Wednesday, manufacturer of digital offset printing solutions Presstek, Inc. (PRST), posted a narrower loss for the fourth quarter, reflecting significantly reduced operating expenses and improved gross margins. Revenues for the quarter declined 28% driven in large part by reduced equipment sales in all regions.
The Greenwich, Connecticut-based company's fourth quarter net loss narrowed to $0.5 million or $0.01 per share from $2.8 million or $0.08 per share last year.
Income from continuing operations for the quarter was $0.6 million or $0.02 per share, compared with a loss from continuing operations of $2.2 million or $0.06 per share in the prior-year quarter.
Quarterly loss from discontinued operations was $1.1 million or $0.03 per share, wider than a net loss of $0.6 million or $0.02 per share in the year-ago quarter.
Revenue for the fourth quarter declined to $42.3 million from $58.9 million in the year-ago quarter, driven in large part by reduced equipment sales in the U.S. and Europe, and weak consumable sales in the U.S. and Canada.
Excluding the impact of changes in foreign currency exchange rates, revenue declined 25% year-over-year. Equipment sales in all regions were negatively impacted by the significant deterioration in the economy in the fourth quarter of 2008 consistent with trends in global capital equipment markets.
Product revenue for the quarter decreased to $34.0 million from $50.0 million, while service and parts revenue dropped to $8.4 million from $9.7 million in the prior-year period.
Gross margin for the quarter improved to 37.9% from 31.9% last year. Consumable and service margins in the quarter improved to 51.2% and 29.7%, respectively driven by mix and business improvement plan benefits. Equipment gross margin for the quarter climbed a modest 11.7% from 11.5% in the same quarter last year.
Operating expenses for the quarter declined 22% year-over-year to $17.0 million from the prior-year quarter. The company incurred restructuring charges of $0.5 million for the quarter.
For fiscal year 2008, net income was $0.5 million or $0.01 per share, compared with net loss of $12.2 million or $0.34 million last year. Income from continuing operations for the period was $3.1 million or $0.09 per share, compared with a loss from continuing operations of $10.4 million or $0.29 per share in the previous year. Loss from discontinued operations was $2.6 million or $0.08 per share, wider than a net loss of $1.8 million or $0.05 per share in the previous year.
Revenue for 2008 decreased to $193.3 million from $246.6 million in 2007.
Looking ahead, Presstek indicated that revenues would continue to be under pressure in the first half of 2009. However, the company said additional cost reduction measures have been implemented to reflect these economic realities.
The company also announced that it has reached an insurance contract lawsuit settlement in the first quarter of 2009 and, as a result, received settlement proceeds of $1.2 million, which will be recorded in the first quarter of 2009.
PRST is currently trading at $2.00, up $0.16 or 8.70%, on a volume of 29,712 shares on the Nasdaq.
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