-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H1x8zoCS8xW5Jy2GwQg2NwkAGTf4KJC3O5ohxvHUWDXQrHdUxh2QONYs2zZkMzY3 UAf2fRO5VO0jpuIWLCyHOQ== 0001001277-05-000573.txt : 20050906 0001001277-05-000573.hdr.sgml : 20050905 20050906163048 ACCESSION NUMBER: 0001001277-05-000573 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050906 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20050906 DATE AS OF CHANGE: 20050906 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERNATIONAL DISPLAYWORKS, INC CENTRAL INDEX KEY: 0000866415 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC COMPONENTS & ACCESSORIES [3670] IRS NUMBER: 943333649 STATE OF INCORPORATION: OR FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27002 FILM NUMBER: 051070687 BUSINESS ADDRESS: STREET 1: 1613 SANTA CLARA DRIVE, SUITE 100 CITY: ROSEVILLE STATE: CA ZIP: 95765 BUSINESS PHONE: (916) 797-6800 MAIL ADDRESS: STREET 1: C/O INTERNATIONAL DISPLAY WORKS, INC STREET 2: 1613 SANTA CLARA DRIVE, SUITE 100 CITY: ROSEVILLE STATE: CA ZIP: 95765 FORMER COMPANY: FORMER CONFORMED NAME: INTERNATIONAL DISPLAYWORKS INC DATE OF NAME CHANGE: 20020408 FORMER COMPANY: FORMER CONFORMED NAME: MORROW SNOWBOARDS INC DATE OF NAME CHANGE: 19951006 8-K 1 for090605press.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): September 6, 2005 INTERNATIONAL DISPLAYWORKS, INC. -------------------------------- (Exact name of registrant as specified in its charter) Delaware 0-27002 94-3333649 -------- ------- ---------- (State or other jurisdiction of (Commission File Number) (I.R.S. Employer incorporation or organization) Identification No.) 1613 Santa Clara Drive, Suite 100 Roseville, California 95661 --------------------------- (Address and telephone number of principal executive offices) (Zip Code) (916) 797-6800 -------------- (Registrant's telephone number, including area code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2. Results of Operations and Financial Condition. On September 6, 2005, International DisplayWorks, Inc. issued a press release announcing its results of operations and financial condition for the three and nine months ended July 31, 2005. The full text of the press release is set forth in Exhibit 99.1 attached to this report. Exhibit No. Exhibit Description 99.1 Press release dated September 6, 2005. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. INTERNATIONAL DISPLAYWORKS, INC., a Delaware Corporation Dated: September 6, 2005 /s/ Alan Lefko -------------------------------------------- Alan Lefko, Vice President of Finance EX-99 2 for090605pressrelease.txt EXHIBIT 99.1 IDW LOGO International DisplayWorks, Inc. Announces Record 3rd Quarter Revenues Sales Increase 103% and Net Income Increases 166% for the Quarter FOR IMMEDIATE RELEASE For additional information contact: Tom Lacey, CEO or Matthew Hayden or Brett Maas International DisplayWorks, Inc. Hayden Communications, Inc. (916) 797-6800 (843) 272-4653 matt@haydenir.com ROSEVILLE, Calif., -- September 6, 2005-- International DisplayWorks, Inc. (IDW) (NASDAQ: IDWK), a manufacturer and designer of liquid crystal displays (LCDs), modules and assemblies, today announced financial results for the Company's third quarter of fiscal 2005 and first nine months ended July 31, 2005. Third Quarter 2005/Nine Month Highlights: o Revenues for the quarter increased 103 percent year-over-year to $23.6 million o Color displays represented 20% of total revenue for the quarter o Net income for the quarter increased to $984,000, or $0.03 per diluted share o SG&A as percent of sales was reduced by 250 basis points sequentially o Year-to-date revenues increased 101 percent to $64.3 million o Net income for nine months increased more than 5 times versus 2004 to $3.5 million, or $0.11 per diluted share For the quarter, revenues were a record $23.6 million, an increase of 103 percent compared to the $11.6 million reported for the third quarter of fiscal 2004. The Company's gross profit increased 70 percent to $4.1 million, or 17.5 percent of sales, compared to a gross profit of $2.4 million, or 20.9 percent of sales, for the same period a year ago. The decrease in gross margin as a percent of sales was due to depreciation and utilities associated with the opening of the North Campus and the Beijing acquisition. General and Administrative expenses decreased from 11 percent of sales, or $1.2 million, to eight percent of sales, or $1.8 million. The dollar increase was attributed to the Beijing factory acquisition and additional employees and employee related expenses, increased professional fees (in part due to outside consulting fees in connection with Sarbanes-Oxley Section 404 compliance), increased insurance costs, increased depreciation expense, which were all offset by favorable exchange rate expense and reduced bad debt expense. The Company reported operating income of $1.3 million; nearly triple the operating income of $444,000 for the third quarter last year. Net income was 984,000, or $0.03 per basic and fully diluted share, compared with net income of $370,000, or $0.01 per basic and fully diluted share last year. The fully diluted weighted average common shares outstanding were 32.7 million for the third quarter of fiscal 2005 versus 32.2 million for the same quarter last year. "We reported our ninth sequential quarter of revenue growth, our seventh consecutive quarter where revenues approximately doubled compared to the year ago period and our eighth consecutive quarter of profitability - our model continues to perform well," commented Tom Lacey, International DisplayWorks' chairman and Chief Executive Officer. "While our revenues were negatively impacted by an inventory issue with our largest customer, we are encouraged with the significant progress we made in the expansion and diversification of our customer base, including our entrance into several new product categories, including color. This ongoing diversification, coupled with our continued sales growth, should continue to minimize the impact one single customer may represent during a quarter. This was also our first quarter with measurable color shipments, as color represented more than 20 percent of our total revenue. These color LCD's will be utilized in a variety of applications, including printers and gaming devices for both the handheld and casino markets. Our successes were augmented this quarter with the successful integration of our recently acquired facility in Beijing and our ability to continue increase customer penetration." For the nine month period ended July 31, 2005, the Company reported revenues of $64.3 million, and increase of 101.2 percent compared to the $32.0 million reported for the same period last year. Gross profit margin was $11.9 million, or 18.5 percent of net sales, compared to gross profit margin of $7.0 million, or 21.8 percent of sales for the same period last year. General and Administrative expenses were $5.5 million, or 8.6 percent of sales, compared to $3.6 million, or 11.2 percent of sales, for the same period last year. Operating income for the year-to-date period was $3.9 million compared to $813,000. Net income was $3.5 million, or $0.11 per basic and fully diluted share, compared with net income of $543,000, or $0.02 per basic and fully diluted share last year. The fully diluted weighted average common shares outstanding were 32.3 million for the third quarter of fiscal 2005 versus 27.0 million for the same period last year. The Company completed the third quarter with current assets totaling $39.8 million and current liabilities totaling $32.3 million, resulting in a current ratio of 1.23:1. At the end of quarter, the Company's credit line totaled $13.3 million, $8 million of which was utilized to complete recent acquisition of the Beijing operation, with $1.2 million of the remaining $6.7 million still available to the company for working capital purposes. Shareholders' equity increased 19 percent to $34.8 million at July 31, 2005 from $29.1 million at October 31, 2004. Jeff Winzeler, the Company's chief financial officer, commented, "Revenue grew both sequentially and year-over-year, continuing our growth trajectory. We experienced a delay related to inventory issues at our largest single customer, accounting for the majority of the variance in our actual revenues for the quarter versus our prior expectations. Gross margins were inline with our expectations despite the increased startup costs for our new facility and as we previously noted, we anticipate improvements as revenues continue to increase across the relatively fixed cost base. Overall profitability of the business during the quarter was solid and represented a material increase from last year. We continue to see long-term opportunities to streamline the business, leverage costs, improve working capital and grow earnings significantly. At this point our revenue guidance range for our 4th fiscal quarter is $22.5M - $25M. We will again deliver substantial revenue growth vs. year ago quarter and we hope to produce another quarter of record revenues." Mr. Lacey concluded, "We continue to win business with top tier manufacturers and are well positioned to capitalize on the strong growth in small form factor color and monochrome LCD displays. Recent contract wins during the quarter with, several large and well known companies is evidence that our strategy is working and our value proposition is resonating with customers. Our North Campus yields exceeded 75 percent during the quarter and we still see opportunities to further improve this metric. In summary, we have made significant progress in our growth strategy, are clearly at an inflection point in the business and have a lot to accomplish during the remainder of this calendar year." Recent Highlights o Integrated the acquisition of Three Five Systems facilities. o Increased the total number and penetration of existing and new customers. o Dramatically grew revenues while improving profitability. o In July, the Company announced it has been included in the Russell 3000 Index, which measures the performance of the 3,000 largest U.S. companies based on total market capitalization, as well as the Russell 2000(R) Index, which is a subset of the Russell 3000 Index, and the Russell Microcap Index, which includes the smallest 1000 companies in the Russell 2000 Index plus the 1,000 largest companies below the minimum market capitalization level of the index. International DisplayWorks is also included in the "Growth" component of both the Russell 3000 and Russell 2000. Teleconference Information Management will discuss the results in a conference call today at 4:30 p.m. EST. Interested parties should call 888-823-7457 if calling within the United States or 973-582-2718 if calling internationally. There will be a playback available until September 13, 2005. To listen to the playback, please call 877-519-4471 if calling within the United States or 973-341-3080 if calling internationally. Please use pass code 6391310 for the replay. This call is being web cast by ViaVid Broadcasting and can be accessed at International DisplayWorks' website at www.idwk.com. The web cast may also be accessed at ViaVid's website at www.viavid.net. The web cast can be accessed until October 6, 2005 on either site.To access the web cast, you will need to have the Windows Media Player on your desktop. For the free download of the Media Player please visit: http://www.microsoft.com/windows/windowsmedia/en/download/default.asp. About International DisplayWorks International DisplayWorks, Inc. is a manufacturer and designer of high quality liquid crystal displays, modules and assemblies for a variety of customer needs including OEM applications. IDW operates 466,000 square feet of manufacturing facilities in the People's Republic of China (PRC). Sales offices are located in US, Europe, Hong Kong, Singapore, and China. Copies of IDW's 10-K and other documents as filed with the SEC are available through a link on our web site: www.idwk.com. NOTE: The foregoing is news relating to International DisplayWorks, Inc. ("IDW") and contains forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. When used in this release, the words "anticipate," "believe," "estimate," "expect" and similar expressions as they relate to IDW or its management, including without limitation, IDW and its subsidiaries, are intended to identify such forward-looking statements. IDW's actual results, performance or achievements could differ materially from the results expressed in, or implied by these forward-looking statements. For more detailed information the reader is referred to IDW's 10-K and other related documents filed with the Securities and Exchange Commission. This does not constitute an offer to buy or sell securities by the Company and is meant purely for informational purposes. TABLES TO FOLLOW
INTERNATIONAL DISPLAYWORKS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands) --------------------- ------------------- ASSETS July 31, October 31, ------ 2005 Unaudited 2004 --------------------- ------------------- Current assets: Cash and cash equivalents Cash in banks $ 6,079 $ 8,187 Cash in commercial paper - 1,999 --------------------- ------------------- Total cash and cash equivalents 6,079 10,186 Accounts receivable, net of allowance for doubtful accounts of $82 and $101 21,937 11,378 Inventories 9,362 5,780 Prepaid expense and other current assets 2,419 1,160 --------------------- ------------------- Total current assets 39,797 28,504 --------------------- ------------------- Property, plant and equipment at cost, net 27,311 16,418 --------------------- ------------------- Total assets $ 67,108 $ 44,922 ===================== =================== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $ 12,638 $ 7,236 Accrued liabilities 3,856 3,588 Line of credit 13,251 4,398 Current portion of long term debt 2,565 496 --------------------- ------------------- Total current liabilities 32,310 15,718 Long-term debt, net of current portion 5 70 --------------------- ------------------- Total liabilities 32,315 15,788 --------------------- ------------------- Commitments and contingencies Shareholders' equity Preferred stock, par $0.001, 10,000,000 shares authorized, none issued Common stock, par $0.001, 100,000,000 shares authorized 31,706,706 and 30,573,383 shares issued and outstanding at July 31, 2005 and October 31, 2004 respectively 31,707 30,573 Paid in capital 35,591 35,069 Accumulated deficit (33,106) (36,579) Cumulative translation adjustment 601 71 --------------------- ------------------- Total shareholders' equity 34,793 29,134 --------------------- ------------------- Total liabilities and shareholders' equity $ 67,108 $ 44,922 ===================== =================== The accompanying notes are an integral part of these financial statements
INTERNATIONAL DISPLAYWORKS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except Share and per share data) For Nine Months Ended For Three Months Ended ------------------------------------- ------------------ ------------------ July 31, 2005 July 31, 2004 July 31, 2005 July 31, 2004 Unaudited Unaudited Unaudited Unaudited ------------------ ------------------ ------------------ ------------------ Sales $ 64,323 $ 31,975 $ 23,600 $ 11,620 Cost of goods sold 52,423 24,997 19,463 9,186 ------------------ ------------------ ------------------ ------------------ Gross profit 11,900 6,978 4,137 2,434 ------------------ ------------------ ------------------ ------------------ Operating expenses: General and administrative 5,532 3,579 1,837 1,234 Selling, marketing and customer service 1,918 1,507 745 633 Engineering, advanced design and product management 525 454 273 123 Litigation settlement - 625 - - ------------------ ----------------- ------------------ ------------------ Total operating expenses 7,975 6,165 2,855 1,990 ------------------ ------------------ ------------------ ------------------ Operating income (loss) 3,925 813 1,282 444 ------------------ ------------------ ------------------ ------------------ Other income (expense): Interest expense (426) (333) (248) (84) Other income (expense) (27) 63 (50) 10 ------------------ ------------------ ------------------ ------------------ Total other income (expense) (453) (270) (298) (74) ------------------ ------------------ ------------------ ------------------ Income (loss) from continuing operations before income taxes 3,472 543 984 370 ------------------ ------------------ ------------------ ------------------ Provision for income taxes - - - - ------------------ ------------------ ------------------ ------------------ Net income (loss) $ 3,472 $ 543 $ 984 $ 370 ================== ================== ================== ================== Basic and diluted loss per common share Basic $ 0.11 $ 0.02 $ 0.03 $ 0.01 ================== ================== ================== ================== Diluted $ 0.11 $ 0.02 $ 0.03 $ 0.01 ================== ================== ================== ================== Weighted average common shares outstanding Basic 31,282,781 24,730,165 31,700,406 29,960,175 Diluted 32,326,370 26,962,928 32,743,995 32,192,938 ================== ================== ================== ==================
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