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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):
August 4, 2005
ULTRALIFE BATTERIES, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
0-20852 16-1387013
------- ----------
(Commission File Number) (I.R.S. Employer Identification No.)
2000 Technology Parkway, Newark, New York 14513
(Address of principal executive offices) (Zip Code)
(315) 332-7100
(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:
[_] 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 2.02. Regulation FD Disclosure.
Ultralife Batteries, Inc. (the "Company") reported results for the second
quarter ended July 2, 2005. Revenues for the quarter were $21.6 million compared
to $28.4 million for the same period last year. The Company's press release is
attached as Exhibit 99.1. The information set forth in this Report on Form 8-K,
including the attached exhibit, is being furnished and not filed pursuant to
Item 2.02.
Item 9.01. Financial Statements, Pro Forma Financials and Exhibits.
(a) Financial Statements of Business Acquired.
Not applicable.
(b) Pro Forma Financial Information.
Not applicable.
(c) Exhibits.
99.1 Press Release dated August 4, 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.
ULTRALIFE BATTERIES, INC.
Dated: August 4, 2005 By: /s/Robert W. Fishback
---------------------------
Robert W. Fishback
Vice President of Finance & CFO
INDEX TO EXHIBITS
(99) Additional Exhibits
99.1 Press Release dated August 4, 2005.
Exhibit 99.1
Ultralife Batteries Reports Second Quarter Results
NEWARK, N.Y.--(BUSINESS WIRE)--Aug. 4, 2005--Ultralife Batteries,
Inc. (NASDAQ: ULBI) reported results for the second quarter ended July
2, 2005. Revenues for the quarter were $21.6 million compared to $28.4
million for the same period last year. Operating income for the
quarter was $0.2 million, in line with management's guidance, compared
with operating income of $3.6 million for the same period last year.
The second quarter revenue reflects lower shipments of BA-5390
batteries to the U.S. military, as anticipated, due to delays in
contract awards. Partially offsetting this decline in military
shipments was an increase in revenue from the company's commercial
product lines, including 9-volt and rechargeable batteries and
systems.
Gross margins for the quarter were 19% compared to 25% in the same
quarter last year, mainly as a result of lower production volumes.
Operating expenses were $4.0 million, a $0.6 million increase over
last year, reflecting the company's commitment to new product
development, including charging systems and accessories. Income taxes
in the second quarter of 2005 amounted to $1.3 million, primarily
resulting from a change in the New York State tax law that required a
non-cash reduction to the company's deferred tax asset. The net loss
for the second quarter of 2005 was $1.4 million, or $0.10 per share,
compared with a net loss of $0.4 million, or $0.03 per share, a year
ago. Last year's loss included a $4.0 million charge related to a
write-down of the company's investment in Ultralife Taiwan Inc.
For the six-month period ended July 2, 2005, revenues totaled
$37.0 million compared with $55.4 million reported for the same period
last year, resulting mainly from lower shipments of BA-5390 batteries
to the U.S. military. The company reported an operating loss of $1.5
million for the first six months of 2005 compared to an operating
income of $7.0 million last year, reflecting the revenue decline as
well as higher operating expenses necessary to support the company's
growth objectives. Net loss for first half of 2005 was $3.0 million,
or $0.21 per share, compared to net income of $2.9 million, or $0.19
per diluted share, for 2004.
"With about two-thirds of second quarter revenue derived from our
commercial business, we are clearly gaining meaningful traction in a
number of target commercial markets this year as design wins move into
volume production," said John D. Kavazanjian, president and chief
executive officer. "Our rechargeable business set new quarterly
records for revenue and gross margin this quarter, an indication that
we are benefiting from higher gross margin products, such as chargers
and accessories. In our military business, we continued to expand our
presence with international military organizations. We remain on track
to complete qualification of the new and improved version of the
BA-5390 battery, with a state-of-charge indicator, during the third
quarter, which we believe will stimulate new order activity.
"With qualification of the new version of the BA-5390, we will
have a catalyst to resume revenue growth," continued Mr. Kavazanjian.
"Combined with the strong growth in our commercial markets and
additional product qualifications under the Next Gen II contract, we
have all the elements for continued sequential revenue and profit
growth throughout 2006."
As of July 2, 2005, the company has reclassified approximately
$6.0 million of debt from long-term to current. Management is working
with its lenders to modify the financial covenants of its credit
facility to accommodate the company's revised outlook. The company
intends to reclassify the debt as long-term pending completion of the
amendment to the credit facility and performing in line with its
current financial outlook.
Outlook
Management is adjusting its guidance for the second half of 2005
as a result of the continued uncertainty of the timing of BA-5390
order flow. Management still anticipates that its commercial business
will continue to grow in the second half of the year in key target
markets such as automotive telematics, search and rescue, and medical.
Based on the latest input from the U.S. military, management still
anticipates receiving orders for the BA-5390, but at modest revenue
levels. As previously stated, management anticipates that BA-5390
order flow will become more predictable following qualification under
the Next Gen II, Phase IV award, which is expected to occur in the
third quarter. In addition, management believes that the new version
of the BA-5390, with the state-of-charge indicator, will strengthen
the company's competitive advantage and support continued market share
gains, contributing to sequential revenue growth in the fourth
quarter.
As a result, management currently projects revenues of
approximately $21 million for the third quarter, including modest
BA-5390 battery shipments, generating positive operating income.
Management projects fourth quarter revenue to increase to
approximately $25 million, with operating margins improving in line
with revenue growth. Overall, revenues for the full year of 2005 are
now projected to be approximately $83 million, compared with previous
guidance indicating that revenues would be in a range between 2004's
level of $98.2 million and up to 10% growth.
About Ultralife Batteries, Inc.
Ultralife is a global provider of power solutions for diverse
applications. The company develops, manufactures and markets a wide
range of non-rechargeable and rechargeable batteries, charging systems
and accessories for use in military, industrial and consumer portable
electronic products. Through its range of standard products and
engineered solutions, Ultralife is able to provide the next generation
of power systems. Industrial, retail and government customers include
General Dynamics, Philips Medical Systems, General Motors, Energizer,
Kidde Safety, Lowe's, Radio Shack and the national defense agencies of
the United States, United Kingdom and Germany, among others.
Ultralife's headquarters, principal manufacturing and research
facilities are in Newark, New York, near Rochester. Ultralife (UK)
Ltd., a second manufacturing facility, is located in Abingdon,
England. Both facilities are ISO-9001 certified. Detailed information
about Ultralife is available at the Company's web site,
www.ultralifebatteries.com.
This press release may contain forward-looking statements based on
current expectations that involve a number of risks and uncertainties.
The potential risks and uncertainties that could cause actual results
to differ materially include: worsening global economic conditions,
increased competitive environment and pricing pressures, disruptions
related to restructuring actions and delays. Further information on
these factors and other factors that could affect Ultralife's
financial results is included in Ultralife's Securities and Exchange
Commission (SEC) filings, including the latest Annual Report on Form
10-K.
Conference Call Information
Investors are invited to listen to a live webcast of the
conference call at 10:00 a.m. ET on August 4 at
http://investor.ultralifebatteries.com. To listen to the live call,
please go to the web site at least fifteen minutes early to download
and install any necessary audio software. For those who cannot listen
to the live broadcast, a replay of the webcast will be available
shortly after the call at the same location for 90 days. Investors may
also listen to a telephone replay of the conference call by dialing
888-203-1112, Reservation #8744605, starting at 1:00 p.m. ET August 4
until 1:00 p.m. ET August 18.
Ultralife(R) is a registered trademark of Ultralife Batteries,
Inc.
ULTRALIFE BATTERIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Amounts)
(Unaudited)
- ----------------------------------------------------------------------
Three-Month Periods Six-Month Periods
Ended Ended
July 2, June 26, July 2, June 26,
2005 2004 2005 2004
---------- --------- --------- ----------
Revenues:
Non-rechargeable products $17,692 $26,321 $30,500 $51,643
Rechargeable products 3,262 1,691 5,390 3,065
Technology contracts 649 427 1,076 719
---------- --------- --------- ----------
Total revenues 21,603 28,439 36,966 55,427
Cost of products sold:
Non-rechargeable products 13,983 19,273 24,851 37,821
Rechargeable products 2,823 1,773 4,900 3,632
Technology contracts 592 345 987 594
---------- --------- --------- ----------
Total cost of products sold 17,398 21,391 30,738 42,047
---------- --------- --------- ----------
Gross margin 4,205 7,048 6,228 13,380
Operating expenses:
Research and development 1,059 560 1,905 1,063
Selling, general, and
administrative 2,942 2,858 5,843 5,329
---------- --------- --------- ----------
Total operating expenses 4,001 3,418 7,748 6,392
---------- --------- --------- ----------
Operating income/(loss) 204 3,630 (1,520) 6,988
Other income (expense):
Interest income 58 27 118 47
Interest expense (180) (110) (373) (235)
Write-off of UTI
investment and note
receivable - (3,951) - (3,951)
Miscellaneous (191) 32 (194) 93
---------- --------- --------- ----------
(Loss)/income before income
taxes (109) (372) (1,969) 2,942
---------- --------- --------- ----------
Income tax
provision/(benefit)-current 15 - (2) 79
Income tax provision-
deferred 1,315 - 1,022 -
---------- --------- --------- ----------
Total income taxes 1,330 - 1,020 79
---------- --------- --------- ----------
Net (loss)/income $(1,439) $(372) $(2,989) $2,863
========== ========= ========= ==========
(Loss)/earnings per share -
basic $(0.10) $(0.03) $(0.21) $0.21
========== ========= ========= ==========
(Loss)/earnings per share -
diluted $(0.10) $(0.03) $(0.21) $0.19
========== ========= ========= ==========
Weighted average shares
outstanding - basic 14,450 14,115 14,413 13,930
========== ========= ========= ==========
Weighted average shares
outstanding - diluted 14,450 14,115 14,413 15,109
========== ========= ========= ==========
ULTRALIFE BATTERIES, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Per Share Amounts)
(unaudited)
- ----------------------------------------------------------------------
July 2, December 31,
ASSETS 2005 2004
----------- -------------
Current assets:
Cash and investments $8,168 $11,529
Trade accounts receivable, net 10,066 8,585
Inventories 17,491 13,938
Prepaid expenses and other current assets 5,418 6,131
----------- -------------
Total current assets 41,143 40,183
Property and equipment 20,242 20,202
Other assets 19,668 20,749
----------- -------------
Total Assets $81,053 $81,134
=========== =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt and current portion of
long-term debt $8,489 $2,390
Accounts payable 6,533 3,545
Other current liabilities 3,945 3,603
----------- -------------
Total current liabilities 18,967 9,538
----------- -------------
Long-term liabilities:
Long-term debt and capital lease
obligations 48 7,215
Other long-term liabilities 458 756
----------- -------------
Total long-term liabilities 506 7,971
----------- -------------
Shareholders' equity:
Common stock, par value $0.10 per share 1,522 1,502
Capital in excess of par value 128,584 127,299
Accumulated other comprehensive income (966) (605)
Accumulated deficit (65,182) (62,193)
----------- -------------
63,958 66,003
Less --Treasury stock, at cost 2,378 2,378
----------- -------------
Total shareholders' equity 61,580 63,625
----------- -------------
Total Liabilities and Shareholders' Equity $81,053 $81,134
=========== =============
CONTACT: Ultralife Batteries, Inc.
Robert W. Fishback, 315-332-7100
bfishback@ulbi.com
or
Investor Relations:
Lippert/Heilshorn & Associates, Inc.
Jody Burfening, 212-838-3777
jburfening@lhai.com
or
Media:
Lippert/Heilshorn & Associates, Inc.
Chenoa Taitt, 212-201-6635
ctaitt@lhai.com