(Source: PrimeNewswire)
INDIANAPOLIS, May 29, 2009 (GLOBE NEWSWIRE) -- May 29, 2009, Hurco Companies, Inc., (Nasdaq:HURC) today reported a net loss of $281,000, or $0.04 per share, for its second quarter ended April 30, 2009, compared to net income of $5,467,000, or $0.85 per share, for the corresponding period in fiscal 2008. The results for the second quarter of 2009 included $2,202,000, or $0.34 per diluted share, of net realized gains on hedge contracts closed before maturity due to forecasted reductions in production and sales for the next six months. For the first six months of fiscal 2009, Hurco reported net income of $73,000, or $0.01 per share, compared to $13,272,000, or $2.06 per share, reported for the corresponding period in fiscal 2008.
Sales and service fees for the second quarter of fiscal 2009 totaled $20,489,000, a decrease of $37,796,000, or 65%, from the second quarter of fiscal 2008. Approximately $3,150,000 of the year-over-year decrease, or 5% of second quarter 2008 sales, reflects the effect of a stronger U.S. Dollar in 2009 when translating foreign sales to U.S. Dollars for financial reporting purposes. Sales and service fees for the six months ended April 30, 2009, totaled $48,796,000, a decrease of $70,412,000, or 59%, from the corresponding period in 2008. The impact of currency translation on the year-over-year sales reduction for the first six months of fiscal 2009 was approximately $6,046,000, or 5% of year to date sales for the corresponding period in fiscal 2008.
The following table sets forth net sales and service fees by geographic region for the second quarter and first half of fiscal 2009 and 2008, respectively:
Net Sales and Service Fees by Geographic Region Three Months Ended Six Months Ended April 30, April 30, % % 2009 2008 Change 2009 2008 Change -------------------------- -------------------------- North America $ 6,171 $ 11,706 -47% $ 15,808 $ 24,785 -36% Europe 13,042 42,653 -69% 31,102 87,705 -65% Asia Pacific 1,276 3,926 -67% 1,886 6,718 -72% -------------------------- -------------------------- Total $ 20,489 $ 58,285 -65% $ 48,796 $119,208 -59% -------------------------- --------------------------
Similar to the first quarter of fiscal 2009, sales were down sharply across all regions due to the worldwide recession. In addition to declining volume and the unfavorable impact of currency translation, approximately 29% of the sales decline was attributable to a decrease in sales of higher priced VMX machines in the Europe sales region, and competitive pricing pressures globally.
New order bookings in the second quarter of fiscal 2009 were $18,135,000, a decrease of $40,775,000, or 69%, compared to the prior year period. Orders in the North America, Europe and Asia Pacific regions decreased $6,233,000, or 56%, $31,527,000, or 72%, and $3,015,000, or 75%, respectively, continuing a decrease that began in the first quarter as Hurco customers, consisting primarily of small job shops, reacted to the economic downturn in their markets. For the first half of fiscal 2009, new orders totaled $42,651,000, a decrease of $77,406,000, or 65%, from the corresponding period in 2008. Of that decrease, North America, Europe and Asia Pacific orders decreased $9,888,000, or 42%, $62,281,000, or 69%, and $5,237,000, or 77%, respectively. The impact of currency translation on new orders booked in the second quarter and first half of 2009 was consistent with the impact on sales.
Hurco's gross margin for the second quarter of fiscal 2009 was 26%, compared to 35% for the 2008 period. The decrease in margin as a percentage of sales was due to the lower sales volume, the decline in sales of higher priced VMX machines in the European sales region, and competitive pricing pressures on a global basis. Selling, general and administrative expenses were $7,518,000, a decrease of $4,158,000, or 36%, from the corresponding period in 2008, reflecting lower sales commissions, the benefit of cost reduction initiatives and the favorable effect of a stronger U.S. Dollar in 2009 when translating foreign operating expenses for financial reporting purposes.
The increase in other income of $2,144,000 for the second quarter of fiscal 2009 compared to the same period in fiscal 2008 was primarily due to $2,202,000 of net realized gains on hedge contracts closed before maturity due to forecasted reductions in production and sales for the next six months.
Cash decreased by $2,276,000 from January 31, 2009 to $27,850,000 at April 30, 2009, primarily due to a $1,586,000 increase in inventories. Production levels are being adjusted downward to bring inventory levels more in line with current demand.
