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Trident International Inc.
(NASDAQ: TRDT)
1114 Federal Road
Brookfield, CT 06804 (203-740-9333
President, CEO, Director:
Elaine A. Pullen
Revenues (FYE September 30, 1998): $32,832,000
Net Income: $7,066,000 Employees: 161
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Business New Haven
11/30/1998
By: Kristine Hansen
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The last time you received a shipping carton in the mail, did you notice the printed markings on the box? Probably not - and you almost surely didn't spend any time thinking about how the markings got there.
But a company in Brookfield thinks a lot about those markings and devotes a large portion of its business to developing equipment to print custom markings on shipping cartons. This company is Trident International Inc., which has been in this line of business (including the operations of its predecessor company) since 1989.
The company had acquired a strategic license from Dataproducts Corp., which bestowed exclusive rights to certain patents related to ink-jet technology for marking purposes. This technology is the basis for the company's industrial printing products today.
Trident is a designer, manufacturer and marketer of ink-jet systems including inks, printheads and related products. Although the major segment of its business focuses on applications for printing on shipping cartons, the company also manufactures products for use in printing business forms, check coding, plotting for clothing patterns and for postal needs such as bar-coding and cancellation of stamps.
Trident's printhead subsystems are marketed under the Ultrajet, PixelJet and MicroCoder names. Trident also offers ink products including PostBrite, AllWrite and VersaPrint, among others, as well as a variety of accessories. Although the company markets in Europe, North America and Far East, about two-thirds of sales are generated in North America. Ten Trident customers account for approximately 70 percent of sales.
Trident completed its initial public offering in February 1996 with proceeds of $28.0 million earmarked for repayment of debt and retirement of notes. The IPO altered the composition of its balance sheet from a deficit equity position at year-end 1995 to $35.9 million by year-end 1996. As of year-end 1998, the company enjoys positive stockholders' equity of $40.6 million with no long-term debt, working capital of $26.6 million and cash and equivalents of $5.9 million.
The 1998 fourth quarter results were somewhat disappointing due to weaknesses in the Asian sector and customers delaying purchases to await new advanced product introductions from the company. Revenues for the quarter declined three percent to $7.7 million, compared to $7.9 million for the 1997 quarter. Net income was $1.3 million, or 20 cents per share, compared to $1.8 million (26 cents per share) for the third quarter of 1997.
Year-end results for 1998 mark an eight percent growth in revenues to $32.8 million from $30.2 million for the 1997 year. Net income was down, however, to $7.1 million ($1.05 per share) compared to $7.5 million (also $1.05 per share). (Note: Per-share calculations were affected by the company's share-repurchase program.)
Competition is stiff in this business, and Trident is investing in its R&D efforts. For the 1998 year, R&D expense was 13 percent of sales, up from ten percent for the 1997 year. Recently the company announced an alliance with the UK-based Xennia Technology Ltd. Xennia will work on the development of proprietary ink to be used for Trident applications.
Also, Trident announced its worldwide launch of the UltraJet II Bar Code Printhead and ScanTrue Ink during the Pack Expo '98 show in Chicago. In concert these two products facilitates the printing of bar codes directly onto boxes, thus eliminating the need for labels.
The company has been honored recently with two noteworthy awards. The Connecticut Technology Council named Trident as one of 50 of Connecticut's fast-growing tech companies - the second time the company has been awarded this recognition. Also Trident was the recipient of a 1998 Gold Connecticut Innovation Prize by the Connecticut Quality Improvement Award Partnership in recognition of an improvement in process in two areas of the company's ink department.
Trident is moving forward - but that is not necessarily being reflected in its stock price. The stock closed at 10 1/2 on November 16, down 3/4. During the first half of 1998 the stock did trade as high as 18 1/2, but has slid since July. Perhaps competition in the industry and the company's dependence on a few customers for a majority of its revenues may be contributing factors. Also, stock-market volatility, especially in high tech stocks, and fallout from the Asian economic woes are adding to the resultant lackluster stock performance. - Kristine Hansen
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