Cybex International, Inc. reported net sales for the third quarter of 2005 were $26,690,000, compared to $25,038,000 for the corresponding 2004 period, an increase of 7%. Excluding a third quarter 2005 litigation-related charge, the company's third quarter 2005 pro forma net income was $566,000 or 4 cents per fully diluted share, compared to net income of $378,000, or 3 cents per share, for the corresponding 2004 period. On a GAAP basis, the company reported a net loss for the third quarter 2005 of $3,535,000, or 23 cents per share.
For the nine months ended September 24, 2005, net sales were $78,646,000, compared to net sales of $73,531,000 for 2004, an increase of 7%. Pro forma net income for the nine months ended September 24, 2005 was $1,723,000, or 11 cents per fully diluted share, compared to net income of $1,342,000, or 12 cents per fully diluted share, for the corresponding 2004 period. On a GAAP basis, the Cybex reported a net loss for the nine months ended September 24, 2005 of $2,378,000, or 16 cents per share.
Actual GAAP results for the third quarter and nine months ended September 24, 2005 include an increase in the company's litigation reserve resulting in a pre-tax charge of $4,101,000. This increase in the litigation reserve reflects the previously announced jury verdict in the Colassi patent infringement case, as well as the reversal on appeal of a summary judgment in favor of the company in another patent infringement case. The company intends to vigorously pursue its appeal of the jury verdict and its defense of the second patent case.
John Aglialoro, chairman and CEO stated, “We are pleased to have begun shipping three important new products: Trazer, a revolutionary virtual reality product that allows users to improve their movement skills; a light commercial / high end consumer treadmill that will help expand CYBEX' dealer network and represents a market not presently served by CYBEX; and VR3, an exciting new line of strength equipment meeting a primary price point which will solidify our reputation in the market.”
CYBEX INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS - ACTUAL (IN THOUSANDS, EXCEPT PER SHARE DATA) (unaudited) Three Months Ended Nine Months Ended September September September September 24, 2005 25, 2004 (1) 24, 2005 25, 2004 (1) ------------ ------------ ------------ ------------ Net sales $ 26,690 $ 25,038 $ 78,646 $ 73,531 Cost of sales 17,143 16,206 50,593 46,227 ----------- ----------- ----------- ----------- Gross profit 9,547 8,832 28,053 27,304 As a percentage of net sales 35.8% 35.3% 35.7% 37.1% Selling, general and administrative expenses 8,276 7,386 24,325 22,759 Litigation charges 4,101 4,101 - ----------- ------------ ----------- ------------ Operating income (loss) (2,830) 1,446 (373) 4,545 Interest expense, net 679 1,007 1,894 2,888 ----------- ----------- ----------- ----------- Income (loss) before income taxes (3,509) 439 (2,267) 1,657 Income taxes 26 29 111 39 ----------- ----------- ----------- ----------- Net income (loss) (3,535) 410 (2,378) 1,618 Preferred stock - - dividends 32 276 ------------ ----------- ------------ ----------- Net income (loss) attributable to common stockholders $ (3,535) $ 378 $ (2,378) $ 1,342 =========== =========== =========== =========== Basic net income (loss) per share $ (0.23) $ 0.03 $ (0.16) $ 0.13 =========== =========== =========== =========== Diluted net income (loss) per share $ (0.23) $ 0.03 $ (0.16) $ 0.12 =========== =========== =========== =========== Shares used in computing basic net income (loss) per share 15,130 12,337 15,119 10,042 =========== =========== =========== =========== Shares used in computing diluted net income (loss) per share 15,130 14,566 15,119 11,132 =========== =========== =========== ===========