The LGL Group, Inc. (NYSE MKT: LGL) (the “Company”), announced results
for the quarter ended March 31, 2015.
Summary of Q1 2015 Results:
-
Revenues of $5.4 million, a decrease of 11.9% compared to Q1 2014
-
Net loss of ($0.2) million, or ($0.07) per share, improved 78.0% vs.
Q1 2014
-
Adjusted EBITDA of $0.1 million, or $0.03 per share, improved 114.3%
vs. Q1 2014
-
Gross margin of 33.3%, improved 7.3 percentage points vs. Q1 2014
Total revenues for the quarter ended March 31, 2015, were $5,404,000, a
decrease of 11.9% from revenues of $6,131,000 for the quarter ended
March 31, 2014. Net loss for the quarter ended March 31, 2015, was
($178,000) compared with ($809,000) for the quarter ended March 31,
2014. Basic and diluted net loss per share for the quarter ended March
31, 2015 and 2014, was ($0.07) and ($0.31), respectively. Gross margins
improved to 33.3% for the quarter ended March 31, 2015; a 7.3 percentage
point increase compared to 26.0% for the quarter ended March 31, 2014.
Adjusted EBITDA was $68,000, or $0.03 per share, for the quarter ended
March 31, 2015, compared to EBITDA loss of ($476,000), or ($0.18) per
share, for the quarter ended March 31, 2014. The improvement in adjusted
EBITDA is due to a 7.3 percentage point improvement in gross margin and
a year-over-year decrease of $450,000 in engineering, selling and
administrative expenses as a result of the continued benefit from the
Company’s efforts to operate more efficiently.
The Company’s Executive Chairman and CEO, Michael Ferrantino, Sr., said:
“Your new management team has now completed three quarters and the
progress continues. Although our markets continue to be challenging, we
are encouraged; new orders have stabilized following and almost
continuous decline over the past several years. With the rightsizing of
the business completed in the last half of 2014, as well as the
improvement in margins, we are pleased to report our journey to
profitability is on the horizon. While we continue on the road to
profitability we have not jeopardized the longer term growth strategy of
the Company. We have continued to upgrade our talent in marketing and
engineering, adding two key employees this quarter. I, as well as all of
our team, am committed to our continuous improvement program and will do
our best to move this company forward.”
Positive Cash Flows from Operations; Solid Capital Position
Operating cash flows were positive for Q1 2015, with net cash provided
by operating activities of $112,000 for the quarter ended March 31,
2015, compared to net cash used in operations of ($540,000) for the
quarter ended March 31, 2014. This was primarily the result of the
improvement in operating margins during the quarter.
Total cash and cash equivalents cash was $5.1 million, or $1.96 per
share, at March 31, 2015, compared to $5.2 million, or $2.00 per share,
at December 31, 2014. Adjusted working capital (accounts receivable,
net, plus inventory, net, less accounts payable) was down slightly to
$5.6 million as of March 31, 2015, compared to $5.7 million as of
December 31, 2014, which reflects the continuing effort to manage
working capital levels to operating activity.
The Company’s Chairman of the Board, Marc Gabelli, said: “I, as well as
the entire board, believe the building blocks are in place to return the
Company to profitability and increase shareholder value. We are
encouraged by the results of the first quarter; it is the strongest
start to a fiscal year that this Company has had in some time. With
exciting new products in our pipeline, as well as the talent we have
invested in, we expect that over the next few years, as qualification
programs are completed, new orders will grow, profits will increase and
our shareholders will be rewarded.”
About The LGL Group, Inc.
The LGL Group, Inc., through its wholly-owned subsidiary MtronPTI,
manufactures and markets highly-engineered electronic components used to
control the frequency or timing of signals in electronic circuits. These
components ensure reliability and security in aerospace and defense
communications, synchronize data transfers throughout the wireless and
internet infrastructure, and provide low noise and base accuracy for lab
instruments.
Headquartered in Orlando, Florida, the Company has additional design and
manufacturing facilities in Yankton, South Dakota and Noida, India, with
local sales offices in Sacramento, California and Hong Kong.
For more information on the Company and its products and services,
contact Patti Smith at The LGL Group, Inc., 2525 Shader Rd., Orlando,
Florida 32804, (407) 298-2000, or visit www.lglgroup.com
and www.mtronpti.com.
Caution Concerning Forward Looking Statements
This press release may contain forward-looking statements made in
reliance upon the safe harbor provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21 E of the Securities
Exchange Act of 1934, as amended. Forward-looking statements include all
statements that do not relate solely to historical or current facts, and
can be identified by the use of words such as “may,” “will,” “expect,”
“project,” “estimate,” “anticipate,” “plan,” “believe,” “potential,”
“should,” “continue” or the negative versions of those words or other
comparable words. These forward-looking statements are not guarantees of
future actions or performance. These forward-looking statements are
based on information currently available to us and our current plans or
expectations, and are subject to a number of uncertainties and risks
that could significantly affect current plans, anticipated actions and
our future financial condition and results. Certain of these risks and
uncertainties are described in greater detail in our filings with the
Securities and Exchange Commission. We are under no obligation to (and
expressly disclaim any such obligation to) update or alter our
forward-looking statements, whether as a result of new information,
future events or otherwise.
THE LGL GROUP, INC.
|
Condensed Consolidated Statements of Operations – UNAUDITED
|
(Dollars in Thousands, Except Per Share Amounts)
|
|
|
|
|
|
|
|
|
|
For the three months ended March 31,
|
|
2015
|
|
2014
|
|
|
|
|
|
REVENUES
|
|
$
|
5,404
|
|
|
$
|
6,131
|
|
Costs and expenses:
|
|
|
|
|
Manufacturing cost of sales
|
|
|
3,605
|
|
|
|
4,535
|
|
Engineering, selling and administrative
|
|
|
1,960
|
|
|
|
2,410
|
|
OPERATING LOSS
|
|
|
(161
|
)
|
|
|
(814
|
)
|
Total other (expense) income
|
|
|
(17
|
)
|
|
|
5
|
|
LOSS BEFORE INCOME TAXES
|
|
|
(178
|
)
|
|
|
(809
|
)
|
Income tax benefit (provision)
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
NET LOSS
|
|
$
|
(178
|
)
|
|
$
|
(809
|
)
|
|
|
|
|
|
Weighted average number of shares used in basic and diluted EPS
calculation
|
|
|
2,616,485
|
|
|
|
2,594,784
|
|
BASIC AND DILUTED NET LOSS PER COMMON SHARE
|
|
$
|
(0.07
|
)
|
|
$
|
(0.31
|
)
|
THE LGL GROUP, INC.
|
Condensed Consolidated Balance Sheets – UNAUDITED
|
(Dollars in Thousands)
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
ASSETS
|
|
2015
|
2014
|
Cash and cash equivalents
|
|
$
|
5,048
|
|
$
|
5,192
|
Accounts receivable, less allowances of $47 and $43, respectively
|
|
|
3,152
|
|
|
3,266
|
Inventories, net
|
|
|
4,030
|
|
|
4,198
|
Prepaid expenses and other current assets
|
|
|
317
|
|
|
278
|
Total current assets
|
|
|
12,547
|
|
|
12,934
|
Property, plant, and equipment, net
|
|
|
3,601
|
|
|
3,547
|
Intangible assets, net
|
|
|
515
|
|
|
528
|
Other assets
|
|
|
250
|
|
|
253
|
Total Assets
|
|
$
|
16,913
|
|
$
|
17,262
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
Total liabilities
|
|
|
2,828
|
|
|
3,025
|
Stockholders’ Equity
|
|
|
14,085
|
|
|
14,237
|
Total Liabilities and Stockholders’ Equity
|
|
$
|
16,913
|
|
$
|
17,262
|
Reconciliations of GAAP to Non-GAAP Measures
To supplement our consolidated condensed financial statements presented
on a GAAP basis, the Company uses certain non-GAAP measures, including
Adjusted EBITDA, which we define as net income (loss) adjusted to
exclude depreciation and amortization expense, interest income
(expenses), provision (benefit) for income taxes and stock-based
compensation expense. We believe such non-GAAP measures are appropriate
to enhance an overall understanding of our past financial performance
and also our prospects for the future. These adjustments to our GAAP
results are made with the intent of providing both management and
investors a more complete understanding of the underlying operational
results and trends and our marketplace performance. The presentation of
this additional information is not meant to be considered in isolation
or as a substitute for net earnings or diluted earnings per share
prepared in accordance with generally accepted accounting principles in
the United States.
Reconciliation of 2015 GAAP Loss Before Income
Taxes to Non-GAAP Adjusted EBITDA/ (EBITDA Loss):
For the three months ended (000s, except shares and per share
amounts)
|
|
March 31, 2015
|
|
March 31, 2014
|
|
|
|
|
|
Net loss before income taxes
|
|
$ (178)
|
|
$ (809)
|
Add: Interest expense
|
|
5
|
|
8
|
Add: Depreciation and amortization
|
|
228
|
|
235
|
Add: Non-cash stock compensation
|
|
13
|
|
90
|
Adjusted EBITDA (EBITDA loss)
|
|
$ 68
|
|
$ (476)
|
|
|
|
|
|
Weighted average number of shares used in basic and diluted EPS
calculation
|
|
2,616,485
|
|
2,594,784
|
Adjusted EBITDA (EBITDA loss) per share
|
|
$ 0.03
|
|
$ (0.18)
|
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