Herley Plans to Update Guidance After 3rd Quarter Results Are Released
Innovative Concepts Expected to be Accretive in Fiscal Year 2005
LANCASTER, Pa., April 22 /PRNewswire-FirstCall/ -- Herley Industries, Inc. (Nasdaq: HRLY) released remarks today by John Kelley and Dr. Andy Feldstein the respective Presidents of Herley and Innovative Concepts.
Mr. John Kelley, Herley's President, stated, "The acquisition of ICI has completed Phase 1 of the business strategy outlined at Herley's Annual Shareholders meeting in January. We continue to explore acquisition complementary opportunities, but we will increase the criteria needed to meet our minimum acceptance threshold. Our near-term focus is to coordinate and harness the capabilities of each division and work to combine these core strengths. These efforts are expected to add value and provide solutions to our customers; elevate our involvement in products earmarked for the military of the future; and create sustainable revenue and earnings growth for the Company.
"We expect procurement for the military of the 21st Century will include the following product segments:
-- Command & control of unmanned vehicles
-- Enhanced sensor technology
-- Data links and solutions to enable diverse communication systems to
interact with each other
The combined command & control strengths of Herley and Micro Systems, along with a history of strong business relationships with the prime manufacturers of sub-scale targets, position Herley as the primary supplier of command & control systems.
"The recent agreement to grant Herley the exclusive global license from Lockheed Martin/Xytrans of millimeter wave technology elevates Herley into a leadership position in next-generation seeker technology for missiles and other unmanned requirements.
"ICI's portfolio of data links and solutions provided by their 304 Improved Data Modems for inter-connectivity of diverse communications systems completes our product offerings for the military needs of the future. With a preponderance of their 100 employees software professionals, Dr. Andy Feldstein, President of ICI, and his team fill the last technological gap.
"Over the past year, Herley has acquired four companies and bought back approximately one million shares of stock, putting the entire proceeds from our 2002 offering to work. We currently have approximately $15 million in cash on hand."
Dr. Feldstein added, "We have been looking for a microwave partner with strong manufacturing skills and the financial resources to take advantage of our business opportunities. Herley Industries' manufacturing and financial strength is an excellent complement to our software skills. The bulk of our business is research and development in communication techniques for the military services, with a special emphasis on IDM's for the Army helicopter forces.
"Our business is growing, fueled by the largest backlog of IDIQ contracts in the history of ICI. Revenue growth is not isolated to the U.S.; we are also experiencing increasing sales in international markets. ICI and Herley both do about one third of our business internationally. Combined, we generate approximately $50 million annually in profitable international business. Our efforts for the future are to continue our marketing efforts and increase our product offerings, in order to offer a more complete solution to the customer. Attention to these details should continue the growth we have experienced in those markets."
Herley Industries, Inc. is a leader in the design, development and manufacture of microwave technology solutions for the defense, aerospace and medical industries worldwide. Based in Lancaster, PA, Herley has nine manufacturing locations and more than 1000 employees. Additional information about the company can be found on the Internet at http://www.herley.com.
For information at Herley contact: Tel: (717) 735-8117
Peg Guzzetti, Investor Relations http://www.herley.com
Safe Harbor Statement - Except for the historical information contained herein, this release may contain forward-looking statements. Such statements are inherently subject to risks and uncertainties. The Company's results could differ materially based on various factors, including, but not limited to cancellation or deferral of customer orders, difficulties in the timely development of new products, difficulties in manufacturing, increased competitive pressures, and general economic conditions.