| SOUTHAMPTON, Pa., Feb. 24 /PRNewswire-FirstCall/ -- Environmental
Tectonics Corporation (Amex: ETC) today announced financial results for the
third quarter ended November 22, 2002. For the third quarter ended November 22, 2002, net income was $436,000, or $.06 per share (diluted), versus a net income of $662,000 or $.09 per share (diluted) for the corresponding quarter of fiscal 2002. Quarterly sales were $12,162,000, an increase of $3,932,000 or 47.8% from the prior year. The primary contributors to the sales increase were additional international revenues for Aircrew Training Systems, which benefited from a human centrifuge project in Malaysia, and U.S. government sales in the hyperbaric area for work on a large U.S. Navy submarine rescue project. Providing partial offsets were reductions in domestic entertainment and environmental sales and international hyperbaric systems, which in fiscal 2002 had benefited from a major project in Thailand. Segmented geographically, domestic sales were down $2,492,000 or 46.2% from the corresponding period of fiscal 2002, primarily reflecting the aforementioned entertainment sales decrease; U.S. Government sales increased to $1,150,000, as compared to $122,000 in the corresponding period of fiscal 2002; while international sales, including those from the Company's foreign subsidiaries, were up $5,396,000 or 198.6% over the corresponding period of fiscal 2002. Gross profit for the third quarter of fiscal 2003 decreased by $88,000 or 2.4% from the corresponding period of fiscal 2002, as the increased sales volume was completely offset by a 15.2 percentage point reduction in the rate as a percent of sales. As previously reported, a settlement with a major customer in the third quarter of fiscal 2002 generated additional contract revenue and corresponding gross profit in the quarter. Acting as a partial offset in the current fiscal period was an increase in gross profit for Aircrew Training Systems reflecting the aforementioned sales increase. Net income, which was down $226,000 or 34.1%, was negatively affected by an increase in legal, bank, and other fees associated with the new financing effort. For the thirty-nine weeks ended November 22, 2002, ETC realized net income of $1,757,000, or $.23 per share (diluted), versus net income of $1,183,000, or $.16 per share (diluted) for the corresponding period of fiscal 2002. Sales for the same period were $34,410,000, an increase of $10,426,000 or 43.5% over the corresponding period in fiscal 2002. The primary contributors to the sales increase were additional revenues for domestic entertainment, increased international Aircrew Training Systems revenues from the Malaysian centrifuge project, higher international environmental systems sales in China, and higher U.S. Government sales on the U.S. Navy submarine rescue project. Gross profit for the thirty-nine weeks ended November 22, 2002 increased by $1,672,000 or 19.1% over the corresponding period of fiscal 2002 reflecting the aforementioned sales increase. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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William F. Mitchell, ETC's President and Chairman, stated that, "The results to date for fiscal 2003 have been very encouraging given the difficult global economic and political environment and the increasing prospects of military conflict in various areas throughout the world. I am especially pleased that international Aircrew Training Systems is seeing improved sales. "In November 2002 the Company launched its entertainment industry initiative with several new product offerings which were introduced at the International Association of Amusement Parks and Attractions (IAAPA) show in Orlando, Florida. The Company plans to capitalize on its advanced knowledge of motion-based physiology, developed for its high-G fighter aircraft simulators, to design entertainment rides that provide a true simulation alternative to the `bump and grind' of carnival rides." ETC designs, develops, installs and maintains aircrew training systems, public entertainment systems, process simulation systems (sterilization and environmental), clinical hyperbaric systems, environmental testing and simulation systems, and related products for domestic and international customers. This press release may include 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. We have based these forward- looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about the Company that may cause our actual results, levels of activity, performance or achievements to be materially different from any other future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "would," "expect," "plan," "anticipate," "believe," "estimate," "continue," or the negative of such terms or similar expressions. Factors that might cause or contribute to such a discrepancy include, but are not limited to, contract cancellations, political unrest in customer countries, general economic conditions, and those issues identified from time to time in our Securities and Exchange Commission filings and other public documents, including, without limitation, our Annual Report on Form 10-K for the fiscal year ended February 22, 2002. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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