TechWeb

HEI, Inc. Announces the Third Quarter 2010 Results

Nov 29, 2010 (12:11 PM EST)
URL: http://www.techweb.com/show-press-release/X819901/hei-inc-announces-the-third-quarter-2010-results.html

MINNEAPOLIS, Nov. 29, 2010 /PRNewswire-FirstCall/ -- HEI, Inc. (Pink Sheets: HEII) (http://www.heii.com) today announced its financial results for its third quarter of fiscal year 2010, which ended October 2, 2010.

Sales for the third quarter were $8,465,000, compared to $6,980,000 for the third quarter of 2009.  The Company generated a net loss of ($510,000) for the third quarter of 2010 compared to a net loss of ($1,034,000) for the same period of 2009.  Sales for the first nine months of 2010 were $27,335,000, compared to $23,692,000 for the first nine months of 2009.  The Company generated a year-to-date net loss of ($139,000) for 2010 compared to a net loss of ($934,000) for the first nine months of 2009.

HEI CEO, Mark B. Thomas, remarked: "We are pleased with the 21% sales increase for the third quarter and the 15% sales increase on a year to date basis as we continue to rebuild our revenues from the downturn in 2009.  The net results are lower than we would like, but we continue to be optimistic about the remainder of fiscal year 2010 and beyond.  Our focus throughout the remainder of 2010 and into 2011 is to continue to grow sales, improve gross margins and expand our customer base."

HEI, Inc. designs, develops and manufactures ultra-miniature microelectronics, substrates, systems, connectivity and software solutions for customers engaged in the medical, hearing, telecommunications, military, aerospace, and industrial markets.  HEI provides its customers with a single point of contact that can take an idea from inception to a fully functional and cost effective product utilizing innovative design solutions and by the application of state-of-the-art materials, processes and manufacturing capabilities.



Corporate Headquarters & HEI –Victoria (Microelectronics Division)

PO Box 5000, 1495 Steiger Lake Lane, Victoria, MN  55386

HEI – Boulder (Advanced Medical Division)

4801 North 63rd Street, Boulder, CO  80301

HEI – Tempe (High Density Interconnect Division)

610 South Rockford Drive, Tempe, AZ  85281



FORWARD LOOKING INFORMATION

Information in this news release, which is not historical, includes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. You can identify these statements by forward-looking words such as "may," "will," "expect," "anticipate," "believe," "intend," "estimate," "continue," and similar words.  Statements contained in this press release, including the implementation of business strategies, growth of specific markets, improved results and estimated HEI revenue, cash flow and profits, are forward looking statements.  All such forward-looking statements involve risks and uncertainties including, without limitation, adverse business and market conditions, the ability of HEI to secure and satisfy customers, the availability and cost of materials from HEI's suppliers, HEI's ability to satisfy financial or other obligations or covenants set forth in its financing agreements, adverse competitive developments, change in or cancellation of customer requirements, collection of receivables and outstanding debt, HEI's ability to control fixed and variable operating expenses, and other risks detailed in previous HEI SEC filings. Since HEI is no longer reporting to the SEC, readers are cautioned to weigh the potential for additional risk factors based on ongoing business activities and the current economic conditions.  The information set forth herein should be read in light of such risks.  We undertake no obligation to update these statements to reflect ensuing events or circumstances, or subsequent actual results.

HEI, INC.

CONSOLIDATED BALANCE SHEETS




October 2,


January 2,


2010


2010


(Unaudited)


(Audited)

ASSETS




Current assets:




Cash and cash equivalents

$                -


$                -

Accounts receivable, net

4,964


3,566

Inventories, net

3,925


2,952

Deferred income taxes

362


362

Other current assets

553


455

Total current assets

9,804


7,335

Property and equipment:




Land

216


216

Building and improvements

4,337


4,337

Fixtures and equipment

24,828


24,140

Accumulated depreciation

(23,858)


(23,025)

Net property and equipment

5,523


5,668

Security deposit

230


230

Other long-term assets

341


388

Total assets

$      15,898


$      13,621

LIABILITIES AND SHAREHOLDERS’ EQUITY




Current liabilities:




Checks issued in excess of cash in bank

$           589


$           395

Current maturities of long-term debt

684


551

Accounts payable

2,677


1,750

Customer deposit liabilities

-


228

Accrued liabilities

953


945

Total current liabilities

4,903


3,869

Deferred income taxes

362


362

Other long-term liabilities, less current maturities

2,037


1,934

Long-term debt, less current maturities

5,420


4,240

Total other long-term liabilities, less current maturities

7,819


6,536

Total liabilities

12,722


10,405

Shareholders’ equity:




Undesignated stock

-


-

Convertible preferred stock, $.05 par

2


2

Common stock, $.05 par

486


486

Paid-in capital

28,196


28,096

Accumulated deficit

(25,508)


(25,368)

Total shareholders’ equity

3,176


3,216

Total liabilities and shareholders’ equity

$      15,898


$      13,621



HEI, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share data)

(UNAUDITED)










Three Months Ended


Nine Months Ended


October 2,


October 3,


October 2,


October 3,


2010


2009


2010


2009

Net sales

$      8,465


$      6,980


$    27,335


$    23,692

Cost of sales

7,713


6,479


23,656


19,812

Gross profit

752


501


3,679


3,880

Operating expenses:








Selling, general and administrative

1,063


1,246


3,258


3,883

Research, development and engineering

116


193


497


626

Operating income (loss)

(427)


(938)


(76)


(629)









Interest expense

(83)


(98)


(230)


(313)

Other income (expense), net

-


2


167


8

Net income (loss)

$       (510)


$    (1,034)


$       (139)


$       (934)









Net income (loss) per common share

$      (0.05)


$      (0.11)


$      (0.01)


$      (0.10)









Weighted average common shares outstanding

9,747,000


9,720,000


9,731,000


9,692,000



SOURCE HEI, Inc.