EX-99.1 2 exhibit99.htm EXHIBIT 99.1 Exhibit 99.1

Exhibit 99.1

Gerber Scientific Announces Fiscal 2008 Third Quarter Results

SOUTH WINDSOR, CT - March 6, 2008 - Gerber Scientific, Inc. (NYSE: GRB) today reported net income of $3.1 million for the third quarter of fiscal 2008, or $0.13 per diluted share, on revenue of $152.0 million, compared with net income of $2.2 million, or $0.10 per diluted share, on revenue of $137.1 million for the third quarter of fiscal 2007. Foreign currency translation had the effect of increasing revenue by approximately $9.6 million in the third quarter of fiscal 2008 as compared with the third quarter of fiscal 2007.

For the nine months ended January 31, 2008, the Company reported net income of $8.4 million, or $0.36 per diluted share, on revenue of $466.3 million, compared with net income of $7.9 million, or $0.34 per diluted share, on revenue of $419.7 million for the nine months ended January 31, 2007. Foreign currency translation had the effect of increasing revenue by approximately $24.2 million for the nine months ended January 31, 2008, as compared with the nine months ended January 31, 2007.

The Company used $7.5 million in cash flows from operations, less capital expenditures, for the first nine months of fiscal 2008 as compared with a cash usage of $11.8 million in the prior year comparable period.

Marc T. Giles, President and Chief Executive Officer, commented: "We are pleased to report for the third quarter of fiscal 2008 that revenue, operating profit and earnings per share all increased as compared with the prior year. Revenue growth of $14.8 million, or 10.8 percent, as compared with the prior year, was led by the Sign Making and Specialty Graphics segment, through the strong performance of the Spandex business unit, with stronger aftermarket revenue and benefits from favorable foreign currency translation, and the incremental revenue provided by our acquisition of Data Technology early this fiscal year. Operating profit margin of 4.1 percent for the third quarter increased 1.1 percentage points, primarily as a result of lower selling, general and administrative expenses during the quarter as a percent of revenue compared with the fiscal quarter ended January 31, 2007. This improved operating performance resulted in a year-over-year increase in earnings per share for the third quarter of $0.03 per diluted share, after recording a non-cash pre-tax charge of $0.3 million, or $0.01 per diluted share, related to the write-off of deferred financing costs associated with the refinancing of the Company's credit facility."

Giles continued, "With regard to our exciting new product - the Solara ion™, we continue to expect to ship in volume during the first quarter of fiscal 2009. Also, pre-order volume has increased by approximately 45% to 125 orders from the amount reported in November 2007. "

About Gerber Scientific, Inc.

Gerber Scientific, Inc. (http://www.gerberscientific.com) is a leading international supplier of sophisticated automated manufacturing systems for the sign making and specialty graphics, apparel and flexible materials, ophthalmic lens processing, and print and packaging industries. Headquartered in South Windsor, Connecticut, the Company operates through four primary business units: Gerber Scientific Products, Spandex, Gerber Technology and Gerber Coburn.

Cautionary Note Concerning Factors That May Affect Future Results

This news release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements contained in this news release regarding the Company's expected financial condition, results of operations, cash flows and product launches are forward-looking statements that involve risks and uncertainties. For information identifying other important economic, political, regulatory, legal, technological, competitive and other risks and uncertainties, readers are referred to the Company's filings with the Securities and Exchange Commission, including but not limited to, the information included in Gerber Scientific's Annual Report on Form 10-K for the fiscal year ended April 30, 2007 under the headings "Business," "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations - Cautionary Note Concerning Factors That May Influence Future Results," as well as information included in subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K, which outline certain important risks regarding the Company's forward-looking statements. These risks include, but are not limited to, delays in the Company's new product development and commercialization, intense competition in markets for each of the Company's operating segments, rapid technological advances, availability and cost of raw materials, volatility in foreign currency exchange rates and fluctuations in interest rates. Actual future results or events may differ materially from those expressed or implied in the Company's forward-looking statements. The Company expressly disclaims any obligation to update any of these forward-looking statements.

GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

 

Quarter Ended
January 31,

Nine Months Ended
January 31,

In thousands, except per share data

2008

2007

2008

2007

Revenue:

        

     Product sales

$133,637 

$120,941 

$411,022 

$370,776 

     Service sales

18,329 

16,183 

55,327 

48,885 

151,966 

137,124 

466,349 

419,661 

Costs and Expenses:

        

     Cost of products sold

95,428 

86,881 

294,302 

264,401 

     Cost of services sold

13,085 

10,242 

36,737 

29,922 

     Selling, general and administrative expenses

30,691 

29,863 

99,972 

92,216 

     Research and development

6,466 

6,050 

19,483 

18,193 
 

145,670 

133,036 

450,494 

404,732 
         

Operating income

6,296 

4,088 

15,855 

14,929 
         

Other income (expense), net

(435)

(145)

(96)

(25)

Interest expense

(1,388)

(965)

(3,460)

   (2,713)
         

Income before income taxes

4,473 

2,978 

12,299 

12,191 

Income tax expense

1,410 

748 

3,898 

     4,248 

Net income

$    3,063 

$    2,230 

$    8,401 

$    7,943 
         

Earnings per share of common stock:

     Basic

$0.13 

$0.10 

$0.36 

$0.35 

     Diluted

$0.13 

$0.10 

$0.36 

$0.34 
         

Weighted average shares outstanding:

        

     Basic

23,374 

23,012 

23,296

22,828 

     Diluted

23,618 

23,398 

23,600

23,258 

 

GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED SUMMARY BALANCE SHEETS
(Unaudited)


In thousands

January 31,
2008

  

April 30,
2007

Assets

      

Current Assets:

      

     Cash and cash equivalents

$ 12,299

  

$ 8,052

     Accounts receivable, net

105,605

  

106,421

     Inventories

77,258

  

65,299

     Prepaid expenses and other current assets

15,523

  

15,106

             Total current assets

210,685

  

194,878
       

Property, plant and equipment, net

39,079

  

36,982

Goodwill

61,348

  

54,825

Deferred income taxes

37,816

  

34,893

Other assets

15,788

  

14,384

             Total assets

$364,716

  

$335,962
       

Liabilities and Shareholders' Equity

      

Current Liabilities:

      

     Current portion of long-term debt

$         --- 

  

$    1,773

     Accounts payable

41,264

  

48,772

     Other accrued liabilities

59,672

  

63,208

             Total current liabilities

100,936

  

113,753
       

Long-term debt

52,000

  

31,603

Other long-term liabilities

50,886

  

46,125
       

Shareholders' equity

160,894

  

144,481

             Total liabilities and shareholders' equity

$364,716

  

$335,962