UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
report (Date of earliest event reported) August 28, 2009
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Hurco
Companies, Inc.
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(Exact
Name of Registrant as Specified in Its Charter
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Indiana
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(State
or Other Jurisdiction of Incorporation
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0-9143
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35-1150732
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(Commission
File Number)
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(I.R.S.
Employer Identification Number)
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One
Technology Way
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Indianapolis,
Indiana
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46268
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(Address
of principal executive offices)
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(Zip
code)
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(317)
293-5309
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(Registrant’s
Telephone Number, Including Area Code
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Not
Applicable
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(Former
Name or Former Address, if Changed Since Last
Report)
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Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.
below):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
2.02.
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Results
of Operation and Financial
Condition
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On August 28, 2009, Hurco Companies,
Inc. (the "Registrant") reported its results of operations for the third quarter
ended July 31, 2009. The Registrant's earnings release for the period
is attached as Exhibit 99 and the information set forth therein is incorporated
herein by reference and constitutes a part of this report. The
attached Exhibit is furnished pursuant to Item 2.02 of Form
8-K.
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Item
9.01
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Financial
Statements and Exhibits.
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99
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Press
Release dated August 28, 2009
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SIGNATURE
Pursuant to the requirements of the
Securities Exchange Act of 1934, the Registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
| Dated: August 28, 2009 | ||
| HURCO COMPANIES, INC | ||
| By: |
/s/John G. Oblazney
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John
G. Oblazney,
Vice
President and
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Chief
Financial
Officer
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EXHIBIT
INDEX
Exhibit
99 Press
Release of Hurco Companies, Inc. dated August 28, 2009
FOR
IMMEDIATE RELEASE
FRIDAY,
AUGUST 28, 2009
HURCO
REPORTS THIRD QUARTER RESULTS
INDIANAPOLIS, INDIANA, — August 28,
2009, Hurco Companies, Inc., (Nasdaq, Global Select Market: 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 $67,835,000, reflecting an
operational decrease of 58% and a negative currency translation impact of 4%
from the corresponding period in fiscal 2008.
The
following table sets forth net sales and service fees by geographic region for
the third quarter and first nine months of fiscal 2009 and 2008,
respectively:
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Net
Sales and Service Fees by Geographic Region
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Three
Months Ended
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Nine
Months Ended
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July
31,
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July
31,
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%
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%
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2009
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2008
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Change
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2009
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2008
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Change
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North
America
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$ | 5,809 | $ | 10,643 | -45 | % | $ | 21,618 | $ | 35,427 | -39 | % | ||||||||||||
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Europe
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11,777 | 43,071 | -73 | % | 42,879 | 130,776 | -67 | % | ||||||||||||||||
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Asia
Pacific
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1,453 | 3,604 | -60 | % | 3,338 | 10,323 | -68 | % | ||||||||||||||||
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Total
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$ | 19,039 | $ | 57,318 | -67 | % | $ | 67,835 | $ | 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. is an industrial technology company that designs and produces
interactive computer controls, software and computerized machine tools for the
worldwide metal cutting and metal forming industry. The end market for the
Company's products consists primarily of independent job shops and short-run
manufacturing operations within large corporations in industries such as
aerospace, defense, medical equipment, energy, transportation and computer
equipment. The Company is based in Indianapolis, Indiana, with manufacturing
operations in Taiwan and China, and sells its products through direct and
indirect sales forces throughout North America, Europe, and Asia. The company
has sales, application engineering support and service subsidiaries in Canada,
China, England, France, Germany, India, Italy, Poland, Singapore, South Africa,
Spain, and the United States of America. Web Site: www.hurco.com
This
news release contains forward looking statements which involve known and unknown
risks, uncertainties and other factors that may cause our actual results,
performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. These factors include, among others, the impact of the
current global economic recession, including disruption in credit markets, other
changes in general economic and business conditions that affect demand for
computerized machine systems, computer numerical control systems and software
products, changes in manufacturing markets, innovations by competitors, our
ability to protect our intellectual property, fluctuations in exchange rates,
fluctuations in prices of raw materials, changes in market demands, quality and
delivery performance by our contract manufacturers and governmental actions and
initiatives including import and export restrictions and tariffs.
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Contact:
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John
Oblazney
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Vice
President & Chief Financial Officer
317-293-5309
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HURCO
COMPANIES, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In
thousands, except per-share data)
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Three
Months Ended
July
31,
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Nine
Months Ended
July
31,
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2009
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2008
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2009
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2008
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(unaudited)
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(unaudited)
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Sales
and service fees
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$ | 19,039 | $ | 57,318 | $ | 67,835 | $ | 176,526 | ||||||||
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Cost
of sales and service
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13,788 | 36,439 | 48,822 | 110,459 | ||||||||||||
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Gross
profit
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5,251 | 20,879 | 19,013 | 66,067 | ||||||||||||
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Selling,
general and administrative expenses
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7,200 | 11,829 | 22,747 | 35,881 | ||||||||||||
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Operating
income (loss)
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(1,949 | ) | 9,050 | (3,734 | ) | 30,186 | ||||||||||
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Interest
expense
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6 | 25 | 33 | 46 | ||||||||||||
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Interest
income
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36 | 154 | 185 | 436 | ||||||||||||
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Investment
income
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3 | 72 | 32 | 363 | ||||||||||||
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Other
expense (income), net
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(133 | ) | 471 | (1,828 | ) | 1,311 | ||||||||||
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Income
(loss) before taxes
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(1,783 | ) | 8,780 | (1,722 | ) | 29,628 | ||||||||||
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Provision
(benefit) for income taxes
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(552 | ) | 2,954 | (564 | ) | 10,530 | ||||||||||
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Net
income (loss)
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$ | (1,231 | ) | $ | 5,826 | $ | (1,158 | ) | $ | 19,098 | ||||||
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Earnings
(loss) per common share
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Basic
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$ | (0.19 | ) | $ | 0.91 | $ | (0.18 | ) | $ | 2.98 | ||||||
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Diluted
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$ | (0.19 | ) | $ | 0.90 | $ | (0.18 | ) | $ | 2.96 | ||||||
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Weighted
average common shares outstanding
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Basic
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6,434 | 6,414 | 6,425 | 6,414 | ||||||||||||
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Diluted
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6,434 | 6,439 | 6,431 | 6,445 | ||||||||||||
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OTHER
CONSOLIDATED FINANCIAL DATA
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Three
Months Ended
July
31,
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Nine
Months Ended
July
31,
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Operating
Data:
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2009
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2008
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2009
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2008
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(unaudited)
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(unaudited)
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Gross
margin
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27.6 | % | 36.4 | % | 28.0 | % | 37.4 | % | ||||||||
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SG&A
expense as a percentage of sales
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37.8 | % | 20.6 | % | 33.5 | % | 20.3 | % | ||||||||
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Operating
income (loss) as a percentage of sales
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-10.2 | % | 15.8 | % | -5.5 | % | 17.1 | % | ||||||||
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Pre-tax
income (loss) as a percentage of sales
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-9.4 | % | 15.3 | % | -2.5 | % | 16.8 | % | ||||||||
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Effective
Tax Rate
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31.0 | % | 33.6 | % | 32.8 | % | 35.5 | % | ||||||||
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Depreciation
(in thousands)
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846 | 777 | 2,451 | 2,190 | ||||||||||||
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Capital
expenditures (in thousands)
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641 | 1,542 | 2,960 | 3,456 | ||||||||||||
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Balance
Sheet Data:
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7/31/2009
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7/31/2008
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(unaudited)
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Working
capital (excluding cash, in thousands)
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$ | 70,487 | $ | 59,746 | ||||
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Days
sales outstanding
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50 | 44 | ||||||
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Inventory
turns
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1.2 | 2.0 | ||||||
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Capitalization
(in thousands)
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Total
debt
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$ | - | $ | - | ||||
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Shareholders'
equity
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121,291 | 118,942 | ||||||
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Total
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$ | 121,291 | $ | 118,942 | ||||
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HURCO
COMPANIES, INC.
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CONDENSED
CONSOLIDATED BALANCE SHEETS
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(In
thousands, except share and per-share
data)
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July
31,
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October
31,
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2009
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2008
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(unaudited)
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(audited)
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ASSETS
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Current
assets:
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Cash
and cash equivalents
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$ | 26,696 | $ | 26,394 | ||||
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Short-term
investments
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- | 6,674 | ||||||
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Accounts
receivable, net
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13,078 | 31,952 | ||||||
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Inventories,
net
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65,284 | 66,368 | ||||||
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Deferred
tax assets, net
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8,947 | 5,444 | ||||||
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Derivative
assets
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161 | 12,463 | ||||||
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Other
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3,606 | 2,017 | ||||||
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Total
current assets
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117,772 | 151,312 | ||||||
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Property
and equipment:
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Land
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782 | 782 | ||||||
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Building
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7,127 | 7,127 | ||||||
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Machinery
and equipment
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15,845 | 14,885 | ||||||
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Leasehold
improvements
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1,754 | 1,765 | ||||||
| 25,508 | 24,559 | |||||||
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Less
accumulated depreciation and amortization
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(12,043 | ) | (10,961 | ) | ||||
| 13,465 | 13,598 | |||||||
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Non-current
assets:
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Software
development costs, less accumulated amortization
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6,265 | 5,711 | ||||||
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Other
assets
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7,365 | 6,823 | ||||||
| $ | 144,867 | $ | 177,444 | |||||
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LIABILITIES
AND SHAREHOLDERS' EQUITY
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Current
liabilities:
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Accounts
payable
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$ | 7,340 | $ | 28,303 | ||||
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Derivative
liabilities
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3,522 | 2,692 | ||||||
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Accrued
expenses
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9,727 | 20,134 | ||||||
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Total
current liabilities
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20,589 | 51,129 | ||||||
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Non-current
liabilities:
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Deferred
tax liabilities, net
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2,071 | 2,056 | ||||||
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Deferred
credits and other obligations
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916 | 782 | ||||||
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Total
liabilities
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23,576 | 53,967 | ||||||
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Shareholders'
equity:
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Preferred
stock: no par value per share; 1,000,000 shares
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authorized;
no shares issued
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Common
stock: no par value; $.10 stated value per
share;
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13,250,000
shares authorized; and 6,440,851 and 6,420,851
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shares
issued and outstanding, respectively
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644 | 642 | ||||||
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Additional
paid-in capital
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51,917 | 51,690 | ||||||
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Retained
earnings
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70,731 | 71,889 | ||||||
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Accumulated
other comprehensive income
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(2,001 | ) | (744 | ) | ||||
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Total
shareholders' equity
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121,291 | 123,477 | ||||||
| $ | 144,867 | $ | 177,444 | |||||