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Cybex International Inc. (CYBI) filed Quarterly Report for the period ended 2011-06-25.
Cybex International Inc. has a market cap of $13.7 million; its shares were traded at around $0.8 with a P/E ratio of 4.7 and P/S ratio of 0.1.
This is the annual revenues and earnings per share of CYBI over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of CYBI.
Highlight of Business Operations:
Our net sales increased $4,892,000, or 18%, to $32,564,000 for the second quarter of 2011 versus $27,672,000 for the second quarter of 2010. For the six months ended June 25, 2011, net sales increased $9,787,000, or 18%, to $63,575,000 from $53,788,000 compared to the same period in 2010. For the second quarter of 2011, sales of cardiovascular products increased $2,553,000, or 16%, to $18,292,000, sales of strength products increased $1,404,000, or 15% to $10,628,000 and freight, parts, and other sales increased $935,000, or 35%, to $3,644,000 compared to the same period in 2010. For the six months ended June 25, 2011, sales of cardiovascular products increased $4,885,000, or 16%, to $34,924,000, sales of strength products increased $3,466,000, or 19%, to $21,652,000 and freight, parts and other sales increased $1,436,000 or 26%, to $6,999,000 compared to the same period in 2010. Both U.S. and international markets were strong, led by sales of our new treadmill models, the 770T and 625T, which have been favorably received by the marketplace.
Selling, general and administrative expenses increased $422,000, or 4%, to $9,952,000 in the second quarter of 2011 compared to $9,530,000 in the second quarter of 2010. For the six months ended June 25, 2011, selling, general and administrative expenses increased by $624,000, or 3%, to $20,413,000 compared to $19,789,000 for the comparable period in 2010. These increases were predominantly due to higher international expenses primarily related to additional headcount. Selling, general and administrative expenses represented 31% and 32% of sales for the three and six months ended June 25, 2011 and 34% and 37% of sales for the three and six months ended June 26, 2010, respectively.
A valuation allowance for deferred tax assets is recorded to the extent it cannot be determined that the realization of these assets is more likely than not. Due to the uncertainty created by the unfavorable Barnhard product liability jury verdict (see Note 11 of the Notes to the Consolidated Financial Statements included herein), we determined that a valuation allowance against the entire amount of our deferred tax assets as of December 31, 2010 was necessary. Our deferred tax assets are fully reserved as of June 25, 2011, therefore income tax expense recorded is the amount of state and federal alternative minimum tax that is currently payable. We recorded an income tax expense of $54,000 and an income tax benefit of ($171,000), for the three and six months ended June 25, 2011 and an income tax benefit of ($50,000) and ($411,000) for the three and six months ended June 26, 2010, respectively. The effective tax benefit rate was (49.3%) and (27.0%) for the six months ended June 25, 2011 and June 26, 2010, respectively. During the first quarter of 2011, we received a refund of federal alternative minimum taxes paid in prior years of $257,000, which was recorded as a benefit in that period since it was fully reserved as of December 31, 2010. This was offset by estimated state and federal alternative minimum taxes payable of $86,000 during the six months ended June 25, 2011. These taxes are based on estimated taxable income, therefore charges related to the Barnhard matter are not currently deductible since they have not been paid. As a result, we recorded income tax expense for the three months ended June 25, 2011 even though we incurred a loss for that period. Actual cash outlays for taxes continue to be reduced by the available operating loss carryforwards and credits.
Cash used in investing activities of $1,163,000 during the six months ended June 25, 2011 consisted of purchases of manufacturing tooling and equipment of $679,000, primarily for the manufacture of new products, and purchases of computer hardware and infrastructure of $484,000. Cash used in investing activities of $1,052,000 during the six months ended June 26, 2010 consisted of purchases of manufacturing tooling and equipment of $632,000, primarily for the manufacture of new products, and purchases of computer hardware and infrastructure of $420,000. While capital expenditures for the
balance of 2011 are expected to be approximately $2,400,000, the timing and amount of these expenditures will depend on economic conditions and results of our operations and other cash needs. Cash used in financing activities was $760,000 for the six months ended June 25, 2011, consisting of principal payments on the Citizens equipment facility and real estate loan. Cash used in financing activities was $1,124,000 for the six months ended June 26, 2010, consisting of $5,863,000 in repayment of the Wells Fargo Bank, NA (“Wells Fargo”) term loans and $260,000 of repayment of the Citizens real estate loan, offset by $4,999,000 advanced under the Citizens equipment lease facility.
At June 25, 2011, there were no outstanding revolving credit loans, a $10,963,000 real estate loan and $4,086,000 outstanding under the Citizens equipment facility. Availability under the revolving loan fluctuates daily based on the borrowing base, and is reduced by outstanding letters of credit. At June 25, 2011, the net remaining availability under the revolving line of credit was $2,000,000.
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