINESS
SEGMENT
Net revenues:
Technology Solutions Group
Products $ 16,588 $ 17,759 $ 30,068 $ 36,186
Services 6,208 6,826 20,151 25,814
-------- -------- -------- --------
Total Technology Solutions
Group 22,796 24,585 50,219 62,000
Recreational Products Group 10,973 11,842 32,792 36,479
-------- -------- -------- --------
Total net revenues $ 33,769 $ 36,427 $ 83,011 $ 98,479
======== ======== ======== ========
Operating income (loss):
Technology Solutions Group $ 398 $ (142) $ 856 $ (3,987)
Recreational Products Group 341 574 1,217 788
Corporate costs (1,076) (1,057) (2,988) (5,423)
-------- -------- -------- --------
Total operating loss (337) (625) (915) (8,622)
Gain on sale of assets -- (39) -- (2,012)
Loss on extinguishment of
debt -- -- 1,053 --
Interest expense, net 225 -- 671 --
-------- -------- -------- --------
Loss from continuing
operations before income
taxes $ (562) $ (586) $ (2,639) $ (6,610)
======== ======== ======== ========
Bell Industries, Inc.
Consolidated Condensed Balance Sheets
(Dollars in thousands)
September 30, December 31,
2008 2007
------------- -------------
ASSETS (unaudited)
Current assets:
Cash and cash equivalents $ 1,331 $ 409
Accounts receivable, net 13,223 12,304
Inventories, net 7,445 10,323
Notes receivable 1,500 --
Prepaid expenses and other
current assets 3,898 1,982
Assets held for sale -- 27,814
------------- -------------
Total current assets 27,397 52,832
Fixed assets, net 1,817 1,956
Assets held for sale -- 5,000
Other assets 697 2,231
------------- -------------
Total assets $ 29,911 $ 62,019
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Floor plan payables $ 298 $ 1,064
Revolving credit facility -- 4,775
Accounts payable 6,969 10,438
Accrued payroll 2,407 1,639
Liabilities associated with assets
held for sale -- 19,084
Other accrued liabilities 4,633 5,849
------------- -------------
Total current liabilities 14,307 42,849
Convertible note 10,721 8,969
Other long-term liabilities 3,570 5,418
------------- -------------
Total liabilities 28,598 57,236
Shareholders' equity 1,313 4,783
------------- -------------
Total liabilities and shareholders'
equity $ 29,911 $ 62,019
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