RONKONKOMA, NY - (PRNewswire) – October 14, 2010 - API Technologies Corp. (OTCBB:ATNY), a provider of highly engineered products and services to the global defense sector, today announced first quarter financial results for the period ending August 31, 2010.
Financial Highlights for the First Quarter Ended August 31, 2010
“I am very pleased with our first quarter results. The Company’s emphasis on value-add engineered defense products continues to generate positive results throughout our operations,” commented Phillip DeZwirek, Chairman and CEO of API Technologies. “We look forward in the coming quarters to continuing to announce new orders from both new and existing customers that further demonstrates our focus on quality and service to the global defense sector.”
About API Technologies Corp.
The Company, through its subsidiaries, is a prime contractor in engineered systems, components and secure communications to the global defense and aerospace industry. API Technologies' customers include the governments of the U.S., Canada, the United Kingdom, NATO and the European Union, as well as many of the leading Fortune 500 companies. The Company is engaged in providing innovative design, engineering and manufacturing solutions to its customers. API Technologies trades on the OTC Bulletin Board under the symbol ATNY. For further information, please visit the company website at www.apitech.com.
(1) In this press release, API has provided a non-GAAP financial measure for (i) gross profit to reflect its financial results without restructuring charges, (ii) gross margin to reflect its financial results without restructuring charges, and (iii) adjusted EBITDA (Earnings before interest, taxes, depreciation and amortization), excluding discontinued operations, restructuring charges, acquisition charges and stock-based compensation expenses and certain non-recurring income items. Management believes the non-GAAP presentations provide investors an additional analytical tool for understanding the Company’s financial performance by excluding the impact of items which may obscure trends in the core operating performance of the business. These are not recognized measures under US GAAP, do not have a standardized meaning, and are unlikely to be comparable to similar measures used by other companies. Accordingly, investors are cautioned that these non-GAAP measures should not be construed as an alternative to net earnings or loss determined in accordance with GAAP as an indicator of the financial performance of the Company or as a measure of the Company's liquidity and cash flows. We expect our financial statements to continue to be affected by items similar to those excluded in the non-GAAP adjustments described above, and exclusion of these items from our non-GAAP financial measures should not be construed as an inference that all such costs are unusual or infrequent.
The following table reconciles three months GAAP gross profit and gross margin to non-GAAP gross profit and gross margin excluding restructuring charges. (in millions)
|Gross margin %||23.8%|
|Non-GAAP gross profit||$7.2|
|Non-GAAP gross margin %||24.8%|
The following table reconciles three months GAAP net income to non-GAAP adjusted EBITDA from continuing operations. (in millions)
|Q1 2011||Q1 2010|
|GAAP net income (loss)||$0.8||$(0.8)|
|Other non-recurring income ||$(0.8)||$(1.4)|
|Amortization of note discounts||$0.3||$0.0|
|Stock-based compensation expense||$0.3||$0.2|
|Non-GAAP adjusted EBITDA||$2.9||$(0.2)|
 The non-recurring item in 2011 is a gain on a sale of a building, and in 2010, a gain on the Cryptek acquisition.
Safe Harbor for Forward-Looking Statements
Except for statements of historical fact, the information presented herein constitutes forward-looking statements. All forward-looking statements are subject to certain risks, uncertainties and assumptions which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These risks and uncertainties, which are more fully described in the Company's Annual and Quarterly Reports filed with the Securities and Exchange Commission, include but are not limited to, general economic and business conditions, our ability to integrate and consolidate our operations, our ability to expand our operations in both new and existing markets, and the effect of growth on our infrastructure. Should one or more of these risks or uncertainties materialize, or should the assumptions prove incorrect, actual results may vary in material aspects from those currently anticipated. All information in this release is as of the date hereof. We undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations. Except as required by law, the Company assumes no obligation to update or revise any forward-looking statements in this press release, whether as a result of new information, future events, or otherwise.
Executive Vice President
API Technologies Corp.