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Tel-Instrument Electronics Corp. Reports Net Income of $ 576k for First Quarter 2022 | 2021-08-12 | Press Releases

Tel-Instrument Electronics Corp. (“Tel & CloseCurlyDoubleQuote; or” Company & CloseCurlyDoubleQuote;) (OTCQB: TIKK), a leading designer and manufacturer of avionics testing and measurement solutions, today reported net income of $ 576k ($ 0.15 per share) on revenue of $ 4.1 million for the first quarter of fiscal 2022 ended June 30, 2021.

Highlights include:

  • Revenue for the first quarter rose to $ 4.1 million, up 40.6 percent from a year ago.
  • Gross margins remain stable at 48.8% due to production efficiency, strict cost control and product mix.
  • Quarterly operating expenses fell 4 percent to $ 1.25 million despite increased revenue and profit-sharing accruals.
  • Operating income rose to $ 766k for the current quarter from $ 209k in the quarter a year ago.
  • Net income rose to $ 576k, or $ 0.15 per ordinary share and $ 0.11 per share on a fully diluted basis.
  • EBITDA for the first quarter improved to $ 812k from $ 255k in the previous quarter.
  • Cash balances improved to $ 6.8 million, compared to $ 5.5 million at the beginning of the fiscal year.
  • Net worth improved to $ 5.7 million from $ 5.2 million at the beginning of the fiscal year.

Mr. Jeffrey O & CloseCurlyQuote; Hara, president and CEO of Tel-Instrument & CloseCurlyQuote, commented: “We are pleased to report improved first-quarter operating results, with revenue of $ 4.1 million. This was generated by strong sales from our military business and a moderate recovery in our trading business. The problems with the COVID-19 supply chain that we experienced in the previous fiscal year seem to be easing, and we are cautiously optimistic that this trend will continue. The company continues to do well in managing operating costs with a reduction of 4% on an annual basis. The delay remained strong at the end of the first quarter at $ 6.1 million. We expect the business with international test modes 5 and orders for the F-35 program to remain strong over the next few years. We are also actively working with the US Navy on ‘Medium Life & CloseCurlyDoubleQuote; update our CRAFT test kits, which can generate significant revenue over the next five to 10 years. We also continue to invest in our market-leading Mode 5 products and plan to demonstrate new test capabilities for Mode 5 Level 2B at an upcoming military test event. This could potentially lead to future software upgrades to all of our Mode 5 on-site test kits.

Our goal over the last few years has been to strengthen our balance sheet and set aside enough money to pay full compensation for Aeroflex’s damages, if necessary, in the event that we fail with our forthcoming legal appeal. This has already been achieved with a cash balance of $ 6.8 million on June 30, 2021. The company plans to apply for full forgiveness of the $ 722 thousand PPP loan in the second quarter, which is expected to lead to a balance with zero external debt.

To meet the standards for the next generation of military applications, we upgraded our 4.5kg manual SDR / OMNI test to include a much faster processor with improved video graphics capabilities. It is designed to meet Class 1 environmental specifications, making it an ideal set of tests for the military market. The goal of this new set of tests is to regain market share in the commercial avionics test kits business and expand into a much larger market for secure radio communications tests. We will demonstrate this device to customers from next month and expect to start accepting commercial orders this fall.

With regard to litigation with Aeroflex, we continue to believe that we have serious grounds for canceling or reducing the award. The appeal process has been delayed due to the COVID-19 pandemic, but we expect a decision within the next 12 months.

For Tel-Instrument Electronics Corp.

Tel-Instrument is a leading designer and manufacturer of avionics testing and measurement solutions for global commercial air transport, general aviation and government / military space and defense markets. Tel-Instrument provides tools for testing, measuring, calibrating and repairing a wide range of on-board navigation and communication equipment. For more information, please visit our website at www.telinstrument.com.

This press release includes statements that are not historical in nature and can be described as “statements for the future, & CloseCurlyDoubleQuote; including those related to future financial and operational results, benefits and synergies of the combined companies, statements about the company’s prospects and CloseCurlyQuote; and their results, long-term goals of the Company and other statements of expectations, beliefs, future plans and strategies, expected events or trends and similar expressions on matters that are not historical facts. All forecasts of future results contain a measure of uncertainty and, accordingly, actual results may differ significantly. Among the factors that could make a difference are: changes in the general economy; changes in demand for the company’s products and CloseCurlyQuote; or in the price and availability of its raw materials; the actions of its competitors; the success of our customers; technological change; changes in employee relations; government regulations; litigation, including their inherent uncertainty; difficulties in the work and materials of the plant; transport, environmental issues; and other unforeseen circumstances. A number of these factors have been discussed in previous Company & CloseCurlyQuote documents to the US Securities and Exchange Commission. The Company rejects any intention or obligation to update any forward-looking statements as a result of developments since the date of this press release. The safe port for forward-looking statements contained in the Securities Litigation Reform Act 1995 (the Act & CloseCurlyDoubleQuote;) protects companies from liability for their forward-looking statements if they meet the requirements of the law.

TEL-INSTRUMENT ELECTRONICS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

June 30,

2021

March 31,

2021

(unaudited)

ASSETS

Current assets:

Cash

$

4,758,819

$

3,485,275

Receivables, net

1,318,276

1 933 321

Stocks, net

3,051,343

3,437,989 th most common

Limited cash in support of the appeal

2,011,050

2,011,050

Prepaid expenses and other current assets

259 556

263 067

Total current assets

11,399,044

11 130 302

Improvements in equipment and leasing, no

169 388

200 769

Assets with the right to use in operating lease

1 867 505

1 922 805

Deferred tax asset, net

2,521,926

2,675,040 th most common

Other long – term assets

35,109 th most common

35 110

The total amount of assets

$

15,992,972

$

15 964 426

LIABILITIES AND SHAREHOLDERS & CloseCurlyQuote; CAPITAL

Current liabilities:

Operating lease liabilities – current part

$

194 469

$

201,883 th most common

Credit accounts

384,559

906 149

Deferred income – current part

154 382

150 709

Accrued costs & dash;

542 074

457 232

Accrued legal damages

5,940,943

5,889,023

Accrued expenses – other

331 848

365 975

Total current liabilities

7,548,275

7 970 971

Operating lease liabilities – long-term

1,673,036

1 720 921

Long-term debt – PPP

722,577

722,577

Deferred income – long-term

329 886

332,428

General obligations

10,273,774

10,746,897

Commitments and unforeseen circumstances

Shareholders and CloseCurlyQuote; equity:

Preference shares, 1,000,000 authorized shares, par value $ 0.10 per share

Preference Shares, 500,000 Shares 8% Cumulative Series A Convertible Preferred

issued and unpaid, par value $ 0.10 per share

3,695,998

3,695,998

Preference shares, 166,667 shares 8% cumulative series B convertible Preferred

issued and unpaid, par value $ 0.10 per share

1,147,367

1,147,367

Ordinary shares, 7,000,000 authorized shares, par value $ 0.10 per share,

3 255 887 issued and in circulation respectively

325 586

325 586

Additional paid-in capital

7,244,788

7 318 620

Accumulated deficit

(6 694 541

)

(7,270,042

)

Total shareholders & CloseCurlyQuote; equity

5,719,198

5,217,529

General Liabilities and Shareholders & CloseCurlyQuote; equity

$

15,992,972

$

15 964 426

TEL-INSTRUMENT ELECTRONICS CORP.

CONDENSED CONSOLIDATED DECLARATIONS OF OPERATIONS

(Unaudited)

Three months are over

June 30,

2021

June 30,

2020

Net sales

$

4,132,393

$

2 939 437

Sales costs

2,117,646 th most common

1,434,826

Gross profit

2,014,747

1,504,611 th most common

Operating expenses:

Sales, general and administrative

554 031

661,251

Legal expenses

1,181 th most common

2,696 th most common

Engineering, research and development

693 575

631,953

Total operating expenses

1 248 787

1,295,900

Revenues from operations

765 960

208,711 th most common

Other income (expenses):

Interest income

984

2,846 th most common

Other income

13 593

13,854 th most common

Interest expenses – judgment

(51 920

)

(75,144

)

Interest expenses

(9 780

)

Total other net (costs)

(37 343

)

(68,224

)

Income before income taxes

728,617

140 487

Income tax expense

153,116 th most common

29 507

Net profit

575 501

110 980

Preference shares dividends

(80,000

)

(80,000

)

Net profit due to ordinary shareholders

$

495 501

$

30 980

Basic income per ordinary share

$

0.15

$

0.01

Diluted income per ordinary share

$

0.11

$

0.01

Weighted average shares outstanding:

Basic

3,255,887

3,255,887

Diluted

5,095,665

3,255,887

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