BRYAN, Texas, Aug. 18 /PRNewswire/ --
Neutral Posture Ergonomics, Inc. (Nasdaq: NTRL) today reported net sales of
$17.2 million for the fiscal year ended June 30, 2000, a 1% increase over the
comparable fiscal year ended in 1999. For the fiscal year ended
June 30, 2000, the Company reported net income of $119,740 ($.04 per share,
basic and diluted) as compared to $838,241 ($.26 per share - basic; $.25 per
share - diluted) for the twelve-month period ended June 30, 1999. The Company
reported a net loss of $272,602 (($.08) per share - basic and diluted) for the
fourth quarter ended June 30, 2000 compared to net income of $27,352 ($.01 per
share - basic and diluted) for the corresponding 1999 period. Per share
amounts for the current periods are based on weighted average shares
outstanding for the three and twelve-month periods ended June 30, 2000 and
1999.
Net sales for the three and twelve month periods ended June 30, 2000
increased 1% to $4.2 million and $17.2 million, respectively, as compared to
the same three and twelve month periods in 1999. For the three month period
ended June 30, 2000, unit sales for the Neutral Posture(R) chair line
decreased 11% when compared to the similar 1999 period while unit sales for
the Harvard chair line increased almost 52%. Average prices for both chair
lines remained relatively flat for the three-month period. For the twelve
month period ended June 30, 2000, unit sales were down only 4% on the Neutral
Posture(R) chair line with average prices increasing approximately 6% leaving
net sales slightly above prior year amounts. Harvard chair line net sales
decreased approximately 4% for the twelve-month period with units sold
increasing approximately 9% while average prices decreased approximately 12%.
Gross profit margins for the three and twelve month periods ended
June 30, 2000 totaled 34.4% and 36.6%, respectively, as compared to margins
for the same three and twelve month periods ended in 1999 of 37.4% and 37.2%,
respectively. An increase in freight costs and the write-off of approximately
$140,000 in obsolete inventory during the fourth quarter adversely affected
margins for fiscal 2000. The write-off of obsolete inventory resulted
primarily from the changes made to revitalize the Harvard chair line. These
changes ranged from changing components to adding additional chair models
while discontinuing less profitable models. In addition, we continue to make
improvements on the Neutral Posture(R) chair line that added to the write-off
of obsolete inventory. These increases in costs were partially offset by
improved material costs for the year.
Selling, general and administrative costs for the three and twelve month
periods ended June 30, 2000 were $1.9 million and $6.2 million, respectively,
as compared to $1.5 million and $5.1 million for the same three and twelve
month periods ended June 30, 1999, respectively. The increase is primarily
due to legal fees related to arbitration, which were approximately $500,000
for the quarter and approximately $1.0 million for the year. Subsequent to
year-end, the Company received approximately $90,000 in reimbursement of these
legal fees from its insurance carrier and is continuing to work with its
carrier for possible further reimbursement. Consulting fees related to
strategic planning early in the fiscal year also contributed to the higher
costs for fiscal 2000.
Commenting on the results for fiscal 2000, Rebecca Boenigk, Chief
Executive Officer for the Company stated, "Two items significantly impacted
earnings for this fiscal year. One item was legal fees related to the
arbitration proceeding. Without these legal fees, net income would have been
$0.24 per share (basic and diluted) for the year. As an update to the status
of the arbitration proceedings, the arbitration has been postponed until late
fall 2000 at which time we hope to conclude the trial portion of the
proceedings. We are working diligently to try and resolve the arbitration
issues so we can move forward into fiscal 2001 with this behind us. The
second item was the write-off for obsolete inventory. We had not made any
significant changes to the Harvard chair line since its acquisition in
March 1998 and we added new designs to keep it competitive in the marketplace
and to expand the line offering. In addition, we are continuing to make
improvements to the Neutral Posture(R) chair line."
"Although net income was off last year's mark, we are excited about the
upcoming year. With the addition of key personnel, led by Tom Peterson who
has assumed the role as President and Chief Operating Officer of the Company,
a revitalized market strategy, the focus on our sales force and distribution
channels, introduction of the N*hancements accessory line late in fiscal 2000,
and the revisions made to the Harvard and Neutral Posture(R) chair lines, we
believe we will see increased growth in sales and earnings as we progress
through fiscal 2001. Furthermore, because the Company's current financial
position provides opportunities for future growth, with more than $3 million
in cash and a low debt position, we will continue to consider acquisition
opportunities that could expand our market share throughout North America and
increase shareholder value and will continue to invest our capital in new
product development and product improvements."
Tom Peterson, President and Chief Operating Officer for the Company,
added, "We have high hopes for the upcoming year. We have our new sales force
in place, with regional sales directors strategically placed around the
country, several factory reps that will focus 100% of their sales efforts on
the Company's products, and continue to have independent sales representatives
throughout the country. We offer a great selection of ergonomic office
seating with the Neutral Posture(R) chair line and the revitalized Harvard
chair line. With the N*hancements accessory line in place, we can now offer a
more complete line of ergonomic office products and we remain excited about
possibilities of market expansion through acquisition opportunities and new
product development."
Neutral Posture Ergonomics, Inc. manufactures, markets and distributes
ergonomic products. Neutral Posture Ergonomics, Inc. is a certified Women
Business Enterprise and its common stock is currently listed on the NASDAQ
Small Cap Market under the symbol NTRL.
PRESS CONTACT:
Gregory A. Katt, Vice President and CFO
979-778-0502, Ext. 111
This press release may include certain statements that may be deemed to be
"forward-looking" within the meaning of the Securities Act of 1933, as
amended, and the Securities Exchange Act of 1934, as amended. There are
certain important factors which could cause actual results to differ
materially from those anticipated by the forward-looking statements. Certain
of the important factors which could cause actual results to differ materially
from those in the forward-looking statements include, among other things,
changes from anticipated levels of sales, the ability to integrate acquired
product lines and related businesses, the results of arbitration and the
timing thereof, future national or regional economic and competitive
conditions, changes in relationships with customers, customer acceptance of
existing and new products, pricing pressures due to excess capacity, raw
material cost increases, change of tax rates, change of interest rates,
declining conditions in the industry, validity of patents, availability of key
component parts, casualty to or other disruption of the Company's production
facility and equipment, delays and disruptions in the shipment of the
Company's products and other factors that generally affect business.
Neutral Posture Ergonomics, Inc.
Summarized Statements of Income
(In thousands, except for per share amounts)
For the Three Months For the Twelve Months
Ended June 30, Ended June 30,
2000 1999 2000 1999
Net sales $ 4,194 $ 4,150 $ 17,217 $ 17,090
Cost of sales 2,753 2,596 10,924 10,737
Gross Profit 1,441 1,554 6,293 6,353
Selling, general
and administrative 1,923 1,546 6,238 5,133
Operating Income (Loss) (482) 8 55 1,220
Interest (income) expense
and other, net (55) (23) (135) (108)
Income (Loss) Before
Income Taxes (427) 31 190 1,328
Income taxes (Benefit) (154) 4 70 490
Net Income (Loss) (273) 27 120 838
Earnings Per Common Share (EPS):
Basic $ (.08) $ .01 $ .04 $ .26
Diluted (.08) .01 .04 .25
Weighted Average Shares
Outstanding:
Basic 3,272 3,309 3,207 3,253
Diluted 3,272 3,362 3,207 3,344
Summarized Balance Sheets
(In thousands)
June 30, June 30,
2000 1999
Assets
Current Assets:
Cash $ 3,139 $ 3,316
Accounts Receivable - net 2,940 2,668
Inventory 1,289 1,195
Other 486 598
Total current assets 7,854 7,777
Property and Equipment - Net 2,267 2,277
Other Assets 404 440
Total Assets $ 10,525 $ 10,494
Liabilities
Current Liabilities $ 1,974 $ 2,164
Long-term debt 501 551
Deferred income tax liability 69 131
Shareholders' equity 7,981 7,648
Total Liabilities
and Shareholders' Equity $ 10,525 $ 10,494
SOURCE Neutral Posture Ergonomics, Inc.
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Related links:
http://www.neutralposture.com
Company News On-Call:
http://www.prnewswire.com/comp/125652.html or fax,
800-758-5804, ext. 125652
CONTACT:
Gregory A. Katt, Vice President and CFO of
Neutral Posture Ergonomics, Inc., 979-778-0502, Ext. 111
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