Frequency Electronics, Inc. Announces Fiscal Year 2013 Results
19 7월 2013 - 12:00AM
Frequency Electronics, Inc. (Nasdaq:FEIM) reported revenues of
$68.9 million for fiscal year 2013, which ended April 30, 2013, an
8% year-over-year increase compared to revenues of $63.6 million
for fiscal 2012.
Operating profit for fiscal 2013 was $4.7 million, compared to
operating profit of $6.7 million for fiscal 2012. Fiscal year 2013
results include a fourth quarter asset write down charge to
earnings of $1.4 million.
Net income for fiscal 2013 was $3.7 million or $0.43 per diluted
share compared to net income of $7.4 million or $0.86 per diluted
share for fiscal 2012. Fiscal year 2012 net income included a
benefit from the $3.1 million reversal of a deferred tax valuation
allowance and recognition of a gain of $700,000 from the step
acquisition of Elcom Technologies.
Commenting on the Company's performance and business outlook,
Chairman of the Board General Joseph Franklin stated: "This past
fiscal year we achieved excellent gains in revenues and profits in
our core satellite payload business. Furthermore, we anticipate
additional, sizable new contracts for space products in the very
near future. Accordingly, we are highly confident in our positive
outlook for the current fiscal year. We also achieved increased
revenues from other non-space US Government/DOD end-use business.
After the end of the past year, the Company determined to take a
one-time asset write down of 1.1 million Euros at our Gillam-FEI
subsidiary. That write down along with fourth quarter results
at our FEI-Zyfer subsidiary prevented consolidated operating income
and EBITDA from reaching previously anticipated record
levels. Looking ahead, we expect increased operating income
and EBITDA as fiscal year 2014 progresses. In addition, after
the end of fiscal 2013 we established a new $25 million credit
facility in support of our present strong financial position and
for potential acquisitions. We continue to aggressively pursue
opportunities for external growth."
Selected Fiscal 2013 Financial Metrics and Other
Items
- Satellite payloads, the Company's dominant and fastest growing
business area, represented 50% of consolidated revenues and grew by
11% over prior year satellite revenues. More than 75% of
year-end backlog represents satellite business, currently weighted
more toward US Government/DOD programs than for commercial
applications.
- Sales for non-space U.S. Government/DOD end-use increased to
26% of consolidated revenues. Total sales for U.S.
Government/DOD, including revenues on U.S. Government satellite
programs and revenues from FEI-Elcom and FEI-Zyfer, accounted for
more than 60% of consolidated revenues.
- Spending on internal research and development (IR&D)
increased by approximately $1.9 million compared to the prior
year. These expenditures include increased efforts on the
Company's expanded product line of satellite microwave
receivers/converters. Excellent progress has been made on
these new products and the Company expects prototypes to be
available for customer appraisal by the fall of 2013 and to obtain
orders prior to the end of fiscal year 2014.
- For fiscal year 2013, operating profit plus depreciation and
amortization, cashless contributions to employee benefit plans,
stock-based compensation and add back of the year-end charge on
Gillam-FEI ("modified EBITDA") was $10.5 million or 15% of
revenues, compared to $11.0 million and 17% of revenues for fiscal
year 2012.
- Revenues from our network infrastructure business area
accounted for 17% of consolidated revenues, down from 20% of
consolidated revenues in the prior year.
- FEI-Elcom results are included in the FEI-NY segment. In
the first quarter of the year FEI-Elcom recorded a $900,000
operating loss. Since that quarter, FEI-Elcom has generated
increased revenues and operating profits. The Company expects
FEI-Elcom to make a positive contribution to fiscal year 2014
profits as well as contributing substantial engineering resources
to new product development.
- FEI-Zyfer's results for the fourth quarter of the fiscal year
were negatively impacted by delays in orders and lower than
anticipated revenues from U.S. Government and commercial
customers. A fourth quarter operating loss of approximately
$700,000 erased the operating profits that FEI-Zyfer had achieved
during the first three quarters of fiscal year 2013.
- Gillam-FEI has participated for several years in designing
hardware and creating software in connection with the French
government's smart electrical grid initiative. Based on slower
than anticipated rollout of this project, the Company has less
visibility regarding the probable schedule for obtaining
production-level orders, which are now anticipated to occur no
earlier than fiscal year 2015. Accordingly, the Company
elected to write down $1.4 million dollars of accumulated
costs.
- Subsequent to year end, the Company established a five-year,
$25 million revolving credit facility with JPMorgan Chase Bank for
working capital and acquisitions. The agreement calls for a
floating interest rate of LIBOR plus 75 basis points and LIBOR plus
175 basis points on separate tranches.
Investor Conference Call
As previously announced, the Company will hold a conference call
to discuss these results on Thursday, July 18, 2013, at 12:00 Noon
Eastern Time. Investors and analysts may access the call by
dialing 1-877-407-9210. International callers may dial
1-201-689-8049. Ask for the Frequency Electronics conference
call.
The call will be archived on the Company's website through
August 16, 2013. The archived call may also be retrieved at
1-877-660-6853 (domestic) or 1-201-612-7415 (international) using
Conference ID #: 418220.
About Frequency Electronics
Frequency Electronics, Inc. is a world leader in the design,
development and manufacture of high precision timing, frequency
control and synchronization products for space and terrestrial
applications. Frequency's products are used in satellite
payloads and in other commercial, government and military systems
including C4ISR markets, missiles, UAVs, aircraft, GPS, secure
radios, energy exploration and wireline and wireless communication
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 and strategic acquisitions world-wide 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 42 GHz, for space and other challenging
environments."
Subsidiaries and Affiliates: Gillam-FEI provides expertise in
network synchronization and monitoring; FEI-Zyfer provides GPS and
secure timing ("SAASM") capabilities for critical military and
commercial applications; FEI-Asia provides cost effective
manufacturing capabilities; FEI-Elcom Tech provides added resources
for state-of-the-art RF microwave products. Frequency's
Morion affiliate supplies high-quality, cost effective quartz
oscillators and components. Additional information is
available on the Company's website:
www.frequencyelectronics.com
Safe Harbor Statement under the Private Securities
Litigation Reform Act of 1995:
The Statements in this press release regarding 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,
inability to integrate operations and personnel, actions by
significant customers or competitors, general domestic and
international economic conditions, consumer spending trends,
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, and other risks detailed in the Company's periodic
report filings with the Securities and Exchange Commission. By
making these forward-looking statements, the Company undertakes no
obligation to update these statements for revisions or changes
after the date of this release.
Frequency Electronics,
Inc. and Subsidiaries |
Consolidated Condensed
Summary of Operations Data |
|
|
|
|
|
|
Quarter Ended |
Year Ended |
|
April 30, |
April 30, |
|
2013 |
2012 |
2013 |
2012 |
|
(unaudited) |
(audited) |
|
(in thousands except per share
data) |
Net Revenues |
$17,541 |
$17,153 |
$68,932 |
$63,595 |
Cost of Revenues |
11,894 |
11,006 |
43,822 |
38,977 |
Gross Margin |
5,647 |
6,147 |
25,110 |
24,618 |
Selling and Administrative |
3,821 |
4,038 |
14,704 |
14,055 |
Research and Development |
1,996 |
907 |
5,727 |
3,860 |
Operating (Loss) Profit |
(170) |
1,202 |
4,679 |
6,703 |
Interest and Other, Net |
127 |
648 |
407 |
111 |
Income before Income Taxes |
(43) |
1,850 |
5,086 |
6,814 |
Income Tax (Benefit) Provision |
-- |
(2,330) |
1,400 |
(560) |
Net Income |
$(43) |
$4,180 |
$3,686 |
$7,374 |
|
|
|
|
|
Net Income per Share: |
|
|
|
|
Basic |
$(0.01) |
$0.50 |
$0.44 |
$0.89 |
Diluted |
$(0.01) |
$0.49 |
$0.43 |
$0.86 |
Average Shares Outstanding |
|
|
|
|
Basic |
8,446,489 |
8,357,106 |
8,412,633 |
8,329,081 |
Diluted |
8,446,489 |
8,551,046 |
8,604,651 |
8,540,955 |
|
|
|
|
|
Frequency Electronics,
Inc. and Subsidiaries |
Condensed Consolidated
Balance Sheets |
|
|
|
|
April 30, |
April 30, |
|
2013 |
2012 |
|
(in thousands) |
ASSETS |
|
|
Cash & Marketable Securities |
$21,730 |
$22,440 |
Accounts Receivable |
7,889 |
10,866 |
Costs and Estimated Earnings in Excess of
Billings, net |
8,617 |
7,207 |
Inventories |
37,150 |
34,299 |
Other Current Assets |
5,367 |
4,550 |
Property, Plant & Equipment |
8,316 |
8,374 |
Other Assets |
19,577 |
18,491 |
|
$108,646 |
$106,227 |
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
Current Liabilities |
$9,309 |
$16,109 |
Long-term Obligations and Other |
17,130 |
10,986 |
Stockholders' Equity |
82,207 |
79,132 |
|
$108,646 |
$106,227 |
|
|
|
Reconciliation of GAAP operating
profit to modified EBITDA: |
|
|
|
Year Ended |
|
April 30, |
|
2013 |
2012 |
|
(in thousands) |
GAAP operating profit |
$4,679 |
$6,703 |
Depreciation & amortization |
2,413 |
2,241 |
Gillam-FEI year-end charge |
1,400 |
-- |
Deferred compensation expense |
1,072 |
1,156 |
Stock-based compensation |
947 |
862 |
Modified EBITDA |
$10,511 |
$10,962 |
|
|
|
"Modified EBITDA" consists of operating profit plus certain
non-cash expenses, including depreciation and amortization,
contributions and accruals for employee benefit programs and
stock-based compensation expense as well as the one-time charge to
write off certain Gillam-FEI assets. Modified EBITDA is a
non-GAAP operating metric used by the Company in assessing its
operating results. The Company's definition of modified EBITDA
may differ from the definition of EBITDA used by other companies
and may not be comparable to similarly titled measures used by
other companies. The Company believes that investors and
analysts may use modified EBITDA along with other information
contained in its SEC filings, in assessing the Company's ability to
generate cash flow and service debt.
CONTACT: Alan Miller, CFO, or General Joseph P. Franklin, Chairman:
TELEPHONE: (516) 794-4500
WEBSITE: www.frequencyelectronics.com
Frequency Electronics (NASDAQ:FEIM)
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Frequency Electronics (NASDAQ:FEIM)
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