PHAZAR CORP (NASDAQ: ANTP) announced today the unaudited results of operations for the three and six-month periods ended November 30, 2008.
Second Quarter Fiscal Year 2009
Revenues of $2.1 million for the second quarter increased 23% compared to $1.7 million for the same period last year. The Company recognized a net loss of $ 153,703, or $ 0.07 per share for the second quarter, compared to net income of $114,224, or $0.05 per share, in last year's fiscal second quarter.
The increase in revenues is attributable to $333,417 of additional shipments in the antenna product line for the three month period ended November 30, 2008. The net loss in the second quarter of fiscal year 2009 is attributed to lower gross profit margins and an increase in sales and administration expense. The lower gross profit margins were due to higher raw material costs on firm fixed price contracts. The increase in sales and administration expense reflects higher compensation costs associated with newly hired employees, incremental research and development costs during the quarter for continued development of our new mesh radio wireless networking product line and an increase in legal and professional fees primarily associated with the litigation against UBS Financial Services.
Six Month Period Ending November 30, 2008
The Company reported revenues for the six-month period of $4.1 million, an increase of 15% compared to $3.6 million for the comparable period last year. Net loss for the six-month period was $ 58,911, or $0.03 per share compared to net income of $290,466, or $0.13 per share for the comparable period last year.
Backlog of Orders
The Company's backlog of orders on November 30, 2008, totaled approximately $2.1 million compared to $4.0 million at November 30, 2007, a decrease of 47.5%. Backlog at our May 31, 2008 year-end and our first quarter of fiscal year 2009 was $2.5 million and $2.0 million, respectively. Incoming orders for the six month period totaled $3.8 million versus $4.0 million for the comparable period last year.
The Company's book to ship ratio was 93% for the six month period ended November 30, 2008 compared to 114% for the comparable six month period last year.
More information and analysis of PHAZAR CORP’s financial results will be provided in the management discussion and analysis of financial condition and results of operations in the Form 10-Q for the second quarter ended November 30, 2008, estimated to be filed with the Securities and Exchange Commission on or around January 15, 2009.
The Form 10-Q will be available at the SEC’s website at www.sec.gov and PHAZAR CORP’S website at www.phazarcorp.com.
Product information is available at www.antennaproducts.com, www.truemeshnetworks.com and www.phazar.com.
The common stock of PHAZAR CORP is listed on the NASDAQ Capital Market under the trading symbol “ANTP.” This press release contains forward-looking information within the meaning of Section 29A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performances and underlying assumption and other statements, which are other than statements of historical facts. Certain statements contained herein are forward-looking statements and, accordingly, involve risks and uncertainties, which could cause actual results, or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections are expressed in good faith and are believed by the Company to have a reasonable basis, including without limitations, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties, but there can be no assurance that management’s expectations, beliefs or projections will result, or be achieved, or accomplished.
| PHAZAR CORP AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||||||
| FOR THE PERIODS ENDED NOVEMBER 30, 2008 AND 2007 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||
| November 30, | November 30, | |||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||
| Sales and contract revenues | $ | 2,126,167 | 1,727,541 | $ | 4,136,879 | 3,589,117 | ||||||||
| Cost of sales and contracts | 1,561,007 | 1,193,182 | 2,814,741 | 2,220,200 | ||||||||||
| Gross Profit | 565,160 | 534,359 | 1,322,138 | 1,368,917 | ||||||||||
| Gross Profit Margin | 27 | % | 31 | % | 32 | % | 38 | % | ||||||
| Sales and administration expenses | 828,000 | 404,654 | 1,604,140 | 1,025,665 | ||||||||||
| Operating Profit (loss) | (262,840 | ) | 129,705 | (282,002 | ) | 343,252 | ||||||||
| Other Income | ||||||||||||||
| Interest income | 30,140 | 11,075 | 119,544 | 22,839 | ||||||||||
| Other income | 2,637 | 22,461 | 36,834 | 54,357 | ||||||||||
| Total Other Income | 32,777 | 33,536 | 156,378 | 77,196 | ||||||||||
| Income (loss) from operations before income taxes | (230,063 | ) | 163,241 | (125,624 | ) | 420,448 | ||||||||
| Income tax provision (benefit) | (76,360 | ) | 49,017 | (66,713 | ) | 129,982 | ||||||||
| Net income (loss) | $ | (153,703 | ) | 114,224 | $ | (58,911 | ) | 290,466 | ||||||
| Basic earnings (loss) per common share | $ | (0.07 | ) | 0.05 | $ | (0.03 | ) | 0.13 | ||||||
| Diluted earnings (loss) per common share | $ | (0.07 | ) | 0.05 | $ | (0.03 | ) | 0.13 | ||||||
| Weighted Average Shares Outstanding | ||||||||||||||
| Basic | 2,367,311 | 2,352,128 | 2,364,009 | 2,326,442 | ||||||||||
| Diluted | 2,367,311 | 2,352,128 | 2,364,009 | 2,337,271 | ||||||||||
PHAZAR CORP AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS NOVEMBER 30, 2008 AND MAY 31, 2008 ASSETS | ||||||||
| November 30, 2008 | May 31, 2008 | |||||||
| (Unaudited) | (Audited) | |||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | 4,989,037 | $ | 2,446,563 | ||||
| Accounts receivable: | ||||||||
Trade, net of allowance for doubtful accounts of $2,002 as of November 30, 2008 and May 31, 2008 | 732,072 | 987,258 | ||||||
| Inventories | 1,995,685 | 1,777,335 | ||||||
| Prepaid expenses and other assets | 53,898 | 47,761 | ||||||
| Income taxes receivable | 122,462 | 169,597 | ||||||
| Deferred income taxes | 138,100 | 67,697 | ||||||
| Total current assets | 8,031,254 | 5,496,211 | ||||||
| Property and equipment, net | 1,062,540 | 939,084 | ||||||
| Marketable securities | 0 | 2,346,840 | ||||||
| Long –term deferred income tax | 120,653 | 178,739 | ||||||
| TOTAL ASSETS | $ | 9,214,447 | $ | 8,960,874 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | 319,053 | $ | 298,192 | ||||
| Accrued liabilities | 586,270 | 462,679 | ||||||
| Deferred revenues | 106,446 | 315,654 | ||||||
| Total current liabilities | 1,011,769 | 1,076,525 | ||||||
| TOTAL LIABILITIES | 1,011,769 | 1,076,525 | ||||||
| COMMITMENTS AND CONTINGENCIES | - | - | ||||||
| SHAREHOLDERS’ EQUITY | ||||||||
Preferred Stock, $1 par, 2,000,000 shares authorized, none issued or outstanding, attributes to be determined when issued | - | - | ||||||
Common stock, $0.01 par, 6,000,000 shares authorized 2,368,428 and 2,357,728 issued and outstanding | 23,685 | 23,578 | ||||||
| Additional paid in capital | 3,900,326 | 3,723,278 | ||||||
| Retained earnings | 4,278,667 | 4,337,579 | ||||||
| Accumulated other comprehensive loss, net of tax | 0 | (200,086 | ) | |||||
| Total shareholders’ equity | 8,202,678 | 7,884,349 | ||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 9,214,447 | $ | 8,960,874 | ||||
PHAZAR CORP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE PERIODS ENDED NOVEMBER 30, 2008 AND 2007 | |||||||
| (Unaudited) | |||||||
| Six Months Ended | |||||||
| November 30, 2008 | November 30, 2007 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
| Net income | $ | (58,911 | ) | $ | 290,466 | ||
|
Adjustments to reconcile net income to net cash
provided by operating activities: | |||||||
| Depreciation | 52,674 | 56,842 | |||||
| Stock based compensation | 177,158 | 75,399 | |||||
| Tax benefit for employee stock options exercised | - | (74,106 | ) | ||||
| Deferred federal income tax | (115,393 | ) | (12,969 | ) | |||
| Changes in assets and liabilities: | |||||||
| Accounts receivable | 255,186 | (478,662 | ) | ||||
| Inventory | (218,350 | ) | (827,009 | ) | |||
| Income taxes receivable | 47,135 | 82,945 | |||||
| Prepaid expenses | (6,137 | ) | 3,029 | ||||
| Accounts payable | 20,861 | 82,133 | |||||
| Accrued expenses | 123,591 | 63,980 | |||||
| Deferred revenues | (209,208 | ) | - | ||||
| NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES | 68,606 | (737,952 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
| Redemption of marketable securities | 2,650,000 | - | |||||
| Purchase of property and equipment | (176,132 | ) | - | ||||
| NET CASH PROVIDED BY INVESTING ACTIVITIES | 2,473,868 | - | |||||
| CASH FLOWS FROM FINANCING ACTIVIITES: | |||||||
| Proceeds from exercise of stock options | - | 78,000 | |||||
| FIT benefit-stock options exercised | - | 74,106 | |||||
| NET CASH PROVIDED BY FINANCING ACTIVITIES | - | 152,106 | |||||
| Net change in cash and cash equivalents | 2,542,474 | (585.846 | ) | ||||
| Cash and cash equivalents, beginning of period | 2,446,563 | 4,114,046 | |||||
| Cash and cash equivalents, end of period | $ | 4,989,037 | $ | 3,528,200 | |||
Contacts:
Kathy Kindle, 940-325-3301
Fax:
940-325-0716
kindle@phazarcorp.com
