Empresas y finanzas

Aeroflex Reports Record Third Quarter Sales



    Aeroflex Incorporated (Nasdaq: ARXX), today announced operating
    results for its fiscal 2007 third quarter which ended March 31, 2007.

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    Quarter Ended March 31,
    -----------------------
    2007 2006
    ----------- -----------

    Sales (in millions) $150.3 $140.5
    =========== ===========
    Diluted earnings per share
    GAAP $ 0.07 $ 0.10
    =========== ===========
    Non-GAAP $ 0.17 $ 0.15
    =========== ===========
    *T

    Operating income of $13.3 million for the fiscal 2007 third
    quarter increased $1.0 million (8.5%) compared to last year. As
    previously announced, Aeroflex has entered into an agreement to be
    acquired by General Atlantic LLC and Francisco Partners II, L.P.
    ("Company Sale Transaction"). Including the Company Sale Transaction
    expenses of $4.3 million ($3.4 million after tax), net income for the
    fiscal 2007 third quarter amounted to $5.5 million, or $0.07 per
    diluted share, compared with $7.7 million, or $0.10 per diluted share
    last year. On a GAAP basis, gross profit margins for the fiscal 2007
    third quarter were 47.1% compared to 47.7% last year. The quarterly
    results were impacted by:

    -- a $3.2 million ($2.1 million after tax or $0.03 per share)
    charge for amortization of acquired intangibles in fiscal
    2007, compared to $3.4 million ($2.1 million after tax or
    $0.03 per share) in fiscal 2006;

    -- a $1.3 million ($807,000 after tax or $0.01 per share) charge
    for share based compensation in fiscal 2007, compared to $1.6
    million ($943,000 after tax or $0.01 per share) in fiscal
    2006;

    -- a $2.0 million ($1.3 million after tax or $0.02 per share)
    charge for restructuring costs related to the consolidation of
    the company's subsidiaries in the United Kingdom in fiscal
    2007, compared to $1.2 million ($723,000 after tax or $0.01
    per share) in fiscal 2006; and

    -- a $4.3 million ($3.4 million after tax or $0.04 per share)
    charge for Company Sale Transaction expenses in fiscal 2007.

    Non-GAAP gross profit margins, excluding the aforementioned items,
    were 47.2%, compared to 48.0 % last year and non-GAAP operating income
    of $19.8 million increased 7.6% compared to last year. The third
    quarter non-GAAP results exclude the following items from net income
    per diluted share:

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    Quarter Ended March 31,
    ------------------------
    2007 2006
    ------------ -----------

    Amortization of acquired intangibles $0.03 $0.03
    Share based compensation 0.01 0.01
    Restucturing costs 0.02 0.01
    Company Sale Transaction expenses 0.04 -
    ------------ -----------
    Total EPS impact $0.10 $0.05
    ============ ===========
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    Year-to-date results were:
    Nine Months Ended March 31,
    ---------------------------------
    2007 2006
    ---------------- ----------------

    Sales (in millions) $432.4 $401.3
    ================ ================
    Diluted earnings per share:
    GAAP $ 0.29 $ 0.26
    ================ ================
    Non-GAAP $ 0.46 $ 0.40
    ================ ================
    *T

    On a GAAP basis, gross profit margins for the nine months of
    fiscal 2007 were 47.0% compared to 47.5% last year. Operating income
    of $38.9 million for the nine months of fiscal 2007 increased 22%
    compared to last year. Net income for the nine months of fiscal 2007
    amounted to $21.8 million, or $0.29 per diluted share, compared with
    $20.0 million, or $0.26 per diluted share. The nine months results
    were impacted by:

    -- a $9.6 million ($6.2 million after tax or $0.08 per share)
    charge for amortization of acquired intangibles in fiscal
    2007, compared to $10.3 million ($6.3 million after tax or
    $0.08 per share) in fiscal 2006;

    -- a fiscal 2006 charge of $1.1 million ($685,000 after tax or
    $0.01 per share) for an acquisition related inventory
    adjustment (for which there was no comparable item in the
    current fiscal year);

    -- a $3.2 million ($2.1 million after tax or $0.03 per share)
    charge for share based compensation in fiscal 2007, compared
    to $5.0 million ($3.1 million after tax or $0.04 per share) in
    fiscal 2006;

    -- a $2.1 million ($1.4 after tax or $0.02 per share) charge for
    restructuring costs in fiscal 2007, compared to $1.2 million
    ($723,000 after tax or $0.01 per share) in fiscal 2006; and

    -- a $4.3 million ($3.4 million after tax or $0.04 per share)
    charge for Company Sale Transaction expenses in fiscal 2007.

    Non-GAAP gross profit margins, excluding the aforementioned items,
    were 47.0%, compared to 47.9% last year and non-GAAP operating income
    of $53.9 million increased 9.0% compared to last year. The
    year-to-date non-GAAP results exclude the following items from net
    income per diluted share:

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    Nine Months Ended March 31,
    2007 2006
    -------------- -------------

    Acquisition-related items:
    Amortization of intangibles $0.08 $0.08
    Purchase adjustments to inventory - 0.01
    Share based compensation 0.03 0.04
    Restructuring charges 0.02 0.01
    Company Sale Transaction costs 0.04 -
    -------------- -------------
    Total EPS impact $0.17 $0.14
    ============== =============
    *T

    Operating cash flow for the nine months was approximately $23
    million. During the nine months, we repurchased approximately 1.8
    million shares of our common stock for $17.2 million. In October 2006,
    we paid $9.2 million in a final determination of the Racal acquisition
    earn-out. This amount has been added to goodwill.

    "Our third quarter and nine months performance positions us well
    for another solid year," said Len Borow, President and Chief Operating
    Officer. Both segments of our business performed well as the nine
    months book-to-bill ratio was 1.03 to 1.0. We head into the remainder
    of the fiscal year with a backlog of $253 million, 46% of which is
    scheduled to ship in the fourth quarter of fiscal 2007."

    Our estimate of operating results for the June 2007 quarter is as
    follows:

    -- net sales are expected to be approximately $162 million, and

    -- GAAP net income per diluted share is anticipated to be $0.15.
    Non-GAAP earnings per diluted share are anticipated to be
    $0.20. Non-GAAP earnings exclude estimated amortization of
    acquired intangibles and share based compensation, of a
    combined $0.05 per diluted share.

    About Aeroflex

    Aeroflex Incorporated is a global provider of high technology
    solutions to the aerospace, defense and broadband communications
    markets. The Company's diverse technologies allow it to design,
    develop, manufacture and market a broad range of test, measurement and
    microelectronic products. The Company's common stock trades on the
    Nasdaq National Market System under the symbol ARXX and is included in
    the S&P SmallCap 600 index. Additional information concerning Aeroflex
    Incorporated can be found on the Company's Web site: www.aeroflex.com.

    All statements other than statements of historical fact included
    in this press release regarding Aeroflex's financial position,
    business outlook, business strategy and plans and objectives of its
    management for future operations are forward-looking statements. When
    used in this press release, words such as "anticipate," "believe,"
    "estimate," "expect," "intend" and similar expressions, as they relate
    to Aeroflex or its management, identify forward-looking statements.
    Such forward-looking statements are based on the current beliefs of
    Aeroflex's management, as well as assumptions made by and information
    currently available to its management. Actual results could differ
    materially from those contemplated by the forward-looking statements
    as a result of certain factors, including but not limited to,
    competitive factors and pricing pressures, completion of the proposed
    Company Sale Transaction, the integration of acquired businesses,
    changes in legal and regulatory requirements, technological change or
    difficulties, product development risks, commercialization
    difficulties, general economic conditions, and other risk factors
    disclosed in Aeroflex's most recently filed Form 10-K. Such statements
    reflect the current views of management with respect to the future and
    are subject to these and other risks, uncertainties and assumptions
    relating to Aeroflex's financial condition, results of operations,
    growth strategy and liquidity. Aeroflex does not undertake any
    obligation to update such forward-looking statements.

    The non-GAAP financial measures used in this press release are not
    prepared in accordance with generally accepted accounting principles
    and may be different from non-GAAP financial measures used by other
    companies. The Company's management refers to these non-GAAP financial
    measures in making operating decisions because they provide meaningful
    supplemental information regarding the Company's operating
    performance. In addition, these non-GAAP financial measures facilitate
    management's internal comparisons to the Company's historical
    operating results. We include these non-GAAP financial measures (which
    should be viewed as a supplement to, and not a substitute for, their
    comparable GAAP measures) in this press release because we believe
    they are useful to investors in allowing for greater transparency to
    supplemental information used by management in its financial and
    operational decision-making. For a reconciliation of our GAAP and
    non-GAAP financial results, please refer to our Reconciliation of
    Reported GAAP Results to Non-GAAP Measures, presented in this release.

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    AEROFLEX INCORPORATED
    AND SUBSIDIARIES
    UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
    (In thousands, except per share data)

    March 31, June 30,
    2007 2006
    ----------- ---------

    ASSETS
    ------------------------------------------------
    Current assets:
    Cash and cash equivalents $ 13,476 $ 10,387
    Marketable securities 10,576 28,332
    Accounts receivable, less allowance for
    doubtful accounts 129,192 120,296
    Inventories 147,763 133,420
    Deferred income taxes 24,159 24,732
    Prepaid expenses and other current assets 13,159 11,187
    ----------- ---------
    Total current assets 338,325 328,354

    Property, plant and equipment, net 79,129 77,940
    Other assets 16,271 14,276
    Intangible assets with definite lives, net 46,228 54,215
    Goodwill 177,522 163,237
    ----------- ---------
    Total assets $ 657,475 $ 638,022
    =========== =========
    LIABILITIES AND STOCKHOLDERS' EQUITY
    ------------------------------------------------
    Current liabilities:
    Current portion of long-term debt $ 607 $ 607
    Accounts payable 39,325 37,832
    Advance payments by customers 21,724 21,128
    Income taxes payable 817 9,162
    Accrued payroll expenses 20,392 17,440
    Accrued expenses and other current
    liabilities 39,041 33,046
    ----------- ---------
    Total current liabilities 121,906 119,215

    Long-term debt 3,327 3,558
    Deferred income taxes 1,251 4,631
    Other long-term liabilities 24,002 22,948
    ----------- ---------
    Total liabilities 150,486 150,352
    ----------- ---------

    Stockholders' equity:
    Preferred Stock, par value $.10 per share;
    authorized 1,000 shares:
    Series A Junior Participating Preferred
    Stock, par value $.10 per share,
    authorized 110 shares; none issued - -
    Common Stock, par value $.10 per share;
    authorized 110,000 shares; issued 73,689 and
    75,270 shares 7,369 7,527
    Additional paid-in capital 372,187 384,870
    Accumulated other comprehensive income 23,800 13,468
    Retained earnings 103,633 81,805
    ----------- ---------
    Total stockholders' equity 506,989 487,670
    ----------- ---------
    Total liabilities and stockholders'
    equity $ 657,475 $ 638,022
    =========== =========
    *T

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    AEROFLEX INCORPORATED
    AND SUBSIDIARIES
    UNAUDITED CONDENSED CONSOLIDATED INCOME STATEMENTS
    ----------------------------------------------------------------------
    (In thousands, except per share data)


    For the Quarter Ended
    --------------------------
    03/31/07 03/31/06
    ------------- ------------

    Net sales $ 150,271 $ 140,527
    Cost of sales 79,460 73,461
    ------------- ------------
    Gross profit 70,811 67,066
    Selling, general and administrative
    expenses 33,907 30,863
    Research and development costs 20,360 20,488
    Amortization of acquired intangibles 3,225 3,440
    ------------- ------------
    Operating income 13,319 12,275
    Company Sale Transaction expenses (4,319) -
    Interest and other income (expense),
    net 582 442
    ------------- ------------

    Income before income taxes 9,582 12,717
    Provision for income taxes 4,093 4,971
    ------------- ------------
    Net income $ 5,489 $ 7,746
    ============= ============

    Net income per common share:
    Basic $ 0.07 $ 0.10
    ============= ============
    Diluted $ 0.07 $ 0.10
    ============= ============

    Weighted average number of shares
    outstanding - Basic 73,775 75,133
    ============= ============
    - Diluted 75,714 77,230
    ============= ============
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    AEROFLEX INCORPORATED
    AND SUBSIDIARIES
    UNAUDITED CONDENSED CONSOLIDATED INCOME STATEMENTS
    ----------------------------------------------------------------------
    (In thousands, except per share data)

    For the Nine Months Ended
    ----------------------------
    3/31/07 3/31/06
    --------------- ------------

    Net sales $ 432,420 $ 401,332
    Cost of sales 229,310 210,785
    --------------- ------------
    Gross profit 203,110 190,547
    Selling, general and administrative
    costs 98,057 91,672
    Research and development costs 56,552 56,742
    Amortization of acquired intangibles 9,650 10,329
    --------------- ------------
    Operating income 38,851 31,804
    Sale Transaction expenses (4,319)
    Interest and other income (expense),
    net 160 887
    --------------- ------------
    Income before income taxes 34,692 32,691
    Provision for income taxes 12,864 12,642
    --------------- ------------
    Net income $ 21,828 $ 20,049
    =============== ============

    Net income per common share:
    Basic $ 0.29 $ 0.27
    =============== ============
    Diluted $ 0.29 $ 0.26
    =============== ============

    Weighted average number of shares
    outstanding - Basic 74,066 74,922
    =============== ============
    - Diluted 75,713 76,306
    =============== ============
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    AEROFLEX INCORPORATED
    AND SUBSIDIARIES
    RECONCILIATION OF REPORTED GAAP RESULTS TO NON-GAAP
    ----------------------------------------------------------------------
    MEASURES (Unaudited)
    ----------------------------------------------------------------------
    (In thousands, except per share data)

    For the Quarter For the Nine
    Ended Months Ended
    -----------------------------------
    3/31/07 3/31/06 3/31/07 3/31/06
    -------- -------- -------- --------

    Gross Profits
    ----------------------------------
    GAAP Gross Profits $ 70,811 $ 67,066 $203,110 $190,547
    -------- -------- -------- --------

    Non-GAAP adjustments:
    Acquisition related inventory
    adjustment - - - 1,088
    Share based compensation 74 72 217 223
    Restructuring costs - 259 - 259
    -------- -------- -------- --------
    Total Non-GAAP adjustments 74 331 217 1,570

    -------- -------- -------- --------
    Non-GAAP Gross Profits $ 70,885 $ 67,397 $203,327 $192,117
    ======== ======== ======== ========

    Operating Income
    ----------------------------------
    GAAP Operating Income $ 13,319 $ 12,275 $ 38,851 $ 31,804
    -------- -------- -------- --------

    Non-GAAP adjustments:
    Amortization of acquired
    intangible assets 3,225 3,440 9,650 10,329
    Acquisition related inventory
    adjustment - - - 1,088
    Share based compensation 1,258 1,552 3,212 5,010
    Restructuring costs 2,040 1,179 2,140 1,179
    -------- -------- -------- --------
    Total Non-GAAP adjustments 6,523 6,171 15,002 17,606

    -------- -------- -------- --------
    Non-GAAP Operating Income $ 19,842 $ 18,446 $ 53,853 $ 49,410
    ======== ======== ======== ========

    Net Income
    ----------------------------------
    GAAP Net Income $ 5,489 $ 7,746 $ 21,828 $ 20,049
    -------- -------- -------- --------

    Non-GAAP adjustments:
    Amortization of acquired
    intangible assets 3,225 3,440 9,650 10,329
    Acquisition related inventory
    adjustment - - - 1,088
    Share based compensation 1,258 1,552 3,212 5,010
    Restructuring costs 2,040 1,179 2,140 1,179
    Company Sale Transaction
    expenses 4,319 - 4,319 -
    Income tax benefit (3,231) (2,413) (6,193) (6,791)
    -------- -------- -------- --------
    Total Non-GAAP adjustments 7,611 3,758 13,128 10,815

    -------- -------- -------- --------
    Non-GAAP net income $ 13,100 $ 11,504 $ 34,956 $ 30,864
    ======== ======== ======== ========
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    AEROFLEX INCORPORATED
    AND SUBSIDIARIES
    RECONCILIATION OF REPORTED GAAP RESULTS TO NON-GAAP
    ----------------------------------------------------------------------
    MEASURES (Unaudited)
    ----------------------------------------------------------------------
    (In thousands, except per share data)

    For the Quarter For the Nine Months
    Ended Ended
    ----------------------------------------
    3/31/07 3/31/06 3/31/07 3/31/06
    ---------- --------- ---------- --------

    Net Income Per Diluted Common
    Share:
    -----------------------------

    GAAP net income $ 0.07 $ 0.10 $ 0.29 $ 0.26
    ---------- --------- ---------- --------

    Non-GAAP adjustments, net of
    taxes:
    Amortization of acquired
    intangible assets 0.03 0.03 0.08 0.08
    Acquisition related
    inventory adjustment - - 0.01
    Share based compensation 0.01 0.01 0.03 0.04
    Restructuring costs 0.02 0.01 0.02 0.01
    Company Sale Transaction
    expenses 0.04 - 0.04 -
    ---------- --------- ---------- --------
    Total Non-GAAP adjustments 0.10 0.05 0.17 0.14

    ---------- --------- ---------- --------
    Non-GAAP net income $ 0.17 $ 0.15 $ 0.46 $ 0.40
    ========== ========= ========== ========

    Projection for the
    Quarter Ending
    June 30, 2007
    ---------------------

    Net Income Per Diluted Common
    Share:
    -----------------------------

    GAAP net income $ 0.15
    --------------------

    Non-GAAP adjustments, net of
    taxes:
    Amortization of acquired
    intangible assets 0.04
    Share based compensation 0.01
    --------------------
    Total Non-GAAP adjustments 0.05
    --------------------

    Non-GAAP net income $ 0.20
    ====================
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