06/29/2022 | Press release | Distributed by Public on 06/29/2022 14:09
DUBLIN, Calif., June 29, 2022 (GLOBE NEWSWIRE) -- (OTCQB: GIGA) - Giga-tronics Incorporated ("Giga-tronics" or the "Company") today reported results for the fourth fiscal quarter and year ended March 26, 2022:
Fourth Quarter Fiscal Year 2022 Review
Full Fiscal Year 2022 Review
John Regazzi, President and Chief Executive Officer of the Company, said, "Our fourth quarter and full year performance was disappointing, as we faced headwinds throughout the year related to lower-than-expected order activity and shipments for our microwave filter and RADAR/EW divisions. The success of our business as it relates to order and shipment activity is largely tied to the procurement procedures and timelines of the Department of Defense, and unfortunately the award process continued to be negatively impacted by Department of Defense staffing shortages and remote work which slowed the contract evaluation process. That said, we were pleased to have recently received an order valued at $783,000 for the Company's RADAR/EW Threat Emulation System (TEmS). The range market segment is relatively new for Giga-tronics, and the Company's technology will play a critical role in the development, testing, and fielding of a new advanced weapon system program of record for the United States Air Force F-35 program. The order was placed through a new multi-year Task Order under a $28 billion Department of Defense contract vehicle. With the apparent return to a more normalized level of contract award activity, we enter fiscal 2023 well positioned with our unique product capabilities."
Lutz Henckels, Executive Vice President, Chief Financial Officer and Chief Operating Officer stated, "We remain optimistic about the long-term prospects for our business. Our pending combination with Gresham remains on track, and we look forward to joining our mutual capabilities to expand our presence in the Electronic Warfare, RF Solutions and Filter and Power conversion verticals. The combination is expected to add scale and production capacity, which we believe will further strengthen our market position as a reliable provider of state-of-the-art solutions for defense and EW emulation applications."
Earnings Conference Call
Giga-tronics will host a conference call on Wednesday June 29, 2022, at 4:30 p.m. ET to discuss the results for the fiscal year and fourth quarter of 2022, ended March 26, 2022. To participate in the call, dial (866) 374-5140 toll free, or (404) 400-0571 and enter PIN Code 66970124#. A replay of the call will subsequently be made available on the Giga-tronics website under "Investor Relations". The conference call discussion reflects management's views as of June 29, 2022.
About Giga-tronics Incorporated
Giga-tronics is a publicly held company, traded on the OTCQB Capital Market under the symbol "GIGA". Giga-tronics produces RADAR filters and Microwave Integrated Components for use in military defense applications as well as sophisticated RADAR/EW test products primarily used in electronic warfare test & emulation applications.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements in this press release, other than statements of historical facts, are forward-looking statements. Generally, forward- looking statements and information can be identified by the use of forward-looking terminology such as "expects" or "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may," "could," "should," or "will" occur. Forward-looking statements include, among others, those concerning future product developments, future prospects, future operating results (including, for example, future revenue, growth, expenses, margin and profitability), growth in market share, product competitiveness and expected and potential orders and sales to customers. Forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by the Company and its management, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include the Company's ability to successfully manufacture its RADAR/EW test products; to identify customer needs and to design and implement new features; the timely receipt of components from third-party suppliers; the receipt or timing of future orders for products or services and cancellations or deferrals of existing or future orders; the adequacy of the Company's capital resources; the Company's ability to manage expenses; the results of pending or threatened litigation; the Company's ability to successfully implement its business plan; the Company's need to modify its business plan as a result of these or other risks; the volatility in the market price of the Company's common stock; and the circumstances relating to the COVID-19 pandemic and governmental responses. You should not place undue reliance on any forward-looking statements, which are made as of the date of this press release. The Company undertakes no obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions or changes in other factors affecting forward-looking statements. For further discussion, see the Company's most recent annual report on Form 10-K for the fiscal year ended March 26, 2022, Part I, under the heading "Risk Factors" and Part II, under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" and those in other public filings the Company may make with the SEC.
GIGA-TRONICS INCORPORATED | ||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||
(In thousands except share data) | ||||||||||
March 26, 2022 | March 27, 2021 | |||||||||
Assets | ||||||||||
Current assets: | ||||||||||
Cash | $ | 25 | $ | 736 | ||||||
Trade accounts receivable, net of allowance of $3 and $3, respectively | 530 | 801 | ||||||||
Inventories, net | 4,853 | 3,601 | ||||||||
Prepaid expenses | 62 | 100 | ||||||||
Unbilled receivable | 1,380 | 1,120 | ||||||||
Total current assets | 6,850 | 6,358 | ||||||||
Property, plant and equipment, net | 341 | 455 | ||||||||
Right-of-use asset | 521 | 865 | ||||||||
Other long-term assets | 343 | 169 | ||||||||
Total assets | $ | 8,055 | $ | 7,847 | ||||||
Liabilities and shareholders' equity | ||||||||||
Current liabilities: | ||||||||||
Accounts payable | $ | 1,530 | $ | 1,044 | ||||||
Loans payable, net of discounts and issuance costs | 1,250 | 683 | ||||||||
Accrued payroll and benefits | 608 | 446 | ||||||||
Deferred revenue | - | 7 | ||||||||
Lease obligations | 485 | 445 | ||||||||
Other current liabilities | 241 | 279 | ||||||||
Total current liabilities | 4,114 | 2,904 | ||||||||
Other non-current liabilities | 10 | 6 | ||||||||
Long term lease obligations | 206 | 690 | ||||||||
Total liabilities | 4,330 | 3,600 | ||||||||
Shareholders' equity: | ||||||||||
Preferred stock; no par value; Authorized - 1,000,000 shares | ||||||||||
Series A convertible preferred stock: 250,000 shares authorized; | - | - | ||||||||
0 shares issued and outstanding at March 26, 2022 and March 27, 2021 | ||||||||||
Series B, C, D convertible preferred stock: 19,500 authorized shares; | 2,745 | 2,745 | ||||||||
17,782 shares issued and outstanding at March 26, 2022 and March 27, 2021; | ||||||||||
(liquidation preference of $3,367 at March 26, 2022 and March 27, 2021) | ||||||||||
Series E convertible preferred stock: 100,000 authorized shares; 5,700 and 9,200 shares | 90 | 177 | ||||||||
issued and outstanding at March 26, 2022 and March 27, 2021, respectively; | ||||||||||
(liquidation preference of $214 at March 26, 2022 and $345 at March 27, 2021) | ||||||||||
Common stock; no par value; Authorized - 13,333,333 shares; 2,767,230 and 2,635,856 | 34,842 | 32,306 | ||||||||
shares issued and outstanding at March 26, 2022 and March 27, 2021, respectively | ||||||||||
Accumulated deficit | (33,952 | ) | (30,981 | ) | ||||||
Total shareholders' equity | 3,725 | 4,247 | ||||||||
Total liabilities and shareholders' equity | $ | 8,055 | $ | 7,847 | ||||||
GIGA-TRONICS INCORPORATED | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
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(In thousands except per share data) |
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Three Months Period Ended | Twelve Months Period Ended | |||||||||||||||
March 26, 2022 | March 27, 2021 | March 26, 2022 | March 27, 2021 | |||||||||||||
Net revenue: | ||||||||||||||||
Goods | $ | 258 | $ | 180 | $ | 770 | $ | 3,670 | ||||||||
Services | 1,178 | 2,548 | 8,257 | 9,382 | ||||||||||||
Total revenue | 1,436 | 2,728 | 9,027 | 13,052 | ||||||||||||
Cost of revenue | 1,036 | 1,898 | 5,770 | 8,111 | ||||||||||||
Gross profit | 400 | 830 | 3,257 | 4,941 | ||||||||||||
Operating expenses: | ||||||||||||||||
Engineering | 299 | 605 | 1,153 | 2,153 | ||||||||||||
Selling, general and administrative | 1,046 | 1,041 | 4,089 | 3,873 | ||||||||||||
Transaction expenses | 210 | - | 611 | - | ||||||||||||
Total operating expenses | 1,555 | 1,646 | 5,853 | 6,026 | ||||||||||||
Operating loss | (1,155 | ) | (816 | ) | (2,596 | ) | (1,085 | ) | ||||||||
Gain on extinguishment of PPP Loan | - | - | - | 791 | ||||||||||||
Interest expense, net and other: | ||||||||||||||||
Interest expense, net | (17 | ) | (12 | ) | (52 | ) | (97 | ) | ||||||||
Other expense, net | - | - | (65 | ) | - | |||||||||||
Loss before income taxes | (1,172 | ) | (828 | ) | (2,713 | ) | (391 | ) | ||||||||
Provision for income taxes | - | - | 2 | 2 | ||||||||||||
Net loss | (1,172 | ) | (828 | ) | (2,715 | ) | (393 | ) | ||||||||
Deemed dividend on Series E preferred stock | (2 | ) | (4 | ) | (53 | ) | (14 | ) | ||||||||
Net loss attributable to common shareholders | $ | (1,174 | ) | $ | (832 | ) | $ | (2,768 | ) | $ | (407 | ) | ||||
Add back: | ||||||||||||||||
Depreciation and amortization | 45 | 58 | 202 | 253 | ||||||||||||
Interest and taxes | 17 | 16 | 54 | 99 | ||||||||||||
EBITDA | $ | (1,112 | ) | $ | (758 | ) | $ | (2,512 | ) | $ | (55 | ) | ||||
Adjustments: | ||||||||||||||||
Stock-based compensation | 161 | 149 | 579 | 354 | ||||||||||||
Finance costs for issuance of prefunded warrants | - | - | 157 | - | ||||||||||||
Gain on extinguishment of PPP Loan | - | - | (92 | ) | - | |||||||||||
Gain on remeasurement of prefunded warrants liability | - | - | - | (791 | ) | |||||||||||
Transaction related expenses | 210 | - | 611 | - | ||||||||||||
Adjusted EBITDA | $ | (741 | ) | $ | (609 | ) | $ | (1,257 | ) | $ | (492 | ) | ||||
Loss per common share - basic and diluted | $ | (0.42 | ) | $ | (0.32 | ) | $ | (1.00 | ) | $ | (0.15 | ) | ||||
Weighted average common shares used in per share calculation: | ||||||||||||||||
Basic and diluted | 2,767 | 2,636 | 2,767 | 2,636 | ||||||||||||
Non-GAAP Financial Measures: Adjusted EBITDA is a non-GAAP measure that does not have a standardized definition under U.S. GAAP. The Company has provided this non-GAAP measure in this press release because management believes it measures the Company's operating performance and free cash flow in a manner useful to investors. The Company defines "Adjusted EBITDA" as net income (loss) before interest, taxes, depreciation and amortization adjusted for net other income or expense, share-based compensation and certain one-time income or expense items.
Contact: Lutz Henckels Executive Vice President, CFO, COO [email protected] (925) 328-4650 ext. 4698 Investor Relations Contact: John Nesbett/Jennifer Belodeau IMS Investor Relations 203.972.9200 [email protected]Source: Giga-tronics Incorporated
Released June 29, 2022