IRVINE, Calif., Oct. 29 /PRNewswire-FirstCall/ -- PRO-DEX, INC. (Nasdaq: PDEX) today announced its financial results for the fiscal first quarter ending September 30, 2009. In addition, Pro-Dex announced that its existing credit agreement with Wells Fargo has been renewed, a new marketing director has been hired, a product development agreement was signed with a new customer, and initial shipments have been made of a newly developed product.
Sales for the first quarter ended September 30, 2009 remained stable at $5.6 million compared to $5.7 million for the previous year's first quarter, as increases in medical devices compensated for continued sluggish motion control sales. Net income for the fourth quarter was $183,000 or $0.02 per share compared to a net loss of $118,000 or ($0.01) per share for the previous year's first quarter.
Mark Murphy, the Company's President and Chief Executive Officer, commented, "In looking at the comparison quarters, we can see the effect of our tuning efforts last year. In the first quarter of fiscal year 2009, we shipped $5.7 million and lost $0.01 per share, and in this first quarter of fiscal year 2010, we shipped $5.6 million and made $0.02 per share. In addition to these P&L improvements, we shipped the first 50 units of a new arthroscopic surgical hand-piece during fiscal Q1 2010. We currently have purchase orders in our backlog totaling $1.4 million for this product with scheduled ship dates through July, 2010."
Commenting further on the Company's top line, Mr. Murphy continued, "We're beginning to see some signs of improvement in our motion control business as those sales have climbed back to nearly half of the sales levels we experienced during each of the five quarters ending December 31, 2008. Our total company backlog is currently at $9.3 million, up from $8.1 million at September 30, 2009. We are also pleased to announce the signing of a new development agreement. The product is for small joint surgery and will include a consumable element that Pro-Dex will provide in addition to the base capital equipment. The initial Purchase Order is for $150,000, and our annual sales of the related disposables could increase significantly if the product is successful, although there can be no assurance of the product's design success or acceptance by the customer or the market-place. The development and regulatory testing schedule, assuming successful design and customer acceptance, targets us making initial shipments in the first quarter of next fiscal year.
Gross profit for the quarter ended September 30, 2009 increased to $1.9 million, a 33% gross profit margin, compared to gross profit of $1.8 million or 31% gross profit margin in last year's first quarter.
Operating expenses for the first quarter decreased by 14% to $1.6 million, compared to $1.9 million in the first quarter 2009. The continued decrease in spending was attributable to structurally lower costs, primarily decreased labor expenses and more efficient marketing spending, resulting from our FY2009 cost-reduction efforts.
Mr. Murphy continued, "This quarter's gross profit margin is an accomplishment in light of our lower motion control sales mix, which typically enhances our margins. Increased product reliability is a major contributor to our improved medical device margins. In light of the current economic environment, we are encouraged by a second consecutive quarter of profit and cash generation. To ensure that we identify every possible opportunity for growth, we have hired a new Director of Marketing who joins us with substantial experience in strategic marketing and top line growth. We look forward to benefitting from this newly created position."
During the first quarter of fiscal year 2010, we continued to strengthen our balance sheet, generating an additional $409,000 of operating cash, improving our trailing 12 months operating cash from $1.7 million to $2.6 million. At September 30, 2009, we had cash and cash equivalents of $1,378,000 compared to cash and cash equivalents of $1,124,000 as of June 30, 2009. There continued to be nothing borrowed under the terms of the Company's revolving credit line. The Company's net debt (total debt less cash) was $1.8 million at September 30, 2009, down from $2.2 million at June 30, 2009 and down from $4.1 million at September 30, 2008.
On October 27, 2009, we renewed our financing agreement with Wells Fargo through November 1, 2010. Except for the introduction of a 1.5% unused line fee, the terms and conditions of the agreement remain the same, with the current $1.6 million tenant improvement term loan continuing to amortize over four years and up to $1 million available on our revolving line of credit.
Teleconference Information:
Investors and all others are invited to listen to a conference call discussing the first fiscal quarter 2010 results, today at 4:30 p.m. Eastern Time. The call is scheduled to be broadcast live over the Internet and may be accessed by visiting the Company's website at http://www.pro-dex.com or directly at http://www.videonewswire.com/event.asp?id=63527. Mark Murphy, Chief Executive Officer and Jeff Ritchey, Chief Financial Officer, plan to host the call. If you would like to join the call, dial (877) 356-8625 U.S. and (706) 634-9779 International, conference I.D. 38163047. You may identify the call as the Pro-Dex First Quarter Earnings Call. An online archive of the broadcast will be available within two hours of the completion of the call and will be accessible on the Company's website for 365 days. Additionally, a telephone replay will be available 2 hours after the call for 48 hours by dialing (800) 642-1687 U.S. or (706) 645-9291 for international callers, conference I.D. number 38163047.
Pro-Dex, Inc., with operations in Irvine, California, Beaverton, Oregon and Carson City, Nevada, provides power and control products used in medical, aerospace, military, research and industrial applications. Experience in multi-axis motion control, fractional horsepower motors and rotary drive systems allows us to develop products that require high precision in harsh environments. Pro-Dex's products are found in hospitals, dental offices, medical engineering labs, commercial and military aircraft, scientific research facilities and high tech manufacturing operations around the world. For more information, visit the Company's website at www.pro-dex.com
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Sales for the first quarter ended September 30, 2009 remained stable at $5.6 million compared to $5.7 million for the previous year's first quarter, as increases in medical devices compensated for continued sluggish motion control sales. Net income for the fourth quarter was $183,000 or $0.02 per share compared to a net loss of $118,000 or ($0.01) per share for the previous year's first quarter.
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Mark Murphy, the Company's President and Chief Executive Officer, commented, "In looking at the comparison quarters, we can see the effect of our tuning efforts last year. In the first quarter of fiscal year 2009, we shipped $5.7 million and lost $0.01 per share, and in this first quarter of fiscal year 2010, we shipped $5.6 million and made $0.02 per share. In addition to these P&L improvements, we shipped the first 50 units of a new arthroscopic surgical hand-piece during fiscal Q1 2010. We currently have purchase orders in our backlog totaling $1.4 million for this product with scheduled ship dates through July, 2010."
Commenting further on the Company's top line, Mr. Murphy continued, "We're beginning to see some signs of improvement in our motion control business as those sales have climbed back to nearly half of the sales levels we experienced during each of the five quarters ending December 31, 2008. Our total company backlog is currently at $9.3 million, up from $8.1 million at September 30, 2009. We are also pleased to announce the signing of a new development agreement. The product is for small joint surgery and will include a consumable element that Pro-Dex will provide in addition to the base capital equipment. The initial Purchase Order is for $150,000, and our annual sales of the related disposables could increase significantly if the product is successful, although there can be no assurance of the product's design success or acceptance by the customer or the market-place. The development and regulatory testing schedule, assuming successful design and customer acceptance, targets us making initial shipments in the first quarter of next fiscal year.
Gross profit for the quarter ended September 30, 2009 increased to $1.9 million, a 33% gross profit margin, compared to gross profit of $1.8 million or 31% gross profit margin in last year's first quarter.
Operating expenses for the first quarter decreased by 14% to $1.6 million, compared to $1.9 million in the first quarter 2009. The continued decrease in spending was attributable to structurally lower costs, primarily decreased labor expenses and more efficient marketing spending, resulting from our FY2009 cost-reduction efforts.
Mr. Murphy continued, "This quarter's gross profit margin is an accomplishment in light of our lower motion control sales mix, which typically enhances our margins. Increased product reliability is a major contributor to our improved medical device margins. In light of the current economic environment, we are encouraged by a second consecutive quarter of profit and cash generation. To ensure that we identify every possible opportunity for growth, we have hired a new Director of Marketing who joins us with substantial experience in strategic marketing and top line growth. We look forward to benefitting from this newly created position."
During the first quarter of fiscal year 2010, we continued to strengthen our balance sheet, generating an additional $409,000 of operating cash, improving our trailing 12 months operating cash from $1.7 million to $2.6 million. At September 30, 2009, we had cash and cash equivalents of $1,378,000 compared to cash and cash equivalents of $1,124,000 as of June 30, 2009. There continued to be nothing borrowed under the terms of the Company's revolving credit line. The Company's net debt (total debt less cash) was $1.8 million at September 30, 2009, down from $2.2 million at June 30, 2009 and down from $4.1 million at September 30, 2008.
On October 27, 2009, we renewed our financing agreement with Wells Fargo through November 1, 2010. Except for the introduction of a 1.5% unused line fee, the terms and conditions of the agreement remain the same, with the current $1.6 million tenant improvement term loan continuing to amortize over four years and up to $1 million available on our revolving line of credit.
Teleconference Information:
Investors and all others are invited to listen to a conference call discussing the first fiscal quarter 2010 results, today at 4:30 p.m. Eastern Time. The call is scheduled to be broadcast live over the Internet and may be accessed by visiting the Company's website at http://www.pro-dex.com or directly at http://www.videonewswire.com/event.asp?id=63527. Mark Murphy, Chief Executive Officer and Jeff Ritchey, Chief Financial Officer, plan to host the call. If you would like to join the call, dial (877) 356-8625 U.S. and (706) 634-9779 International, conference I.D. 38163047. You may identify the call as the Pro-Dex First Quarter Earnings Call. An online archive of the broadcast will be available within two hours of the completion of the call and will be accessible on the Company's website for 365 days. Additionally, a telephone replay will be available 2 hours after the call for 48 hours by dialing (800) 642-1687 U.S. or (706) 645-9291 for international callers, conference I.D. number 38163047.
Pro-Dex, Inc., with operations in Irvine, California, Beaverton, Oregon and Carson City, Nevada, provides power and control products used in medical, aerospace, military, research and industrial applications. Experience in multi-axis motion control, fractional horsepower motors and rotary drive systems allows us to develop products that require high precision in harsh environments. Pro-Dex's products are found in hospitals, dental offices, medical engineering labs, commercial and military aircraft, scientific research facilities and high tech manufacturing operations around the world. For more information, visit the Company's website at www.pro-dex.com
Statements herein concerning the Company's plans, growth and strategies may include 'forward-looking statements' within the context of the federal securities laws. Statements regarding the Company's future events, developments and future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. The Company's actual results may differ materially from those suggested as a result of various factors. Interested parties should refer to the disclosure concerning the operational and business concerns of the Company set forth in the Company's filings with the Securities and Exchange Commission.
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SOURCE Pro-Dex, Inc.
