Frequency Electronics, Inc. Announces Second Quarter Fiscal Year 2023 Financial Results
20 Dezembro 2022 - 6:13PM
Frequency Electronics, Inc. (“FEI” or the “Company”) (NASDAQ-FEIM)
is reporting revenues for the three- and six-month periods of
fiscal 2023, ended October 31, 2022, of approximately $8.9 million
and $17.2 million, respectively, compared to revenues of $12.9
million and $25.9 million, respectively, for the same periods of
fiscal 2022, ended October 31, 2021. Operating loss for the second
quarter of fiscal 2023 was $2.3 million compared to an operating
profit of $303,000 for the same period of fiscal 2022. Operating
loss for the six months ended October 31, 2022 was $5.4 million
compared to an operating loss of $1.4 million for the six months
ended October 31, 2021. Net loss from operations for the three and
six months ended October 31, 2022 was $2.3 million or ($0.25) per
diluted share and $5.4 million or ($0.58) per diluted share,
respectively, compared to a net income of $497,000 or $0.05 per
diluted share for the three months ended October 31, 2021 and a net
loss of $1.1 million or ($0.12) per diluted share for the six
months ended October 31, 2021. Additionally, as just announced in a
separate press release, the Company will be paying a special cash
dividend of $1.00 per share of common stock on January 27, 2023, to
stockholders of record as of the close of business on January 6,
2023. Please see that release for further details.
FEI Interim President and CEO, Thomas
McClelland, commented, “The second quarter of fiscal 2023 continued
to be challenging financially, but corrective steps are in
progress, and some very promising indicators of this are now
apparent. Revenue quarter over quarter has increased. FEI’s backlog
of approximately $56 million at quarter end is higher than it has
been at any time in the last 8 years, as is the book to bill ratio
of 2.8. These indicators show in numbers the increase in activity
we are witnessing in our primary markets. As it relates to our
industry, both commercial and government satellite businesses show
signs of sustained double-digit growth going forward. We still
struggle with supply chain issues and persistent inflation, but in
both cases signs of easing are beginning to appear. Continued
vigilance is required to navigate the changing economic and
geopolitical environment, but we are nonetheless confident that we
are progressing in a positive direction, and look forward to a
dramatic improvement in results. The Company is committed to moving
towards sustained profitability and cash generation in the near
future. We remain debt free, and our strong balance sheet allows us
to pay the special cash dividend discussed in the separate release
today, while still maintaining the ability to invest for future
growth opportunities.”
Fiscal Year 2023 Selected Financial
Metrics and Other Items
-
For the three and six months ended October 31, 2022, revenues from
satellite payloads were approximately $4.3 million, or 48%, and
$7.8 million, or 46%, respectively, of consolidated revenues
compared to approximately $6.6 million, or 51%, and $13.3 million,
or 52%, respectively, for the same periods of the prior fiscal
year.
-
For the three and six months ended October 31, 2022, revenues for
non-space U.S. Government/DOD customers were approximately $3.9
million, or 44%, and $8.0 million, or 47%, respectively, of
consolidated revenues compared to approximately $5.1 million, or
39%, and $10.6 million, or 41%, respectively, for the same period
of the prior fiscal year.
-
For the three and six months ended October 31, 2022, revenues from
other commercial and industrial sales accounted for approximately
$698,000, or 8%, and $1.4 million, or 8%, respectively, of
consolidated revenues compared to approximately $1.2 million, or
10%, and $2.0 million, or 8%, respectively, for the same period of
the prior fiscal year.
-
Net cash used in operating activities for the six months ended
October 31, 2022 was $466,000 compared to $1.7 million provided by
operating activities in the comparable prior fiscal 2022
period.
-
Backlog at October 31, 2022 was approximately $56 million, compared
to $40 million at April 30, 2022.
Investor Conference CallAs
previously announced, the Company will hold a conference call to
discuss these results on Tuesday, December 20, 2022, at 4:30 PM
Eastern Time. The conference call is being webcast by
Webcast@issuersdirect.com and can be accessed in the Investor
Relations section of Frequency’s website at www.freqelec.com.
Investors and analysts may access the call by dialing
1-888-506-0062. International callers may dial
1-973-528-0011. Callers should provide participant
access code: 113502 or ask for the Frequency Electronics conference
call.
The archived call may be accessed by calling
1-877-481-4010 (domestic), or 1-919-882-2331 (international), for
one week following the call (replay passcode: 47314). Subsequent to
that, the call can be accessed via a link available on the
Company’s website through March 19, 2023.
About Frequency
ElectronicsFrequency Electronics, Inc. is a world leader
in the design, development and manufacture of high precision
timing, frequency generation and RF control products for space and
terrestrial applications. Frequency’s products are used in
satellite payloads and in other commercial, government and military
systems including C4ISR and electronic warfare, missiles, UAVs,
aircraft, GPS, secure communications, energy exploration and
wireline and wireless networks. Frequency has received over 100
awards of excellence for achievements in providing high performance
electronic assemblies for over 150 space and DOD programs. The
Company invests significant resources in research and development
to expand its capabilities and markets.
Frequency’s Mission Statement: “Our mission is
to provide precision time and low phase noise frequency generation
systems from 1 Hz to 50 GHz, for space and other challenging
environments.”
Subsidiaries and Affiliates: FEI-Zyfer provides
GPS and secure timing ("SAASM") capabilities for critical military
and commercial applications; FEI-Elcom Tech provides Electronic
Warfare (“EW”) sub-systems and state-of-the-art RF microwave
products. Additional information is available on the Company’s
website: www.frequencyelectronics.com
Forward-Looking Statements
The statements in this press release regarding
future earnings and operations and other statements relating to the
future constitute “forward-looking” statements pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements inherently involve risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements. Factors that would cause or
contribute to such differences include but are not limited to, the
risks associated with health epidemics and pandemics, including the
COVID-19 pandemic and similar outbreaks, such as their impact on
our financial condition and results of operations and on our
ability to continue manufacturing and distributing our products,
and the impact of health epidemics and pandemics on general
economic conditions, including any resulting recession, our
inability to integrate operations and personnel, actions by
significant customers or competitors, general domestic and
international economic conditions, reliance on key customers,
continued acceptance of the Company’s products in the marketplace,
competitive factors, new products and technological changes,
product prices and raw material costs, dependence upon third-party
vendors, competitive developments, changes in manufacturing and
transportation costs, the availability of capital, the outcome of
any litigation and arbitration proceedings, and failure to maintain
an effective system of internal controls over financial reporting.
The factors listed above are not exhaustive and should be read in
conjunction with the other cautionary statements that are included
in this release and in our filings with the Securities and Exchange
Commission. The Company’s Annual Report on Form 10-K for the fiscal
year ended April 30, 2022, filed on July 14, 2022 with the
Securities and Exchange Commission includes additional factors that
could materially and adversely impact the Company’s business,
financial condition and results of operations, as such factors are
updated from time to time in our periodic filings with the
Securities and Exchange Commission, which are accessible on the
Securities and Exchange Commission’s website at www.sec.gov.
Moreover, the Company operates in a very competitive and rapidly
changing environment. New factors emerge from time to time and it
is not possible for management to predict the impact of all these
factors on the Company’s business, financial condition or results
of operations or the extent to which any factor, or combination of
factors, may cause actual results to differ materially from those
contained in any forward-looking statements. Given these risks and
uncertainties, investors should not rely on forward-looking
statements as a prediction of actual results. Any or all of the
forward-looking statements contained in this press release and any
other public statement made by the Company or its management may
turn out to be incorrect. The Company expressly disclaims any
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law.
Contact
information: |
|
Dr. Thomas
McClelland, Interim President and Chief Executive Officer; |
|
|
Steven Bernstein, Chief Financial Officer; |
TELEPHONE: (516) 794-4500 ext.5000
WEBSITE: www.freqelec.com
|
Frequency Electronics, Inc. and
SubsidiariesCondensed Consolidated Statements of
Operations(in thousands except per share
data) |
|
|
Three Months Ended |
|
Six Months Ended |
|
October 31, |
October 31, |
|
(unaudited) |
(unaudited) |
|
2022 |
|
2021 |
|
2022 |
|
2021 |
Revenues |
$ |
8,949 |
|
|
$ |
12,936 |
|
|
$ |
17,153 |
|
|
$ |
25,890 |
|
Cost of Revenues |
|
8,599 |
|
|
|
8,845 |
|
|
|
16,808 |
|
|
|
17,738 |
|
Gross Margin |
|
350 |
|
|
|
4,091 |
|
|
|
345 |
|
|
|
8,152 |
|
Selling and
Administrative |
|
2,034 |
|
|
|
2,411 |
|
|
|
4,026 |
|
|
|
6,805 |
|
Research and Development |
|
599 |
|
|
|
1,377 |
|
|
|
1,709 |
|
|
|
2,732 |
|
Operating (Loss) Income |
|
(2,283 |
) |
|
|
303 |
|
|
|
(5,390 |
) |
|
|
(1,385 |
) |
Interest and Other, Net |
|
(30 |
) |
|
|
196 |
|
|
|
(39 |
) |
|
|
309 |
|
Loss (Income) Before Income
Taxes |
|
(2,313 |
) |
|
|
499 |
|
|
|
(5,429 |
) |
|
|
(1,076 |
) |
Provision for Income
Taxes |
|
1 |
|
|
|
2 |
|
|
|
2 |
|
|
|
2 |
|
Net (Loss) Income |
$ |
(2,314 |
) |
|
$ |
497 |
|
|
$ |
(5,431 |
) |
|
$ |
(1,078 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) per
Share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted (Loss) Income per Share |
$ |
(0.25 |
) |
|
$ |
0.05 |
|
|
$ |
(0.58 |
) |
|
$ |
(0.12 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Shares
Outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
9,326 |
|
|
|
9,256 |
|
|
|
9,317 |
|
|
|
9,246 |
|
Diluted |
|
9,326 |
|
|
|
9,302 |
|
|
|
9,317 |
|
|
|
9,246 |
|
|
Frequency Electronics, Inc. and
SubsidiariesCondensed Consolidated Balance
Sheets(in thousands) |
|
|
|
October 31, 2022 |
|
|
|
April 30, 2022 |
|
|
|
(unaudited) |
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
Cash & Marketable Securities |
$ |
19,732 |
|
|
$ |
21,525 |
|
Accounts Receivable, net |
|
4,855 |
|
|
|
4,291 |
|
Contract Assets |
|
9,473 |
|
|
|
8,857 |
|
Inventories, net |
|
19,878 |
|
|
|
19,906 |
|
Other Current Assets |
|
1,310 |
|
|
|
1,431 |
|
Property, Plant & Equipment, net |
|
8,148 |
|
|
|
8,564 |
|
Other Assets |
|
11,576 |
|
|
|
11,381 |
|
Right-of-Use Assets – Operating Leases |
|
8,104 |
|
|
|
8,805 |
|
|
$ |
83,076 |
|
|
$ |
84,760 |
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
Lease Liability - current |
|
1,751 |
|
|
|
1,744 |
|
Contract Liabilities |
$ |
16,976 |
|
|
$ |
11,098 |
|
Other Current Liabilities |
|
8,150 |
|
|
|
9,019 |
|
Other Long-term Obligations |
|
8,631 |
|
|
|
8,858 |
|
Operating Lease Liability – non-current |
|
6,629 |
|
|
|
7,353 |
|
Stockholders’ Equity |
|
40,939 |
|
|
|
46,688 |
|
|
$ |
83,076 |
|
|
$ |
84,760 |
|
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