CPSH CPS Technologies Corp

CPS Technologies Corporation (NASDAQ:CPSH) (“CPS” or the “Company”) today announced financial results for the fiscal fourth quarter ended December 30, 2023.

Fourth Quarter Highlights

• Revenue of $6.7 million for the fourth quarter of 2023 versus $6.1 million in the prior-year period, primarily due to growth in shipments
• Gross margin of 17.0 percent versus 26.6 percent in the fourth quarter of 2022, reflecting certain quality issues with a major customer
• Operating profit of $0.1 million for the quarter ended December 30, 2023 compared to $0.3 million in the prior-year period

“We finished the year with the highest annual revenue in the Company’s history – $27.6 million – driven by 10 percent growth in the fourth quarter versus the prior-year period,” said Brian Mackey, President and CEO. “We are cautiously optimistic that the quality issues previously disclosed have been largely mitigated and should not have a material impact on 2024 results. While the Continuing Resolution in Washington has hampered certain decision making, impacting some of our new business development initiatives, we believe our strong position across the Company’s diverse end markets provides plenty of opportunity for further top line expansion. That said, the U.S. Navy contract for HybridTech Armor® panels is, as previously discussed, expected to be completed during the second quarter of this year. We remain steadfast in our mission to pursue other fast-growing industrial and technological applications that can accelerate demand and drive CPS to new levels of performance. We continue to invest for the future, and I am confident that order flow will improve as the year plays out. Even as short-term headwinds exist, the future is bright for CPS.”

Results of Operations CPS reported revenue of $6.7 million in the fourth quarter of fiscal 2023 versus $6.1 million in the prior-year period, reflecting overall growth in product shipments. Gross profit was $1.1 million, or 17.0 percent of revenue, versus $1.6 million, or 26.6 percent of revenue, in the fiscal 2022 fourth quarter, with the lower gross margin year-over-year largely due to quality issues with one of the Company’s major customers.

Operating profit was $0.1 million in the fiscal 2023 fourth quarter compared with $0.3 million in the prior-year period. Reported net income was also $0.2 million, or $0.01 per diluted share, versus $0.3 million, or $0.02 per diluted share, in the quarter ended December 31, 2022.

Conference Call The Company will be hosting its fourth quarter 2023 earnings call at 9:00 am on March 7, 2024. Those interested in participating in the conference call should dial the following: 

Call in Number: 1-844-943-2942 Participant Passcode: 531915

The Company encourages those who wish to participate to call in 10 minutes before the scheduled start time to ensure the operator can connect all participants.

About CPS CPS is a technology and manufacturing leader in producing high-performance materials solutions for its customers. The company’s products and intellectual property address critical needs in a variety of applications, including electric trains and subway cars, wind turbines, hybrid vehicles, electric vehicles, Navy ships, the smart electric grid, 5G infrastructure and others. CPS hermetic packages can be found in many Aerospace and Satellite applications.  CPS’ armor products provide exceptional ballistic protection and environmental durability at very light weight. CPS is committed to innovation and to supporting our customers in building solutions for the transition to clean energy.

Safe Harbor Statements made in this document that are not historical facts or which apply prospectively, including those relating to 2024 financial results, are forward-looking statements that involve risks and uncertainties. These forward-looking statements are identified by the use of terms and phrases such as "will," "intends," "believes," "expects," "plans," "anticipates" and similar expressions. Investors should not rely on forward looking statements because they are subject to a variety of risks and uncertainties and other factors that could cause actual results to differ materially from the company's expectation. Additional information concerning risk factors is contained from time to time in the company's SEC filings, including its Annual Report on Form 10-K and other periodic reports filed with the SEC. Forward-looking statements contained in this press release speak only as of the date of this release. Subsequent events or circumstances occurring after such date may render these statements incomplete or out of date. The company expressly disclaims any obligation to update the information contained in this release.

CPS Technologies Corporation                                   111 South Worcester Street Norton, MA 02766 www.cpstechnologysolutions.com

Investor Relations: Chris Witty 646-438-9385 cwitty@darrowir.com

CPS TECHNOLOGIES CORPORATION
Statements of Operations (Unaudited)
		Three Months Ended						Year Ended
		December 30,			December 31,			December 30,			December 31,
		2023			2022			2023			2022
Revenues:
	Product sales	$	6,747,199		$	6,115,352		$	27,550,646		$	26,586,926
	Total revenues	$	6,747,199		$	6,115,352		$	27,550,646		$	26,586,926
Cost of product sales			5,598,616			4,489,640			20,725,237			19,285,846
	Gross Margin		1,148,583			1,625,712			6,825,409			7,301,080
Selling, general, and
	administrative expense		1,004,948			1,316,530			5,126,046			5,066,660
	Income from operations		143,635			309,182			1,699,363			2,234,420
Interest/Other income (expense)			80,823			9,866			253,018			635,248
Net income before
	income tax		224,458			319,048			1,952,381			2,887,668
Income tax provision (benefit)			84,948			50,057			582,085			756,268
	Net income	$	139,510		$	268,991		$	1,370,296		$	2,131,400
Wtd. Avg. basic common shares outstanding - diluted			14,617,473			14,649,719			14,628,811			14,675,646
Net income per
	basic common share	$	0.01		$	0.02		$	0.09		$	0.15

CPS TECHNOLOGIES CORP.
Balance Sheets (Unaudited)
		December 31,			December 31,
		2022			2022
ASSETS
Current assets:
Cash and cash equivalents	$	8,813,626		$	8,266,753
Accounts receivable-trade, net		4,389,155			3,777,975
Accounts Receivable - other		83,191			685,668
Inventories, net		4,581,930			4,875,901
Prepaid expenses and other current assets		276,349			211,242
Total current assets		18,144,251			17,817,539
Net property and equipment		1,556,139			1,326,968
Right-of-use lease asset		332,000			466,000
Deferred taxes, net		1,269,726			2,069,436
Total Assets	$	21,602,116		$	21,679,943
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Note payable, current portion		46,797			43,711
Accounts payable		2,535,086			1,836,865
Accrued expenses		1,075,137			820,856
Deferred revenue		251,755			2,521,128
Lease liability, current portion		160,000			157,000
Total current liabilities		4,068,775			5,379,560
Note payable less current portion		8,090			54,847
Deferred revenue – long term		31,277			231,020
Long term lease liability		172,000			309,000
Total liabilities		4,280,142			5,974,427
Total stockholders’ equity		17,321,974			15,705,516
Total liabilities and stockholders’
equity	$	21,602,116		$	21,679,943