CONCORD, Mass, Aug. 16 /PRNewswire/ -- Starmet Corporation (Nasdaq: STMT)
a Concord, Massachusetts based manufacturer of specialized metal products,
today announced financial results for the third quarter which ended July 4,
1999.
For the first time in the Company's recent history, the growth in revenues
from the commercialization of emerging technologies and existing businesses
outpaced the decline in its traditional DU penetrator business. As sales for
the months of May and June averaged $2.1 million, the Company generated net
income for two consecutive months. As of July 4, 1999, the annualized
breakeven point has been cut in half from $44 million in sales a year ago to
$22 million, or $5.5 million a quarter.
While total sales declined by $281,000, gross profit improved by
$1,368,000, to $1,484,000, as compared to the second quarter of fiscal 1999.
The gross profit improvement for the quarter is attributable in part to a
reduction in Holding Basin remediation costs expensed in the quarter combined
with reduced direct and indirect manufacturing costs.
Despite the reported net loss of $2,996,000 for the first nine months of
fiscal 1999, the Company generated positive cash flow from operations for
three consecutive quarters totaling $1,621,000. This is a result of
aggressive cost reductions, reduced headcount and spending curbs implemented
by the Company over the past nine months.
The Company sustained a net loss of $817,000 for the third quarter, or
$0.17 per share on average shares outstanding of 4,791,000. This compares with
a net loss of $2,092,000, or $0.44 per share for the second quarter, a
$1,275,000 improvement on $281,000 less in sales.
Backlog was $20.4 million as of July 4, 1999.
On June 23, 1999, the Company entered into an agreement with its principal
lender to forbear on all collection efforts until calendar 2000. The Company
presently expects to meet certain conditions that would extend the forbearance
period into calendar 2001.
The Company continues to purse potential expansion of its titanium powder
business; development of its Beralcast(R) investment casting technology for
aerospace and defense applications; development of its Beralcast(R) MGA
extrusion capability for computer disc drive applications, and its DUCRETE(TM)
shielding technology for potential radiation shielding applications. The
Company continues to invest heavily in research and development for perfecting
processes to recover valuable fluorine compounds from uranium tetrafluoride.
All of these have the potential of making significant contributions to the
future profitability of the Company.
THIRD QUARTER ENDED NINE MONTHS ENDED
July 4, June 30, July 4, June 30,
1999 1998 1999 1998
Sales $5,638,000 $7,429,000 $18,976,000 $26,198,000
Gross Profit $1,484,000 $617,000 $3,647,000 $4,861,000
Operating Income
(Loss) $(437,000) $ (2,301,000) $(1,756,000) $(3,098,000)
Net Income (Loss) $(817,000) $ (2,765,000) $(2,996,000) $(4,051,000)
Basic Earnings (Loss)
Per Share $(0.17) $(0.58) $(0.63) $(0.85)
Weighted Average
Number of Shares 4,791,000 4,791,000 4,791,000 4,788,000
Special Note Regarding Forward-looking Statements:
Statements contained herein that are not statements of historical fact are
"forward-looking statements." Forward-looking statements include statements
concerning backlog, extension of the forbearance agreement, the timing of
orders, quarterly, annual and long-term sales growth and future profitability.
Such forward-looking statements are based on a number of assumptions and
involve a number of risks and uncertainties, and, accordingly, actual results
could differ materially from those projected in the forward-looking
statements. Factors that may cause such differences include, but are not
limited to: the effects of government regulation; the need for additional
financing to fund growth, continued and future acceptance of the Company's
products and services; and the presence of competitors with greater technical,
marketing and financial resources.
SOURCE Starmet Corporation
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Related links:
http://www.starmet.com
Company News On-Call:
http://www.prnewswire.com/comp/632850.html or fax,
800-758-5804, ext. 632850
CONTACT:
Gary Mattheson, Chief Financial Officer of
Starmet Corporation, 978-369-5410
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