Presstek Reports Improved 2010 Third Quarter Operating Profits
Third quarter 2010 operating expenses of $11.7 million represented a reduction of $2.2 million, or 16%, from the third quarter of 2009. Excluding the impact of restructuring charges in each period, operating expenses declined by $1.6 million. The decline in operating expenses was primarily related to reduced payroll costs and professional service fees; partially offset by increased non-cash stock compensation expenses.
Debt net of cash totaled $6.9 million at the end of the third quarter, a reduction of $9.4 million versus the third quarter of 2009 and a reduction of $1.9 million from the end of the 2010 second quarter. The primary cause of the decrease from the prior year level was the proceeds received from the sale of the Company's Lasertel subsidiary in the first quarter of 2010.
"We continued to see sluggish sales results in the third quarter as the increase in our equipment revenue was more than offset by declines in our 'traditional' consumables and service revenue," said Presstek Executive Vice President and Chief Financial Officer, Jeff Cook. "A contributing factor to our overall consumables decline is a shift in buying patterns within the distributor channel, which negatively impacted the current quarter. Despite continued market softness we have maintained our positive adjusted EBITDA levels for the fourth consecutive quarter and reduced our debt net of cash position in the quarter by $1.9 million, to a relatively low $6.9 million."
"The Graph Expo tradeshow re-affirmed the confidence we have in our strategic direction," commented Jacobson. "As we established our strategy three years ago we envisioned that the 75DI would be the linchpin for our up-market strategy, serving as the spark for DI growth and providing the up-market customer contact to drive our new CTP products. The excitement around this product at Graph Expo confirmed our expectations. We had customers come to see the 75DI that have not done business with Presstek in the past and we had customers come that haven't looked at DI technology in years. They came to see the 75DI but stayed to see the rest of the portfolio after they were reintroduced to the new and improved DI technology. We have the products and resources in place to drive our strategy and we are confident that as the economy improves, our expanded portfolio and channel reach will result in increased sales and provide increased profitability with our streamlined cost structure."