Headlines > News > SpaceDev Reports Second Quarter Fiscal 2006 Results

SpaceDev Reports Second Quarter Fiscal 2006 Results

Published by Sigurd De Keyser on Thu Aug 17, 2006 10:00 pm
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SpaceDev, Inc. (OTCBB: SPDV) has reported the financial results for its second quarter ended June 30, 2006. The Company reported its 14th consecutive quarter of revenue growth, and 11th consecutive quarter of positive EBITDA, both enhanced by its acquisition of Starsys Research Corporation on January 31, 2006. Starsys is a design, engineering, and manufacturing company for mechanical and electromechanical subsystems and components for spacecraft, headquartered in Boulder, Colorado.

SpaceDev’s revenue for the three and six months ended June 30, 2006 was approximately $8.6 and $15.8 million, respectively, up more than 350% and 325% from the approximate $1.9 and $3.7 million in revenues during the same two periods in 2005. Revenues increased primarily due to the Company’s first-quarter acquisition of Starsys Research Corporation, as well as the continuing work on its existing government contracts, in particular the Missile Defense Agency contract, which generated more than $2.4 million and $4.9 million for the three and six months ended June 30, 2006.

“SpaceDev experienced another highly productive quarter,” said Mark N. Sirangelo, SpaceDev Vice Chairman and Chief Executive Officer. “We have continued to prove our ability to successfully execute on important government contracts and are positioning ourselves as a viable competitor in the mid-sized aerospace marketplace.”

Net income for the three and six months ended June 30, 2006 was approximately $36,000, or $0.00 per share, and approximately $43,000, or $0.00 per share, respectively, compared to approximately $111,000, or $0.01 per share, and approximately $212,000, or $0.01 per share, for the comparable periods in 2005. Although net income per share remained relatively stable, there was a decrease in net income primarily attributable to stock option expense, which is now required under SFAS 123(R), as well as additional expenditures related to the preparation of several significant contract proposals. One such proposal effort was completed during the first quarter of 2006 and resulted in the award of an Air Force Research Laboratory Space Vehicles Directorate contract to SpaceDev for the preliminary design of a sophisticated nanosatellite. Another significant contract proposal effort was completed in July 2006 in connection with the NASA Commercial Orbital Transportation Services program. SpaceDev has been notified that it is one of six finalists for the program. A final contract award decision is expected in mid-August 2006.

Income from operations in the second quarter of 2006 was approximately $10,000 with a loss of approximately $36,000 for the six months ended June 30, 2006, compared to income from operations of approximately $75,000 and $140,000 for the same three and six month periods in 2005. The reduction in operating income can be mostly attributed to stock option expenses under the newly applicable SFAS No. 123(R) of approximately $25,000, and $116,000, respectively, for the three and six month periods as well as an increase in marketing and sales expense in connection with the proposals mentioned above. During the second quarter of 2006, the Company’s EBITDA increased to approximately $260,000, or 3.0% of net sales and approximately $452,000, or 2.9% of net sales, for the six months ended June 30, 2006 compared to an EBITDA of $110,000, or 5.8% of net sales, and approximately $204,000, or 5.5% of net sales, respectively, for the same three and six month periods the year before. (See below for more information about EBITDA, a non-GAAP financial measure defined as earnings before net interest income (expense), taxes, depreciation and amortization.)

Net decrease in cash during the first six months of 2006 was approximately $4.5 million, compared to a cash increase of approximately $374,000 during the same period in 2005. This was primarily due to the Starsys acquisition.

“Our focus for the second quarter of 2006 was continued productivity and expansion in each of SpaceDev’s core competencies,” said Richard B. Slansky, SpaceDev President and Chief Financial Officer. “The integration of our merger with Starsys is going well. We have been awarded important contracts during the second quarter and we are working toward further synergies and cost savings between our companies. We believe the Company is now positioned for continued growth, execution and expansion.”

Second Quarter Conference Call Details

SpaceDev will host a conference call Tuesday, August 15, 2006, at 11:00 a.m. EDT to discuss the quarter results. All those interested in hearing management’s discussion are invited to join the call by dialing (877) 407-9205. International participants may access the call by dialing (201) 689-8054. Participants may also access a live Web cast of the conference call through the Investor Relations section of SpaceDev’s Web site at www.spacedev.com. A replay of the Web cast will be available for seven days.

For more information on SpaceDev, please review the Company’s filings on the SEC EDGAR system at www.sec.gov or at www.spacedev.com.

To download this entire Press Release in PDF format and including all financial tables, please click here.

* This release contains disclosure of EBITDA, which is a non-GAAP financial measure within the meaning of Regulation G promulgated by the Securities and Exchange Commission. The definition of EBITDA used to calculate the EBITDA figures presented herein, while considered the most common definition used by investors and financial analysts, may not be comparable to similarly titled measures reported by other companies. The Company believes that EBITDA provides an important additional perspective on its operating results, its ability to service its long-term obligations, its ability to fund continuing growth, and its ability to continue as a going concern. The Company’s management regularly evaluates its progress based on EBITDA. The Company believes that EBITDA, while providing useful information, should not be considered in isolation or as an alternative to other financial measures determined under GAAP, such as net income or loss (as an indicator of operating performance) or cash flow (as a measure of liquidity).

About SpaceDev

SpaceDev (OTCBB: SPDV) creates and sells affordable and innovative space products and solutions to government and commercial enterprises. SpaceDev’s innovations include the design, manufacture, marketing and operation of sophisticated micro- and nano-satellites, hybrid rocket-based orbital Maneuvering and orbital Transfer Vehicles as well as sub-orbital and orbital hybrid rocket-based propulsion systems for safe human space flight. In addition, Starsys, Inc., a wholly-owned subsidiary of SpaceDev, is engaged in the design and manufacture of mechanical and electromechanical subsystems and components for spacecraft. Starsys’ subsystems enable critical spacecraft functions such as pointing solar arrays and communication antennas and restraining, deploying and actuating of moving spacecraft components. For more information, visit www.spacedev.com.

Forward-Looking Statements

Except for the factual statements made herein, the information contained in this news release consists of forward-looking statements that involve risks, uncertainties and assumptions about things that are difficult to predict. Words and expressions reflecting optimism and satisfaction with current prospects, as well as words such as “believe,” “intends,” “expects,” “plans,” “anticipates” and variations thereof, identify forward-looking statements, although their absence does not mean that a statement is not forward looking. Forward-looking statements are based on the Company’s current expectations. Such forward-looking statements are not guarantees of performance, and the Company’s actual results could differ materially from the Company’s current expectations based on many factors. Factors directly related to the subject of this release that could cause or contribute to such differences include risks and uncertainties associated with (i) the Company’s ability to effectively perform under its government contracts, (ii) any rescheduling or cancellation of the Missile Defense Agency contract or any other customer order, including the size and timing of Task Orders delivered, (iii) the uncertainties in the government budgeting process, (iv) the integration and management of Starsys, (v) the Company’s ability to control costs and expenses, and (vi) the need for additional financing to support the business. Reference is also made to other factors set forth in the Company’s periodic reports filed with the Securities and Exchange Commission, including “Management’s Discussion and Analysis” and other sections of the Company’s most current Annual Report on Form 10-KSB and subsequent Quarterly Reports on Form 10-QSB. These forward-looking statements speak only as of the date of this release, and, except as may be required by law, the Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release.

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