Contact:

Mark Thomson, CFO

(757) 766-4224

 

FOR IMMEDIATE RELEASE

 

Measurement Specialties Announces Results

For the Fiscal Year Ended March 31, 2012

Net Income of $27.7 million on Net Sales of $313.2 million

 

Hampton, VA, June 6, 2012 – Measurement Specialties, Inc. (NASDAQ: MEAS) (the “Company”), a global designer and manufacturer of sensors and sensor-based systems, announces results for the three and twelve months ended March 31, 2012.

 

The Company reported an increase in consolidated net sales of $38.4 million, or 14%, to $313.2 million for the twelve months ended March 31, 2012, as compared to the corresponding period of last year. For the twelve months ended March 31, 2012, the Company reported net income of $27.7 million, or $1.74 per diluted share, as compared to net income of $28.2 million, or $1.84 per diluted share, for the same period last year.

 

The Company reported an increase in consolidated net sales of $9.7 million, or approximately 13%, to $86.4 million for the three months ended March 31, 2012, as compared to the corresponding period of last year. For the three months ended March 31, 2012, the Company reported net income of $8.3 million, or $0.52 per diluted share, as compared to net income of $8.3 million, or $0.53 per diluted share, for the same period last year.

 

Frank Guidone, Company CEO commented, “We had a very strong finish to a difficult year. We began the year on plan, posting a solid first quarter, but global uncertainty created a situation where many customers cut their outlook, resulting in inventory contraction in the supply chain and weak sales in our second and third quarters. Global demand stabilized in the fourth quarter, which allowed us to better absorb overhead and deliver results more consistent with our expectations in Q4. With Q4 sales of approximately $86.4 million, along with the incremental benefit from Cosense (acquired April 2^nd), we believe we are well positioned to deliver against our sales guidance of $360 million for FY13. While we remain cautious given the current macro-economic environment, we remain confident in our long term growth strategy and ability to drive shareholder value.”

 

On June 6, 2012, the Company filed its Form 10-K for the twelve months ended March 31, 2012. Please refer to the Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Form 10-K for a more complete discussion of sales, margin and expenses.

 

The Company will host an investor conference call on Thursday, June 7, 2012 at 11:00 AM Eastern to answer questions regarding the third quarter results reported in our Form 10-K for the quarter and year ended March 31, 2012.  US dialers: (877) 407-9210; International dialers (201) 689-8049.  Interested parties may also listen via the Internet at: www.investorcalendar.com.  The call will be available for replay for 30 days by dialing (877) 660-6853 (US dialers); (201) 612-7415 (International dialers), and entering the replay pass code #286 and conference ID# 394984, and on Investorcalendar.com.

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com

 

About Measurement Specialties: Measurement Specialties, Inc. (MEAS) designs and manufactures sensors and sensor-based systems to measure precise ranges of physical characteristics such as pressure, temperature, position, force, vibration, humidity and photo optics. MEAS uses multiple advanced technologies – piezo-resistive silicon sensors, application-specific integrated circuits, micro-electromechanical systems (“MEMS”), piezoelectric polymers, foil strain gauges, force balance systems, fluid capacitive devices, linear and rotational variable differential transformers, electromagnetic displacement sensors, hygroscopic capacitive sensors, ultrasonic sensors, optical sensors, negative thermal coefficient (“NTC”) ceramic sensors, mechanical resonators, reed switch and submersible hydrostatic level sensors – to engineer sensors that operate precisely and cost effectively. 

 

This release includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended.  Forward looking statements may be identified by such words or phrases  as “should”, "intends", “ is subject to”, "expects", "will", "continue", "anticipate", "estimated", "projected", "may", " believe", "future prospects", or similar expressions.  Factors that might cause actual results to differ materially from the expected results described in or underlying our forward-looking statements include: Conditions in the general economy, including risks associated with the current financial crisis and worldwide economic conditions and reduced demand for products that incorporate our products; Competitive factors, such as price pressures and the potential emergence of rival technologies; Compliance with export control laws and regulations; Fluctuations in foreign currency exchange and interest rates; Interruptions of suppliers’ operations or the refusal of our suppliers to provide us with component materials, particularly in light of the current economic conditions and potential for suppliers to fail; Timely development, market acceptance and warranty performance of new products; Changes in product mix, costs and yields; Uncertainties related to doing business in Europe and China; Legislative initiatives, including tax legislation and other changes in the Company’s tax position; Legal proceedings; Compliance with debt covenants, including events beyond our control; Conditions in the credit markets, including our ability to raise additional funds or refinance our existing credit facility; Adverse developments in the automotive industry and other markets served by us; and risk factors listed from time to time in the reports we file with the SEC.  The Company from time-to-time considers acquiring or disposing of business or product lines. Forward-looking statements do not include the impact of acquisitions or dispositions of assets, which could affect results in the near term.  Actual results may differ materially.  The Company assumes no obligation to update the information in this release.

 

Company Contact: Mark Thomson, CFO, (757) 766-4224

 

 

 

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com

 

MEASUREMENT SPECIALTIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

 

		Three Months Ended								Twelve Months Ended
		March 31,								March 31,
		(Unaudited)
(Amounts in thousands, except per share amounts)		2012				2011				2012				2011
Net sales		$	86,436			$	76,766			$	313,204			$	274,789
Cost of goods sold			51,874				45,556				187,323				159,981
Gross profit			34,562				31,210				125,881				114,808
Selling, general, and administrative expenses			23,681				20,611				89,963				78,673
Operating income			10,881				10,599				35,918				36,135
Interest expense, net			642				650				2,574				3,045
Foreign currency exchange loss (gain)			(222	)			305				(175	)			439
Equity income in unconsolidated joint venture			(194	)			(168	)			(806	)			(570	)
Impairment of asset held for sale			400				-				400				-
Other expense			27				99				68				209
Income before income taxes			10,228				9,713				33,857				33,012
Income tax expense			1,883				1,383				6,153				4,837
Net income		$	8,345			$	8,330			$	27,704			$	28,175
Earnings per common share - Basic:
Net income - Basic		$	0.55			$	0.57			$	1.84			$	1.92
Net income - Diluted		$	0.52			$	0.53			$	1.74			$	1.84
Weighted average shares outstanding - Basic			15,167				14,720				15,086				14,692
Weighted average shares outstanding - Diluted			16,024				15,655				15,936				15,336

 

 

 

 

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com

MEASUREMENT SPECIALTIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

 

 

		March 31,				March 31,
(Amounts in thousands)		2012				2011
ASSETS
Current assets:
Cash and cash equivalents		$	32,725			$	20,860
Accounts receivable trade, net of allowance for
doubtful accounts of $766 and $714, respectively			49,315				43,624
Inventories, net			57,704				52,212
Deferred income taxes, net			1,626				3,212
Prepaid expenses and other current assets			5,229				5,514
Other receivables			2,967				1,222
Asset held for sale			1,429				-
Total current assets			150,995				126,644
Property, plant and equipment, net			60,484				50,303
Goodwill			144,455				115,864
Acquired intangible assets, net			49,378				28,656
Deferred income taxes, net			3,613				2,883
Investment in unconsolidated joint venture			3,038				2,578
Other assets			6,244				2,838
Total assets		$	418,207			$	329,766

 

 

 

 

 

 

 

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com

 

MEASUREMENT SPECIALTIES, INC.

CONSOLIDATED BALANCE SHEETS

 

 

		March 31,				March 31,
(Amounts in thousands, except share amounts)		2012				2011
LIABILITIES  AND  SHAREHOLDERS'  EQUITY
Current liabilities:
Short-term debt		$	1,867			$	-
Current portion of long-term debt			123				171
Current portion of capital lease obligations			30				39
Promissory notes payable			-				2,713
Accounts payable			31,879				21,815
Accrued expenses			5,116				5,441
Accrued compensation			8,755				12,646
Income taxes payable			3,124				2,491
Deferred income taxes, net			375				444
Other current liabilities			3,201				2,752
Total current liabilities			54,470				48,512
Revolver			80,251				46,000
Long-term debt, net of current portion			20,711				20,901
Capital lease obligations, net of current portion			30				17
Acquisition earn-out contingencies			4,317				-
Deferred income taxes, net			10,184				3,532
Other liabilities			5,227				1,735
Total liabilities			175,190				120,697
Equity:
Serial preferred stock; 221,756 shares authorized; none outstanding			-				-
Common stock, no par; 25,000,000 shares authorized; 15,297,151 shares
and 14,989,675 shares issued and outstanding			-				-
Additional paid-in capital			101,435				93,608
Retained earnings			129,013				101,309
Accumulated other comprehensive income			12,569				14,152
Total equity			243,017				209,069
Total liabilities and shareholders' equity		$	418,207			$	329,766

 

 

 

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com

MEASUREMENT SPECIALTIES, INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

		Years ended March 31,
(Amounts in thousands)		2012				2011				2010
Cash flows from operating activities:
Net income		$	27,704			$	28,175			$	5,916
Loss from discontinued operations			-				-			$	(142	)
Income from continuing operations			27,704				28,175				6,058
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization			16,735				14,893				14,072
Gain on sale of assets			-				(47	)			68
Non-cash equity based compensation			4,264				3,588				3,218
Impairment of asset held for sale			400				-				-
Deferred income taxes			(713	)			(63	)			(1,927	)
Research tax credits			(1,551	)			1,287				1,677
Equity income in unconsolidated joint venture			(806	)			(570	)			(427	)
Unconsolidated joint venture distributions			582				114				815
Net change in operating assets and liabilities:
Accounts receivable, trade			(1,506	)			(10,351	)			(2,595	)
Inventories			(1,326	)			(7,627	)			4,258
Prepaid expenses, other current assets and other receivables			(712	)			(2,361	)			674
Other assets			(1,855	)			476				690
Accounts payable			7,804				841				1,356
Accrued expenses, accrued compensation, other current and other liabilities			(3,034	)			4,852				4,288
Income taxes payable			(3,366	)			699				(3,025	)
Net cash provided by operating activities			42,620				33,906				29,200
Cash flows from investing activities:
Purchases of property and equipment			(20,655	)			(9,628	)			(5,372	)
Proceeds from sale of assets			-				81				67
Acquisition of business, net of cash acquired, and acquired intangible assets			(46,575	)			(27,037	)			(100	)
Net cash used in investing activities			(67,230	)			(36,584	)			(5,405	)
Cash flows from financing activities:
Borrowings from revolver and short-term debt			64,193				62,746				5,000
Borrowings from long-term debt			-				20,000				-
Repayments of revolver and capital leases			(30,764	)			(77,978	)			(21,074	)
Repayments of long-term debt			(186	)			(8,173	)			(6,382	)
Payment of deferred financing costs			(353	)			(1,568	)			(832	)
Purchase of treasury stock			(6,500	)			(7,500	)			-
Proceeds from exercise of options and employee stock purchase plan			8,973				11,433				172
Excess tax benefit from exercise of stock options			1,090				749				-
Net cash provided by (used in) financing activities			36,453				(291	)			(23,116	)
Net cash provided by operating activities of  discontinued operations			-				-				141
Net cash provided by investing activities of discontinued operations			-				-				141
Net change in cash and cash equivalents			11,843				(2,969	)			820
Effect of exchange rate changes on cash			22				664				68
Cash, beginning of year			20,860				23,165				22,277
Cash, end of period		$	32,725			$	20,860			$	23,165

 

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com

Reconciliation of Non-GAAP Financial Measures (Unaudited):

 

		Three Months Ended								Twelve Months Ended
		March 31,								March 31,
		2012				2011				2012				2011
(In thousands, except percentages)
Income from continuing operations, net of income taxes		$	8,345			$	8,330			$	27,704			$	28,175
Add Back:
Interest			642				650				2,574				3,045
Provision for income taxes			1,883				1,383				6,153				4,837
Depreciation and amortization			4,787				3,667				16,735				14,893
Foreign currency exchange loss (gain)			(222	)			305				(175	)			439
Non-cash equity based compensation			602				1,356				4,264				3,588
Impairment of asset held for sale			400				-				400				-
ITAR legal fees and acquisition related professional fees			188				-				988				32
Adjusted EBITDA		$	16,625			$	15,691			$	58,643			$	55,009
As % of Net Sales			19.2	%			20.4	%			18.7	%			20.0	%
Free Cash Flow
Net cash provided by operating
activities from continuing operations		$	15,426			$	11,319			$	42,620			$	33,906
Purchases of property and equipment			(10,896	)			(2,952	)			(20,655	)			(9,628	)
Free Cash Flow		$	4,530			$	8,367			$	21,965			$	24,278

 

Regulation G, “Conditions for Use of Non-GAAP Financial Measures,” promulgated under the Securities and Exchange Act of 1934, as amended, defines and prescribes the conditions for use of certain non-GAAP financial information. We believe that certain of our financial measures which meet the definition of non-GAAP financial measures provide important supplemental information to investors.

 

The financial information accompanying this press release includes the Company’s earnings before interest, income taxes, depreciation, amortization, foreign currency transaction gains/losses, non-cash equity based compensation and certain legal expenses, or “Adjusted EBITDA” and “Free Cash Flow.” Adjusted EBITDA and Free Cash Flow are non-GAAP measures that are not in accordance with, or an alternative to, measures prepared in accordance with GAAP and may be different from Adjusted EBITDA and Free Cash Flow measures used by other companies. Adjusted EBITDA is derived by adding interest, taxes, depreciation, amortization, foreign currency transaction gains/losses, non-cash equity based compensation and certain legal expenses related to International Traffic in Arms Regulation (ITAR) matters to the Company’s net income from continuing operations and professional fees related to acquisitions. Free Cash Flow is derived by taking net cash provided by operating activities from continuing operations and subtracting capital expenditures (purchases of property and equipment). The Company believes that Adjusted EBITDA is important to investors because it provides a financial measure that is more representative of the Company’s cash flow (prior to taking into account the effects of changes in working capital and purchases of property and equipment), excluding non-cash expenses and items such as foreign currency transaction gains/losses, income taxes, interest and certain legal expenses, which vary greatly period to period. Legal expenses relate to the Company’s previously announced investigation into certain export compliance issues. The Company believes that this measure is important to investors because it more accurately represents the leverage effect of fixed expenses. The Company believes Free Cash Flow is also important to investors as it provides useful information about the amount of cash generated by the business after the purchase of property, buildings and equipment, which can then be used to, among other things, invest in the Company’s business, make strategic acquisitions and strengthen the balance sheet, and because it is a significant measure used in determining the enterprise value of the Company. A limitation on the use of Free Cash Flow as a measure of financial performance is that it does not represent the total increase or decrease in the Company’s cash balance for the period or the residual cash flows available for discretionary expenditures due to the fact that the measure does not deduct the payments required for debt service and other obligations or payments made for business acquisitions.

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com

 

 

These non-GAAP financial measures are used by management in addition to and in conjunction with the results presented in accordance with GAAP. These non-GAAP financial measures should not be relied upon to the exclusion of GAAP financial measures. Non-GAAP financial measures provide an additional way of viewing aspects of our operation that, when viewed with our GAAP results and the accompanying reconciliations to the corresponding GAAP financial measures, provide an understanding of certain factors and trends relating to our business. The Company strongly encourages investors to review our financial statements and publicly filed reports in their entirety and to not rely on any single financial measure.

 

*****End of Press Release*****

 

 

 

 

Measurement Specialties Inc. • 1000 Lucas Way • Hampton, VA 23666 • www.meas-spec.com