LOS ANGELES, Aug. 3 /PRNewswire-FirstCall/ -- En Pointe Technologies, Inc. , a leading national provider of business-to-business information technology products, services and solutions, today announced consolidated results for its third fiscal quarter ended June 30, 2007. Total net sales in the third quarter of fiscal 2007 increased 5% to $100.0 million when compared to the $95.6 million reported for the third quarter of fiscal 2006. For the nine months ended June 30, 2007, total net sales increased $4.8 million, or 2%, to $250.1 million from $245.3 million reported during the comparable period in the prior fiscal year. En Pointe's gross profits increased by $0.4 million, or 3%, to $11.9 million in the third quarter of fiscal 2007 as compared to $11.5 million reported in the third quarter of fiscal 2006.
Operating income in the third quarter of fiscal 2007 decreased by $0.6 million to $0.3 million compared with $0.9 million income reported in the third quarter of fiscal 2006 due to increased selling and marketing expenses related to service infrastructure and customer offerings. As a result, net income for the third quarter of fiscal 2007 decreased by $0.6 million to $0.4 million, or $0.06 per basic and diluted share, as compared with a net income of $1.0 million, or $0.14 per basic and diluted share, reported in the third quarter of fiscal 2006. For the nine months ended June 30, 2007, En Pointe reported net income of $0.9 million, or $0.13 per basic and $0.12 per diluted share, as compared with a net loss of $1.0 million, or $0.15 per basic and diluted share, reported in the comparable period of fiscal 2006.
"With our sales and gross profits for the quarter one of the highest since December 2001, we invested a portion of our profits into several exciting improvements to our sales and marketing infrastructure and customer offerings." said Bob Din, CEO of En Pointe. Mr. Din added, "We have added key personnel to our Convergent Technologies Team that offer customers voice over IP (VoIP) and video conferencing solutions. These were high-end Cisco certified engineers that will provide En Pointe's customers with additional technical expertise. We also inaugurated a Cabling Division that installs voice and data cable for our customers' network infrastructure. These initiatives are just a part of our ongoing commitment to assure that we can tend to our customers' IT needs in a complete and comprehensive way. Lastly, let me add that, as was announced in our Form 8-K that was filed on July 31, 2007, we are extremely pleased that our lender, GE Commercial Distribution Finance Corporation has had the confidence to not only renew but to increase our financing facilities from $30 million to $45 million."
During the June 2007 quarter, overall gross profits increased 3%, as compared with the June 2006 quarter, primarily as a result of 21% increase in service gross profits during the period. The service gross profit increase came on higher service net sales that increased 12% over the June 2006 quarter. Product gross profits declined a marginal 5% from the comparable quarter in fiscal 2006 due to a higher concentration of low margin governmental product sales.
En Pointe wishes to announce that effective July 30, 2007, Computershare Trust Company, N.A. ("Computershare") replaces U.S. Stock Transfer and becomes our official transfer agent and registrar. Their toll free telephone number is (800) 962-4284. Their address and web site is 250 Royal Street, Canton, MA 02021, http://www.computershare.com/. Computershare offers many new shareholder benefits including QuickCert, on-demand, cost effective stock certificates and paperless stock registration capabilities via their Direct Registration System.
About En Pointe Technologies, Inc.
En Pointe Technologies, Inc. provides the information technology marketplace, including mid-market and enterprise accounts, government agencies, and educational institutions nationwide, with computer hardware, software, information security, and managed and professional services. En Pointe has the flexibility to customize information technology services to fulfill the unique needs of each of its customers.
En Pointe employs SAP, Clarify(TM), and AccessPointe(TM) (an e-procurement application), proven and dependable software applications, to support its broad customer base. Founded in 1993 and headquartered in Los Angeles, En Pointe maintains an ISO 9001:2000 compliant configuration center in San Bernardino County, California and is well represented in leading national markets throughout the United States. En Pointe has the experience and the technology to help organizations simplify the management of their information technology infrastructure.
En Pointe's Ovex Global division provides customers with solutions for affordable information technology services by combining low cost with high quality offshore services provided through its foreign subsidiary, Ovex Technologies (Private), Inc., with experienced onshore information technology management teams that provide the necessary supervision and guidance to smooth each customer's outsourcing transition.
Visit http://www.enpointe.com/ to learn more.
This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, from time to time, En Pointe Technologies, or its representatives, have made or may make forward-looking statements, orally or in writing. The words "estimate," "project," "potential," "intended," "expect," "anticipate," "believe" and similar expressions or words are intended to identify forward-looking statements. Such forward-looking statements may be included in, but are not limited to, various filings made by En Pointe with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the Company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions. Reference is hereby made to En Pointe's Annual Report on Form 10-K for the fiscal year ended September 30, 2006 for information regarding those factors and conditions. Among the important factors that could cause actual results to differ materially from management's projections, estimates and expectations include, but are not limited to: changing economic influences in the industry; dependence on key personnel; actions of manufacturers and suppliers; and availability of adequate financing. Readers are cautioned not to place undue reliance upon these forward-looking statements that speak only as of the date of this press release. En Pointe undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.
All trademarks and service marks are the property of their respective owners.
To contact En Pointe regarding any investor matters, please contact:
Javed Latif
Chief Financial Officer and
Sr. Vice President, Operations
En Pointe Technologies, Inc.
Phone: (310) 725-5212
Fax: (310) 725-9786
To contact En Pointe regarding any sales or customer matters, please e-mail us at:
En Pointe Technologies, Inc.
Condensed Consolidated Balance Sheets
Unaudited
(In Thousands)
(Unaudited)
June 30, September 30,
2007 2006
ASSETS:
Current assets:
Cash $ 15,219 $ 10,240
Restricted cash 75 74
Short term cash investment 1,323 --
Accounts receivable, net 62,055 46,417
Inventories, net 11,576 4,201
Prepaid expenses and other current
assets 1,123 1,067
Total current assets 91,371 61,999
Property and equipment, net of
accumulated depreciation and
amortization 5,169 2,765
Other assets 2,310 1,474
Total assets $ 98,850 $ 66,238
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable, trade $ 31,762 $ 19,105
Borrowings under line of credit 30,176 15,673
Accrued liabilities 5,487 5,796
Accrued taxes and other liabilities 8,687 4,928
Total current liabilities 76,112 45,502
Long term liabilities 596 238
Total liabilities 76,708 45,740
Minority interest 1,931 1,487
Total stockholders' equity 20,211 19,011
Total liabilities and stockholders'
equity $ 98,850 $ 66,238
En Pointe Technologies, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(in thousands, except per share data)
Three months ended Nine months ended
June 30, June 30,
2007 2006 2007 2006
Net sales:
Product $ 87,863 $ 84,835 $ 214,050 $ 211,525
Service 12,104 10,789 36,035 33,800
Total net sales 99,967 95,624 250,085 245,325
Cost of sales:
Product 80,378 76,985 195,474 194,726
Service 7,701 7,147 22,764 22,349
Total cost of sales 88,079 84,132 218,238 217,075
Gross profit:
Product 7,485 7,850 18,576 16,799
Service 4,403 3,642 13,271 11,451
Total gross profit 11,888 11,492 31,847 28,250
Selling and marketing
expenses 8,542 7,325 22,263 21,091
General and administrative
expenses 3,093 3,237 8,907 8,446
Operating income (loss) 253 930 677 (1,287)
Interest income, net 90 60 222 120
Other income, net 30 24 69 60
Income (loss) before income
taxes and minority interest 373 1,014 968 (1,107)
Provision for income taxes 3 26 29 26
Income (loss) before
minority interest 370 988 939 (1,133)
Minority interest 42 28 (42) 115
Net income (loss) $ 412 $ 1,016 $ 897 $ (1,018)
Net income (loss) per share:
Basic $ 0.06 $ 0.14 $ 0.13 $ (0.15)
Diluted $ 0.06 $ 0.14 $ 0.12 $ (0.15)
Weighted average shares
outstanding:
Basic 7,150 7,027 7,141 7,000
Diluted 7,455 7,092 7,432 7,000
