(Source: PrimeNewswire)
INDIANAPOLIS, Aug. 28, 2009 (GLOBE NEWSWIRE) -- Hurco Companies, Inc., (Nasdaq:HURC) today reported a net loss of $1,231,000, or ($0.19) per diluted share, for its third quarter ended July 31, 2009, compared to net income of $5,826,000, or $0.90 per diluted share, for the corresponding quarter in fiscal 2008. For the first nine months of fiscal 2009, Hurco reported a net loss of $1,158,000, or ($0.18) per diluted share, compared to net income of $19,098,000, or $2.96 per diluted share, reported for the corresponding period in fiscal 2008.
Sales and service fees for the third quarter of fiscal 2009 totaled $19,039,000, a decrease of $38,279,000 from the third quarter of fiscal 2008. Sales and service fees reflected an operational decrease of 64% and a negative impact of foreign currency translation of 3%. Sales and service fees for the nine months ended July 31, 2009, declined to $67,835,000, reflecting an operational decrease of 58% and a negative currency translation impact of 4% from the corresponding period in fiscal 2008.
The following table sets forth net sales and service fees by geographic region for the third quarter and first nine months of fiscal 2009 and 2008, respectively:
Net Sales and Service Fees by Geographic Region Three Months Ended Nine Months Ended July 31, July 31, % % 2009 2008 Change 2009 2008 Change -------------------------- -------------------------- North America $ 5,809 $ 10,643 -45% $ 21,618 $ 35,427 -39% Europe 11,777 43,071 -73% 42,879 130,776 -67% Asia Pacific 1,470 3,604 -59% 3,355 10,323 -67% -------------------------- -------------------------- Total $ 19,056 $ 57,318 -67% $ 67,852 $176,526 -62% -------------------------- --------------------------
Similar to the first and second quarters of fiscal 2009, sales in the third quarter were significantly impacted by the worldwide recession. The decrease in sales was primarily driven by lower volume, particularly for higher priced VMX machines, and continued pricing pressures globally. Unit shipments for the third quarter of fiscal 2009 decreased in the North America, Europe and Asia Pacific sales regions by 51%, 68% and 57%, respectively, compared to the third quarter of fiscal 2008.
New order bookings in the third quarter of fiscal 2009 were $17,914,000, a decrease of $34,544,000, or 66%, compared to the prior year period. Orders in the North America, Europe and Asia Pacific regions decreased $5,423,000, or 50%, $27,274,000, or 71%, and $1,847,000, or 61%, respectively. For the first nine months of fiscal 2009, new orders totaled $60,565,000, a decrease of $111,949,000, or 65%, from the corresponding period in 2008. Of that decrease, North America, Europe and Asia Pacific orders decreased $15,310,000, or 45%, $89,555,000, or 70%, and $7,084,000, or 72%, respectively. The impact of currency translation on new orders booked in the third quarter and first nine months of 2009 was consistent with the impact on sales.
Hurco's gross margin for the third quarter of fiscal 2009 was 28%, compared to 36% for the 2008 period. The decrease in margin as a percentage of sales was primarily due to lower sales of higher priced VMX machines and competitive pricing pressures on a global basis. Selling, general and administrative expenses were $7,200,000, a decrease of $4,629,000, or 39%, 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.
Cash decreased during the third quarter of fiscal 2009 by $1,154,000 to a balance of $26,696,000. Inventory increased by $404,000, or 1%. Monthly unit production levels for the third and fourth quarters of fiscal 2009 have been reduced by more than 80% from fiscal 2008 production levels in an effort to decrease inventory.
Michael Doar, Chief Executive Officer, said, "We implemented cost reduction initiatives earlier this year, which minimized our operating loss even though sales decreased 62% during the first three quarters of fiscal 2009. I credit both our organizational agility and the fiscally conservative culture of our company for allowing us to maintain product development schedules, which will allow us to participate in the eventual recovery with an expanded and more advanced product line. We are fortunate that we have been able to avoid the credit crisis so many companies are facing at this time due to our strong cash position and zero debt."
Hurco Companies, Inc.
