Tel-Instrument Electronics Corp. (“Tel-Instrument,” “TIC,” or the “Company”) (OTCQB: TIKK), a leading designer and manufacturer of avionics test and measurement solutions, today reported a net loss of $435K (($0.16 ) per basic share) on revenues of $1.6 million for the second quarter of 2024 fiscal year, ended September 30, 2023.
Notes On First Quarter:
- TIC paid the full Aeroflex judgement amount of $6,559,233 on September 15, 2023.
- TIC issued $721K of Series B and Series C Preferred Stock to Company insiders.
- Revenues for the second quarter were $1.6 million, a 22% decrease from $2 million in the year-ago quarter.
- Bookings for the second quarter improved to $2.8 million and backlog increased to $6.5 million.
- The gross margin percentage decreased to 23% versus 27% in the year-ago quarter. This decline was largely volume related.
- Operating expenses decreased by $250K, a 23% decline versus the year-ago level as a result of funded engineering projects.
- Net loss was $435K or $(0.16) per share, compared to net loss of $477K or $(0.17) per share in the year-ago quarter.
- Net loss for the first two quarters was $140K versus a net loss of $710K in the first half of the last fiscal year.
Mr. Jeffrey O’Hara, Tel-Instrument’s President and CEO commented: “The second quarter was disappointing from both a revenue and profitability standpoint as several large orders for our older test sets could not be shipped due to parts availability issues. $500k of revenue was shifted into the third quarter as the engineering work to replace an obsolete display on our TR-401 product was more complicated than anticipated. The improvement in bookings and backlog is encouraging but getting the necessary parts in a timely manner has been a continuing challenge. Large contracts in process include: (1) a $1.7 million German T-4530i order; (2) a $1.5 million MADL order and (3) a $1.2 CRAFT 708 order for the F-35 program. The SDR-OMNI test sets continue to gain market traction and we expect to secure a market leading position in the commercial avionics segment. The engineering for the U.S. Army software upgrade for the TS-4530A product is now complete and we are conducting final design verification testing. We expect to submit the $875k invoice for this work in the next few months. The CRAFT ECP engineering is proceeding on schedule and the Test Readiness Review (“TRR”) will take place late in the Spring of 2024. The CRAFT ECP production contract should commence later next year and is expected to generate annual revenues of up to $5 million per year.”
About Tel-Instrument Electronics Corp.
Tel-Instrument is a leading designer and manufacturer of avionics test and measurement solutions for the global commercial air transport, general aviation, and government/military aerospace and defense markets. Tel-Instrument provides instruments to test, measure, calibrate, and repair a wide range of airborne navigation and communication equipment. For further information please visit our website at www.telinstrument.com.
This press release includes statements that are not historical in nature and may be characterized as “forward-looking statements,” including those related to future financial and operating results, benefits, and synergies of the combined companies, statements concerning the Company’s outlook, pricing trends, and forces within the industry, the completion dates of capital projects, expected sales growth, cost reduction strategies, and their results, long-term goals of the Company and other statements of expectations, beliefs, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. All predictions as to future results contain a measure of uncertainty and, accordingly, actual results could differ materially. Among the factors which could cause a difference are: changes in the general economy; changes in demand for the Company’s products or in the cost 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 its inherent uncertainty; difficulties in plant operations and materials; transportation, environmental matters; and other unforeseen circumstances. A number of these factors are discussed in the Company’s previous filings with the U.S. Securities and Exchange Commission. The Company disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this press release. The safe harbor for forward-looking statements contained in the Securities Litigation Reform Act of 1995 (the “Act”) protects companies from liability for their forward-looking statements if they comply with the requirements of the Act.
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TEL-INSTRUMENT ELECTRONICS CORP.
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CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
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September 30,
2023
|
|
March 31,
2023
|
|
|
|
(unaudited)
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|
|
|
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ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash
|
|
$
|
356,942
|
|
|
$
|
3,839,398
|
|
|
Accounts receivable, net
|
|
|
941,826
|
|
|
|
900,881
|
|
|
Inventories, net
|
|
|
4,102,786
|
|
|
|
3,586,065
|
|
|
Restricted cash to support appeal bond
|
|
|
-
|
|
|
|
2,011,083
|
|
|
Prepaid expenses and other current assets
|
|
|
233,670
|
|
|
|
817,625
|
|
|
Total current assets
|
|
|
5,635,224
|
|
|
|
11,155,052
|
|
|
|
|
|
|
|
|
|
|
Equipment and leasehold improvements, net
|
|
|
93,194
|
|
|
|
85,167
|
|
|
Operating lease right-of-use assets
|
|
|
1,426,491
|
|
|
|
1,526,551
|
|
|
Deferred tax asset, net
|
|
|
2,720,638
|
|
|
|
2,627,935
|
|
|
Other long-term assets
|
|
|
35,109
|
|
|
|
35,109
|
|
|
Total assets
|
|
$
|
9,910,656
|
|
|
$
|
15,429,814
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES & STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Line of credit
|
|
$
|
690,000
|
|
|
$
|
690,000
|
|
|
Operating lease liabilities – current portion
|
|
|
206,060
|
|
|
|
202,087
|
|
|
Accounts payable
|
|
|
607,564
|
|
|
|
322,582
|
|
|
Deferred revenues - current portion
|
|
|
132,345
|
|
|
|
123,117
|
|
|
Accrued expenses ‐vacation pay, payroll and payroll withholdings
|
|
|
307,757
|
|
|
|
240,034
|
|
|
Accrued legal damages
|
|
|
-
|
|
|
|
6,360,698
|
|
|
Accrued expenses - other
|
|
|
186,553
|
|
|
|
157,896
|
|
|
Total current liabilities
|
|
|
2,130,279
|
|
|
|
8,096,414
|
|
|
|
|
|
|
|
|
|
|
Operating lease liabilities – long-term
|
|
|
1,220,431
|
|
|
|
1,324,464
|
|
|
Other long term liabilities
|
|
|
49,459
|
|
|
|
53,416
|
|
|
Deferred revenues – long-term
|
|
|
142,497
|
|
|
|
173,883
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
3,542,666
|
|
|
|
9,648,177
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity:
|
|
|
|
|
|
|
|
Preferred stock, 1,000,000 shares authorized, par value $0.10 per share
|
|
|
|
|
|
|
|
Preferred stock, 500,000 shares 8% Cumulative Series A Convertible Preferred
authorized, issued and outstanding, par value $0.10 per share
|
|
|
3,995,998
|
|
|
|
3,875,998
|
|
|
Preferred stock, 302,000 shares 8% Cumulative Series B Convertible Preferred
authorized, 233,224 and 166,667 issued and outstanding, respectively, par value $0.1 per share
|
|
|
1,648,701
|
|
|
|
1,207,367
|
|
|
Preferred stock, 166,667 shares 8% Cumulative Series C Convertible Preferred
authorized 53,500 and 0 issued and outstanding, Par value $0.10 per share
|
|
|
322,375
|
|
|
|
-
|
|
|
Common stock, 7,000,000 shares authorized, par value $0.10 per share,
3,255,887 and 3,255,887 shares issued and outstanding, respectively
|
|
|
325,586
|
|
|
|
325,586
|
|
|
Additional paid-in capital
|
|
|
6,564,040
|
|
|
|
6,721,535
|
|
|
Accumulated deficit
|
|
|
(6,488,710
|
)
|
|
|
(6,348,849
|
)
|
|
Total stockholders’ equity
|
|
|
6,367,990
|
|
|
|
5,781,637
|
|
|
Total liabilities and stockholders’ equity
|
|
$
|
9,910,656
|
|
|
$
|
15,429,814
|
|
|
TEL-INSTRUMENT ELECTRONICS CORP.
|
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
September
30,
2023
|
|
September
30,
2022
|
|
September
30,
2023
|
|
September
30,
2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
1,565,094
|
|
|
$
|
2,012,758
|
|
|
$
|
4,432,024
|
|
|
$
|
4,266,515
|
|
|
Cost of sales
|
|
|
1,205,610
|
|
|
|
1,459,286
|
|
|
|
2,777,990
|
|
|
|
2,877,858
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
|
359,484
|
|
|
|
553,472
|
|
|
|
1,654,034
|
|
|
|
1,388,657
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative
|
|
|
521,070
|
|
|
|
479,253
|
|
|
|
1,105,928
|
|
|
|
1,036,186
|
|
|
Engineering, research, and development
|
|
|
317,715
|
|
|
|
609,636
|
|
|
|
607,155
|
|
|
|
1,131,739
|
|
|
Total operating expenses
|
|
|
838,785
|
|
|
|
1,088,889
|
|
|
|
1,713,083
|
|
|
|
2,167,925
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
|
(479,301
|
)
|
|
|
(535,417
|
)
|
|
|
(59,049
|
)
|
|
|
(779,268
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
12,320
|
|
|
|
2,137
|
|
|
|
51,609
|
|
|
|
3,123
|
|
|
Interest expense – judgement
|
|
|
(128,290
|
)
|
|
|
(71,016
|
)
|
|
|
(198,535
|
)
|
|
|
(122,936
|
)
|
|
Interest expense – other
|
|
|
(13,133
|
)
|
|
|
-
|
|
|
|
(26,587
|
)
|
|
|
-
|
|
|
Total other net (expense) income
|
|
|
(129,103
|
)
|
|
|
(68,879
|
)
|
|
|
(173,513
|
)
|
|
|
(119,813
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income taxes
|
|
|
(608,404
|
)
|
|
|
(604,296
|
)
|
|
|
(232,562
|
)
|
|
|
(899,081
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
|
|
|
(173,251
|
)
|
|
|
(126,928
|
)
|
|
|
(92,701
|
)
|
|
|
(188,844
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
(435,153
|
)
|
|
|
(477,368
|
)
|
|
|
(139,861
|
)
|
|
|
(710,237
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred dividends
|
|
|
(82,708
|
)
|
|
|
(80,000
|
)
|
|
|
(162,708
|
)
|
|
|
(160,000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable to common shareholders
|
|
$
|
(517,861
|
)
|
|
$
|
(557,368
|
)
|
|
$
|
(302,569
|
)
|
|
$
|
(870,237
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net loss per common share
|
|
$
|
(0.16
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.27
|
)
|
|
Diluted net loss per common share
|
|
$
|
(0.16
|
)
|
|
$
|
(0.17
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.27
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
3,255,887
|
|
|
|
3,255,887
|
|
|
|
3,255,887
|
|
|
|
3,255,887
|
|
|
Diluted
|
|
|
3,255,887
|
|
|
|
3,255,887
|
|
|
|
3,255,887
|
|
|
|
3,255,887
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20231114506848/en/