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adobe pdf icon Analogic Corporation Announces Revenues and Earnings for Its Fourth Quarter and Fiscal Year Ended July 31, 2007

Analogic Corporation Announces Revenues and Earnings for Its Fourth Quarter and Fiscal Year Ended July 31, 2007

Analogic Corporation Announces Revenues and Earnings for Its Fourth Quarter and Fiscal Year Ended July 31, 2007

PEABODY, Mass.–(BUSINESS WIRE)–Sept. 24, 2007–Analogic
Corporation (NASDAQ: ALOG), a leading designer and manufacturer of
high-precision health and security imaging equipment, today announced
revenues and earnings for its fourth quarter and twelve-month period
ended July 31, 2007.

Revenues from continuing operations for the fourth quarter ended
July 31, 2007, were $92,933,000, compared with the prior year’s
fourth-quarter revenues from continuing operations of $83,718,000, an
increase of $9,215,000, or 11%. Net income from continuing operations
for the quarter ended July 31, 2007, before discontinued operations
and the cumulative effect of a change in accounting principle, was
$8,322,000, or $0.60 per diluted share, compared with a net loss from
continuing operations of $8,070,000, or a loss of $0.59 per diluted
share, for the prior year’s fourth quarter.

During the fourth quarter of the year ending July 31, 2007,
Bio-Imaging Research, Inc. (BIR), of Lincolnshire, Illinois, of which
Analogic had approximately 17% ownership, declared a dividend and made
a dividend payment of $1,429,000 to the Company on May 24, 2007. Also
on that day Analogic sold its entire ownership interest in BIR for
approximately $3,714,000, of which $2,807,000 was paid in cash upon
closing, with the remaining $907,000 to be held in escrow for up to
two years to secure any indemnification claims. The Company recorded
income before taxes on the sale and related dividend income of
$4,036,000 during the quarter and will recognize the escrow balance,
less any amount used to satisfy indemnification claims, as income
before taxes as the cash is received.

During the quarter ended July 31, 2006, the Company recorded
restructuring and asset impairment charges totaling $12,085,000
related to a $7,730,000 writedown of capitalized software and excess
inventory related to a medical Computed Tomography (CT) development
program, a $3,850,000 writedown related to the Company’s decision to
discontinue the development of a medical CT workstation, and asset
impairment and restructuring charges of $505,000 related to the fiscal
2006 closure of the Company’s SKY Computers subsidiary. The net loss
attributable to discontinued operations and the disposal of
discontinued operations for the three months ended July 31, 2006, was
$453,000, or a loss of $0.04 per diluted share.

Net income for the fourth quarter ended July 31, 2007, was
$8,322,000, or $0.60 per diluted share, compared to a net loss of
$8,523,000, or a loss of $0.63 per diluted share, for the prior year’s
fourth quarter.

Revenues for the twelve months ended July 31, 2007, were
$340,782,000, compared with the prior year’s revenues of $351,445,000,
a decrease of $10,663,000, or 3%. Net income from continuing
operations before discontinued operations and the cumulative effect of
a change in accounting principle for the twelve-month period was
$15,380,000, or $1.10 per diluted share, compared with $4,600,000, or
$0.33 per diluted share, for the same period a year ago, an increase
of $10,780,000, or 234%.

During the twelve-month period ended July 31, 2006, the Company
recorded asset impairment charges of $14,876,000 related to a
$7,730,000 writedown of capitalized software and inventory on hand in
excess of future estimated requirements related to a medical CT
development program, a $3,850,000 writedown related to the Company’s
decision to discontinue the development of a medical CT workstation,
$2,805,000 related to the closure of SKY Computers, Inc., and $491,000
related to the writedown of certain assets to their net realizable
value.

During the year ended July 31, 2006, the Company realized a net
gain of $20,207,000, or $1.46 per diluted share, from the sale of its
Camtronics Medical Systems subsidiary to Emageon, Inc. of Birmingham,
Alabama, on November 1, 2005. As a result of the sale, the Company
classified the Camtronics business as a discontinued operation and
recast its financial statements accordingly to represent the operation
as discontinued.

Net income attributable to discontinued operations, the cumulative
effect of a change in accounting principle, and the gain on disposal
of discontinued operations for the twelve months ended July 31, 2006,
was $20,466,000, or $1.48 per diluted share.

Net income for the twelve months ended July 31, 2007, was
$15,380,000, or $1.10 per diluted share, compared with a net income of
$25,066,000, or $1.81 per diluted share, for the same period a year
earlier.

Jim Green, Analogic President and CEO, said, “Several trends were
evident in our health businesses this quarter. Sales of our
high-performance CT subsystems were up significantly from a very good
quarter a year earlier. Sales of ultrasound systems and subsystems,
and of power systems for magnetic resonance imaging, were on a par
with last year’s strong performance.” During the quarter Analogic
announced that its Anrad subsidiary had concluded a supply agreement
to develop and provide advanced flat-panel digital radiography
detector plates to Siemens AG for next-generation Full-Field Digital
Mammography (FFDM), which are particularly suitable for use in
next-generation tomosynthesis systems. “We expect sales of amorphous
Selenium-based, flat-panel detector plates for digital mammography to
grow significantly over the course of the next several years,” Green
noted. During the quarter the Company also concluded an agreement
granting CAS Medical Systems, Inc., of Branford, Connecticut,
exclusive worldwide rights to market and sell Analogic’s innovative
LIFEGARD® Family of non-invasive patient monitors.

Security revenues were up modestly over a weak quarter a year
earlier as the Company shipped 15 EXplosive Assessment Computed
Tomography (EXACT®) Systems to L-3 Communications, up from 11
systems a year earlier. The Company shipped 52 EXACTs in fiscal 2007,
compared to 107 a year earlier. Shortly after the quarter ended, the
Company received a $17.5 million order for EXACT systems and upgrade
components from L-3.

“The security systems business continues to offer us a number of
opportunities,” said Green. “We see a sustained demand for our current
EXACT system and upgrades. We’re also developing checked baggage
screening systems for two potentially developing market segments new
for Analogic: the KING COBRA® for the many small to mid-sized
airports that currently use expensive, labor-intensive screening
procedures, and the XLB1100 for large, high-volume airports.”

Addressing the checkpoint, a segment new to Analogic, at the end
of the quarter the Company installed its first Carry-On Baggage
Real-time Assessment (COBRA) system at Cleveland Hopkins International
Airport in Ohio, the first “Auto-EDS” installed at any airport
checkpoint in the world. An Automatic Explosives and Weapons Detection
System, the COBRA has performed exceptionally well and been received
enthusiastically by checkpoint inspectors and by passengers, who are
no longer required to remove laptop computers or “3-1-1” bags of
liquids from their carrying cases. The Company is scheduled to install
additional COBRA prototypes as the primary screening devices at three
additional airports over the next several months.

“This has been a year of significant transition,” said Green.
“Following a disappointing first quarter, income from operations has
improved for three consecutive quarters. As I noted in June, the
Company has eliminated losses in its end-user Medical Computed
Tomography business and significantly reduced its losses in its
Digital Radiography business. We trimmed some administrative expenses
and sharpened the focus of our research and development efforts,
reducing expenditures while continuing to invest in exciting
breakthrough technologies, such as our new, high-power, non-contact
PowerLink. Significant advances in computed tomography, like the
PowerLink, have application in both our health and security
businesses. We continue to focus our resources on the health and
security opportunities that have the greatest potential for long-term
growth and profitability. We are confident that we have the building
blocks – solid base businesses; advanced, proprietary technology; and
a strong balance sheet – to help ensure Analogic’s long-term success
as The World Resource for Health and Security Technology.”

Conference Call

Analogic will conduct an investor conference call on Monday,
September 24, at 11:00 a.m. ET to discuss the fourth-quarter and
fiscal-year 2007 results and recent developments. To participate in
the conference call dial 1-866-823-6992 (toll free), or 1-334-323-7225
for international callers, approximately five to ten minutes before
the conference is scheduled to begin. Inform the operator that you
wish to join the Analogic conference, Passcode 03391. You will then be
asked for your name, organization, and telephone number and be
connected to the conference. To listen to the live audio webcast,
visit www.analogic.com approximately five to ten minutes before the
conference is scheduled to begin.

A replay of the conference call webcast will be archived on the
Company’s website at www.analogic.com approximately three hours after
the call is completed and will be available through Monday, October
15, 2007.

A telephone digital replay will be available approximately two
hours after the call is completed through midnight (ET) Monday,
October 1, 2007. To access the digital replay, dial 1-877-919-4059
(toll free), or 1-334-323-7226 for international callers. The
conference ID number is 13196930. For more information on the
conference call, visit www.analogic.com, call 978-326-4213, or email
proberts@analogic.com.

Analogic Corporation is a leading designer and manufacturer of
advanced health and security systems and subsystems sold primarily to
Original Equipment Manufacturers (OEMs). The Company is recognized
worldwide for advancing the state of the art in Automatic Explosives
Detection, Computed Tomography (CT), Digital Radiography (DR),
Ultrasound, Magnetic Resonance Imaging (MRI), Patient Monitoring, and
Advanced Signal Processing.

Forward-Looking Statements

Any statements in this press release about future expectations,
plans, and prospects for the Company, including statements about
orders for the Company’s products, statements about shipments and
installation of the Company’s products, and other statements
containing the words “believes,” “anticipates,” “plans,” “expects,”
and similar expressions, constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those indicated by such
forward-looking statements as a result of various important factors,
including risks relating to technology development and
commercialization, risks in product development, limited demand for
the Company’s products, risks associated with competition,
uncertainties associated with regulatory agency approvals, competitive
pricing pressures, downturns in the economy, the risk of potential
intellectual property litigation, and other factors discussed in our
most recent quarterly report filed with the Securities and Exchange
Commission. In addition, the forward-looking statements included in
this press release represent the Company’s views as of September 24,
2007. The Company anticipates that subsequent events and developments
will cause the Company’s views to change. However, while the Company
may elect to update these forward-looking statements at some point in
the future, the Company specifically disclaims any obligation to do
so. These forward-looking statements should not be relied upon as
representing the Company’s views as of any date subsequent to
September 24, 2007.

Consolidated Statements of Operations (in thousands, except per share
                                 data)

                                Three Months Ended Twelve Months Ended
                                     July 31,           July 31,
                                --------------------------------------
                                   (Unaudited)          (Audited)
                                  2007     2006      2007      2006
                                --------------------------------------
Net revenue:
Products                        $83,070  $ 76,131  $312,921  $323,486
Engineering                       6,722     4,513    17,182    17,859
Other                             3,141     3,074    10,679    10,100
                                --------------------------------------
Total net revenue                92,933    83,718   340,782   351,445
                                --------------------------------------
Cost of sales:
Products                         50,928    49,502   192,572   197,605
Engineering                       6,450     5,899    15,736    19,963
Other                             1,797     1,455     6,634     5,381
Asset impairment charges             --     6,182     8,625     7,361
                                --------------------------------------
Total cost of sales              59,175    63,038   223,567   230,310
                                --------------------------------------
Gross margin                     33,758    20,680   117,215   121,135
                                --------------------------------------
Operating expenses:
Research and product
 development                     11,186    12,232    46,955    51,790
Selling and marketing             8,622     7,642    30,066    29,242
General and administrative       11,098    10,779    36,789    37,837
Restructuring and asset
 impairment charges                  --     5,903     1,080     7,515
                                --------------------------------------
Total operating expenses         30,906    36,556   114,890   126,384
                                --------------------------------------
Income (loss) from operations     2,852   (15,876)    2,325    (5,249)
                                --------------------------------------
Other (income) expense:
Interest income, net             (3,223)   (3,043)  (12,755)  (10,155)
Equity (gain) loss in
 unconsolidated affiliates           80        --       667       787
Gain on sale of marketable
 securities                      (4,036)       --    (4,036)       --
Other                               (32)      144      (226)      (14)
                                --------------------------------------
Total other (income) expense     (7,211)   (2,899)  (16,350)   (9,382)
                                --------------------------------------
Income (loss) from continuing
 operations before income
 taxes, discontinued operations
 and cumulative effect of
 change in accounting principle  10,063   (12,977)   18,675     4,133
Provision (benefit) for income
 taxes                            1,741    (4,907)    3,295      (467)
                                --------------------------------------
Income (loss) from continuing
 operations before discontinued
 operations and cumulative
 effect of change in accounting
 principle                        8,322    (8,070)   15,380     4,600
Income (loss) from discontinued
 operations (net of income tax
 provision of $20 and $146 for
 the three and twelve months
 ended July 31, 2006)                --       (20)       --       139
Gain (loss) on disposal of
 discontinued operations (net
 of income tax benefit of $219
 and income tax provision of
 $8,885 for the three and
 twelve months ended July 31,
 2006)                               --      (433)       --    20,207
Cumulative effect of change in
 accounting principle (net of
 income tax of $61 for the
 twelve months ended July 31,
 2006)                               --        --        --       120
                                --------------------------------------
Net income (loss)               $ 8,322  $ (8,523) $ 15,380  $ 25,066
                                --------------------------------------
Basic earnings (loss) per
 share:
Income (loss) from continuing
 operations                     $  0.60  $  (0.59) $   1.11  $   0.34
Income from discontinued
 operations, net of tax              --        --        --      0.01
Gain (loss) on disposal of
 discontinued operations, net
 of tax                              --     (0.04)       --      1.47
Cumulative effect of change in
 accounting principle, net of
 tax                                 --        --        --      0.01
                                --------------------------------------
Net income (loss)               $  0.60  $  (0.63) $   1.11  $   1.83
                                --------------------------------------
Diluted earnings (loss) per
 share:
Income (loss) from continuing
 operations                     $  0.60  $  (0.59) $   1.10  $   0.33
Income from discontinued
 operations, net of tax              --        --        --      0.01
Gain (loss) on disposal of
 discontinued operations, net
 of tax                              --     (0.04)       --      1.46
Cumulative effect of change in
 accounting principle, net of
 tax                                 --        --        --      0.01
                                --------------------------------------
Net income (loss)               $  0.60  $  (0.63) $   1.10  $   1.81
                                --------------------------------------
Dividends declared per share    $  0.10  $   0.10  $   0.40  $   0.38
Shares outstanding:
Basic                            13,670    13,815    13,814    13,704
Diluted                          13,842    13,912    13,946    13,853

         Condensed Consolidated Balance Sheets (in thousands)

                                                  July 31,   July 31,
                                                    2007       2006
                                                  ---------  ---------
                                                  (Audited)  (Audited)
Assets:
Cash, cash equivalents and marketable securities   $228,545   $258,237
Accounts receivable, net                             58,926     52,112
Inventories                                          54,413     55,518
Other current assets                                 23,558     24,968
                                                  ---------  ---------
Total current assets                                365,442    390,835
                                                  ---------  ---------
Property, plant and equipment, net                   80,482     81,853
Other assets                                         13,217     15,957
                                                  ---------  ---------
Total Assets                                       $459,141   $488,645
                                                  ---------  ---------
Liabilities and Stockholders' Equity:
Accounts payable                                   $ 21,734   $ 17,372
Accrued liabilities                                  26,570     24,111
Advance payments and deferred revenue                11,517      9,386
Accrued income taxes                                  5,507      5,011
                                                  ---------  ---------
Total current liabilities                            65,328     55,880
                                                  ---------  ---------
Deferred income taxes                                   456        840
                                                  ---------  ---------
Total long-term liabilities                             456        840
                                                  ---------  ---------
Stockholders' Equity                                393,357    431,925
                                                  ---------  ---------
Total Liabilities and Stockholders' Equity         $459,141   $488,645
                                                  ---------  ---------

CONTACT:
Analogic Corporation

John J. Millerick
978-326-4000
Senior Vice President & CFO
or
Paul M. Roberts
978-326-4213
Director of Communications
proberts@analogic.com

SOURCE:
Analogic Corporation