Attached files
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| 8-K - PHAZAR CORP 8-K - PHAZAR CORP | a6841529.htm |
Exhibit 99.1
PHAZAR CORP Reports Fourth Quarter and Fiscal Year 2011 Financial Results
MINERAL WELLS, Texas--(BUSINESS WIRE)--August 25, 2011--PHAZAR CORP, (NASDAQ: ANTP) designs, manufactures and markets antennas, wireless mesh network solutions, towers, support structures, masts and communication accessories worldwide. Today, PHAZAR CORP announces the results of operations for the three and twelve month periods ended June 30, 2011 and the one month period ended June 30, 2010.
Fourth Quarter Fiscal Year 2011
Revenues of $1,728,076 for the fourth quarter increased 22% compared to $1,415,297 for the same three month period last year. Sales from our shipboard product line were up $489,464 during the fourth quarter compared to the same period last year, offset by a $257,006 decline in the commercial wireless sales quarter over quarter.
The $262,279, or 21% decrease in cost of goods sold is largely attributed to a non-recurring $203,000 adjustment to the warranty reserve in the fourth quarter in fiscal year 2010. The warranty charge was for an ongoing voluntary recall of safety climb components and a replacement of a specific production run of a new antenna design that was found to have a manufacturing defect, which has since been rectified. The fourth quarter fiscal year 2011 gross profit margin improved over patterns seen earlier in the year.
The $177,639, or 19% decrease in sales and administration expense reflects a $203,383 non-recurring stock compensation charge in the fourth quarter of prior year. Research and development costs of $63,748 were up $47,828, for the three months ended June 30, 2011 compared to $15,920 in the prior year. The increase represents continued product development for the commercial wireless product line.
The Company recognized a net loss of $52,060, or $.02 per share for the fourth quarter, compared to net loss of $569,397, or $.25 per share, in last year's fiscal fourth quarter.
One Month Period Ended June 30, 2010
The Company reported revenues for the one month period ended June 30, 2010 of $1,002,331 with a gross profit margin of 56%. Net income for the one month period was $36,489, or $.02 per share.
Fiscal Year Ended June 30, 2011
The Company reported revenues for the fiscal year 2011 of $8,399,586, an increase of $1,401,753, or 20% compared to fiscal year 2010 ending on May 31, 2010. The pattern of sales for the fiscal year reflects strong growth in the ILS markets ($1,123,295) during the first half of the year and the shipboard product line predominately in the fourth quarter ($587,479). The gross profit margin improved slightly at 44% in fiscal year 2011, compared to 43% in fiscal year 2010.
The $686,217, or 21% decrease in selling, general and administration expense reflects $325,610 of non-recurring stock compensation expense in fiscal year 2010 along with a continued increase in plant utilization overhead.
In January 2011, the Company announced that, after a thorough review of the progress and status of the True Mesh Network Radio program, the Board of Directors concluded that commercial viability and profitability was unlikely to be achievable in the foreseeable future and voted to discontinue further development. As a result, the Company has recorded a charge of $994,082 for discontinued operations, net of tax for the year ended June 30, 2011, of which $508,546 relates to activity prior to the decision to discontinue operations.
The Company recognized a net loss after discontinued operations of $326,833, or $.14 per share for the year ended June 30, 2011 compared to a net loss of $937,994, or $.41 per share for fiscal year ended May 30, 2010.
Backlog of Orders
The Company's backlog of orders on June 30, 2011, totaled approximately $2,277,566 compared to $2,561,866 at June 30, 2010 and $2,907,590 at May 31, 2010, a decrease of 21.6%. Incoming orders for the year ended June 30, 2011 totaled $8,359,869 versus $8,846,659 for the fiscal year ended May 31, 2010, a decrease of 6%.
Commenting on operations and financial results, Garland P. Asher, Chairman and Chief Executive Officer, said, “Recent Congressional budget wrangling is negatively impacting DOD and FAA order activity, and uncertainty surrounding the proposed AT&T – T Mobile merger would appear to be delaying DAS antenna projects in the commercial area.”
More information and analysis of PHAZAR CORP’s financial results will be provided in the management discussion and analysis of financial condition and results of operations in the Form 10-K for the year ended June 30, 2011, estimated to be filed with the Securities and Exchange Commission on or around September 29, 2011.
The Form 10-K will be available at the SEC’s website at www.sec.gov and PHAZAR CORP’S website at www.phazarcorp.com.
Product information is available at www.antennaproducts.com and www.phazar.com.
The common stock of PHAZAR CORP is listed on the NASDAQ Capital Market under the trading symbol “ANTP”. This press release contains forward-looking information within the meaning of Section 29A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performances and underlying assumption and other statements, which are other than statements of historical facts. Certain statements contained herein are forward-looking statements and, accordingly, involve risks and uncertainties, which could cause actual results, or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections are expressed in good faith and are believed by the Company to have a reasonable basis, including without limitations, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties, but there can be no assurance that management’s expectations, beliefs or projections will result, or be achieved, or accomplish.
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PHAZAR CORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS |
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Three Months
Ended |
Twelve Months Ended | One Month Ended | Twelve Months Ended | ||||||||||||||||||||||||
| June 30, 2011 |
May 31, 2010 |
June 30, 2011 |
June 30, 2010 |
May 31, 2010 |
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| Sales and contract revenues | $ | 1,728,076 | $ | 1,415,297 | $ | 8,399,586 | $ | 1,002,331 | $ | 6,997,833 | |||||||||||||||||
| Cost of sales and contracts | 972,871 | 1,235,150 | 4,713,705 | 442,284 | 4,019,752 | ||||||||||||||||||||||
| Gross profit | 755,205 | 180,147 | 3,685,881 | 560,047 | 2,978,081 | ||||||||||||||||||||||
| Gross profit margin % | 44 | % | 13 | % | 44 | % | 56 | % | 43 | % | |||||||||||||||||
| Selling, general and administration expenses | 775,043 | 952,682 | 2,586,064 | 318,886 | 3,272,281 | ||||||||||||||||||||||
| Research and development costs | 63,748 | 15,920 | 160,611 | 7,813 | 209,154 | ||||||||||||||||||||||
| Total selling, general and administration expenses | 838,791 | 968,602 | 2,746,675 | 326,699 | 3,481,435 | ||||||||||||||||||||||
| Operating income (loss) | (83,586 | ) | (788,455 | ) | 939,206 | 233,348 | (503,354 | ) | |||||||||||||||||||
| Other income | |||||||||||||||||||||||||||
| Interest income (net) | 15,705 | (25,154 | ) | 56,558 | (3,333 | ) | 11,195 | ||||||||||||||||||||
| Other income | (126 | ) | 8,361 | 21,695 | 1,263 | 27,999 | |||||||||||||||||||||
| Total other income | 15,579 | (16,793 | ) | 78,253 | (2,070 | ) | 39,194 | ||||||||||||||||||||
| Income (loss) from operations before income taxes | (68,007 | ) | (805,248 | ) | 1,017,459 | 231,278 | (464,160 | ) | |||||||||||||||||||
| Income tax expense (benefit) | (23,122 | ) | (273,511 | ) | 350,210 | 95,679 | (157,541 | ) | |||||||||||||||||||
| Net income (loss) before discontinued operations | (44,885 | ) | (531,737 | ) | 667,249 | 135,599 | (306,619 | ) | |||||||||||||||||||
| Discontinued operations | 10,872 | 57,061 | 1,506,185 | 150,167 | 956,629 | ||||||||||||||||||||||
| Income tax benefit from discontinued operations | (3,697 | ) | (19,401 | ) | (512,103 | ) | (51,057 | ) | (325,254 | ) | |||||||||||||||||
| Net discontinued operations expense | $ | 7,175 | $ | 37,660 | $ | 994,082 | $ | 99,110 | $ | 631,375 | |||||||||||||||||
| Net income (loss) | $ | (52,060 | ) | $ | (569,397 | ) | $ | (326,833 | ) | $ | 36,489 | $ | (937,994 | ) | |||||||||||||
| Basic income (loss) per common share | |||||||||||||||||||||||||||
| Continuing operations | $ | (0.02 | ) | $ | (0.23 | ) | $ | 0.29 | $ | 0.06 | $ | (0.13 | ) | ||||||||||||||
| Discontinued operations | (0.00 | ) | (0.02 | ) | (0.44 | ) | (0.04 | ) | (0.27 | ) | |||||||||||||||||
| Net income (loss) | $ | (0.02 | ) | $ | (0.25 | ) | $ | (0.14 | ) | $ | 0.02 | $ | (0.41 | ) | |||||||||||||
| Diluted income (loss) per common share | |||||||||||||||||||||||||||
| Continuing operations | $ | (0.02 | ) | $ | (0.23 | ) | $ | 0.29 | $ | 0.06 | $ | (0.13 | ) | ||||||||||||||
| Discontinued operations | (0.00 | ) | (0.02 | ) | (0.44 | ) | (0.04 | ) | (0.27 | ) | |||||||||||||||||
| Net income (loss) | $ | (0.02 | ) | $ | (0.25 | ) | $ | (0.14 | ) | $ | 0.02 | $ | (0.41 | ) | |||||||||||||
| Basic weighted average of common shares O/S | 2,309,644 | 2,302,995 | 2,275,300 | 2,303,807 | 2,300,191 | ||||||||||||||||||||||
| Diluted weighted average of common shares O/S | 2,309,644 | 2,302,995 | 2,275,300 |
2,303,807 |
2,300,191 | ||||||||||||||||||||||
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PHAZAR CORP AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS |
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| June 30, 2011 | June 30, 2010 | May 31, 2010 | ||||||||||||||
| CURRENT ASSETS | $ | 1,169,318 | $ | 1,403,839 | $ | 2,030,774 | ||||||||||
| Cash and cash equivalents | 785,664 | 1,207,057 | 748,671 | |||||||||||||
| Accounts receivable: | ||||||||||||||||
| Trade, net of allowance for doubtful accounts of $0 | ||||||||||||||||
| as of June 30, 2011, June 30, 2010 and May 31, 2010 | ||||||||||||||||
| Inventories | 2,732,232 | 2,642,607 | 3,012,904 | |||||||||||||
| Prepaid expenses and other assets | 125,989 | 75,543 | 95,586 | |||||||||||||
| Income taxes receivable | 236,366 | 286,769 | 316,374 | |||||||||||||
| Deferred income taxes | 224,875 | 96,169 | 105,314 | |||||||||||||
| Assets held for discontinued operations | - | 789,112 | 468,170 | |||||||||||||
| Total current assets | 5,274,444 | 6,501,096 | 6,777,793 | |||||||||||||
| Property and equipment, net | 1,043,435 | 1,159,195 | 1,170,090 | |||||||||||||
| Note receivable | 963,684 | 474,993 | 432,146 | |||||||||||||
| Long - term deferred income tax | 252,617 | 226,314 | 232,188 | |||||||||||||
| TOTAL ASSETS | $ | 7,534,180 | $ | 8,361,599 | $ | 8,612,217 | ||||||||||
| CURRENT LIABILITIES | ||||||||||||||||
| Accounts payable | $ | 216,575 | $ | 797,069 | 477,111 | |||||||||||
| Accrued liabilities | 284,969 | 372,476 | 538,952 | |||||||||||||
| Deferred revenues | 2,355 | 28,703 | 207,514 | |||||||||||||
| Liabilities held for discontinued operations | 178,060 | 87,607 |
360,120 |
|||||||||||||
| Total current liabilities | $ | 681,959 | $ | 1,285,855 | $ | 1,583,697 | ||||||||||
| TOTAL LIABILITIES | $ | 681,959 | $ | 1,285,855 | $ | 1,583,697 | ||||||||||
| COMMITMENTS AND CONTINGENCIES | - | - | - | |||||||||||||
| SHAREHOLDERS’ EQUITY | ||||||||||||||||
| Preferred Stock, $1 par, 2,000,000 shares authorized, none issued | ||||||||||||||||
| or outstanding, attributes to be determined when issued | - | - | - | |||||||||||||
| Common stock, $0.01 par, 6,000,000 shares authorized | 23,852 | 23,788 | 23,785 | |||||||||||||
| and 2,385,128, 2,378,728 and 2,378,428 issued and outstanding on June 30, 2011 | ||||||||||||||||
| June 30, 2010 and May 31, 2010, respectively | ||||||||||||||||
| Additional paid in capital | 4,517,234 | 4,414,050 | 4,403,261 | |||||||||||||
| Treasury stock, at cost, 74,691 shares on June 30, 2011, June 30, 2010 and May 31, 2010 | (215,918 | ) | (215,918 | ) | (215,918 | ) | ||||||||||
| Retained earnings | 2,527,053 | 2,853,824 | 2,817,392 | |||||||||||||
| Total shareholders’ equity | 6,852,221 | 7,075,744 | 7,028,520 | |||||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 7,534,180 | $ | 8,361,599 | $ | 8,612,217 | ||||||||||
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PHAZAR CORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS |
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| Fiscal Year Ended |
One Month Ended |
Fiscal Year Ended | ||||||||||||||
| June 30, 2011 | June 30, 2010 | May 31, 2010 | ||||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||||
| Net income (loss) | $ | (326,833 | ) | $ | 36,489 | $ | (937,994 | ) | ||||||||
| Adjustments to reconcile net income (loss) to net cash | ||||||||||||||||
| provided (used in) operating activities: | ||||||||||||||||
| Depreciation | 131,760 | 10,897 | 142,299 | |||||||||||||
| Loss from discontinued operations | 994,082 | 99,110 | 631,375 | |||||||||||||
| Stock based compensation | 103,310 | 10,733 | 428,855 | |||||||||||||
| Deferred federal income tax | (155,007 | ) | 15,017 | (145,654 | ) | |||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||||
| Accounts receivable | 421,393 | (458,386 | ) | (85,172 | ) | |||||||||||
| Inventories | (89,625 | ) | 370,297 | (644,179 | ) | |||||||||||
| Income taxes receivable | 50,403 | 29,605 | 26,771 | |||||||||||||
| Prepaid expenses | (50,447 | ) | 20,043 | (19,326 | ) | |||||||||||
| Accounts payable | (580,494 | ) | 319,958 | 261,271 | ||||||||||||
| Accrued expenses | (87,507 | ) | (166,476 | ) | 52,286 | |||||||||||
| Deferred revenues | (26,348 | ) | (178,810 | ) | 190,630 | |||||||||||
| Net cash used in discontinued operations | (114,517 | ) | (692,565 | ) | (576,334 | ) | ||||||||||
| Net cash provided by ( used in) operating activities | 270,170 | (584,088 | ) | (675,172 | ) | |||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||||
| Funding of note receivable | (488,691 | ) | (42,847 | ) | (432,146 | ) | ||||||||||
| Purchase of property and equipment | (16,000 | ) | - | (172,248 | ) | |||||||||||
| Purchase of treasury stock | - | - | (10,307 | ) | ||||||||||||
| Net cash used in investing activities | (504,691 | ) | (42,847 | ) | (614,701 | ) | ||||||||||
| Net decrease in cash and cash equivalents | (234,521 | ) | (626,935 | ) | (1,289,873 | ) | ||||||||||
| CASH AND CASH EQUIVALENTS, beginning of period | 1,403,839 | 2,030,774 | 3,320,647 | |||||||||||||
| CASH AND CASH EQUIVALENTS, end of period | $ | 1,169,318 |
$ |
1,403,839 |
$ | 2,030,774 | ||||||||||
CONTACT:
Antenna Products Corporation
Kathy Kindle, 940-325-3301
Fax:
940-325-0716
kindle@phazarcorp.com