For Immediate Release

Contact:  John Krawczynski

June 28, 2007

(860) 644-1551

GERBER SCIENTIFIC REPORTS FOURTH QUARTER AND FULL YEAR FISCAL 2007 RESULTS

SOUTH WINDSOR, CT -- Gerber Scientific, Inc. (NYSE: GRB) today reported net income for the quarter ended April 30, 2007 of $5.6 million, or $0.24 per diluted share, on revenue of $155.1 million, compared with net income of $3.9 million, or $0.17 per diluted share, on revenue of $143.1 million for the fourth quarter ended April 30, 2006. Results for the fourth quarter of fiscal 2007 included a non-cash, after tax charge for stock option expense of $0.4 million, or $0.02 per diluted share associated with the fiscal 2007 adoption of SFAS 123R, "Share-Based Payment" (SFAS 123R). Included in fourth quarter of fiscal 2006 results was a non-cash, after tax charge of $0.3 million, or $0.02 per diluted share, related to the adoption of FASB Interpretation No. 47, "Accounting for Contingent Asset Retirement Obligations" (FIN 47).

For the fiscal year ended April 30, 2007, the Company reported net income of $13.5 million, or $0.58 per diluted share, on revenue of $574.8 million. For the fiscal year ended April 30, 2006, the Company reported net income of $2.6 million, or $0.12 per diluted share, on revenue of $530.4 million. Full year fiscal 2007 net income included stock option expense of $1.0 million, or $0.04 per diluted share associated with the implementation of SFAS 123R. Net income for fiscal 2006 included a $2.5 million pre-tax charge associated with the early extinguishment of the Company’s former credit facility, a $2.3 million tax charge associated with the reversal of a deferred tax asset in the United Kingdom and a $0.3 million charge related to the cumulative effect of adopting FIN 47. These items cumulatively reduced prior year diluted earnings per share by $0.18.

Foreign currency translation had the effect of increasing revenue by approximately $7.3 million and $19.2 million for the fiscal 2007 fourth quarter and full year, respectively, over the fiscal 2006 comparable periods.

Gerber Scientific President and Chief Executive Officer, Marc T. Giles, commented, "Gerber reported solid results for fiscal 2007 with full year consolidated revenue up 8.4 percent as compared with fiscal 2006. Though our top line clearly benefited from favorable foreign currency translation, each operating segment reported strong organic growth. This growth was attributable to our success with new products and improved aftermarket demand, as well as increased volume within our Asian markets. Operating income increased to $23.6 million for fiscal 2007, improving by more than 30 percent from prior year. Both revenue and operating income were at the highest levels since fiscal 2000. Assuming no significant changes in the economic climate, we expect to report continued improvement in fiscal 2008, supported by new products, our Asian market base and initiatives, global expansion efforts and the impact of recent acquisitions."

For additional information, including segment and order information, please see our Annual Report on Form 10-K for the fiscal year ended April 30, 2007, to be filed with the Securities and Exchange Commission.

About Gerber Scientific, Inc.

Gerber Scientific, Inc. (http://www.gerberscientific.com) is a leading international supplier of sophisticated automated manufacturing systems for sign making and specialty graphics, apparel and flexible materials, and ophthalmic lens processing. Headquartered in South Windsor, Connecticut, the Company operates through four businesses: Gerber Scientific Products, Spandex, Gerber Technology, and Gerber Coburn.

Cautionary Note Concerning Factors That May Affect Future Results

Statements contained in this news release regarding the Company’s expected financial condition, results of operations, cash flows and product launches are forward-looking statements that involve risks and uncertainties. For information identifying other important economic, political, regulatory, legal, technological, competitive and other uncertainties, readers are referred to the Company’s filings with the Securities and Exchange Commission, including but not limited to, the information included in Gerber Scientific’s Annual Report on Form 10-K for the fiscal year ended April 30, 2006 under the headings "Business," "Risk Factors" and "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Cautionary Note Concerning Factors That May Influence Future Results," as well as information included in subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K, which outline certain important risks regarding the Company’s forward-looking statements. These risks include, but are not limited to, delays in the Company’s new product development and commercialization, intense competition in markets for each of the Company’s operating segments, rapid technological advances, availability and cost of raw materials, volatility in foreign currency exchange rates and fluctuations in interest rates. The Company expressly disclaims any obligation to update any of these forward-looking statements, except as required by law. Actual future results or events may differ materially from these forward-looking statements.

 

 

GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

Quarter Ended
April 30,

Year Ended
April 30,

In thousands, except per share data

2007 

2006 

2007 

2006 

Revenue:

       

     Product sales

$138,365 

$127,238 

$509,141 

$468,355 

     Service sales

16,772 

15,843 

65,657 

62,063 

155,137 

143,081 

574,798 

530,418 

Costs and Expenses:

       

     Cost of products sold

97,814 

89,617 

362,215 

331,920 

     Cost of services sold

10,287 

9,913 

40,209 

37,982 

     Selling, general and administrative expenses

32,244 

30,743 

124,460 

118,053 

     Research and development

6,089 

6,089 

24,282 

24,878 

     Restructuring charges

--- 

--- 

--- 

(231)

 

146,434 

136,362 

551,166 

512,602 

Operating income

8,703 

6,719 

23,632 

17,816 

Other income (expense), net

549 

(232)

524 

(1,669)

Loss on early extinguishment of debt

--- 

--- 

--- 

(2,483)

Interest expense

(817)

(663)

(3,530)

(4,481)

Income before income taxes and cumulative effect of
    accounting change


8,435 


5,824 


20,626 


9,183 

Income tax expense

2,870 

1,541 

7,118 

6,199 

         

Income before cumulative effect of accounting change

5,565 

4,283 

13,508 

2,984 

Cumulative effect of accounting change, net of tax

--- 

(340)

--- 

(340)

         

Net income

$     5,565

$    3,943 

$  13,508 

$    2,644 

         

Earnings per share of common stock:

       

Basic:

       

     Income before cumulative effect of accounting change

$      0.24 

$      0.19 

$      0.59 

$      0.13 

     Cumulative effect of accounting change

--- 

(0.02)

--- 

(0.01)

     Net income

$      0.24 

$      0.17 

$      0.59 

$      0.12 

         

Diluted:

       

     Income before cumulative effect of accounting change

$      0.24 

$      0.19 

$      0.58 

$       0.13 

     Cumulative effect of accounting change

--- 

(0.02)

--- 

(0.01)

     Net income

$      0.24 

$      0.17 

$      0.58 

$      0.12 

         

Weighted average shares outstanding:

       

     Basic

23,105 

22,555 

22,896 

22,418 

     Diluted

23,509 

22,971 

23,446 

22,706 

 

 

GERBER SCIENTIFIC, INC. AND SUBSIDIARIES
CONSOLIDATED SUMMARY BALANCE SHEETS
(Unaudited)


In thousands

April 30,
2007

April 30,
2006

Assets

   

Current Assets:

   

     Cash and cash equivalents

$    8,052

$  14,145

     Accounts receivable, net

106,421

92,422

     Inventories

65,299

53,794

     Prepaid expenses and other current assets

15,106

16,718

             Total current assets

194,878

177,079

     

Property, plant and equipment, net

36,982

38,529

Goodwill

54,825

51,554

Deferred income taxes

34,893

27,696

Other assets

14,384

15,622

             Total assets

$335,962

$310,480

     

Liabilities and Shareholders’ Equity

   

Current Liabilities:

   

     Current portion of long-term debt

$    1,773

$       284

     Accounts payable

48,772

53,886

     Other accrued liabilities

63,208

57,248

             Total current liabilities

113,753

111,418

     

Long-term debt

31,603

36,836

Other long-term liabilities

46,125

36,610

     

Shareholders’ equity

144,481

125,616

             Total liabilities and shareholders’ equity

$335,962

$310,480