JMIH Jupiter Marine International Holdings Inc (CE)

Jupiter Marine International Holdings, Inc. (OTCBB: JMIH): 2Q FY 2006 Highlights -- Revenue increased 31.5% to $3.4 million due to higher sales from the Jupiter 38' -- Net income applicable to common shareholders up 11.2% to 116,000, or $.01 per diluted share -- Order backlog remains steady at six months -- Production underway at Jupiter Marine's new Palmetto, FL manufacturing facilities -- Company taking orders for new Jupiter 29' boat Jupiter Marine International Holdings, Inc. (OTCBB: JMIH), a leading manufacturer of high quality, semi-custom center console boats under the Jupiter(TM) brand name, today announced financial results for the second quarter and six months-ended January 28, 2006 (see attached tables). Carl Herndon, President of Jupiter Marine, stated, "We are very pleased with our results in the second quarter and first half of fiscal 2006, which we feel are even more impressive when you factor in various economic factors affecting our customer base, including higher fuel prices, higher interest rates and the effect of a especially destructive hurricane season. Despite these economic conditions, we have maintained a steady order backlog of approximately six months throughout the first half of fiscal 2006. We attribute this continued demand for our boats to outstanding customer service, the increased recognition of our brand among boaters and our well connected dealer network." Mr. Herndon continued, "As we recently announced, a major contributor to our future growth will be the increase in capacity as a result of our opening new manufacturing facilities in Palmetto, FL. We have officially opened and begun production at this facility, and are currently in the process of hiring employees to satisfy existing orders. By adding this facility to our existing operations in Fort Lauderdale, we have achieved one of the Jupiter Marine's primary goals of the past three years, which was to increase production capacity and enable the Company to accommodate higher volume. Our expansion in Palmetto over time could potentially double the number of boats we manufacture. We intend to build our new 29' Forward Seating Center Console model, which has received rave reviews from our dealers, and a select number of the very popular Jupiter 31' models in Palmetto. Other models will remain in production at the existing Fort Lauderdale facility." Net sales for the second quarter of fiscal 2006 increased 31.5% to $3.4 million from $2.6 million in the same period last year. Higher sales were due to continued strong demand for the Company's outboard product line, driven largely by sales of the Jupiter 38', which the Company initially introduced in February 2005. Gross profit increased 15.6% to $825,000 in the second quarter of fiscal 2006, from $714,000 in the comparable period of last year. The Company's gross profit margin decreased to 24.0% in the second quarter of fiscal 2006 from 27.3% in the second quarter of fiscal 2005. Jupiter Marine has stated in the past that it will attempt to offset rising raw materials costs through the result of better utilization of overhead, pricing increases and improved materials management. Although the Company is, through a variety of initiatives, proactively addressing the impact of these costs on its operations, there can be no assurances that it can continue to compensate for these increases without an adverse affect on its operating results. In addition, the Company incurred costs of approximately $95,000 in relation to the start up of its new Palmetto manufacturing facility, which has now commenced operations. The Company also decided that it would no longer manufacture its current 27' Forward Seating model. Consequently, a one-time provision for loss on disposition of assets (boat molds) in the amount of $73,844 was recorded during the quarter. Despite the aforementioned expenses, Jupiter Marine's net income applicable to common shareholders in the second quarter of fiscal 2006 increased 11.2% to $116,000, or $.01 per diluted share on approximately 18.4 million diluted shares outstanding, from $105,000, or $.01 per diluted share on approximately 15.4 million diluted shares outstanding, in the second quarter of fiscal 2005. Net sales for the first half of fiscal 2006 increased 22.4% to $6.6 million from $5.4 million in the same period last year. Gross profit increased 13.9% to $1.6 million, or 24.4% of net sales, from $1.4 million, or 26.2% of net sales, in the year earlier period. Higher sales and gross profit for the first half of fiscal 2006 were due primarily to the reasons outlined above. The Company reported net income applicable to common shareholders for the first half of fiscal 2006 of $337,000, or $.02 per diluted share on approximately 18.0 million diluted shares outstanding, versus $267,000, or $.02 per diluted share on approximately 15.1 million diluted shares outstanding, in the same period last year. Mr. Herndon concluded, "We feel that Jupiter Marine is one of the best positioned outboard boat manufacturers in the country. We have achieved great success in carving a niche in what is a highly competitive market. We feel that the increased recognition of our brand among boaters is a testament to the quality of our products and the dedication of our employees. For the reasons we have continuously highlighted, we are optimistic with regard to the long-term growth of the Company and growing acceptance of our brand." Financial Position Jupiter Marine's balance sheet at January 28, 2006 is highlighted by a current ratio of 1.53:1, a debt-to-equity ratio of 0.63 compared to 0.64 at July 31, 2005, and no long-term debt. In addition, Jupiter Marine negotiated an increase to $750,000 from $500,000 in its revolving line of credit, of which $370,000 was available at January 28, 2006. About Jupiter Marine International Holdings, Inc. Jupiter Marine designs, manufactures and markets high quality sportfishing boats designed to run at high speeds in offshore sea conditions while providing passengers with a smooth, comfortable, dry ride. The center console product line includes the 38' Forward Seating, 31' Open, 31' Forward Seating and 31' Cuddy, in addition to the all new Jupiter 29 Forward Seating model. The Company's website is www.jupitermarine.com. This press release may contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The matters discussed in this press release include statements regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to the future operating performance of the Company. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward-looking statements as a result of various factors. -0- *T Jupiter Marine International Holdings, Inc. Consolidated Statements of Operations (Unaudited) Three Months Ended Six Months Ended January 28, January 29, January 28, January 29, 2006 2005 2006 2005 NET SALES $3,439,337 $2,614,651 $6,573,637 $5,371,181 COST OF SALES (exclusive of depreciation) 2,613,919 1,900,546 4,968,712 3,961,939 ------------------------ ----------------------- GROSS PROFIT 825,418 714,105 1,604,925 1,409,242 ------------------------ ----------------------- OPERATING EXPENSES: Selling and marketing 161,313 85,603 272,667 180,006 General and administrative 412,062 341,137 772,813 676,511 Depreciation and amortization 57,014 70,387 139,684 144,424 ------------------------ ----------------------- Total operating expenses 630,389 497,127 1,185,164 1,000,941 ------------------------ ----------------------- OTHER INCOME (EXPENSE): Interest expense (14,933) (16,439) (30,817) (33,348) Impairment of assets (73,844) - (73,844) - Interest expense - loan guarantee - (91,000) - (91,000) Other income 10,158 4,787 22,072 11,074 ------------------------ ----------------------- Total other income (expense) (78,619) (102,652) (82,589) (113,274) NET INCOME BEFORE INCOME TAXES 116,410 114,326 337,172 295,027 INCOME TAX EXPENSE - - - - ------------------------ ----------------------- NET INCOME 116,410 114,326 337,172 295,027 Dividends on preferred stock - (9,679) - (28,108) NET INCOME APPLICABLE TO COMMON SHAREHOLDERS $ 116,410 $ 104,647 337,172 266,919 ======================== ======================= Basic and diluted net income per common share Basic $ 0.01 $ 0.01 $ 0.02 $ 0.02 ======================== ======================= Diluted $ 0.01 $ 0.01 $ 0.02 $ 0.02 ======================== ======================= Weighted average number of shares of common stock outstanding Basic 16,372,493 12,830,490 15,964,009 12,552,340 ======================== ======================= Diluted 18,372,493 15,354,106 17,964,009 15,075,956 ======================== ======================= Jupiter Marine International Holdings, Inc. Condensed Consolidated Balance Sheet January 28, July 30, 2006 2005 (Unaudited) Current Assets $ 2,333,654 $ 2,092,268 -------------- -------------- Total Assets $ 3,952,161 $ 3,180,669 ============== ============== Current Liabilities $ 1,529,917 $ 1,245,597 -------------- -------------- Total Liabilities $ 1,529,917 $ 1,245,597 -------------- -------------- Shareholders' Equity $ 2,422,244 $ 1,935,072 -------------- -------------- Total Liabilities and Shareholders' Equity $ 3,952,161 $ 3,180,669 ============== ============== *T