Cybex International, Inc. saw net sales climb 9.8% for its third quarter ended Sept. 27, to $35.8 million from $32.6 million. Net earnings plunged 92.5% to $340,000, or 6 cents a share, from $4.6 million, or 26 cents, a year ago, but the year-ago period included an unusual tax credit. Excluding the credit and special charges in the year-ago period, earnings were essentially flat in the latest period.

During the third quarter of 2007, the company reevaluated, in accordance with SFAS 109, the need for the remaining deferred tax valuation allowance originally established in 2002 and, based on this review, substantially reduced the reserve as of Sept. 29, 2007. The reduction of the tax valuation allowance increased net income by $5.2 million, or 29 cents per diluted share, for the quarter and nine months.


The 2007 results also included third quarter pre-tax charges of approximately $1,650,000, or 5 cents per diluted share (after tax), for the relocation of our Owatonna, MN facility (about $550,000 included in Cost of Sales), the estimated cost to repair certain treadmills built prior to 2002, and asset write-downs.

For the nine months ended Sept. 27, 2008, net sales increased to $108.7 million compared to $102.0 million for 2007. Net income dropped to $1.8 million, or 10 cents per share, compared to net income of $6.8 million, or 38 cents,, for 2007.


Chairman and CEO John Aglialoro stated, “Given the current global economic environment, we are pleased with the Q3 results. While general economic conditions make short term results difficult to predict, we maintain a positive focus over the longer term. We continue to introduce new products, an important factor in continuing sales growth. CYBEX expects to ship Next Generation Arcs, a new home Arc, a totally improved commercial bike, and expanded video display products by the end of Q4.”






























































































































































































































































































CYBEX INTERNATIONAL, INC.


CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


(In thousands, except per share data)


(unaudited)



 


 

 



 

 



 

 



 



 

Three Months Ended



 

Nine Months Ended



 

September 27,



 

September 29,



 

September 27,



 

September 29,



 

2008



 

2007



 

2008



 

2007



 


 


 


 


 


 


 

 


Net sales


$


35,753



 


 

$


32,585



 


 

$


108,669



 


 

$


102,001



 


Cost of sales


 


24,202


 



 

 


22,083


 



 

 


72,290


 



 

 


66,400


 


Gross profit



 

11,551



 


 


 

10,502



 


 


 

36,379



 


 


 

35,601



 


As a percentage of sales



 

32.3


%



 


 

32.2


%



 


 

33.5


%



 


 

34.9


%


Selling, general and administrative expenses


 


10,600


 



 

 


11,354


 



 

 


32,240


 



 

 


32,530


 


Operating income (loss)



 

951



 


 


 

(852


)



 


 

4,139



 


 


 

3,071



 


Interest expense, net


 


306


 



 

 


422


 



 

 


931


 



 

 


584


 


Income (loss) before income taxes



 

645



 


 


 

(1,274


)



 


 

3,208



 


 


 

2,487



 


Income taxes (benefit)


 


305


 



 

 


(5,833


)



 

 


1,422


 



 

 


(4,271


)


Net income


$


340


 



 

$


4,559


 



 

$


1,786


 



 

$


6,758


 


Basic net income per share


$


0.02


 



 

$


0.26


 



 

$


0.10


 



 

$


0.39


 


Diluted net income per share


$


0.02


 



 

$


0.26


 



 

$


0.10


 



 

$


0.38


 


Shares used in computing basic net income per share


 


17,560


 



 

 


17,340


 



 

 


17,439


 



 

 


17,291


 


Shares used in computing diluted net income per share


 


17,660


 



 

 


17,876


 



 

 


17,566


 



 

 


17,883