WDHD Woodhead Industries (MM)

Woodhead Industries, Inc., (NASDAQ:WDHD) today announced financial results for its fiscal second quarter ended April 1, 2006. The Company reported second quarter revenue of $59.0 million, up 4.7% (7.3% in constant dollars), compared to the same period last year. Income from operations totaled $4.9 million, up 56.9% from the second quarter of 2005. Net income increased 129.3% to $3.0 million, or $0.25 per diluted share for the 2006 second quarter, compared to net income of $1.3 million, or $0.11 per diluted share for the same period in 2005. Philippe Lemaitre, Woodhead Industries' Chairman and Chief Executive Officer, commented, "Our second quarter results provide evidence that our sales and marketing initiatives and cost management efforts are paying off. Sales were at the high end of our guidance and earnings exceeded our expectations. Performance in our Electrical segment was particularly strong, as increased volumes and diligent cost management led to significantly improved profitability. We were also pleased with performance in our North American Connectivity segment, which registered another quarter of solid revenue growth. " In the Connectivity segment, sales were $43.5 million, up 2.4% (5.9% in constant dollars) from the second quarter of 2005, with foreign exchange negatively impacting the year-over-year comparison. Income from operations totaled $3.0 million, compared to $2.3 million last year. North American Connectivity revenue growth remained strong, increasing 9.1% during the quarter. Connectivity segment operating income improved 32.2% primarily due to higher volume levels and cost control. Electrical segment revenue increased 11.5% to $15.5 million, as compared to $13.9 million for the second quarter of 2005. Income from operations was $2.8 million, up 79.3% from $1.6 million during the same period last year. The substantial increase in Electrical segment profitability is attributable to higher volumes, operational improvements and cost control. Outlook Lemaitre noted, "Our positive outlook for the remainder of the year is tempered by the start-up of a new ERP system in North America. We are being cautious and currently anticipate that revenues during the second half of our 2006 fiscal year will be in a range of $115 to $118 million, with earnings per share of $0.42 to $0.45. This performance would result in full year revenues of $227 to $230 million, and earnings per share of $0.85 to $0.88, which is up from our previous full year earnings guidance of $0.79 to $0.85 as a result of our strong second quarter performance." This press release contains statements that are forward-looking. These statements are based on current expectations that are subject to risks and uncertainties. In particular, such risks include future actions, prospective products, future performance or results of current or anticipated products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, general economic and business conditions, business system conversions, competition, and other issues discussed in our Form 10-K and other SEC filings. Conference Call Woodhead Industries, Inc., will host a conference call today, April 27, 2006, at 11:00 am Eastern Time to discuss performance and financial results for the fiscal second quarter. The dial-in phone number is 800-967-7184 or 719-457-2633. The Access code is 2109034. To access a live internet webcast of the conference call, visit the Company's website at www.woodhead.com and select the webcast icon. A replay of the conference call will be archived and available on the Company's website following the live event. About Woodhead Industries, Inc. Woodhead Industries (NASDAQ:WDHD) develops, manufactures and markets network and electrical infrastructure products engineered for performance in harsh, demanding, and hazardous industrial environments. Woodhead is known in the global industrial market by its recognized brands which include Brad Harrison(R), BradPower(TM), BradControl(TM), SST(TM), Daniel Woodhead(R), mPm(R), applicom(R), Aero-Motive(R) and RJ-Lnxx(R). Our expertise extends from mechanical, electrical, and electronics to communication software products and technologies. Woodhead operates from 21 locations in 10 countries spanning North America, Europe and Asia/Pacific. For further information, contact: Robert Fisher, Vice President, Finance and CFO, 847-317-2400, e-mail: rfisher@woodhead.com. (Tables to Follow) -0- *T WOODHEAD INDUSTRIES, INC. Consolidated Balance Sheet (Amounts in thousands) ------------------------ Assets 4/1/2006 10/1/2005 ------------------------ Current Assets Cash and short-term investments $16,276 $13,887 Accounts receivable 42,303 39,040 Inventories 22,750 21,173 Prepaid expenses 5,764 5,785 Refundable income taxes 366 2,097 Deferred income taxes 3,133 2,164 ---------------------------------------------------------------------- Total current assets 90,592 84,146 Property, plant and equipment, net 55,340 54,758 Goodwill, net 35,993 35,730 Deferred income taxes 2,502 2,746 Other Assets 942 1,000 ---------------------------------------------------------------------- Total Assets $185,369 $178,380 ---------------------------------------------------------------------- Liabilities and Stockholders' Investment Current Liabilities Accounts payable $11,336 $11,080 Accrued expenses 13,979 11,531 Income taxes payable 1,725 1,053 Current portion of long-term debt 5,700 5,700 ---------------------------------------------------------------------- Total current liabilities 32,740 29,364 Long-term debt 19,500 19,500 Deferred income taxes 4,958 4,698 Other liabilities 3,828 4,139 ---------------------------------------------------------------------- Total Liabilities 61,026 57,701 Stockholders' investment: Common stock at par (shares issued: 12,405 at 4/1/06, 12,260 at 10/1/05) 12,218 12,260 Additional paid-in capital 22,157 21,596 Deferred stock compensation - (397) Accumulated other comprehensive income 4,679 4,726 Retained earnings 85,289 82,494 ---------------------------------------------------------------------- Total stockholders' investment 124,343 120,679 ---------------------------------------------------------------------- Total Liabilities and Stockholders' Investment $185,369 $178,380 ---------------------------------------------------------------------- WOODHEAD INDUSTRIES, INC. Consolidated Income Statement (Amounts in thousands, except per share data) Quarter Ended: Six Months Ended: ------------------ --------- ------------------ --------- 4/1/2006 4/2/2005 % Change 4/1/2006 4/2/2005 % Change ------------------ --------- ------------------ --------- Net Sales $59,028 $56,393 4.7% $112,467 $105,069 7.0% Cost of Sales 36,704 35,548 3.3% 69,987 67,502 3.7% ------------------ ------------------ Gross Profit 22,324 20,845 7.1% 42,480 37,567 13.1% % of Net Sales 37.8% 37.0% 37.8% 35.8% Operating Expenses 17,466 17,748 (1.6%) 33,993 34,244 (0.7%) % of Net Sales 29.6% 31.5% 30.2% 32.6% ------------------ ------------------ Income From Operations 4,858 3,097 56.9% 8,487 3,323 155.4% % of Net Sales 8.2% 5.5% 7.5% 3.2% Other Expenses Interest Expense 223 477 (53.2%) 527 963 (45.3%) Other (Income)/ Expenses, Net (147) 515 (302) (1,303) ------------------ ------------------ Other (Income)/ Expenses 76 992 225 (340) Income Before Taxes 4,782 2,105 127.2% 8,262 3,663 125.6% % of Net Sales 8.1% 3.7% 7.3% 3.5% Provision For Income Taxes 1,739 778 123.5% 3,003 1,120 168.1% ------------------ ------------------ Net Income $3,043 $1,327 129.3% $5,259 $2,543 106.8% % of Net Sales 5.2% 2.4% 4.7% 2.4% ================== ================== Earnings per share Diluted $0.25 $0.11 127.3% $0.43 $0.21 104.8% Weighted- average common shares outstanding Diluted 12,383 12,287 0.8% 12,333 12,284 0.4% ================== ================== Dividends Per Share $0.10 $0.10 0.0% $0.20 $0.20 0.0% ================== ================== SEGMENT DATA Quarter Ended: Six Months Ended: ------------------ --------- ------------------ --------- 4/1/2006 4/2/2005 % Change 4/1/2006 4/2/2005 % Change ------------------ --------- ------------------ --------- Net Sales --------- Connectivity $43,527 $42,495 2.4% $83,904 $79,381 5.7% Electrical 15,501 13,898 11.5% 28,563 25,688 11.2% ------------------ ------------------ Total $59,028 $56,393 4.7% $112,467 $105,069 7.0% ================== ================== Income From Operations ----------- Connectivity $3,020 $2,284 32.2% $4,728 $2,345 101.6% Electrical 2,813 1,569 79.3% 4,060 1,869 117.2% Corporate and Other (975) (756) (301) (891) ------------------ ------------------ Total $4,858 $3,097 56.9% $8,487 $3,323 155.4% ================== ================== *T