SHELTON, Conn.--Jan. 31, 2007-- Baldwin Technology Company, Inc., a leading global manufacturer of printing press accessories and control equipment, reported net sales for the second fiscal quarter ended December 31, 2006, of $48,168,000 compared to $43,826,000 for the second quarter last year, an increase of 9.9%. Net income for the quarter was $402,000, or $0.03 per diluted share, compared to $1,383,000, or $0.09 per diluted share, for the similar quarter last year.
Net income for the current quarter was impacted by a pretax restructuring charge of $994,000 associated with the acquisition of the Oxy-Dry companies along with integration expenses of approximately $111,000. In addition, the company incurred fees of $125,000 to voluntarily terminate its credit line with Maple Bank GmbH and recorded a one-time tax expense of $250,000 in settlement of a tax audit at its German subsidiary that related to prior years. Currency translation had a negligible impact on net income for the quarter.
The increase in sales was primarily attributable to the Oxy-Dry companies, which were acquired in late November 2006. Currency translation also favorably increased sales by $2,012,000 for the quarter.
Net sales for the six months ended December 31, 2006, were $91,375,000, compared to $86,471,000 in the comparable period last year, an increase of 5.7%. Currency translation favorably increased sales by $2,568,000 for the six month period.
Backlog at the end of the quarter was $58,614,000, including approximately $6,400,000 from the Oxy-Dry entities. Backlog was $49,167,000 at the beginning of the fiscal year, and $51,882,000 on September 30, 2006. Prior period backlog does not include Oxy-Dry.
President and COO Karl S. Puehringer said, "During this quarter, we successfully completed the acquisition of the Oxy-Dry group of companies. Immediately after closing in late November, we started to aggressively manage the integration of Oxy-Dry operations into our own, and I am pleased with the progress we have achieved in the intervening two months. We expect to complete the integration before the end of the calendar year. While we will be able to record some of the integration benefits in Q3 and Q4 of FY '07, the full impact of expected annual savings of $3,700,000 will be felt during FY '08.
"The acquisition of Oxy-Dry makes Baldwin the leading global full solution provider of cleaning applications in the offset printing market. We are pleased with initial reactions from customers about our new product lines. We will continue to work hard to leverage this unique market position," Puehringer said.
Baldwin's Vice President and CFO Vijay Tharani, added, "During the quarter we refinanced our long-term debt by entering into a new larger credit facility with LaSalle/ABNAmro Bank. Under this arrangement, we have the ability to borrow up to $50,000,000 over the next five years at terms comparable to our previous arrangement. A portion of this credit line was utilized in the acquisition of Oxy-Dry."
Baldwin will review its second quarter results and discuss its business outlook during a conference call today beginning at 11 a.m. Eastern Time. Call-in information is available at http://www.baldwintech.com under the Investor Relations section. Interested investors are encouraged to log onto the website and participate in the call or access the webcast to replay the call. Puehringer and Tharani will participate in the conference call.
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