SOURCE: BUTLER INTERNATIONAL, INC.

September 06, 2005 08:00 ET

Butler International Reports Increased Sales and Profits for Second Quarter 2005; Sales Increase by 16%; Income From Continuing Operations Increases by 17% Compared to Prior Year

MONTVALE, NJ -- (MARKET WIRE) -- September 6, 2005 -- Butler International, Inc. (NASDAQ: BUTLE) announced today its results for the second quarter and first six months of 2005, along with the filing of its Form 10-Q for the quarter ended June 30, 2005.

Second Quarter 2005

For the quarter ended June 30, 2005, the Company reported net income of $1.3 million, or $0.10 per diluted share, compared to net income of $1.1 million, or $0.08 per diluted share for the same period in 2004. Excluding income from discontinued operations of $0.3 million and $0.1 million in the second quarter of 2005 and 2004, respectively, earnings per diluted share from continuing operations was $0.08 in the second quarter of 2005 and $0.07 in the second quarter of 2004.

Second quarter 2005 sales were $72.9 million, a 16% increase over the $63.1 million reported for the same quarter of 2004. This is the seventh straight quarter of year over year quarterly sales growth. Focusing on satisfying key customers' needs is a cornerstone of Butler's strategy. Sales to the top 10 customers accounted for approximately 74% of sales in the second quarter of 2005, an increase from approximately 67% during the same quarter of 2004.

Second quarter 2005 gross margin and operating income both increased compared to the second quarter of 2004. Gross margin for 2005 was $13.2 million, an increase of 20%, or $2.2 million compared to 2004. Gross margin as a percent of sales expanded slightly in 2005 to 18.1%, up from 17.4% in 2004. The increase in gross margin was driven by higher sales and a focus on higher margin business. Operating income for 2005 was $3.0 million, an increase of 34%, or $0.8 million compared to 2004. Operating income as a percent of sales expanded in 2005 to 4.2%, up from 3.6% in 2004. The increase in operating income resulted from gross margin growing slightly faster than selling, general, and administrative expenses (SG&A) and lower 2005 depreciation expense as a result of classifying the Montvale, NJ, building as an asset held for sale. SG&A as a percent of sales was 13.4% in the second quarter of 2005 compared to 13.1% in the second quarter of 2004.

Second quarter 2005 sales and operating profits from all of the Company's three business segments increased compared to the second quarter of 2004. Butler's largest and fastest growing segment, Technical Services, exceeded the prior year sales by 20% ($7.4 million) while profits grew by 11% ($0.4 million) for the same period. The year on year sales increase primarily resulted from work performed in the aerospace, defense, and heavy manufacturing equipment sectors. Profit growth was not as strong as sales growth as investments were made in business centers to capture future growth opportunities. The Telecom Services segment exceeded last year's sales and profit results by 10% ($1.9 million) and 53% ($0.8 million), respectively. The increased profitability was principally due to a combination of increased volume at key customers and an increase in the gross margin. The Information Technology Services segment exceeded last year's sales by 8% ($0.4 million), with profits up marginally compared to the prior year.

Six Months

For the six months ended June 30, 2005, the Company reported net income of $1.8 million, or $0.13 per diluted share, compared to net income of $1.2 million, or $0.09 per diluted share for the same period in 2004. Excluding income from discontinued operations of $0.3 million and $0.1 million in the six months ended June 30 of 2005 and 2004, respectively, earnings per diluted share from continuing operations were $0.11 and $0.08 during 2005 and 2004, respectively.

Six months 2005 sales were $136.9 million, a 13% increase over the $121.0 million reported for six months of 2004. Gross margin for six months of 2005 was $24.1 million, an increase of 16%, or $3.4 million compared to 2004. Gross margin as a percent of sales expanded slightly in 2005 to 17.6%, up from 17.1% in 2004. The increase in gross margin was driven by higher sales and a focus on better margin business. Operating income for the first six months of 2005 was $4.8 million, an increase of 36%, or $1.3 million compared to 2004.

Butler's Technical Services segment exceeded the prior year sales by 17% ($12.5 million) while profits grew by 7% ($0.5 million) for the same period. The Telecom Services segment exceeded last year's sales and profit results by 10% ($3.5 million) and 72% ($1.5 million), respectively. The Information Technology Services segment 2005 sales were 1% ($0.1 million) below last year's sales, with profits were 7% ($0.1) below last year's.

Outlook

Edward M. Kopko, Chairman and Chief Executive Officer, commented, "The second quarter of 2005 built on the success of our first quarter sales growth and was also an exciting continuation of year on year improvements for Butler. Our formula of quality-oriented, client-focused services continues to be successful. We look forward to continued strong sales growth for the balance of 2005."

About Butler International

Butler International, Inc. is a leading provider of TechOutsourcing services, helping customers worldwide increase performance and savings. Butler's global services model provides clients with onsite, offsite, or offshore service delivery options customized appropriately to their unique objectives. During its 59-year history of providing services, Butler has served many prestigious companies in industries including aircraft, aerospace, defense, telecommunications, financial services, heavy equipment, manufacturing, and more. If you would like to find out more about Butler's value-added global services, visit us on the web at http://www.butler.com.

Information contained in this press release, other than historical information, may be considered forward-looking in nature as such it is based upon certain assumptions and is subject to various risks and uncertainties as set forth in the Company's filings with the Securities and Exchange Commission. Such risks and uncertainties may not be controllable by the Company. To the extent that these assumptions prove to be incorrect, or should any of these risks or uncertainties materialize, the actual results may vary materially from those that were anticipated.

                    Mindpower for a Changing World(SM)
                            World Headquarters
         New River Center, 200 East Las Olas Boulevard, Suite 1730
                         Ft. Lauderdale, FL 33315
                              www.butler.com

                          BUTLER INTERNATIONAL, INC.
                            SUMMARY OF OPERATIONS
                     (in thousands except per share data)
                                 (unaudited)

                                Quarter Ended          Six Months Ended
                                   June 30,                 June 30,
                               2005        2004         2005        2004
                            ---------   ---------    ---------   ---------

Net sales                   $  72,863   $  63,055    $ 136,928   $ 120,967
Cost of sales                  59,651      52,077      112,868     100,278
                            ---------   ---------    ---------   ---------
    Gross margin               13,212      10,978       24,060      20,689

Depreciation and
 amortization                     382         454          754         947
Selling, general and
 administrative expenses        9,798       8,260       18,538      16,239
                            ---------   ---------    ---------   ---------
    Operating income            3,032       2,264        4,768       3,503

Interest expense                1,152       1,039        2,145       2,034
                            ---------   ---------    ---------   ---------

    Income from continuing
     operations before
     income taxes               1,880       1,225        2,623       1,469

Income tax expense                783         290        1,093         382
                            ---------   ---------    ---------   ---------

    Income from continuing
     operations                 1,097         935        1,530       1,087

Income from discontinued
 operations, net of taxes         250         125          250         125
                            ---------   ---------    ---------   ---------

    Net income              $   1,347   $   1,060    $   1,780   $   1,212
                            =========   =========    =========   =========

Basic income per share:
    Continuing operations   $    0.10   $    0.08    $    0.13    $   0.09
    Discontinued operations      0.02        0.01         0.02        0.01
                            ---------   ---------    ---------   ---------
        Net income          $    0.12   $    0.09    $    0.15    $   0.10
                            =========   =========    =========   =========

Diluted income per share:
    Continuing operations   $    0.08   $    0.07    $    0.11    $   0.08
    Discontinued operations      0.02        0.01         0.02        0.01
                            ---------   ---------    ---------   ---------
        Net income          $    0.10   $    0.08    $    0.13    $   0.09
                            =========   =========    =========   =========

Average number of common
 shares and dilutive
 common share equivalents
 outstanding:
Basic                          10,306      10,218       10,281      10,218
                            =========   =========    =========   =========
Diluted                        13,624      13,053       13,672      13,025
                            =========   =========    =========   =========


                          BUTLER INTERNATIONAL, INC.
                      SELECTED BALANCE SHEET INFORMATION
                               (in thousands)
                                 (unaudited)

                                                       June         June
                                                       2005         2004
                                                       ----         ----
          Accounts Receivable, Net                  $  45,327    $  36,675
          Total Current Assets                         52,802       45,100
          Accounts Payable and Accrued Liabilities     21,196       18,501
          Working Capital                              31,606       26,599
          Total Assets                                110,891      104,219
          Total Liabilities                            87,647       86,020
           Total Stockholders' Equity                  23,244       18,199

   Certain prior year balances have been reclassified to conform to the
   current year's presentation.

Contact Information

  • CONTACT:
    Tom Considine
    (201) 476-5404