SOURCE: Williams Controls, Inc.

Williams Controls, Inc.

December 15, 2010 08:30 ET

Williams Controls Reports Results for Fiscal Year 2010

PORTLAND, OR--(Marketwire - December 15, 2010) - Williams Controls, Inc. (the "Company") (NASDAQ: WMCO) today announced financial results for its fourth quarter and year ended September 30, 2010.

Net sales for the quarter were $14,144,000, up 34% from sales of $10,543,000 reported in the fourth quarter of fiscal 2009. The Company generated fourth quarter net income of $510,000, or $0.07 per diluted share, compared to net income in the 2009 fourth quarter of $365,000, or $0.05 per diluted share.

Sales for the year ended September 30, 2010, increased $13,457,000, or 35%, to $52,266,000 from $38,809,000 for the comparable period last year. Net income for the year ended September 30, 2010 was $1,377,000, or $0.19 per diluted share, compared to a net loss of $2,009,000, or $0.27 per diluted share, for the year ended September 30, 2009.

Sales volume increased in essentially all of our principal markets as the industry continues to recover world-wide. Sales to NAFTA truck customers in the quarter were up 32% over fourth quarter fiscal 2009 and up 21% for the full year. Sales to European OEM truck customers have increased 157% on a quarter over quarter basis and are up 80% for the entire fiscal year. Net sales to our Asian customers were up 16% for the quarter and 54%, for the full year primarily due to increased sales volumes of heavy trucks in Korea and heavy trucks and off-road vehicles in China. Fourth quarter fiscal 2010 world-wide off-road sales were up 51% from the corresponding quarter of 2009 and fiscal 2010 off-road sales were up 57% when compared to fiscal 2009. A significant portion of that is from new China off-road customers and US military applications.

Fourth quarter operating income was $548,000 compared to operating income of $131,000 in the fourth quarter of fiscal 2009. For the year ended September 30, 2010, operating income was $1,224,000 compared to an operating loss of $3,292,000 for fiscal 2009. The improvement for both the quarter and full year was primarily the result of the overall sales increase from the prior year periods. We are still seeing scheduling and supply chain issues as some of our suppliers continue to have difficulty meeting the demand increases. We incurred approximately $175,000 in the current quarter and approximately $500,000 for the full year, for expedited freight charges largely resulting from this lack of supplier capacity. India start-up costs included in operating results was approximately $145,000 in the quarter and $190,000 for the full year.

Commenting on the fourth quarter results Patrick W. Cavanagh, Williams Controls' President and Chief Executive Officer stated, "We were pleased to see our world-wide markets begin to recover this year, and even more positive for us was our $4 million revenue growth from new product introductions this year." He continued, "International, as well as domestic, off-road has been particularly strong this year from a combination of new product introduction and market recovery. Asia off-road sales have developed faster than we initially expected and in 2010 comprised 25% of our total Asia sales." He concluded, "We also have been able to capture a significant share of the developing India market and are in the process of opening our new facility in Pune, India to serve that fast-growing market."

Williams Controls will hold an investor conference call at 10:30 A.M. Eastern Time on Wednesday, December 15, 2010 to provide an overview of the fourth quarter of fiscal 2010 financial performance and business highlights. You are invited to listen to the conference call by dialing 1-888-665-2348 (domestic) or 1-706-643-4013 (international). Participants should call prior to the start time to allow for registration. The conference access code is 26378903. An audio replay will be available by telephone through December 31, 2010. The telephone number to access the replay is 1-800-642-1687 (domestic) and 1-706-645-9291 (international). The access code will be 26378903.

ABOUT WILLIAMS CONTROLS

Williams Controls is a leading global designer and manufacturer of Electronic Throttle Control Systems ("ETCs") for the heavy truck, bus and off-road markets. Williams Controls is headquartered in Portland, Oregon and employs more than 200 people worldwide at locations in North America, Europe, and Asia. For more information, visit Williams Controls' website at www.wmco.com. Information posted on our website is not incorporated into, and does not constitute a part of, this release.

The statements included in this news release concerning predictions of economic performance and management's plans and objectives constitute forward-looking statements made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on management's assumptions and projections, and are sometimes identifiable by use of the words, "expect to," "plan," "will," "believe" and words of similar predictive nature. Because management's assumptions and projections are based on anticipation of future events, you should not place undue emphasis on forward-looking statements. You should anticipate that our actual performance may vary from these projections, and variations may be material and adverse. You should not rely on forward-looking statements in evaluating an investment or prospective investment in our stock, and when reading these statements you should consider the uncertainties and risks that could cause actual results to differ materially from the forward-looking statements. Factors which could cause or contribute to such differences include, but are not limited to, factors detailed in the Company's Securities and Exchange Commission filings. Some of these factors include the length and severity of any economic downturns affecting our operations, competition, and our ability to attract and retain qualified management and to maintain positive labor relations with our collective bargaining employees. The forward-looking statements contained in this press release speak only as of the date hereof and the Company disclaims any intent or obligation to update these forward-looking statements.

                               Williams Controls, Inc.
             Unaudited Condensed Consolidated Statements of Operations
             (Dollars in thousands, except share and per share amounts)


                                  Three      Three
                                  months     months     Year       Year
                                  ended      ended      ended      ended
                                 9/30/10    9/30/09    9/30/10    9/30/09
                                ---------  ---------  ---------  ---------
Net sales                       $  14,144  $  10,543  $  52,266  $  38,809
                                ---------  ---------  ---------  ---------
Cost of sales                      10,316      7,592     37,446     30,173
                                ---------  ---------  ---------  ---------
Gross profit                        3,828      2,951     14,820      8,636
                                ---------  ---------  ---------  ---------
Research and development
 expense                            1,099        981      4,505      3,981
                                ---------  ---------  ---------  ---------
Selling expense                       721        559      2,836      2,425
                                ---------  ---------  ---------  ---------
Administration expense              1,460      1,280      5,480      5,522
                                ---------  ---------  ---------  ---------
Class action settlement                 -          -        775          -
                                ---------  ---------  ---------  ---------
Operating income (loss)               548        131      1,224     (3,292)
                                ---------  ---------  ---------  ---------
Interest (income) expense, net          1          -          4         (7)
                                ---------  ---------  ---------  ---------
Loss on impairment of
 investments                            -          -          -        317
                                ---------  ---------  ---------  ---------
Other (income) loss, net               (6)        (1)      (495)        84
                                ---------  ---------  ---------  ---------
Income (loss) before income
 taxes                                553        132      1,715     (3,686)
                                ---------  ---------  ---------  ---------
Income tax (benefit) expense           43       (233)       338     (1,677)
                                ---------  ---------  ---------  ---------
Net income (loss)               $     510  $     365  $   1,377  $  (2,009)
                                ---------  ---------  ---------  ---------
Earnings (loss) per share
 information:

Basic -

Net income (loss) per common
 share                          $    0.07  $    0.05  $    0.19  $   (0.27)
                                ---------  ---------  ---------  ---------
Weighted average shares used in
 per share calculation - basic  7,286,151  7,270,820  7,276,544  7,315,343
                                ---------  ---------  ---------  ---------
Diluted -

Net income (loss) per common
 share                          $    0.07  $    0.05  $    0.19  $   (0.27)
                                ---------  ---------  ---------  ---------
Weighted average shares used in
 per share calculation -diluted 7,412,625  7,329,576  7,387,939  7,315,343
                                ---------  ---------  ---------  ---------




                             Williams Controls, Inc.
                 Unaudited Condensed Consolidated Balance Sheets
                             (Dollars in thousands)


                                             September 30,   September 30,
                                                 2010            2009
                                             -------------   -------------
                   Assets

Current Assets:

  Cash and cash equivalents                  $       3,016   $       9,245
                                             -------------   -------------
  Short-term investments                                 -             286
                                             -------------   -------------
  Trade accounts receivable, net                     8,854           6,677
                                             -------------   ------------- 
  Other accounts receivable                            599           1,509
                                             -------------   -------------
  Inventories                                        7,512           5,539
                                             -------------   -------------
  Deferred income taxes                                927             579
                                             -------------   -------------
  Prepaid expenses and other current assets            341             269
                                             -------------   -------------
    Total current assets                            21,249          24,104
                                             -------------   -------------

Property, plant and equipment, net                   9,025           8,893
                                             -------------   -------------
Deferred income taxes                                3,493           3,019
                                             -------------   -------------
Other assets, net                                      438             368
                                             -------------   -------------
    Total assets                             $      34,205   $      36,384
                                             -------------   -------------

    Liabilities and Stockholders' Equity

Current Liabilities:

  Accounts payable                           $       4,593   $       2,990
                                             -------------   -------------
  Accrued expenses                                   5,698           4,492
                                             -------------   -------------
  Current portion of employee benefit
   obligations                                         212             225
                                             -------------   -------------
    Total current liabilities                       10,503           7,707
                                             -------------   -------------
Long-term Liabilities:

  Employee benefit obligations                       8,694           8,297
                                             -------------   -------------
  Other long-term liabilities                          244             290
                                             -------------   -------------
Stockholders' Equity:

  Preferred stock                                        -               -
                                             -------------   -------------
  Common stock                                          73              73
                                             -------------   -------------
  Additional paid-in capital                        37,623          36,643
                                             -------------   -------------
  Accumulated deficit                              (12,677)         (6,776)
                                             -------------   -------------
  Treasury stock                                    (2,734)         (2,734)
                                             -------------   -------------
  Accumulated other comprehensive loss              (7,521)         (7,116)
                                             -------------   -------------

    Total stockholders' equity                      14,764          20,090
                                             -------------   -------------
    Total liabilities and stockholders'
     equity                                  $      34,205   $      36,384
                                             -------------   -------------

Contact Information

  • Contact:
    Mike Rusk
    Financial Controller
    Telephone: (503) 684-8600