Exhibit 99.1
IMPCO Reports Favorable Third Quarter 2004 Results
CERRITOS, Calif., November 4, 2004 /PRNewswire/ — IMPCO Technologies, Inc. (Nasdaq: IMCO), today reported results for its third quarter ended September 30, 2004.
IMPCO’s third quarter fiscal 2004 results were $30.1 million in revenues and $2.4 million in operating income, as compared to $18.7 million in revenues and $0.4 million in operating income in the same period in 2003. Third quarter of fiscal year 2004 revenues increased $11.4 million, or 61%, while operating income increased $2.0 million, or 500%, compared to the same period in 2003. Net income for the third quarter of 2004 was $0.5 million and 3 cents net income per share, compared to a net loss of ($1.2) million and 8 cents net loss per share in the same period in 2003.
IMPCO’s nine month fiscal 2004 results were $91.2 million in revenues and $7.8 million in operating income, as compared to $56.6 million in revenues and $2.6 million in operating income in the comparable nine month period of 2003. Nine month fiscal 2004 revenues increased $34.6 million, or 61%, while operating income increased $5.2 million, or 200%, compared to the same period in 2003. Net income for the nine months of fiscal 2004 was $2.0 million and 10 cents net income per share, compared to a net loss of ($1.0) million and 6 cents net loss per share in the same period in 2003.
Mr. Robert Stemmler, Chairman and CEO said that, “the third quarter’s favorable results and the year-to-date outstanding performance of the company were due to underlying strengths which have been built into IMPCO over the past two years”. He added, “These strengths include a leading position in the rapidly expanding emission controlled off-highway industrial market in the U.S., a leading position in the large overseas motor vehicle market, and the low operating expenses of all USA and international business units”.
Commenting on the growth of the industrial market, Mr. Stemmler stated, “the industrial market was responsible for the company’s revenue growth year-to-date and represents a 116% improvement over the same period last year”. In regard to the new emission controlled off-highway business in the U.S., Mr. Stemmler cited that it was the major factor for the growth of the industrial market with year-to-date revenues of $29.4 million.
Referring to the international motor vehicle market, Mr. Stemmler said that the net income contribution from our joint venture partner, BRC, has also been a major factor in the company’s performance. He said, “Our 50% unconsolidated subsidiary, which is a leader in the global motor vehicle market, is having an outstanding year through growth in the European Union, Eastern Europe, India and South American regions. BRC revenues, which are not consolidated into IMPCO, have increased 39% to $38.7 million in the first three quarters of this year in comparison to the same period in CY03.”
Mr. Stemmler said that IMPCO’s past efforts to reduce operating costs and improve efficiency was also an indirect contributor to the favorable results of the company. He said third quarter year-to-date SG&A costs were approximately the same as last year and noted that this was accomplished despite added expenses of approximately $200,000 which were primarily due to implementation of the Sarbanes Oxley requirements. As a percent of sales, SG&A was 14.6% third quarter year-to-date versus 24% last year.
Mr. Stemmler referred those interested in the acquisition of the remaining 50% of BRC to review IMPCO’s October 25, 2004 8-K filing on the subject.
Earnings Call Scheduled for November
IMPCO will host a conference call to discuss financial results on Thursday, November 4, 2004 at 4:30 p.m. EST, 1:30 p.m. PST. All shareholders and other interested parties are invited to dial into the call, which may be accessed by calling (706) 679-3125. In order to ensure participation, please dial in 15 minutes prior to the scheduled time. A recording of the call will be available for 24 hours and can be accessed by calling (800) 642-1687 or (706) 645-9291, reference conference code #1868575.
IMPCO and BRC design, manufacture, market and supply advanced alternative fuel systems and related products for the transportation, industrial and power generation markets. Headquartered in Cerritos, California and Cherasco, Italy, they have offices in Asia, Europe, Australia and South and North America. More information can be found at IMPCO’s web side, http://www.impco.ws and at BRC’s web site, http://www.brc.it.
Except for historical information, the statements, expectations and assumptions contained in the foregoing press release are forward-looking statements. Such forward-looking statements include, but are not limited to, the company’s expectations regarding revenues in future periods and trends in the global economy and environmental regulation that impact our business from time to time. Such statements are subject to a number of risks and uncertainties, and actual results could differ materially from those discussed in any forward-looking statement. Accordingly, you should not construe statements of anticipated performance or planned courses of action as assurances or promises, and note that our statements of expectations are based on information currently available to management. Factors that could cause actual results to differ materially from our forward-looking statements include, among other factors, prevailing market and global economic conditions; changes in environmental regulations that impact the demand for our products; our ability to manage our leverage and address operating covenant restrictions relating to our indebtedness; our ability to negotiate and comply with waivers pertaining to existing loan covenant defaults; the company’s ability to design and market advanced fuel metering, fuel storage and electronic control products; the company’s ability to meet OEM specifications; and the level and success of the company’s development programs with OEMs. Readers also should consider the risk factors set forth from time to time in our SEC reports, including but not limited to those contained in the section entitled “Management’s Discussion & Analysis of Financial Condition and Results of Operation – Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2003. The company does not undertake to update or revise any of its forward-looking statements even if experience or future changes show that the indicated results or events will not be realized.
For further information, please contact Mr. Dale Rasmussen, Investor Relations, +1-206-315-8242.
IMPCO TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
Three and Nine Months Ended September 30, 2003 and 2004
(In thousands except per share data)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| 2003 |
2004 |
2003 |
2004 |
|||||||||||||
| Revenue |
$ | 18,669 | $ | 30,064 | $ | 56,581 | $ | 91,146 | ||||||||
| Costs and expenses: |
||||||||||||||||
| Cost of revenue |
12,864 | 21,933 | 38,247 | 66,874 | ||||||||||||
| Research and development expense |
911 | 1,189 | 2,693 | 3,190 | ||||||||||||
| Selling, general and administrative expense |
4,482 | 4,542 | 13,036 | 13,279 | ||||||||||||
| Total costs and expenses |
18,257 | 27,664 | 53,976 | 83,343 | ||||||||||||
| Operating Income |
412 | 2,400 | 2,605 | 7,803 | ||||||||||||
| Interest expense, net |
1,552 | 1,504 | 2,808 | 4,163 | ||||||||||||
| Income from operations before income taxes |
(1,140 | ) | 896 | (203 | ) | 3,640 | ||||||||||
| Equity share in (income) loss of unconsolidated affiliates |
617 | (435 | ) | 617 | (718 | ) | ||||||||||
| Income tax expense (benefit) |
(703 | ) | 483 | (328 | ) | 1,499 | ||||||||||
| Income from operations before minority interest |
(1,054 | ) | 848 | (492 | ) | 2,859 | ||||||||||
| Minority interest in income of consolidated subsidiaries |
185 | 343 | 478 | 853 | ||||||||||||
| Net income (loss) |
$ | (1,239 | ) | $ | 505 | $ | (970 | ) | $ | 2,006 | ||||||
| Net income (loss) per share: |
||||||||||||||||
| Basic net income (loss) |
$ | (0.08 | ) | $ | 0.03 | $ | (0.06 | ) | $ | 0.11 | ||||||
| Diluted net income (loss) |
$ | (0.08 | ) | $ | 0.03 | $ | (0.06 | ) | $ | 0.10 | ||||||
| Number of shares used in per share calculation: |
||||||||||||||||
| Basic |
16,459 | 18,617 | 16,443 | 18,595 | ||||||||||||
| Diluted |
16,459 | 19,478 | 16,443 | 19,704 | ||||||||||||
IMPCO TECHNOLOGIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands except share data)
| December 31, 2003 |
September 30, 2004 |
|||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 9,524 | $ | 6,781 | ||||
| Restricted cash |
724 | |||||||
| Accounts receivable, net |
14,051 | 27,094 | ||||||
| Inventories: |
||||||||
| Raw materials and parts |
9,347 | 10,220 | ||||||
| Work-in-process |
277 | 270 | ||||||
| Finished goods |
8,275 | 6,344 | ||||||
| Total inventories |
17,899 | 16,834 | ||||||
| Deferred tax assets |
283 | 129 | ||||||
| Other current assets |
1,648 | 2,145 | ||||||
| Total current assets |
44,129 | 52,983 | ||||||
| Equipment and leasehold improvements |
||||||||
| Dies, molds and patterns |
6,572 | 7,160 | ||||||
| Machinery and equipment |
7,792 | 7,967 | ||||||
| Office furnishings and equipment |
8,545 | 7,949 | ||||||
| Automobiles and trucks |
402 | 415 | ||||||
| Leasehold improvements |
3,597 | 3,667 | ||||||
| 26,908 | 27,158 | |||||||
| Less accumulated depreciation and amortization |
18,589 | 19,282 | ||||||
| Net equipment and leasehold improvements |
8,319 | 7,876 | ||||||
| Net goodwill and intangibles |
10,106 | 9,901 | ||||||
| Deferred tax assets, net |
9,476 | 9,058 | ||||||
| Investment in affiliates |
25,500 | 26,532 | ||||||
| Other assets |
3,606 | 3,539 | ||||||
| $ | 101,136 | $ | 109,889 | |||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 9,082 | $ | 10,241 | ||||
| Accrued payroll obligations |
2,762 | 2,833 | ||||||
| Other accrued expenses |
4,195 | 4,423 | ||||||
| Current revolving line of credit |
5,238 | 9,943 | ||||||
| Current maturities of long-term debt and capital leases |
713 | 399 | ||||||
| Total current liabilities |
21,990 | 27,839 | ||||||
| Term loans, net of discount |
17,617 | 18,968 | ||||||
| Capital leases |
95 | 164 | ||||||
| Other liabilities |
1,483 | 1,330 | ||||||
| Minority interest |
2,822 | 2,638 | ||||||
| Stockholders’ equity: |
||||||||
| Preferred stock, $.001 par value, authorized 500,000 shares; none issued and outstanding at December 31, 2003 and September 30, 2004 |
— | — | ||||||
| Common stock, $.001 par value, authorized 100,000,000 shares; 18,616,649 outstanding at September 30, 2004 (18,568,721 at December 31, 2003) |
19 | 19 | ||||||
| Additional paid-in capital |
132,190 | 132,780 | ||||||
| Shares held in treasury |
(312 | ) | (360 | ) | ||||
| Accumulated deficit |
(74,993 | ) | (72,994 | ) | ||||
| Accumulated other comprehensive income (loss) |
225 | (495 | ) | |||||
| Total stockholders’ equity |
57,129 | 58,950 | ||||||
| $ | 101,136 | $ | 109,889 | |||||