ELMWOOD PARK, N.J., May 14 /PRNewswire-FirstCall/ -- Kreisler Manufacturing Corporation (Nasdaq: KRSL) announced sales and earnings for the three and nine months ended March 31, 2008.



    Highlights

    Three Months Ended March 31, 2008
    -- Net Sales    19% increase to $7,445,000 compared to $6,247,000 at
                    March 31, 2007
    -- Net income   96% increase to $605,000 compared to $308,000 at
                    March 31, 2007
    -- EPS          $0.32 fully diluted earnings per common share compared to
                    $0.16 at March 31, 2007
    -- Backlog      9% increase to $32,400,000 compared to $29,689,000 at
                    March 31, 2007


    Nine Months Ended March 31, 2008
    -- Net Sales    25% increase to $21,709,000 compared to $17,346,000 at
                    March 31, 2007
    -- Net income   25% increase to $1,635,000 compared to $1,308,000 at
                    March 31, 2007
    -- EPS          $0.86 fully diluted earnings per common share compared to
                    $0.71 at March 31, 2007

Kreisler CEO Michael Stern commented that "We are pleased with our latest financial results. Our strategy remains focused on expanding global capabilities, making incremental improvements in product quality and, to further improve efficiencies, enhancing employee skills. Kreisler Polska's tube and pipe facility is on schedule to be operational this summer with the goal of supporting current and future U.S. and European customers. We continue positioning Kreisler to benefit from strategic opportunities while providing competitive pricing through process improvements and cost containment."

"Our net income for the three and nine months ended March 31, 2008 increased 96% and 25%, respectively, compared to the prior fiscal year," said Kreisler CFO Ned Stern. "During our fiscal 2008 third quarter, sales of components for military aircraft engines and industrial gas turbines increased 24% and 179%, respectively, compared to our third quarter fiscal 2007 sales," said Ned Stern, "while our sales of commercial aircraft engine components were 7% lower. For the nine months ended March 31, 2008, all three of our industry market areas experienced sales increases compared to the same period in the prior fiscal year." The Company noted that the net income for the three months ended March 31, 2007 was affected by a $235,000 pre-tax product warranty expense and a $129,000 sales reduction attributable to a U.S. Government contract.

Ned Stern also noted that, "our order backlog as of March 31, 2008 increased 9% to $32,400,000 compared to $29,689,000 as of March 31, 2007. Approximately 74% of our order backlog is scheduled to ship over the next 12 months. Our March 31, 2008 cash on hand and short-term investments of $7,523,000 increased $1,900,000 compared to June 30, 2007 due to strong working capital management and advanced payments from our customers. We also held approximately $700,000 of AAA-rated auction rate securities as long-term investments. While we have no immediate need for liquidity, these long-term investments have been affected by the ability of the financial markets to trade such securities. We do not anticipate that the lack of liquidity of these long-term investments will affect our ability to execute our current business plan."

Kreisler Manufacturing Corporation is a manufacturer of precision metal components and assemblies for use in military and commercial aircraft engines and industrial gas turbines. These products primarily include tube and manifold assemblies. The Company has two wholly owned subsidiaries: Kreisler Industrial Corporation located in Elmwood Park, New Jersey, and Kreisler Polska Sp. z o.o located in Krakow, Poland.





    Kreisler Manufacturing Corporation and Subsidiaries
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (Unaudited)

                               Three Months Ended        Nine Months Ended
                                    March 31,                 March 31,
                               2008         2007         2008         2007

    Net Sales              $7,445,087   $6,247,219   $21,708,880  $17,345,535

    Cost of goods sold      5,977,364    5,261,352    17,507,707   13,938,815
    Selling, general and
     administrative
     expenses                 507,768      540,520     1,626,698    1,320,777
      Total Costs and
       Expenses             6,485,132    5,801,872    19,134,405   15,259,592
    Income from operations    959,955      445,347     2,574,475    2,085,943

    Interest and other
     income                    76,774       45,886       202,060      131,309
    Interest and other
     expenses                 (25,305)      (6,315)      (43,973)     (37,800)

    Income before income
     taxes                  1,011,424      484,918     2,732,562    2,179,452

    Income taxes             (406,019)    (176,794)   (1,097,878)    (871,794)
    Net income               $605,405     $308,124   $ 1,634,684  $ 1,307,658
    Net income per common
     share:
    Net income - basic shares   $0.32        $0.17         $0.88        $0.71
    Net income - diluted
     shares                     $0.32        $0.16         $0.86        $0.71
    Weighted average
     common shares -
     basic                  1,867,948    1,842,792     1,867,948    1,834,781
    Weighted average common
     shares - diluted       1,881,431    1,881,523     1,893,508    1,853,960



    Kreisler Manufacturing Corporation and Subsidiaries
    CONDENSED CONSOLIDATED BALANCE SHEETS


                                             March 31, 2008    June 30, 2007
                                                 (Unaudited)        (Audited)
    Assets
    Cash and cash equivalents                    $7,521,971       $5,068,325
    Short-term investments                               --          550,000
    Accounts receivable - trade (net)             2,494,058        2,366,177
    Inventories                                   6,581,027        5,546,983
    Deferred tax asset                                  192           96,312
    Other current assets                          1,172,975           66,200
      Total current assets                       17,770,223       13,693,997

    Property, plant and equipment, net            1,805,776        2,425,098
    Long-term investments                           700,000               --
    Deferred tax asset                              123,942          123,942
      Total non-current assets                    2,629,718        2,549,040
                                                $20,399,941      $16,243,037

    Liabilities and Stockholders' Equity

    Liabilities
    Accounts payable - trade                     $1,721,159       $1,130,990
    Accrued expenses                                863,997          520,540
    Deferred tax liability                          139,720               --
    Deferred revenue                              1,657,812          500,000
    Product warranties                                   --          148,185
    Income taxes payable                            124,711               --
    Obligations under capital leases, current
     portion                                        125,234          115,731
      Total current liabilities                   4,632,633        2,415,446

    Obligations under capital leases, net of
     current portion                                161,192          258,343
    Accrued environmental cost                      440,085          426,117
      Total long-term liabilities                   601,277          684,460

      Total stockholders' equity                 15,166,031       13,143,131
                                                $20,399,941      $16,243,037

Forward-Looking Statements

Certain oral statements made by management of Kreisler Manufacturing Corporation (the "Company") from time to time and certain statements contained herein or in other periodic reports filed by the Company with the Securities and Exchange Commission are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to results of operations and the business of the Company. All such statements, other than statements of historical facts, including those regarding market trends, the Company's financial position and results of operations, business strategy, projected costs, and plans and objectives of management for future operations, are forward-looking statements. In general, such statements are identified by the use of forward-looking words or phrases including, but not limited to, "estimates," "intended," "will," "should," "may," "believes," "expects," "expected," "anticipates," and "anticipated" or the negative thereof or variations thereon or similar terminology. These forward-looking statements are based on the Company's current expectations. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. These forward-looking statements represent the Company's current judgment. The Company disclaims any intent or obligation to update its forward looking statements. Because forward-looking statements involve risks and uncertainties, the Company's actual results could differ materially from those set forth in or underlying the forward-looking statements.

SOURCE Kreisler Manufacturing Corporation