Devcon International Corp. Reports First Quarter 2007 Financial Results
22 Maio 2007 - 10:30AM
PR Newswire (US)
Company Announces Investor Conference Call for Tuesday, May 29,
2007 BOCA RATON, Fla., May 22 /PRNewswire-FirstCall/ -- Devcon
International Corp. (NASDAQ:DEVC) today reported a net loss from
continuing operations for its first quarter ended March 31, 2007 of
$(8.8) million or $(1.42) per fully diluted share, compared to a
net loss from continuing operations of $(9.6) million, or ($1.61)
per fully diluted share for the three months ended March 31, 2006.
Revenue from continuing operations (security revenue) for the first
quarter 2007 increased $3.6 million to $14.2 million, compared to
revenue of $10.6 million for the first quarter 2006, a 34%
increase. Included in the 2007 first quarter revenues is
approximately $4.4 million related to three months of Guardian
revenues, compared to one month of activity in 2006. For the first
quarter, the Company reported an operating loss from continuing
operations of $(3.2) million after taking effect for amortization
and depreciation expenses of $4.5 million, compared to an operating
loss of $(3.7) million for the first quarter of 2006. Selling,
general and administrative expense, including severance and
retirement expense, from continuing operations increased by $0.8
million in the first quarter of 2007 compared to the first quarter
of 2006. As a percentage of revenue this was a decrease of 8.6%,
quarter over quarter. Selling, general and administrative expenses
in the quarter were impacted by certain non-recurring or short-term
factors, including severance charges related to the departure of
senior executives, legal expense related to SEC filings and various
litigation, and accounting expenses related to the change in audit
firms and various SEC filings. Additionally, during the first
quarter of 2007, the Company recorded a non-cash charge of $2.4
million related to derivative financial instrument expense compared
to $1.5 million during the first quarter of 2006. Interest expense
in the first quarter of 2007 was $4.0 million compared to $3.9
million in the first quarter of 2006. As part of Devcon's continued
focus on and expansion into the electronic security services
industry, on September 30, 2005, March 2, 2006 and May 2, 2006, the
Company disposed of its non-core operations of its Materials
Division in the U.S. Virgin Islands, Antigua and Puerto Rico,
respectively. On March 21, 2007, the Company sold the majority of
the assets, inventory and customer lists of the construction
division. As a result, the financial results of these operations
and the remaining Materials and Utilities operations held for sale
are reported separately as discontinued operations for all periods
presented. The Company reported a loss from discontinued operations
of $742,000 for the three months ended March 31, 2007, compared to
a gain from discontinued operations of $887,000 for the same period
last year. Richard C. Rochon, the Company's Acting CEO, stated,
"With the recent sale of our Construction Division we are
enthusiastic about the future of Devcon as a leading provider of
electronic security services." Conference Call The Company's first
quarter 2007 conference call is scheduled for 10:00 a.m. ET,
Tuesday, May 29, 2007. To participate in the call, dial
800-257-3401 for domestic callers and 303-262-2130 for
international callers. The call may also be accessed through a live
webcast link on the Company's Internet home page,
http://www.devc.com/. The webcast will be archived for one month
following the call. About Devcon Devcon International's
wholly-owned subsidiary, Devcon Security
(http://www.devcon-security.com/), is a leading provider of
installation, monitoring and related electronic security services,
currently serving more than 140,000 commercial and residential
customers in Florida, New York City and Staten Island. Since
February, 2005, Devcon has made 3 significant acquisitions of
full-service electronic security services companies with
significant concentrations throughout Florida and the New York
Metropolitan region. Currently, Devcon Security Services Corp. is
the second largest security monitoring and alarm company in Florida
and the eleventh largest in the U.S. Forward-Looking Statements
This press release may contain statements, which are not historical
facts and are considered forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements contain projections of Devcon's
future results of operations, financial position or state other
forward-looking information. In some cases you can identify these
statements by forward-looking words such as "anticipate,"
"believe," "could," "estimate," "expect," "intend," "may,"
"should," "will," and "would" or similar words. You should not rely
on forward-looking statements because Devcon's actual results may
differ materially from those indicated by these forward-looking
statements as a result of a number of important factors. These
factors include, but are not limited to: general economic and
business conditions; our business strategy for expanding our
presence in our industry; anticipated trends in our financial
condition and results of operation; the impact of competition and
technology change; existing and future regulations effecting our
business, and other risks and uncertainties discussed under the
heading "Item 1A - Risk Factors" in Devcon's Annual Report on Form
10-K for the period ended December 31, 2006 as filed with the
Securities and Exchange Commission, and other reports Devcon files
from time to time with the Securities and Exchange Commission.
Devcon does not intend to and undertakes no duty to update the
information contained in this press release. Devcon International
Corp. Consolidated Statement of Operations (Amounts in thousands,
except share and per share data) For The Three Months Ended March
31, 2007 March 31, 2006 Security revenue $14,185 $10,603 Cost of
Sales (exclusive of amortization and depreciation shown below):
6,064 4,598 Gross profit 8,121 6,005 Operating expenses Selling,
general and administrative 6,792 5,759 Amortization and
depreciation 4,497 3,709 Severance and retirement - 229 Operating
loss (3,168) (3,692) Other income (expense) Joint venture equity
earnings - (35) Interest expense (3,998) (3,941) Interest income
127 76 Derivative financial instrument expense (2,393) (1,535) Loss
from continuing operations before income taxes (9,432) (9,127)
Income tax (benefit) expense (591) 531 Net loss from continuing
operations (8,841) (9,658) Loss income from discontinued
operations, net of income tax (benefit) expense of $ 0 and ($581)
for the three months ended March 31, 2007 and 2006, respectively
(512) (126) (Loss) gain on disposal of discontinued operations, net
of income tax expense of $0 and $0 for the three months ended March
31, 2007 and 2006, respectively (230) 1,013 Net loss $(9,583)
$(8,771) Basic (loss) income per share: Continuing operations
$(1.42) $(1.61) Discontinued operations $(0.12) $0.15 Net loss
$(1.55) $(1.46) Diluted (loss) income per share: Continuing
operations $(1.42) $(1.61) Discontinued operations (0.12) 0.15 Net
loss $(1.55) $(1.46) Weighted average number of shares outstanding:
Basic 6,200,024 6,006,156 Diluted 6,200,024 6,006,156 Devcon
International Corp. Condensed Balance Sheet (in thousands) March 31
December 31 2007 2006 Balance Sheet Data: Cash and cash equivalents
$6,605 $5,015 Total assets $204,984 $212,897 Long-term debt,
excluding current position $88,675 $89,202 Stockholders' equity
$41,354 $36,126 DATASOURCE: Devcon International Corp. CONTACT:
Stan Smith, +1-561-955-7300 or Web site: http://www.devc.com/
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