M-tron Industries, Inc. (NYSE American: MPTI) (“Company” or “MtronPTI”) announced its financial results for the three and nine months ended September 30, 2023. Management will host an earnings call on Thursday, November 16, 2023 at 10:30am EST.
- Revenue of $10.9 million for the three months ended September 30, 2023, was an increase of 29.4% compared to $8.4 million for the comparable prior year period. For the nine months ended September 30, 2023, revenue was $30.4 million, a 31.2% increase over the $23.2 million reported for the comparable prior year period.
- Gross margin was 42.8% for the three months ended September 30, 2023, compared to 32.4% for the comparable period in the prior year. Gross margins for the nine months ended September 30, 2023 were 39.2% compared to 35.6% for the comparable prior year period.
- Basic and diluted net income for the three months ended September 30, 2023 was $0.59 and $0.57 per share, respectively, compared to $0.19 per share for the prior year quarter, and was $1.27 and $1.25 per share, respectively, for the nine months compared to $0.60 per share for the comparable prior year period.
- Backlog of $50.3 million at September 30, 2023, an increase of $6.2 million or 14.1% compared to $44.1 million at September 30, 2022.
- Adjusted EBITDA, a non-GAAP measure, was $2.3 million for the three months ended September 30, 2023 versus $0.9 million for the comparable prior year period. For the nine months, Adjusted EBITDA was $5.3 million compared to $2.9 million for the comparable prior year period.
Michael Ferrantino, MtronPTI’s Chief Executive Officer, stated, “MtronPTI and its employees performed very well during the third quarter, resulting in additional incremental revenues and improved profitability exceeding expectations. The commitment of MtronPTI and its employees to continued and profitable growth while supporting our customers’ demands is unwavering.”
Results from Operations
Revenue for the three months ended September 30, 2023 increased $2.5 million, or 29.4%, to $10.9 million from $8.4 million for the three months ended September 30, 2022. Revenue for the nine months ended September 30, 2023 increased $7.2 million, or 31.2%, to $30.4 million from $23.2 million for the nine months ended September 30, 2022. The revenue increase reflects strong defense product shipments. Gross margin was 42.8% for the three months ended September 30, 2023, compared to 32.4% for the comparable period in the prior year, as a result of a favorable product mix. Gross margins for the nine months ended September 30, 2023 were 39.7% compared to 35.6% for the comparable prior year period benefiting from favorable product mix and the increase in business volume.
Backlog was $50.3 million at September 30, 2023 compared to $46.2 million at the beginning of the year and $44.1 million at the end of the third quarter of 2022. Backlog has generally increased during 2023 due to an increase in defense product orders. Supply chain constraints within the defense industry appear to be moderating but continue to push our customers to order in advance to secure product deliveries for their production requirements.
The Company reported operating income of $4,359,000 for the nine months ended September 30, 2023 compared to operating income of $2,047,000 for the nine months ended September 30, 2022. The increase reflects both higher revenue and higher margins impacted by favorable product mix, as described above. For the nine months ended September 30, 2023, engineering, selling and administrative costs increased $1,508,000 primarily as a result of $1,234,000 of administrative cost increases in the nine months ended September 30, 2023, which included public company costs of $735,000, increased salaries and employee benefits of $328,000, increased audit and tax costs of $97,000, and other miscellaneous cost increases of $74,000. The public company costs of $735,000 represent the incremental direct costs of being a public company, with no comparable amounts being recorded within the prior year when results were presented on a standalone basis.
Net income was $3,416,000 for the nine months ended September 30, 2023 compared to $1,608,000 for the nine months September 30, 2022. The increase for the nine months ended September 30, 2023 was primarily from the previously discussed items. Basic net income per share for the nine months ended September 30, 2023 and 2022 was $1.27 and $0.60, respectively. Diluted net income per share for the three months ended September 30, 2023 and 2022 was $0.57 and $0.19, respectively.
Adjusted EBITDA was $2,336,000 for the three months ended September 30, 2023 versus $876,000 for the three months ended September 30, 2022 which was reported on a standalone basis. Adjusted EBITDA was $5,295,000 for the nine months ended September 30, 2023 versus $2,894,000 for the nine months ended September 30, 2022. Note that adjusted EBITDA on a standalone basis for the three and nine months ended September 30, 2022 does not include any adjustments for the potential impact from the additional costs of being a publicly traded company.
Investor Call
MtronPTI’s CEO, Michael Ferrantino and CFO, James Tivy will host an earnings call on Thursday, November 16, 2023 at 10:30am EST to discuss our Q3, 2023 earnings and respond to investor questions directly.
The call can be accessed using the following dial-in details:
Toll-Free Dial-In Number: (888) 440-4199
Toll Dial-In Number: (646) 960-0818
Conference ID: 6978153
An archive of the call will be available after the call on the Events and Presentations page on the Investor Relations section of MtronPTI’s website at https://ir.mtronpti.com/events-and-presentations/default.aspx, along with MtronPTI’s earnings press release.
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M-tron Industries, Inc. |
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Condensed Consolidated Statements of Operations |
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(Unaudited) |
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(Amounts in Thousands, Except Share and Per Share Amounts) |
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Three Months Ended |
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Nine Months Ended |
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September 30, |
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September 30, |
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2023 |
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2022 |
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2023 |
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2022 |
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REVENUES |
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$ |
10,888 |
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$ |
8,417 |
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$ |
30,395 |
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$ |
23,172 |
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Costs and expenses: |
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Manufacturing cost of sales |
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6,230 |
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5,688 |
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18,322 |
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14,919 |
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Engineering, selling and administrative |
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2,625 |
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2,099 |
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7,714 |
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6,206 |
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OPERATING INCOME |
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2,033 |
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630 |
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4,359 |
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2,047 |
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Total other income (expense), net |
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13 |
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(16 |
) |
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(12 |
) |
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(47 |
) |
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INCOME BEFORE INCOME TAXES |
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2,046 |
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614 |
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4,347 |
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2,000 |
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Income tax provision (benefit) |
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460 |
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|
111 |
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|
931 |
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|
392 |
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NET INCOME |
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$ |
1,586 |
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$ |
503 |
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$ |
3,416 |
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$ |
1,608 |
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Number of basic shares |
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2,703,840 |
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2,676,469 |
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2,693,400 |
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2,676,469 |
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net income per basic share |
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$ |
0.59 |
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$ |
0.19 |
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$ |
1.27 |
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$ |
0.60 |
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Number of diluted shares |
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2,759,780 |
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2,676,469 |
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2,739,819 |
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2,676,469 |
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net income per diluted share |
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$ |
0.57 |
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$ |
0.19 |
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$ |
1.25 |
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$ |
0.60 |
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M-tron Industries, Inc. |
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Condensed Consolidated Balance Sheets |
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(Unaudited) |
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(Amounts in Thousands) |
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September 30, 2023 |
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December 31, 2022 |
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ASSETS |
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Cash and cash equivalents |
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$ |
2,552 |
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$ |
926 |
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Accounts receivable, net |
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5,031 |
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5,197 |
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Inventories, net |
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8,962 |
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7,518 |
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Prepaid expenses and other current assets |
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419 |
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673 |
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Total Current Assets |
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16,964 |
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14,314 |
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Property, plant, and equipment, net |
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3,635 |
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3,647 |
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Right-of-use lease asset |
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106 |
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147 |
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Intangible assets, net |
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58 |
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98 |
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Deferred income taxes, net |
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1,010 |
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1,051 |
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Other assets, net |
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12 |
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16 |
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Total Assets |
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$ |
21,785 |
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$ |
19,273 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Total Current Liabilities |
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3,992 |
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4,856 |
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Long-Term Liabilities |
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40 |
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76 |
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Total Liabilities |
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4,032 |
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4,932 |
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Total Stockholders’ Equity |
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17,753 |
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14,341 |
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Total Liabilities and Stockholders’ Equity |
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$ |
21,785 |
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$ |
19,273 |
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Reconciliations of GAAP to Non-GAAP Measures
To supplement our consolidated financial statements presented on a GAAP (generally accepted accounting principles) basis, the Company uses certain non-GAAP measures, including Adjusted EBITDA, which we define as net income before income taxes adjusted to exclude depreciation and amortization expense, interest income and expense, stock-based compensation expense, and other items we believe are discrete events which have a significant impact on comparable GAAP measures and could distort an evaluation of our normal operating performance. These adjustments to our GAAP results are made with the intent of providing both management and investors with 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 GAAP.
Reconciliation of GAAP Income Before Income Taxes to Non-GAAP Adjusted EBITDA:
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Three Months Ended |
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Nine Months Ended |
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September 30, |
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September 30, |
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(Amounts in thousands, except share amounts) |
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2023 |
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2022 |
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2023 |
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2022 |
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Income before income taxes |
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$ |
2,046 |
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$ |
614 |
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$ |
4,347 |
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$ |
2,000 |
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Interest expense |
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(1 |
) |
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1 |
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6 |
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6 |
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Depreciation and amortization |
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205 |
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186 |
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617 |
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526 |
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Non-cash stock compensation |
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86 |
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75 |
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|
297 |
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|
362 |
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Excess Spin-off costs |
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— |
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— |
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28 |
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— |
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Adjusted EBITDA |
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$ |
2,336 |
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$ |
876 |
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$ |
5,295 |
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$ |
2,894 |
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Basic per share information: |
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Weighted average shares outstanding |
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2,703,840 |
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2,676,469 |
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2,693,400 |
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2,676,469 |
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Adjusted EBITDA per share |
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$ |
0.86 |
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$ |
0.33 |
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$ |
1.97 |
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$ |
1.08 |
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Diluted per share information: |
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Weighted average shares outstanding |
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2,759,780 |
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2,676,469 |
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2,739,819 |
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|
2,676,469 |
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Adjusted EBITDA per share |
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$ |
0.85 |
|
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$ |
0.33 |
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$ |
1.93 |
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|
$ |
1.08 |
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About MtronPTI:
M-tron Industries, Inc. trades publicly on the NYSE American under the symbol MPTI. Originally founded in 1965, MtronPTI designs, manufactures and markets highly engineered, high reliability frequency and spectrum control products and solutions. As an engineering-centric company, MtronPTI provides close support to its customers throughout our products’ entire life cycle, including product design, prototyping, production and subsequent product upgrades. MtronPTI has design and manufacturing facilities in Orlando, Florida and Yankton, South Dakota, a sales office in Hong Kong, and a manufacturing facility in Noida, India.
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, such as those pertaining to the uncertain financial impact of COVID-19 and the Company’s financial condition, results of operations, business strategy and financial needs. All statements other than statements of current or historical fact contained in this press release are forward-looking statements. The words “believe,” “expect,” “anticipate,” “should,” “plan,” “will,” “may,” “could,” “intend,” “estimate,” “predict,” “potential,” “continue” or the negative of these terms and similar expressions, as they relate to MtronPTI, are intended to identify forward-looking statements.
These forward-looking statements are largely based on current expectations and projections about future events and financial trends that may affect the financial condition, results of operations, business strategy and financial needs of the Company. They can be affected by inaccurate assumptions, including the risks, uncertainties and assumptions described in the filings made by MtronPTI with the Securities and Exchange Commission, including those risks set forth under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K as filed with the SEC on March 30, 2023. In light of these risks, uncertainties and assumptions, the forward-looking statements in this press release may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. When you consider these forward-looking statements, you should keep in mind these risk factors and other cautionary statements in this press release.
These forward-looking statements speak only as of the date of this press release. MtronPTI undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Accordingly, readers are cautioned not to place undue reliance on these forward-looking statements. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.
View source version on businesswire.com: https://www.businesswire.com/news/home/20231109052695/en/