Tue, 05 Nov

Tel-Instrument Electronics Corp. Reports Financial Results For First Quarter FY 2025

Tel-Instrument Electronics Corp. Reports Financial Results For First Quarter FY 2025

Pauline Romeo
Tel-Instrument Electronics Corp.
(201) 933-1600 (Ext 309)

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 income of $42K ($0.02) per basic and per diluted share, on revenues of $2.8 million for the first quarter of 2025 fiscal year, ended June 30, 2024.

Notes On First Quarter:

  • Revenues for the first quarter were $2.8 million, as compared to $2.9 million in the year-ago quarter.
  • The gross margin percentage decreased to 26% versus 45% the year-ago period due to low margin CRAFT ECP invoices.
  • Operating expenses decreased by $200K, a 23% decline versus the year ago level as a result of funded engineering projects.
  • Net income was $42K or $(0.02) per share, compared to net income of $295K or $0.07 per share in the year-ago quarter.
  • CRAFT ECP Test Readiness Review (“TRR”) was completed in April 2024.
  • Bookings backlog was $7 million at the end of the first quarter.

Mr. Jeffrey O’Hara, Tel-Instrument’s President and CEO commented, “We are expecting strong growth for the balance of FY 2025 due to the success of the SDR-OMNI and SDR-OMNI/MI and the expected commencement of MADL and CRAFT ECP production later this year. The successful completion of the Navy TRR was important as it was a key milestone in the development process, and it generated a large progress billing which bolstered our cash position. CRAFT ECP production is projected to commence in the fourth quarter of this fiscal year and should generate annual revenues of around $5 million. We were thrilled that Airbus selected our SDR-OMNI commercial test set for use in its world-wide manufacturing operations after an extensive technical evaluation. Additional volume orders were received from Airbus in the second quarter, and we continue to gain traction in the commercial marketplace. We are even more excited about the prospects for the SDR-OMNI/MIL which has the potential to replace thousands of obsolete test sets currently in use by the U.S. military and our NATO allies. The SDR-OMNI/MIL is the only multi-purpose avionic test set in the market that meets Class 1 military environmental specifications. While DOD procurement for new test sets tends to be an extended process, the SDR-OMNI/MIL has the potential to generate millions of dollars of annual revenues. The Lockheed Martin F-35 MADL Test Set development program has been completed and we are currently in negotiations to supply up to 119 MADL test sets this 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.

TEL-INSTRUMENT ELECTRONICS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

June 30,

2024

 

 

March 31,

2024

 

 

 

(unaudited)

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash

 

$

149,550

 

 

$

132,013

 

Accounts receivable, net

 

 

1,763,680

 

 

 

1,110,548

 

Inventories, net

 

 

5,208,229

 

 

 

5,411,644

 

Prepaid expenses and other current assets

 

 

213,024

 

 

 

214,161

 

Total current assets

 

 

7,334,483

 

 

 

6,868,366

 

 

 

 

 

 

 

 

 

 

Equipment and leasehold improvements, net

 

 

64,165

 

 

 

73,195

 

Operating lease right-of-use assets

 

 

1,272,700

 

 

 

1,324,463

 

Deferred tax asset, net

 

 

2,439,427

 

 

 

2,450,657

 

Other long-term assets

 

 

35,109

 

 

 

35,109

 

Total assets

 

$

11,145,884

 

 

$

10,751,790

 

 

 

 

 

 

 

 

 

 

LIABILITIES & STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

1,242,906

 

 

$

1,276,935

 

Accrued expenses ?vacation pay, payroll and payroll withholdings

 

 

265,948

 

 

 

248,713

 

Deferred revenues - current portion

 

 

57,778

 

 

 

72,803

 

Operating lease liabilities – current portion

 

 

204,064

 

 

 

210,111

 

Accrued expenses - other

 

 

179,748

 

 

 

120,027

 

Line of credit

 

 

1,000,000

 

 

 

690,000

 

Promissory notes – related parties

 

 

80,500

 

 

 

-

 

Total current liabilities

 

 

3,030,944

 

 

 

2,618,589

 

 

 

 

 

 

 

 

 

 

Operating lease liabilities – long-term

 

 

1,068,636

 

 

 

1,114,352

 

Other long term liabilities

 

 

43,524

 

 

 

45,501

 

Deferred revenues – long-term

 

 

104,963

 

 

 

119,721

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

4,248,067

 

 

 

3,898,163

 

 

 

 

 

 

 

 

 

 

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, respectively par value $0.10 per share

 

 

4,175,998

 

 

 

4,115,998

 

Preferred stock, 320,000 shares 8% Cumulative Series B Convertible Preferred authorized, 233,334 and 233,334 issued and outstanding, par value $0.10 per share

 

 

1,732,701

 

 

 

1,704,701

 

Preferred stock, 166,667 shares 8% Cumulative Series C Convertible Preferred authorized; 53,500 and 53,500 issued, and outstanding, par value $0.10 per share

 

 

341,635

 

 

 

335,215

 

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

 

 

6,286,607

 

 

 

6,379,085

 

Accumulated deficit

 

 

(5,964,710

)

 

 

(6,006,958

)

Total stockholders’ equity

 

 

6,897,817

 

 

 

6,853,627

 

Total liabilities and stockholders’ equity

 

$

11,145,884

 

 

$

10,751,790

 

TEL-INSTRUMENT ELECTRONICS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three Months Ended

 

 

 

June 30, 2024

 

 

June 30, 2023

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

2,842,176

 

 

$

2,866,929

 

Cost of sales

 

 

2,096,274

 

 

 

1,572,380

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

745,902

 

 

 

1,294,549

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

542,340

 

 

 

584,858

 

Engineering, research, and development

 

 

131,638

 

 

 

289,441

 

Total operating expenses

 

 

673,978

 

 

 

874,299

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

71,924

 

 

 

420,250

 

 

 

 

 

 

 

 

 

 

Other (expense) income:

 

 

 

 

 

 

 

 

Interest income

 

 

11

 

 

 

39,289

 

Interest expense – other

 

 

(18,457

)

 

 

(13,455

)

Interest expense – judgement

 

 

-

 

 

 

(70,245

)

Total other net expense

 

 

(18,446

)

 

 

(44,411

)

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

53,478

 

 

 

375,839

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

 

11,230

 

 

 

80,547

 

 

 

 

 

 

 

 

 

 

Net income

 

 

42,248

 

 

 

295,292

 

 

 

 

 

 

 

 

 

 

Preferred dividends

 

 

(94,420

)

 

 

(80,000

)

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to common shareholders

 

$

(52,172

)

 

$

215,292

 

 

 

 

 

 

 

 

 

 

Basic net (loss) income per common share

 

$

(0.02

)

 

$

0.07

 

Diluted net (loss) income per common share

 

$

(0.02

)

 

$

0.06

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

 

3,255,887

 

 

 

3,255,887

 

Diluted

 

 

3,255,887

 

 

 

5,215,665

 

 


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