Daktronics, Inc. Announces Fourth Quarter and Fiscal 2009 Results

• Press Release
• Source: Daktronics
• On 8:30 am EDT, Tuesday June 2, 2009

 * Net sales increase 16 percent for fiscal 2009 and decrease
   6 percent for the fourth quarter of fiscal 2009 compared to fiscal
   2008
 * Earnings per share increase 2 percent for fiscal 2009 and decrease
   93 percent for the fourth quarter of fiscal 2009 compared to fiscal
   2008
 * Expects sales and earnings to decline in fiscal 2010
 * Declares annual cash dividend of $0.095 per share based on
   continued positive cash flow performance

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BROOKINGS, S.D., June 2, 2009 (GLOBE NEWSWIRE) -- Daktronics, Inc. (Nasdaq:DAKT - News) today reported fiscal 2009 fourth quarter net sales of $121.8 million and net income of $0.3 million, or $0.01 per diluted share, compared to net sales of $129.1 million and net income of $5.7 million, or $0.14 per diluted share, for the fourth quarter of fiscal 2008. Backlog at the end of the 2009 fourth quarter was approximately $120 million, compared with a backlog of approximately $175 million a year earlier and $128 million at the end of the third quarter of fiscal 2009.

Net sales for the fiscal year ended May 2, 2009 totaled $581.9 million, up over 16 percent from net sales of $499.7 million in 2008. Net income for fiscal 2009 was $26.4 million, a one percent increase from net income of $26.2 million in fiscal 2008. Earnings per diluted share for the year ended May 2, 2009 were $0.64, compared to $0.63 per diluted share for the year ended April 26, 2008.

"During the quarter, we successfully launched new mega systems for two major league baseball facilities in New York that are showcases for our products and reflect the quality and dedication of our employees," said Jim Morgan, president and chief executive officer. "We are excited about what this means for the long-term; however, we continue to be adversely impacted by the economic environment, with the largest impact being within our Commercial and International business units. Orders for the fourth quarter of fiscal 2009 were up five percent in our Live Events and Schools and Theatres business units, and over 55 percent in our Transportation business unit as compared to the fourth quarter of fiscal 2008. This increase was offset by order declines of 62 percent and 85 percent in our Commercial and International business units, respectively. As previously discussed, the largest decline in our Commercial business unit is due to the pullback in capital spending by the major outdoor billboard companies. Based on industry reports, we do not expect any noticeable recovery in this niche until calendar 2011, at the earliest."

Morgan continued, "Our response to this overall downturn has been and will continue to be to adjust our infrastructure without harming our long-term opportunities. We are working diligently to decrease expenses where possible. This includes reductions in personnel, limitations on capital expenditures and, most importantly, establishing a tone within the company that expense reduction coupled with a focus on lean initiatives in manufacturing and administration are vital for our position when the economy improves."

"For fiscal 2010, we expect to see a significant reduction in orders and sales," said Morgan. "It's very difficult to forecast the business at this point, but we are focusing our strategic initiatives and cost controls under an assumption that the fourth quarter net sales level is an indicator of the trend for the year as a whole. In addition to an expected decline in our commercial business, as discussed above, we also expect a decline in our live events business. However, it's important to keep the expected decline in live events in perspective. With live events experiencing a revenue growth of 60 percent this past year, it would be appropriate, even in normal economic times, to expect a sequential year decline due to the natural volatility of that business. On the competitive environment, we have seen some very aggressive pricing, especially on larger projects. Although we believe some of the pricing we are seeing from competitors is not sustainable, it can have an adverse impact on us in the short term. At the same time we have renewed our emphasis on product development to reduce the cost of our products while still delivering products that are second to none in the industry. Nonetheless, we see gross margin pressure as a factor for the near term."

"Our gross margin for the quarter was significantly less than expected due to a number of factors, including lower than expected margin on contracts," said Bill Retterath, chief financial officer. "We also continue to see pressure resulting from the excess capacity, warranty costs and the competitive environment. We have made improvements by decreasing costs that impact gross profit, and further efforts in this regard remain a high priority for us. On the positive side, we continued to show declines in operating expenses overall and have plans to decrease this spending more in fiscal 2010."

Morgan concluded, "We have ended the 2009 fiscal year with a strong cash position and we are confident that we can continue to improve our cash position during fiscal year 2010. With no debt, and by approaching capital expenditures primarily with a view towards maintenance rather than growth, we believe that a dividend continues to be an effective use of our growing cash balances. Our priorities for the use of cash in fiscal 2010 are to continue to fund operations on a scaled back basis, explore and develop new and better product offerings, invest in business process initiatives and pay dividends to our shareholders."

The annual cash dividend will be payable June 23, 2009, to shareholders of record as of the close of business June 9, 2009. Although the company intends to pay regular annual dividends for the foreseeable further, subsequent dividends will continue to be reviewed annually and declared by the Board at its discretion.

Webcast Information

The company will host a conference call and webcast to discuss its financial results today at 10:00 am (Central Time). This call will be broadcast live at http://investor.daktronics.com and available for replay shortly after the event.

About Daktronics

Daktronics has strong leadership positions in, and is the world's largest supplier of, large screen video displays, electronic scoreboards, LED text and graphics displays, and related control systems. The company excels in the control of display systems, including those that require integration of multiple complex displays showing real-time information, graphics, animation and video. Daktronics designs, manufactures, markets and services display systems for customers around the world, in Sport, Business, Schools and Theaters and Transportation segments. For more information, visit the company's World Wide Web site at: http://www.daktronics.com, e-mail the company at investor@daktronics.com, call (605) 692-0200 or toll-free (800) 843-5843 in the United States or write to the company at 201 Daktronics Dr., PO Box 5128 Brookings, S.D. 57006-5128.

The Daktronics logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5476

Safe Harbor Statement

Cautionary Notice: In addition to statements of historical fact, this news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to enjoy the protection of that Act. These forward-looking statements reflect the Company's expectations or beliefs concerning future events. The Company cautions that these and similar statements involve risk and uncertainties which could cause actual results to differ materially from our expectation, including, but not limited to, changes in economic and market conditions, management of growth, timing and magnitude of future contracts, and other risks noted in the company's SEC filings, including its Annual Report on Form 10-K for its 2008 fiscal year and its Quarterly Reports on Form 10-Q for the quarters ended August 2, 2008, November 1, 2008 and January 31, 2009. Forward-looking statements are made in the context of information available as of the date stated. The Company undertakes no obligation to update or revise such statements to reflect new circumstances or unanticipated events as they occur.

                  Daktronics, Inc. and Subsidiaries
                  Consolidated Statements of Income
               (in thousands, except per share amounts)
                             (unaudited)

                             Three Months Ended    Twelve Months Ended
                            --------------------  --------------------
                              May 2,   April 26,    May 2,   April 26,
                               2009      2008        2009      2008
                            ---------  ---------  ---------  ---------
 Net sales                  $ 121,823  $ 129,117  $ 581,931  $ 499,677
 Cost of goods sold            94,163     92,788    426,573    352,087
                            ---------  ---------  ---------  ---------
  Gross profit                 27,660     36,329    155,358    147,590

 Operating expenses:
  Selling                      14,932     16,094     62,335     62,479
  General and administrative    6,975      6,736     28,787     26,040
  Product design and
   development                  4,637      5,863     21,619     20,828
                            ---------  ---------  ---------  ---------
                               26,544     28,693    112,741    109,347
                            ---------  ---------  ---------  ---------
  Operating income              1,116      7,636     42,617     38,243

 Nonoperating income
  (expense):
  Interest income                 504        462      2,068      1,757
  Interest expense                (47)      (158)      (244)    (1,423)
  Other income (expense),
   net                           (510)      (460)    (2,888)     1,049
                            ---------  ---------  ---------  ---------

 Income before income taxes     1,063      7,480     41,553     39,626
  Income tax expense              719      1,770     15,125     13,413
                            ---------  ---------  ---------  ---------
  Net income                $     344  $   5,710  $  26,428  $  26,213
                            =========  =========  =========  =========

 Weighted average shares
  outstanding:
  Basic                        40,652     40,180     40,537     39,918
                            ---------  ---------  ---------  ---------
  Diluted                      40,949     41,158     41,152     41,337
                            =========  =========  =========  =========

 Earnings per share:
  Basic                     $    0.01  $    0.14  $    0.65  $    0.66
                            =========  =========  =========  =========
  Diluted                   $    0.01  $    0.14  $    0.64  $    0.63
                            =========  =========  =========  =========

  Cash dividend paid per
   share                    $      --  $      --  $    0.09  $    0.07
                            =========  =========  =========  =========


                  Daktronics, Inc. and Subsidiaries
                     Consolidated Balance Sheets
                            (in thousands)

                                                May 2,
                                                 2009       April 26,
                                              (unaudited)     2008
                                              -----------  -----------
 ASSETS

 CURRENT ASSETS:
  Cash, cash equivalents and restricted cash  $    37,584  $     9,782
  Accounts receivable, less allowance for
   doubtful accounts                               61,412       56,516
  Inventories                                      51,400       50,525
  Costs and estimated earnings in excess of
   billings                                        27,541       27,126
  Current maturities of long-term receivables       7,962        7,435
  Prepaid expenses and other                        5,587        4,796
  Deferred income taxes                            15,017        9,517
  Property and equipment available for sale           470           --
                                              -----------  -----------
   Total current assets                           206,973      165,697
                                              -----------  -----------

 Advertising rights, net                            2,392        3,457
 Long-term receivables, less current
  maturities                                       15,879       16,837
 Investments in affiliates                          2,541        2,998
 Goodwill                                           4,549        4,722
 Intangible and other assets                        2,804        3,102
 Deferred income taxes                                311          143
                                              -----------  -----------
                                                   28,476       31,259
                                              -----------  -----------
 PROPERTY AND EQUIPMENT:
  Land                                              1,204        3,190
  Buildings                                        50,810       49,464
  Machinery and equipment                          50,013       44,743
  Office furniture and equipment                   52,369       45,482
  Equipment held for rental                         2,423        2,658
  Demonstration equipment                           8,021        7,516
  Transportation equipment                          5,115        6,106
                                              -----------  -----------
                                                  169,955      159,159
   Less accumulated depreciation                  (80,528)     (61,636)
                                              -----------  -----------
                                                   89,427       97,523
                                              -----------  -----------
 TOTAL ASSETS                                 $   324,876  $   294,479
                                              ===========  ===========


                  Daktronics, Inc. and Subsidiaries
               Consolidated Balance Sheets (continued)
                            (in thousands)

                                                May 2,
                                                 2009       April 26,
                                              (Unaudited)    2008
                                              -----------  -----------
 LIABILITIES AND SHAREHOLDERS' EQUITY

 CURRENT LIABILITIES:
  Accounts payable                            $    30,273  $    31,540
  Accrued expenses and warranty obligations        35,548       26,100
  Current maturities of long-term debt and
   marketing obligations                              367          910
  Billings in excess of costs and estimated
   earnings                                        13,769       24,560
  Customer deposits                                10,007       12,113
  Deferred revenue                                  9,531        6,980
  Income taxes payable                              2,935          949
                                              -----------  -----------
   Total current liabilities                      102,430      103,152
                                              -----------  -----------

 Long-term debt, less current maturities               23           55
 Long-term marketing obligations, less
  current maturities                                  759          646
 Long-term warranty obligations and other
  payables                                          4,805        3,766
 Deferred income taxes                              4,948        3,607
                                              -----------  -----------
                                                   10,535        8,074
                                              -----------  -----------
 TOTAL LIABILITIES                                112,965      111,226

 SHAREHOLDERS' EQUITY:
  Common stock                                     27,872       25,638
  Additional paid-in capital                       13,898       10,398
  Retained earnings                               170,705      147,912
  Treasury stock, at cost                              (9)          (9)
  Accumulated other comprehensive loss               (555)        (686)
                                              -----------  -----------
 TOTAL SHAREHOLDERS' EQUITY                       211,911      183,253
                                              -----------  -----------
 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $   324,876  $   294,479
                                              ===========  ===========


                  Daktronics, Inc. and Subsidiaries
                Consolidated Statements of Cash Flows
                            (in thousands)
                             (unaudited)

                                                       Years Ended
                                                  --------------------
                                                    May 2,   April 26,
                                                     2009      2008
                                                  ---------  ---------
 CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                                      $  26,428  $  26,213
  Adjustments to reconcile net income to net
   cash provided by operating activities:
   Depreciation                                      24,133     20,806
   Amortization                                         315        315
   Gain on sale of property and equipment              (862)        (7)
   Gain on sale of equity investment                     --     (2,878)
   Stock-based compensation                           3,154      2,628
   Equity in losses of affiliates                     2,404      2,402
   Provision for doubtful accounts                      419        145
   Deferred income taxes, net                        (4,326)      (785)
   Change in operating assets and liabilities        (2,934)    10,994
                                                  ---------  ---------
    Net cash provided by operating activities        48,731     59,833
                                                  ---------  ---------

 CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of property and equipment                (22,888)   (33,916)
  Loans to equity investees                            (665)        --
  Cash consideration paid for equity method
   investments                                           --       (750)
  Proceeds from sale of property and equipment        4,667        523
  Proceeds from sale of investments                      --      7,000
                                                  ---------  ---------
   Net cash used in investing activities            (18,886)   (27,143)
                                                  ---------  ---------

 CASH FLOWS FROM FINANCING ACTIVITIES:
  Net payments on notes payable                          --    (24,615)
  Proceeds from exercise of stock options               630      2,335
  Excess tax benefits from stock-based
   compensation                                         345        339
  Principal payments on long-term debt                 (546)      (563)
  Dividend paid                                      (3,635)    (2,770)
                                                  ---------  ---------
   Net cash used in financing activities             (3,206)   (25,274)
                                                  ---------  ---------

 EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
  EQUIVALENTS                                           537       (681)
                                                  ---------  ---------

 INCREASE IN CASH AND CASH EQUIVALENTS               27,176      6,735

 CASH AND CASH EQUIVALENTS BEGINNING OF PERIOD        9,325      2,590
                                                  ---------  ---------

 CASH AND CASH EQUIVALENTS END OF PERIOD          $  36,501  $   9,325
                                                  =========  =========


                  Daktronics, Inc. and Subsidiaries
                     Sales and Orders By Segment
                            (in thousands)
                             (unaudited)

                             Three Months Ended    Twelve Months Ended
                            --------------------  --------------------
                              May 2,   April 26,    May 2,   April 26,
                               2009      2008        2009      2008
                            ---------  ---------  ---------  ---------
 Net sales
  Commercial                $  24,232  $  46,020  $ 155,851  $ 180,938
  Live Events                  64,878     40,718    269,650    168,640
  Schools & Theatres           14,293     11,815     66,444     60,919
  Transportation               10,988     10,476     34,289     37,355
  International                 7,432     20,088     55,697     51,825
                            ---------  ---------  ---------  ---------
   Total Net Sales          $ 121,823  $ 129,117  $ 581,931  $ 499,677
                            =========  =========  =========  =========

 Orders
  Commercial                $  21,153  $  56,299  $ 135,316  $ 183,555
  Live Events                  56,600     54,308    247,296    201,775
  Schools & Theatres           16,117     15,308     63,173     63,286
  Transportation               15,888     10,231     44,707     34,500
  International                 3,977     27,250     37,960     63,303
                            ---------  ---------  ---------  ---------
   Total Orders             $ 113,735  $ 163,396  $ 528,452  $ 546,419
                            =========  =========  =========  =========

Daktronics, Inc.
Investor Relations:
Bill Retterath, Chief Financial Officer
(605) 692-0200 Investor@daktronics.com