SOURCE: New Century Companies, Inc.

November 15, 2007 12:29 ET

New Century Companies, Inc. Announces Third Quarter and Nine Months 2007 Financial Results

SANTA FE SPRINGS, CA--(Marketwire - November 15, 2007) - New Century Companies, Inc. (OTCBB: NCNC), a leading manufacturer and re-manufacturer of machine tools, today announced financial results for the third quarter ending September 30, 2007.

Third Quarter 2007 Financial Results

New Century posted revenue of approximately $1.4 million for the quarter ended September 30, 2007, a decrease of 29% compared to the approximately $1.9 million for the comparable period of 2006. The decrease in revenues can be attributed to a slower than anticipated summer sales period resulting from tighter inventories and the recent down turn in the credit markets.

Gross profit for the quarter was a loss of approximately ($34,561), compared to gross profit of $368,900 for the same period the prior year. Operating loss for the quarter was approximately ($457,790) compared to operating loss of ($18,661) for the same period in the prior year. The decrease in gross profit is due to the change in product mix for the types of machines in process during the quarter and the decrease in order flow, coupled with remanufacturing of three machines requiring additional labor cost not covered for the additional work, while the decrease in operating income can be attributed to an increase in consulting related expenses.

New Century posted a Net loss for the quarter ended September 30, 2007 of approximately ($926,383) or ($0.07) loss per basic share, compared to a net loss of approximately ($125,375) or ($0.01) per diluted share for the same period last year.

Nine Months Financial Results 2007

The Company posted revenues of approximately $7.2 million for the nine month period ended September 30, 2007, an increase of 20% compared to the approximately $5.99 million for the same nine month period of 2006. The increase is the result of higher sales volumes in the first half of the year which were offset by the third quarter.

Gross profit for the nine months was approximately $1.86 million, or 25.8% of revenues, compared to $1.58 million, or 26.3% of revenues for the same period the prior year. Operating income for the six months was approximately $200,792 compared to operating income of $276,027 for the same period in the prior year. The decrease in operating income can be attributed to an increase in consulting related expenses coupled with additional labor costs over-runs.

New Century posted a Net loss for the nine months ended September 30, 2007 of approximately ($1.4) million or ($0.11) loss per basic share, compared to a net loss of approximately ($990,962) or ($0.07) per diluted share for the same period last year. The first nine months of 2007 had approximately $2.1 million in non-cash related expenses related to consulting fees and interest expenses compared to approximately $1 million of similar expenses for the same period in 2006.

David Duquette, President and CEO of New Century, commented, "This quarter has been a challenging time for New Century. We did not anticipate the downturn in the market as a result of the looming credit crunch which caused many of our longtime customers to delay purchasing equipment. Since the end of the quarter we have seen an increase in quotation activity and order bookings across all sectors of the industries we service, with the highest demand coming from the wind turbine industry. While we are disappointed with our third quarter financial results we believe we will finish the year on a positive note. Our objective is to increase profit margins as we implement pricing increases for our high end products as we move in to the New Year. The industries we serve continue to see growth and the demand for CNC products in the market continues to strengthen, while inventory remains tight. As we finish this year and focus our efforts on diversifying our customer base we believe New Century will be better positioned to accelerate growth and return to profitability."

About New Century Co.

New Century Companies, Inc. is one of the leading U.S.-based makers of machine tools, primarily vertical boring mills and large lathes such as vertical turning centers (VTCs). It specializes in re-manufacturing, starting with existing major castings and fitting them with state-of-the-art, computer-controlled equipment. These products generally cost 40% to 60% less to make than new ones. New Century passes these savings on to its customers, which include such leading manufacturers as General Electric Co., General Dynamics Corp., Siemens AG and Gardner Denver. New Century machines are used to manufacture jet engine components, airplane landing gear parts, power generation equipment, oil and gas production components and construction materials, to name just a few applications. New Century's production facility is in Santa Fe Springs, CA.

Visit New Century's Web site at www.newcenturyinc.com.

Safe Harbor

Forward-looking statement: Except for historical information, this press release contains forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from those statements. Those risks and uncertainties include, but are not limited to, changing market conditions and other risks detailed from time to time in the Company's ongoing quarterly filings, annual information form, and annual reports. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in this press release might not occur.

Contact Information

  • Contact:
    David Duquette
    CEO of New Century
    Phone: 562-906-8455