15 Nov 02. Paravant Inc. (Nasdaq: PVAT – News) a defense electronics technology company, reported financial results for its year and quarter ended September 30, 2002. Revenues increased by 19.8% from $51.8m to $62.1m for the fiscal years ended September 30, 2001 and 2002, respectively.
For the full year 2002, the Company had net income of $4,464,040, compared to $447,747 for last year. The increase in net income was primarily due to the elimination of goodwill amortization costs related to the adoption of Statement of Financial Accounting Standards (SFAS) No. 142, lowered interest expense related to reduced debt and lower interest rates, as well as improved revenues in both segments of the business. For the full fiscal year, earnings per share increased from $0.03 (both basic and diluted) in fiscal 2001 to $0.26 basic and $0.25 diluted for fiscal year 2002.
Fourth Quarter Performance Revenues for the quarter were $22.0m, (2001: $15.7m). This 40.3% increase was primarily due to increases in Appliqué product revenues. Income from operations was up 61.3% to $4.1m for the quarter ended September 30, 2002, (2001: $2.5m). This increase in operating income was due to stronger operating performance in the Tactical Systems segment, which had significantly improved earnings results in the fourth quarter of 2002, versus the same fiscal 2001 fourth quarter. Net Income was $2,324,476 for the fourth quarter of 2002, (2001: $412,105). The quarter-to-quarter increase of $1,912,371 was primarily due to increased Tactical Systems revenues, adoption of SFAS 142 and lowered income tax expense.
As of September 30, 2002 the Company’s overall backlog, which consists of both funded purchase orders and IDIQ (indefinite delivery, indefinite quantity) contracts, was approximately $44.6m, (2001; $30.8m), an increase of 44.8%. The backlog does not include an $89m contract amendment made to the company’s contract for the United Kingdom’s BOWMAN program, as announced on October 23, 2002. The company currently expects to manufacture and deliver substantially all of the products in the funded backlog within the next twelve months with the bulk of the shipments taking place in the second half of the year.
In commenting on the 2002 results, Paravant President and CEO Bill Craven said, “We were very pleased that we accomplished our primary goals in 2002 of increasing revenues, enhancing profitability, and reducing our debt.”
On October 28, 2002, Prince Merger Corporation, a wholly-owned subsidiary of DRS Technologies, Inc. (NYSE: DRS – News), commenced a cash tender offer for all of the outstanding shares of common stock of Paravant at a price of $4.75 per share in cash. The tender offer is being made pursuant to an Offer to Purchase, dated October 28, 2002, and in connection with an Agreement and Plan of Merger, dated October 23, 2002, between DRS, Prince Merger Corporation and Paravant. The tender offer is scheduled to expire at 12:00 midnight, New York City time, on Monday, November 25, 2002, unless the offer is extended. Following the completion of the tender offer, Prince Merger Corporation will be merged with and into Paravant. Holders of any remaining outstanding common stock of Paravant will receive in the merger the $4.75 price per share in cash. Paravant’s board of directors unanimously recommended that its shareholders tender their shares pursuant to the tender offer. Certain shareholders owning approximately 22 percent of the outstanding common stock of Paravant have agreed to tender their shares in the offer. The tender offer is subject to customary regulatory approvals and other closing conditions, including a majority of the fully diluted shares being deposited for tender and not withdrawn.