Press release

Tel-Instrument Electronics Corp. Reports Financial Results For Fiscal Year 2024

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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 $342K on revenues of $8.8 million for the 2024 fiscal year ended March 31, 2024.

Highlights include:

  • Revenues for the fiscal year ended March 31, 2024, increased $178K, or 2%, versus the prior fiscal year.

  • Gross margin for the 2024 fiscal year was 46.6%, or 11.3 percentage points increase over the prior fiscal year.

  • Operating expenses decreased by $666K, or 17% year-over-year, due primarily to client funded engineering projects.

  • Operating income was $737K as compared to an operating loss of $898K in the prior fiscal year.

  • Net income was $342K, compared to a net loss of $388K in the prior fiscal year.

  • Working capital increased $1.2 million or 39% to $4.3 million as compared to the prior fiscal year.

  • Backlog increased $640K from the prior year end to $7.2 million as of March 31, 2024.

  • Recent receipt of Airbus order for SDR/OMNI.

Mr. Jeffrey O’Hara, Tel-Instrument’s President and CEO commented, “The 2024 fiscal year was very difficult due to parts shortages that significantly impacted production. This parts procurement issues are gradually easing, and we expect strong growth in fiscal year 2025. We are extremely excited by the prospects of the SDR-OMNI and the SDR-OMNI/MIL. We were pleased that Airbus selected our SDR-OMNI test set for use in its world-wide manufacturing operations after an extensive technical evaluation. 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. The SDR-OMNI and SDR-OMNI/MIL are the only multi-purpose avionic test set in the market that meets Class 1 military environmental specification. We are confident that these two multi-purpose test sets provide market leading capabilities. We are also introducing a GPS simulator software application this summer.

The CRAFT ECP contract will be critical for the Company as this is expected to generate five million dollars of annual production revenues, starting when the engineering work is completed. TIC successfully completed the Test Readiness Review (“TRR”) in April 2024. The next major milestone is the Production Readiness Review that is scheduled for later this year. We expect to start shipping upgraded Navy production units in the fourth quarter of FY 2025.

The Lockheed Martin F-35 MADL Test Set development program has been completed. 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.

Consolidated Balance Sheets 

Audited

 

ASSETS

 

March 31, 2024

 

 

March 31, 2023

Current assets:

 

 

 

 

 

 

 

Cash

 

$

132,013

 

 

$

3,839,398

Accounts receivable, net

 

 

1,110,548

 

 

 

900,881

Inventories, net

 

 

5,411,644

 

 

 

3,586,065

Restricted cash to support appeal bond

 

 

 

 

 

2,011,083

Prepaid expenses and other current assets

 

 

214,161

 

 

 

817,625

Total current assets

 

 

6,868,366

 

 

 

11,155,052

 

 

 

 

 

 

 

 

Equipment and leasehold improvements, net

 

 

73,195

 

 

 

85,167

Operating lease right-of-use assets

 

 

1,324,463

 

 

 

1,526,551

Deferred tax asset, net

 

 

2,450,657

 

 

 

2,627,935

Other assets

 

 

35,109

 

 

 

35,109

 

 

 

 

 

 

 

 

Total assets

 

$

10,751,790

 

 

$

15,429,814

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERSEQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Line of credit

 

$

690,000

 

 

$

690,000

Operating lease liabilities – current portion

 

 

210,111

 

 

 

202,087

Accounts payable

 

 

1,276,935

 

 

 

322,582

Deferred revenues – current portion

 

 

72,803

 

 

 

123,117

Accrued expenses – vacation pay, payroll and payroll withholdings

 

 

248,713

 

 

 

240,034

Accrued legal damages

 

 

 

 

 

6,360,698

Accrued expenses – other

 

 

120,027

 

 

 

157,896

Total current liabilities

 

 

2,618,589

 

 

 

8,096,414

 

 

 

 

 

 

 

 

Operating lease liabilities – long-term

 

 

1,114,352

 

 

 

1,324,464

Other long term liabilities

 

 

45,501

 

 

 

53,416

Deferred revenues – long-term

 

 

119,721

 

 

 

173,883

 

 

 

 

 

 

 

 

Total liabilities

 

 

3,898,163

 

 

 

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, respectively par value $0.10 per share

 

 

4,115,998

 

 

 

3,875,998

Preferred stock, 320,000 shares 8% Cumulative Series B Convertible Preferred

authorized; 233,334 and 166,667 issued and outstanding, par value $0.10 per share

 

 

1,704,701

 

 

 

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

 

 

335,215

 

 

 

Common stock, 7,000,000 shares authorized, par value $.10 per share,

3,255,887 and 3,255,887 shares issued and outstanding, respectively

 

 

325,586

 

 

 

325,586

Additional paid-in capital

 

 

6,379,085

 

 

 

6,721,535

Accumulated deficit

 

 

(6,006,958

)

 

 

(6,348,849

 

 

 

 

 

 

 

 

Total stockholders equity

 

 

6,853,627

 

 

 

5,781,637

 

 

 

 

 

 

 

 

Total liabilities and stockholders equity

 

$

10,751,790

 

 

$

15,429,814

 

TEL-INSTRUMENT ELECTRONICS CORP.

Consolidated Statements of Operations

 

Audited

 

 

 

For the years ended March 31,

 

 

 

2024

 

 

2023

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

8,809,087

 

 

$

8,631,157

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

 

4,791,734

 

 

 

5,582,407

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

4,017,353

 

 

 

3,048,750

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

2,114,945

 

 

 

2,098,684

 

Litigation expenses

 

 

9,870

 

 

 

33,988

 

Engineering, research, and development

 

 

1,155,750

 

 

 

1,814,198

 

 

 

 

 

 

 

 

 

 

Total operating expenses

 

 

3,280,565

 

 

 

3,946,870

 

 

 

 

 

 

 

 

 

 

Income (loss) from operations

 

 

736,788

 

 

 

(898,120

)

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Interest income

 

 

24,642

 

 

 

17,188

 

Interest expense

 

 

(70,086

)

 

 

(157

)

Interest expense – judgment

 

 

(198,535

)

 

 

(263,425

)

Other income, net

 

 

27,025

 

 

 

627,832

 

 

 

 

 

 

 

 

 

 

Total other (expense) income

 

 

(216,954

)

 

 

381,438

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

519,834

 

 

 

(516,682

)

 

 

 

 

 

 

 

 

 

Provision (benefit) for income taxes

 

 

177,943

 

 

 

(128,137

)

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

341,891

 

 

 

(388,545

)

 

 

 

 

 

 

 

 

 

Preferred dividends

 

 

(351,549

)

 

 

(320,000

)

 

 

 

 

 

 

 

 

 

Net loss attributable to common shareholders

 

$

(9,658

)

 

$

(708,545

)

 

 

 

 

 

 

 

 

 

Basic loss per common share

 

$

(0.00

 

$

(0.22

)

Diluted loss per common share

 

$

(0.00

 

$

(0.22

)

 

 

 

 

 

 

 

 

 

Weighted average number of shares outstanding

 

 

 

 

 

 

 

 

Basic and Diluted

 

 

3,255,887

 

 

 

3,255,887