Category: Uncategorized
- Published: 29 November -0001
News Release: Revenues Increase By 125%
Delta Systems, Inc. ("Delta" or the "Company") (CDNX - DLT.S), the automation and motion control company, today announced its financial results for the second quarter ended June 30, 2002. Results are reported in U.S. dollars under U.S. Generally Accepted Accounting Principles (U.S. GAAP).
Net revenues for the three months ended June 30, 2002 were $3.57 million, compared to $1.58 million for the same period last year representing an increase of 125%. Gross profit for the quarter ended June 30, 2002 was $1.47 million or 41.1%, compared to $0.62 million or 39.2% for the second quarter of 2001. Operating expenses for the quarter ended June 30, 2002 were $1.45 million compared to operating expenses of $1.14 million in the second quarter of 2001. The Company's net loss for the quarter ended June 30, 2002 was $0.07 million compared to a net loss of $0.57 million in the second quarter of 2001.
Earnings Before Interest & Taxes ("EBITDA") for the second quarter of 2002 was $13,954 versus negative ($519,100) in the same quarter of 2001.
Second Quarter Highlights:
* In spite of a continued difficult capital equipment market in North
America, Delta's revenues increased by 125.1% versus the second
quarter of 2001, and by 80.5% versus the first quarter of 2002.
* Delta's gross margin improved to 41.1% from a year ago level of
39.2%. This improvement is primarily due to better-cost management
as well as an improvement in the mix of projects being executed by
the Company.
* The Company's order bookings were $2.9 million for the quarter. Sales
of controls software, hardware and services to third party customers
grew to $231,000 from $102,000 in the first quarter of 2002
representing 126% sequential quarterly growth.
* As part of its program to broaden its product line, Delta established
a joint venture agreement with Delfin S.r.l. of Malo, Italy to
jointly market an entry point lower priced horizontal flow wrapper
in North America, which is branded the Falcon Wrapper. Delta received
its first order for a Falcon Wrapper in the second quarter of 2002
and will ship this unit in the third quarter of 2002.
* Delta booked orders from four new significant customers during the
quarter bringing the total number of new customers to nine
year-to-date.
* The Company signed a new rep agreement for Mexico/South America and
now has market coverage for all of North & South America.
* A debenture financing totaling U.S.$1.25 million was completed to
bolster Delta's working capital and support the bonding and letter
of credit requirements related to initial orders totaling
approximately U.S.$1 million from a division of one of North
America's largest food processing companies;
* Delta completed the development of phase 2 of its SoftFlow(TM)
controls software for Tyson Foods Inc and is currently installing
it in one of Tyson's production facilities.
* The Company completed the development of custom prototype versions
of its SoftFlow(TM) controls software for two additional significant
customers. Each of these projects involves a potential licensing
of SoftFlow(TM), Delta's automation control software with embedded
real-time operating system, together with specialized control
hardware and related systems integration services.
"We are very pleased to have achieved all of our targets for the second quarter of 2002 in a very challenging capital equipment market. We are well positioned to achieve our revenue growth targets supported by our expanded geographic sales coverage, expanding product breadth and growing blue chip customer list. We are particularly excited about the very positive reaction we have had from our initial customers for our controls software and hardware and are focused on accelerating our growth in the dynamic and large controls market" said Jake Bushey, President of Delta Systems Inc
Earnings before interest, taxes, depreciation and amortization or EBITDA is used by Delta to measure its operating results. EBITDA may not be consistent with the calculation of similar measures for other companies and should not be viewed as an alternative to net income or other measures of performance calculated in accordance with generally accepted accounting principles. Similarly, EBITDA margins may not be comparable to similar measures reported by other companies.
Summary financial information - Unaudited Quarter Ended June 30Business Outlook
---------------------------------------------------------------
Three Months Ended Six Months Ended
------------------ ----------------
June 30, 2002 June 30, 2001 June 30, 2002 June 30, 2001
------------- ------------- ------------- -------------
Net Sales $3,565,108 $1,584,168 $5,540,495 $3,094,738
Gross Profit 1,465,300 620,538 2,274,733 1,105,388
GP% 41.1% 39.2% 41.1% 35.7%
Operating
Expenses 1,451,346 1,139,638 2,858,888 2,268,297
EBITDA 13,954 (519,100) (584,155) (1,162,909)
Net Loss ($70,517) ($574,468) ($725,333) ($1,266,435)
Basic and
Diluted Net
Loss Per Share ($0.00) ($0.04) ($0.04) ($0.11)
Weighted average
common shares
Outstanding
(basic) 16,982,511 13,765,798 16,375,156 12,912,417
Diluted 16,982,511 13,880,798 16,375,156 13,027,417
With respect to expected future financial performance, the Company expects revenues in the third quarter of 2002 to exceed $3 million and revenue for the year to exceed $12 million. Delta expects that order flow will follow the typical seasonal pattern of slowing during the summer period and then increasing in the fall
About Delta Systems
Delta Systems, Inc. provides leading edge PC based automation control solutions for manufacturing and distribution operations. Its core motion control software, SoftFlow(TM), utilizes a proprietary real-time operating system to provide automation control applications with significantly greater speed, efficiency, precision and flexibility while leveraging the benefits of an open architecture solution. Delta operates two businesses: Delta Software Inc. and Delta Automation Solutions Inc. Delta has been providing quality automation solutions since 1993, and can be found on the Web at www.delta-systems-inc.com.
No stock exchange or regulatory authority has approved or disapproved of the information contained herein. Delta's common shares have not been registered under the United States Securities Act of 1933 (the "1933 Act") and may not be offered or sold to persons in the United States or to U.S. persons, except pursuant to an applicable exemption from the registration requirements of the 1933 Act. The ".s" suffix in the trading symbol indicates that certain restrictions are imposed by Regulation S under the 1933 Act.
Certain statements contained in this press release may constitute "forward looking statements". When used in this press release, the words "may," "would," "could," "will," "intend," "plan," anticipate," "believe," "estimate," "expect," and similar expressions, as they relate to Delta or its management are intended to identify forward-looking statements. Such statements reflect Delta's current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause Delta's actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward looking statements, including among other things, those which are discussed under the headings "Risk Factors" and elsewhere in documents that Delta files from time to time with securities regulatory authorities. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Delta does not intend, and does not assume any obligation, to update these forward looking statements.
Delta Systems Inc.
Jake Bushey
President
(479) 619-2585
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