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ADDvantage Technologies Announces Financial Results for the Fiscal First Quarter of 2013

Feb 12 2013 12:00AM

Marketwire

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BROKEN ARROW, OK -- (Marketwire) -- 02/12/13 -- ADDvantage Technologies Group, Inc. (NASDAQ: AEY) today announced its results for the three month period ended December 31, 2012.

Revenue for the three months ended December 31, 2012 increased 7% to $9.6 million compared to $9.0 million for the same period last year. New equipment sales were $5.6 million for the three months ended December 31, 2012 as compared to $5.3 million for the three months ended December 31, 2011. Net refurbished equipment sales were $3.0 million for the three months ended December 31, 2012 as compared to $2.6 million for the same period last year. Service revenue decreased to $1.0 million for the three month period ended December 31, 2012 compared to $1.1 million for the same period last year.

Net income increased 100% to $0.8 million, or $0.08 per diluted share, for the three month period ended December 31, 2012, compared to $0.4 million, or $0.04 per diluted share, for the same period last year.

Cash and cash equivalents were $7.3 million as of December 31, 2012 compared to $5.2 million as of September 30, 2012.

David Humphrey, President and CEO, commented, "We achieved revenue growth of 7% in the first quarter of fiscal 2013 primarily as a result of the recent extreme weather conditions in the Mid-Atlantic and Northeastern regions of the U.S. We were able to satisfy the customers' urgent equipment needs with our inventory on hand for which the original equipment manufacturer was unable to deliver in a timely manner. Although we do not anticipate this particular situation to provide much additional revenue, these types of situations will continue to provide us with opportunities to take advantage of our inventory position. Gross margins for the first quarter of fiscal 2013 increased to 33% from 30% from the prior year period, which is primarily attributable to higher margin sales of certain equipment purchased at significant discounts. As a result, we increased our profitability for the quarter and strengthened our cash position to $7.3 million as of December 31, 2012. This bottom line performance also reflects a $0.2 million decrease in interest expense compared to the same period last year, following the payoff of a term loan and the termination of the associated interest rate swap agreement last year."

"Our Company is purchasing small volumes of our common stock in the open market, over 170,000 shares since December 2012, as we believe our stock is a good value. The stock purchases notwithstanding, we remain focused on our previously announced growth strategy, which is to expand upon existing agreements with our suppliers, entering into new agreements with new suppliers, expanding our geographical footprint and identifying accretive acquisitions within our industry," concluded Mr. Humphrey.

Earnings Conference Call
As previously announced, the Company will host a conference call on Tuesday, February 12, 2013, at 12:00 p.m. Eastern Time featuring remarks by Ken Chymiak, Chairman of the Board, David Humphrey, President and Chief Executive Officer, Dave Chymiak, Chief Technology Officer, and Scott Francis, Chief Financial Officer. The conference call will be available via webcast and can be accessed through the Investor Relations section of ADDvantage's website, www.addvantagetechnologies.com. Please allow extra time prior to the call to visit the site and download any necessary software to listen to the Internet broadcast. The dial-in number for the conference call is (888) 389-5988 (domestic) or (719) 325-2469 (international). All dial-in participants must use the following code to access the call: 5034666. Please call at least five minutes before the scheduled start time.

For interested individuals unable to join the conference call, a replay of the call will be available through February 26, 2013 at (877) 870-5176 (domestic) or (858) 384-5517 (international). Participants must use the following code to access the replay of the call: 5034666. The online archive of the webcast will be available on the Company's website for 30 days following the call.

About ADDvantage Technologies Group, Inc.
ADDvantage Technologies Group, Inc. supplies the cable television (CATV) industry with a comprehensive line of new and used system-critical network equipment and hardware from leading manufacturers, including Cisco, Motorola, ARRIS and Fujitsu Frontech North America, as well as operating a national network of technical repair centers. The equipment and hardware ADDvantage distributes is used to acquire, distribute, and protect the broad range of communications signals carried on fiber optic, coaxial cable and wireless distribution systems, including television programming, high-speed data (Internet) and telephony.

ADDvantage operates through its subsidiaries, Tulsat, Tulsat-Atlanta, Tulsat-Nebraska, Tulsat-Texas, NCS Industries, ComTech Services and Adams Global Communications. For more information, please visit the corporate web site at www.addvantagetechnologies.com.

The information in this announcement may include forward-looking statements. All statements, other than statements of historical facts, which address activities, events or developments that the Company expects or anticipates will or may occur in the future, are forward-looking statements. These statements are subject to risks and uncertainties, which could cause actual results and developments to differ materially from these statements. A complete discussion of these risks and uncertainties is contained in the Company's reports and documents filed from time to time with the Securities and Exchange Commission.


ADDVANTAGE TECHNOLOGIES GROUP, INC. CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED) Three Months Ended December 31, 2012 2011 ----------- -----------Sales: Net new sales income $ 5,598,898 $ 5,307,461 Net refurbished sales income 3,013,217 2,588,717 Net service income 1,004,083 1,108,217 ----------- -----------Total net sales 9,616,198 9,004,395Cost of sales 6,470,370 6,265,374 ----------- -----------Gross profit 3,145,828 2,739,021Operating, selling, general and administrative expenses 1,853,530 1,846,615 ----------- -----------Income from operations 1,292,298 892,406Interest expense 6,881 158,626 ----------- -----------Income before provision for income taxes 1,285,417 733,780Provision for income taxes 488,000 287,000 ----------- -----------Net income attributable to common shareholders 797,417 446,780Other comprehensive income: Unrealized gain on interest rate swap, net of taxes - 54,369 ----------- -----------Comprehensive income $ 797,417 $ 501,149 =========== ===========Earnings per share: Basic $ 0.08 $ 0.04 Diluted $ 0.08 $ 0.04Shares used in per share calculation: Basic 10,185,026 10,207,390 Diluted 10,185,398 10,209,036 ADDVANTAGE TECHNOLOGIES GROUP, INC. CONSOLIDATED BALANCE SHEETS December 31, September 30, 2012 2012 (unaudited) (audited) ------------ -------------AssetsCurrent assets: Cash and cash equivalents $ 7,346,004 $ 5,191,514 Accounts receivable, net of allowance of $300,000 3,170,332 3,050,796 Income tax refund receivable - 409,386 Inventories, net of allowance for excess and obsolete inventory of $1,160,000 and $1,000,000, respectively 21,632,454 22,666,385 Prepaid expenses 83,055 129,357 Deferred income taxes 959,000 920,000 ------------ -------------Total current assets 33,190,845 32,367,438Property and equipment, at cost: Land and buildings 8,794,272 8,794,272 Machinery and equipment 2,946,449 2,953,949 Leasehold improvements 9,633 9,633 ------------ -------------Total property and equipment, at cost 11,750,354 11,757,854Less accumulated depreciation and amortization (3,737,550) (3,666,327) ------------ -------------Net property and equipment 8,012,804 8,091,527Other assets: Goodwill 1,560,183 1,560,183 Other assets 11,428 13,778 ------------ -------------Total other assets 1,571,611 1,573,961 ------------ -------------Total assets $ 42,775,260 $ 42,032,926 ============ =============Liabilities and Shareholders' EquityCurrent liabilities: Accounts payable $ 1,699,041 $ 1,437,492 Accrued expenses 681,446 1,030,174 Income tax payable 107,918 - Notes payable - current portion 184,008 184,008 ------------ -------------Total current liabilities 2,672,413 2,651,674Notes payable, less current portion 1,456,610 1,502,612Deferred income taxes 77,000 62,000Shareholders' equity: Common stock, $.01 par value; 30,000,000 shares authorized; 10,465,323 shares issued; 10,154,926 and 10,189,120 shares outstanding, respectively 104,653 104,653 Paid in capital (5,724,610) (5,748,503) Retained earnings 44,778,007 43,980,590 ------------ ------------- Total shareholders' equity before treasury stock 39,158,050 38,336,740 Less: Treasury stock, 310,397 and 276,203 shares, at cost, respectively (588,813) (520,100) ------------ -------------Total shareholders' equity 38,569,237 37,816,640 ------------ -------------Total liabilities and shareholders' equity $ 42,775,260 $ 42,032,926 ============ =============





For further information
Company Contact:
Scott Francis
(918) 25l-9121

KCSA Strategic Communications
Garth Russell
(212) 896-1250
grussell@kcsa.com

Diane Imas
(212) 896-1242
dimas@kcsa.com





Source: Marketwire