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Fiscal_2004_Earnings




SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): December 8, 2004



HURCO COMPANIES, INC.
(Exact name of registrant as specified in its charter)



     
INDIANA
0-9143
35-1150732
(State or other jurisdiction of
(Commission File No.)
(I.R.S. Employer
incorporation or organization)
  
Identification No.)
     
     

ONE TECHNOLOGY WAY
INDIANAPOLIS, INDIANA    46268
(Address of principal executive offices and zip code)

(317) 293-5309
(Registrants' telephone number, including area code)

NOT APPLICABLE
(Former name or former address, if changed since last report)

  
     
 

ITEM 2.02.    RESULTS OF OPERATION AND FINANCIAL CONDITION

On December 8, 2004, Hurco Companies, Inc. (the "Registrant") reported its results of operations for the fiscal year ended October 31, 2004. 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.




  
     
 


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: December 8, 2004

HURCO COMPANIES, INC.

By:  /s/ Stephen J. Alesia        
  Stephen J. Alesia
  Vice President and
  Chief Financial Officer

 




  
     
 

  EXHIBIT INDEX

Exhibit 99    Press Release of Hurco Companies, Inc. dated December 8, 2004

 
Fiscal_2004_Earnings
EXHIBIT 99
FOR IMMEDIATE RELEASE
WEDNESDAY, DECEMBER 8, 2004

HURCO REPORTS FYE 2004 AND FOURTH QUARTER RESULTS
INDIANAPOLIS, INDIANA, — December 8, 2004—Hurco Companies, Inc. (Nasdaq:HURC) today announced net income of $6,269,000, or $1.04 per share, for its fiscal year ended October 31, 2004 compared to $462,000, or $.08 per share, reported for fiscal 2003. For the final quarter of fiscal 2004, the company reported net income of $2,281,000, or $.36 per share, compared to $574,000, or $.10 per share, for the corresponding 2003 period.

The company attributed the dramatic improvement in its operating results to a substantial increase in its computerized machine tools sales, due primarily to strong demand for new models introduced by the company over the past two years and improving market conditions, particularly in the United States and Southeast Asia. The improved results also reflected the favorable impact of stronger European currencies relative to the U.S. Dollar when translating foreign sales for financial reporting purposes.

Sales and service fees for fiscal 2004 were $99,572,000, an increase of $24,040,000, or 32%, over fiscal 2003. Approximately 68% of Hurco’s sales during fiscal 2004 were made outside the United States and were denominated in foreign currencies, primarily the Euro and Pound Sterling. Due to the strength of those currencies relative to the U.S. Dollar, approximately $6,423,000 of the increase was attributable to the effects of currency translation. Computerized machine tool sales, which were the highest in the company’s 26-year history, totalled $83,663,000, an increase of 36.3% from the $61,386,000, recorded in 2003. Sales and service fees for fourth quarter of fiscal 2004 were $28,851,000, an increase of $5,079,000, or 21%, over the corresponding period of 2003. Approximately $1,504,000 of the increas e was attributable to the effects of currency translation.

New order bookings in fiscal 2004 also were a record amount for the company and totaled $103,500,000, representing an increase of $25,648,000, or 33%, over the prior year. Approximately $6,295,000 of the increase was attributable to the effects of currency translation. Orders increased 49% in the United States, 23% in Europe and 63% in Asia. New order bookings for the fourth quarter of fiscal 2004 totaled $30,161,000, an increase of $5,653,000, or 23%, over the corresponding 2003 period. Backlog was $12,750,000 at October 31, 2004, compared to $11,104,000 at July 31, 2004, and $8,153,000 at October 31, 2003.

Hurco’s gross margin for fiscal 2004 was 30.4% compared to 27.6% for the prior year, reflecting the benefits of higher unit sales and a weakening U.S. Dollar. Selling, general and administrative expenses were $21,401,000 for fiscal 2004, an increase of $2,652,000 over the amount recorded for 2003.

Operating income for fiscal 2004 totaled $8,432,000, or 8.5% of sales, compared to $2,197,000, or 2.9% of sales, in the prior year. Operating income in the fourth quarter, which included a $465,000 one-time severance charge, totaled $2,470,000, or 8.6% of sales, compared to $1,324,000, or 5.6% of sales, in the same period one year ago.

Total debt was $4,600,000 at October 31, 2004, (compared to $9,222,000, one year earlier), and represented 11% of the company’s total capitalization, which aggregated $43,055,000. As of October 31, 2004, the company had unutilized credit facilities of $13,334,000 available for direct borrowing or commercial letters of credit.

Michael Doar, Chief Executive Officer, stated, "I am pleased by the financial results achieved in fiscal 2004. Order intake throughout our worldwide markets improved considerably during the year and our new products continue to gain acceptance in the market. We are beginning to see increases in our machine costs due to a worldwide increase in prices for raw materials, primarily steel, but, to date, those increases have been more than offset by foreign currency exchange benefits. We are anticipating stronger sales and profitability in 2005, driven by growth from our existing operations and new products that have recently been introduced.

“I was very happy with the customer response received regarding our existing and new machine tool models at the International Manufacturing Technology Show in September. These new offerings included a series of turning centers (lathes), a first for Hurco, that broaden our product line and the markets we can serve.

“Finally, I would like to recognize our employees for their dedication and hard work. We encountered difficult market conditions from fiscal 2000 through fiscal 2002. We could not have achieved the profits reported in fiscal 2004 without such a dedicated effort from our employees to overcome the obstacles the Company faced during that period.”

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 the aerospace, defense, medical equipment, energy, transportation and computer equipment. The Company is based in Indianapolis, Indiana, and has sales, application engineering and service subsidiaries in High Wycombe, England; Munich, Germany; Paris, France; Milan, Italy; Shanghai, China and Singapore, along with manufacturing operations in Taiwan. Products are sold through independent agents and distributors in the United States, Europe and Asia. The Company also has direct sales forces in the United Kingdom, Germany, France, Italy, and Asia.
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, 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, quality and delivery performance by our contract manufacturers and governmental actions and initiatives including import and export restrictions and tariffs.


Contact: Stephen J. Alesia
Vice President & Chief Financial Officer
317-293-5309

 
     
 


                   
Hurco Companies, Inc.
  
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
  
(In thousands, except per-share data)
  
                   
   
Three Months Ended October 31,
  
Twelve Months Ended October 31,
 
                   
   
2004
  
2003
  
2004
  
2003
  
   
(audited)
  
(audited)
  
Sales and service fees
  
$
28,851
  
$
23,772
  
$
99,572
  
$
75,532
  
                           
Cost of sales and service
    
19,810
   
17,146
   
69,274
   
54,710
 
Gross profit
    
9,041
   
6,626
   
30,298
   
20,822
 
                           
Selling, general and administrative expenses
    
6,106
   
5,426
   
21,401
   
18,749
 
Severance and other expense (credit)
    
465
   
(124
)
  
465
   
(124
)
Operating income
   
2,470
   
1,324
   
8,432
   
2,197
 
                           
Interest expense
    
94
   
182
   
468
   
658
 
                           
Variable Option Expense
    
-
   
-
   
322
   
-
 
                           
Other income (expense), net
    
45
   
(124
)
  
(74
)
  
(119
)
                           
Income before taxes
    
2,421
   
1,018
   
7,568
   
1,420
 
                           
Provision for income taxes
    
140
   
444
   
1,299
   
958
 
                           
Net income
 
$
2,281
  
$
574
  
$
6,269
  
$
462
  
                           
Earnings per common share
                          
                           
Basic
  
$
0.38
  
$
0.10
  
$
1.08
  
$
0.08
  
Diluted
  
$
0.36
  
$
0.10
  
$
1.04
  
$
0.08
  
                           
Weighted average common shares outstanding
                          
Basic
    
5,969
   
5,578
   
5,784
   
5,582
 
Diluted
    
6,263
   
5,612
   
6,026
   
5,582
 
                           
OTHER CONSOLIDATED FINANCIAL DATA
    
Three Months Ended October 31,
    
Twelve Months Ended October 31,
 
                           
Operating Data:
    
2004
    
2003
    
2004
    
2003
  
 
    
(audited) 
    
(audited)
  
Gross margin
    
31.3
%
  
27.9
%
  
30.4
%
  
27.6
%
                           
SG&A expense as a percentage of sales
    
21.2
%
  
22.8
%
  
21.5
%
  
24.8
%
                           
Operating income as a percentage of sales
    
8.6
%
  
5.6
%
  
8.5
%
  
2.9
%
                           
Income before taxes as a percentage of sales
   
8.4
%
  
4.3
%
  
7.6
%
  
1.9
%
                           
Depreciation
    
291
   
356
   
1,223
   
1,429
 
                           
Capital expenditures
    
371
   
380
   
2,103
   
1,215
 
                 
       
Balance Sheet Data:
    
10/31/2004
    
10/31/2003
              
                           
Working capital (excluding short term debt)
  
$
26,664
  
$
22,881
              
                           
Days sales outstanding
    
38
   
39
             
                           
Inventory turns
    
2.3
   
2.3
             
                           
Capitalization
                          
Total debt
  
$
4,600
  
$
9,222
              
Shareholders' equity
    
38,455
   
28,741
             
Total
  
$
43,055
  
$
37,963
              


 
     
 


Hurco Companies, Inc.
  
CONDENSED CONSOLIDATED BALANCE SHEET
  
(In thousands, except per-share data)
  
           
           
 
October 31,
October 31,
2004
2003
(audited)
(audited)
 
ASSETS
          
Current assets:
          
Cash and cash equivalents
  
$
8,249
  
$
5,289
  
Cash - restricted
    
277
   
622
 
Accounts receivable
    
17,337
   
12,823
 
Inventories
    
28,937
   
22,247
 
Other
    
1,672
   
1,409
 
Total current assets
    
56,472
   
42,390
 
               
Property and equipment:
              
Land
    
761
   
761
 
Building
    
7,205
   
7,239
 
Machinery and equipment
    
12,106
   
11,731
 
Leasehold improvements
    
676
   
544
 
     
20,748
   
20,275
 
Less accumulated depreciation and amortization
    
(12,512
)
  
(11,893
)
     
8,236
   
8,382
 
               
Software development costs, less amortization
    
2,920
   
1,922
 
Investments and other assets
    
5,818
   
5,264
 
   
$
73,446
  
$
57,958
  
               
               
LIABILITIES AND SHAREHOLDERS' EQUITY
              
Current liabilities:
              
Accounts payable
  
$
18,361
  
$
9,461
  
Accrued expenses
    
11,447
   
10,048
 
Current portion of long-term debt
    
317
   
645
 
Total current liabilities
    
30,125
   
20,154
 
               
Non-current liabilities:
              
Long-term debt
    
4,283
   
8,577
 
Deferred credits and other obligations
    
583
   
486
 
Total liabilities
    
34,991
   
29,217
 
               
Shareholders' equity:
              
Preferred stock: no par value per share; 1,000,000 shares
    
-
   
-
 
authorized; no shares issued
              
Common stock: no par value; $.10 stated value per share;
              
12,500,000 shares authorized; and 6,019,594 and
              
5,575,987 shares issued, respectively
    
602
   
557
 
Additional paid-in capital
    
46,778
   
44,695
 
Accumulated deficit
    
(3,442
)
  
(9,711
)
Accumulated other comprehensive income
    
(5,483
)
  
(6,800
)
Total shareholders' equity
    
38,455
   
28,741
 
   
$
73,446
  
$
57,958