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WIRELESS TELECOM GROUP ANNOUNCES SECOND QUARTER 2022 FINANCIAL RESULTS

·19-min read
Wireless Telecom Group, Inc.
Wireless Telecom Group, Inc.

Highlights for the quarter ended June 30, 2022:

Revenue of $6.1 million compared to $7.8 million for the same period last year

Gross profit of $3.4 million compared to $4.4 million for the same period last year

Consolidated gross profit margin of 56.3%, compared to 56.2% for the same period last year

$13.3 million in cash on balance sheet as of June 30, 2022, and no debt

Highlights for the six months ended June 30, 2022:

Test & Measurement revenue increased 6.5% compared to the same period last year

Net loss from continuing operations of $(2.8) million, compared to net income from continuing operations of $651,000 for the same period last year

Non-GAAP adjusted net loss from continuing operations of $(1.0) million compared to net income of $186,000 for the same period last year

Non-GAAP Adjusted EBITDA of $(846,000), compared to Non-GAAP Adjusted EBITDA of $105,000 for the same period last year

Bookings of $10.7 million compared to $18.7 million for the same period last year, backlog of $6.4 million as of June 30, 2022

July 2022 bookings and contract signatures of $3.0 million

Parsippany, New Jersey, Aug. 09, 2022 (GLOBE NEWSWIRE) -- Wireless Telecom Group, Inc. (NYSE American: WTT) (the “Company”) announced today results for the three months ended June 30, 2022.

Tim Whelan, CEO of Wireless Telecom Group, Inc. stated, “Second quarter revenues and bookings were impacted by lower sales of digital signal processing cards as well as by supply chain shortages and delayed deliveries, a softening of demand as customers were delaying orders or reducing quantities purchased, and by the lockdown in China resulting from the continued Covid-19 pandemic. There were also certain timing issues, as evidenced by the strength of approximately $3 million in bookings and contract wins that were anticipated to close in June that occurred in July. This includes the $1.5 million multiparty contract with ADVA, which was announced in the fourth quarter last year. We are thrilled to be part of this project researching specialized small cells.”

Mr. Whelan continued, “We believe the pressures that impacted our second quarter results will ease in the second half of this year. We expect that our order flow will significantly improve in the third quarter which will lead to a reacceleration of year-over-year growth for the remainder of the year. Our current bookings and contract expectations for the third quarter are approximately $8 million to $10 million providing a basis for reaccelerating revenue growth in the 2022 second half. If the timing of supply chain delivery improves, we have additional revenue opportunities in the next two quarters, which further increases our basis for growth this year. Additionally, as announced at the annual shareholders meeting on July 29, 2022 we are undergoing a comprehensive strategic review process with CDX Advisors, a tech-enabled investment bank. We have various scenarios under evaluation including the sale of the entire Company or the sale of one or both segments separately. Our goal is to unlock and maximize shareholder value.”

Second Quarter 2022 Operating Results:

Consolidated net revenues decreased 22% from the prior year due to lower hardware and software sales at RBS.

Gross profit margin of 56% which is consistent with the prior year period. Lower RBS gross profit margin was due primarily to lower software license sales in the quarter, which was offset by continued strong gross profit margins at T&M.

Operating expenses were lower by 1.6% as higher stock compensation expense and non-recuring expenses associated with our strategic initiatives were offset by lower research and development expenses, intangible asset amortization expense and headcount related expenses.

GAAP net loss from continuing operations of $(1.4) million compared to net income of $1.1 million in the prior year. The higher net loss was due primarily to lower gross profit in the current year and the gain on forgiveness of the PPP loan in the prior year period.

Non-GAAP adjusted net loss from continuing operations of $(887,000) compared to adjusted net income of $459,000 in the prior year period. Non-GAAP adjusted net loss from continuing operations is a metric the Company uses to measure its core operations. A reconciliation of net loss from continuing operations to Non-GAAP adjusted net loss from continuing operations is provided later in this press release.

Non-GAAP Adjusted EBITDA was a loss of $(778,000) compared to $(161,000) in the prior year. Non-GAAP adjusted EBITDA is a metric the Company uses to measure our core operations. A reconciliation of non-GAAP adjusted EBITDA to GAAP net income is provided later in this press release.

Cash Flow and Balance Sheet

Consolidated cash balance of $13.3 million as of June 30, 2022

1.7 million common shares repurchased in the second quarter for $2.5 million

Conference Call

As previously announced, Wireless Telecom Group Inc. will host a conference call on August 9, 2022, at 8:30 a.m. ET in which management will discuss second quarter results and related matters. To participate in the conference call, dial 800-346-7359 or 973-528-0008. The conference identification number is 455180.

The call will also be webcast over the internet at the following URL:
https://www.webcaster4.com/Webcast/Page/1690/46304

A replay will be made available on the Wireless Telecom website following the conference call.

Investor Contact

Andrew M. Berger
Managing Director
SM Berger & Company
Tel: (216) 464-6400
andrew@smberger.com

Contact

Michael Kandell
25 Eastmans Road
Parsippany, NJ 07054
Tel: (973) 386-9696
Fax: (973) 386-9191
www.wirelesstelecomgroup.com

Use of Non-GAAP Financial Measures

The Company reports its financial results in accordance with generally accepted accounting principles (“GAAP”). Management believes, however, that certain non-GAAP financial measures used in managing the Company’s business may provide users of this financial information with additional meaningful comparisons between current results and prior reported results. Certain of the information set forth herein and certain of the information presented by the Company from time to time may constitute non-GAAP financial measures within the meaning of Regulation G adopted by the Securities and Exchange Commission. We have presented herein a reconciliation of these measures to the most directly comparable GAAP financial measure. The non-GAAP measures presented herein may not be comparable to similarly titled measures presented by other companies. The foregoing measures do not serve as a substitute and should not be construed as a substitute for GAAP performance but provide supplemental information concerning our performance that our investors and we find useful.

The Company defines Non-GAAP adjusted operating income/(loss) as GAAP operating income/(loss) excluding non-cash amortization expense of purchased intangible assets, non-recurring expenses associated with acquisition and divestiture activities, expenses associated with our strategic initiatives and non-cash stock compensation expense.

The Company defines Non-GAAP adjusted net income/(loss) from continuing operations as GAAP net income/(loss) from continuing operations excluding non-cash amortization expense of purchased intangible assets, non-recurring expenses associated with acquisition and divestiture activities, expenses associated with our strategic initiatives, non-cash stock compensation expense and the loss on extinguishment of our Muzinich and Bank of America N.A. credit facilities.

The Company defines EBITDA as its net earnings before interest, taxes, depreciation and amortization. “Adjusted EBITDA” is EBITDA excluding our stock compensation expense, restructuring charges, acquisition and divestitures expenses, expenses associated with our strategic initiatives, integration expenses, unrealized and realized foreign exchange gains and losses, purchase accounting adjustments, non-recurring legal fees associated with the Harris arbitration, goodwill and indefinite lived intangible asset impairment charges, (gain)/loss on change in fair value of contingent consideration, gain on extinguishment of our PPP loan, loss on extinguishment of our Muzinich and Bank of America N.A. credit facilities and other non-recurring costs. A reconciliation of net income/(loss) to non-GAAP Adjusted EBITDA is included as an attachment to this press release.

The Company views Non-GAAP Adjusted EBITDA, Non-GAAP Adjusted Operating Income/(Loss) and Non-GAAP Adjusted Net Income/(Loss) from Continuing Operations as important indicators of performance, consistent with the manner in which management measures and forecasts the Company’s performance. We believe these Non-GAAP measures are important performance metrics because they facilitate the analysis of our results, exclusive of certain non-cash and non-recurring items, including items which do not directly correlate to our business operations.

The Company believes that Non-GAAP Adjusted EBITDA, Non-GAAP Adjusted Operating Income/(Loss) and Non-GAAP Adjusted Net Income/(Loss) from Continuing Operations metrics provide qualitative insight into our current performance; we use these measures to evaluate our results, the performance of our management team and our management’s entitlement to incentive compensation; and we believe that making this information available to investors enables them to view our performance the way that we view our performance and thereby gain a meaningful understanding of our core operating results, in general, and from period to period.

Forward-Looking Statements

This press release contains “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. In some cases, such forward-looking statements may be identified by terms such as believe, expect, seek, may, will, intend, project, anticipate, plan, estimate, guidance or similar words. Forward-looking statements include, among others, our expectation that pressures impacting our second quarter will ease in the second half of the year, our expectation that our order flow will significantly improve in the third quarter which will lead to growth in the second half of the year, our current bookings expectations of approximately $8 to $10 million for the third quarter of 2022 which will provide a basis for revenue ramp in the second half of 2022 and our expectation that if the timing of supply chain delivery improves, we have additional opportunity for increasing revenues in the next two quarters which we expect will provide the basis for growth for the full year. Investors are cautioned that such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties that could materially affect actual results, including, among others, the ongoing impact that the conflict in Ukraine and related sanctions have had and may continue to have on our business, supply chain, transportation costs, and our backlog; the impact that the evolving COVID-19 pandemic has had and may continue to have on our supply chain, human capital and the general economy in the future; the impact inflation has had and may continue to have on our business and the economy in general, our dependency on capital spending on data and communication networks by our customers and end users; our dependency on the deployment of 4G LTE and 5G NR private networks and related services to grow our business; the impact of the loss of any significant customers; the ability of our management to successfully implement our evolving business plan; the impact of competitive products and pricing; our abilities to protect our intellectual property rights and our ability to manage risks related to our information technology and cyber security as well as other risks and uncertainties set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. These forward-looking statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise, as except as required by law.

About Wireless Telecom Group, Inc.

Wireless Telecom Group, Inc., comprised of Boonton, CommAgility, Holzworth, and Noisecom, is a global designer and manufacturer of advanced RF and microwave components, modules, systems, and instruments. Serving the wireless, telecommunication, satellite, military, aerospace, and semiconductor industries, Wireless Telecom Group products enable innovation across existing and emerging wireless technologies. With a product portfolio including peak power meters, signal generators, phase noise analyzers, signal processing modules, LTE PHY/stack software, noise sources, and programmable noise generators, Wireless Telecom Group supports the development, testing, and deployment of wireless technologies around the globe. Wireless Telecom Group, Inc.’s website address is wirelesstelecomgroup.com.

Wireless Telecom Group INC.

CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS)
(UNAUDITED)
(In thousands, except per share amounts)

 

 

For the Three Months Ended

 

 

For the Six Months Ended

 

 

 

June 30

 

 

June 30

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net revenues

 

$

6,068

 

 

$

7,788

 

 

$

13,664

 

 

$

15,972

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues

 

 

2,653

 

 

 

3,410

 

 

 

5,894

 

 

 

6,740

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

3,415

 

 

 

4,378

 

 

 

7,770

 

 

 

9,232

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

1,126

 

 

 

1,244

 

 

 

2,285

 

 

 

2,400

 

Sales and marketing

 

 

1,261

 

 

 

1,144

 

 

 

2,520

 

 

 

2,339

 

General and administrative

 

 

2,706

 

 

 

2,787

 

 

 

6,098

 

 

 

5,638

 

Total operating expenses

 

 

5,093

 

 

 

5,175

 

 

 

10,903

 

 

 

10,377

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating loss

 

 

(1,678

)

 

 

(797

)

 

 

(3,133

)

 

 

(1,145

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain/(loss) on extinguishment of debt

 

 

-

 

 

 

2,045

 

 

 

(792

)

 

 

2,045

 

Other income/(expense)

 

 

32

 

 

 

(17

)

 

 

133

 

 

 

10

 

Interest expense

 

 

-

 

 

 

(285

)

 

 

(177

)

 

 

(582

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income/(loss) before taxes

 

 

(1,646

)

 

 

946

 

 

 

(3,969

)

 

 

328

 

Tax benefit

 

 

(286

)

 

 

(179

)

 

 

(1,136

)

 

 

(323

)

Net income/(loss) from continuing operations

 

$

(1,360

)

 

$

1,125

 

 

$

(2,833

)

 

$

651

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income from discontinued operations, net of taxes

 

 

-

 

 

 

412

 

 

 

11,670

 

 

 

652

 

Net income/(loss)

 

$

(1,360

)

 

$

1,537

 

 

$

8,837

 

 

$

1,303

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income/(loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

(380

)

 

 

12

 

 

 

(517

)

 

 

87

 

Comprehensive income/(loss)

 

$

(1,740

)

 

$

1,549

 

 

$

8,320

 

 

$

1,390

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income/(loss) per share from continuing operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.06

)

 

$

0.05

 

 

$

(0.13

)

 

$

0.03

 

Diluted

 

$

(0.06

)

 

$

0.05

 

 

$

(0.13

)

 

$

0.03

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income per share from discontinued operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.00

 

 

$

0.02

 

 

$

0.53

 

 

$

0.03

 

Diluted

 

$

0.00

 

 

$

0.01

 

 

$

0.48

 

 

$

0.02

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income/(loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.06

)

 

$

0.07

 

 

$

0.40

 

 

$

0.06

 

Diluted

 

$

(0.06

)

 

$

0.06

 

 

$

0.35

 

 

$

0.05

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

21,857

 

 

 

21,763

 

 

 

22,151

 

 

 

21,728

 

Diluted

 

 

21,857

 

 

 

24,343

 

 

 

24,200

 

 

 

24,063

 


CONSOLIDATED BALANCE SHEETS

(In thousands, except number of shares and par value)

 

 

(Unaudited)

 

 

 

 

 

 

June 30 2022

 

 

December 31 2021

 

CURRENT ASSETS

 

 

 

 

 

 

 

 

Cash & cash equivalents

 

$

13,338

 

 

$

4,472

 

Accounts receivable - net of reserves of $180 and $196, respectively

 

 

4,007

 

 

 

2,407

 

Inventories - net of reserves of $678 and $681, respectively

 

 

5,247

 

 

 

5,088

 

Prepaid expenses and other current assets

 

 

2,156

 

 

 

1,689

 

Current assets of discontinued operations

 

 

-

 

 

 

6,869

 

TOTAL CURRENT ASSETS

 

 

24,748

 

 

 

20,525

 

 

 

 

 

 

 

 

 

 

PROPERTY PLANT AND EQUIPMENT - NET

 

 

1,272

 

 

 

1,110

 

 

 

 

 

 

 

 

 

 

OTHER ASSETS

 

 

 

 

 

 

 

 

Goodwill

 

 

9,701

 

 

 

10,108

 

Acquired intangible assets, net

 

 

3,243

 

 

 

3,661

 

Deferred income taxes

 

 

2,904

 

 

 

5,580

 

Right of use assets

 

 

867

 

 

 

1,146

 

Other assets

 

 

269

 

 

 

284

 

Non current assets of discontinued operations

 

 

-

 

 

 

1,937

 

TOTAL OTHER ASSETS

 

 

16,984

 

 

 

22,716

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

43,004

 

 

$

44,351

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Short term debt

 

$

-

 

 

$

126

 

Accounts payable

 

 

1,404

 

 

 

1,481

 

Short term leases

 

 

484

 

 

 

585

 

Accrued expenses and other current liabilities

 

 

5,242

 

 

 

6,676

 

Deferred revenue

 

 

132

 

 

 

408

 

Current liabilities of discontinued operations

 

 

-

 

 

 

1,965

 

TOTAL CURRENT LIABILITIES

 

 

7,262

 

 

 

11,241

 

 

 

 

 

 

 

 

 

 

LONG TERM LIABILITIES

 

 

 

 

 

 

 

 

Long term debt

 

 

-

 

 

 

3,595

 

Long term leases

 

 

430

 

 

 

615

 

Other long term liabilities

 

 

37

 

 

 

52

 

Deferred tax liability

 

 

205

 

 

 

228

 

TOTAL LONG TERM LIABILITIES

 

 

672

 

 

 

4,490

 

 

 

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Preferred stock, $.01 par value, 2,000,000 shares authorized, none issued

 

 

-

 

 

 

-

 

Common stock, $.01 par value, 75,000,000 shares authorized
36,250,636 and 35,915,636 shares issued, 21,290,098 and 22,666,072 shares outstanding

 

 

362

 

 

 

359

 

Additional paid in capital

 

 

52,226

 

 

 

51,555

 

Retained earnings

 

 

9,391

 

 

 

554

 

Treasury stock at cost, 14,960,538 and 13,249,564 shares

 

 

(27,163

)

 

 

(24,619

)

Accumulated other comprehensive income

 

 

254

 

 

 

771

 

TOTAL SHAREHOLDERS’ EQUITY

 

 

35,070

 

 

 

28,620

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

$

43,004

 

 

$

44,351

 


CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)
(Unaudited)

 

 

For the Six Months

 

 

 

Ended June 30

 

 

 

2022

 

 

2021

 

CASH FLOWS PROVIDED/(USED) BY OPERATING ACTIVITIES

 

 

 

 

 

 

 

 

Net income

 

$

8,837

 

 

$

1,303

 

Adjustments to reconcile net loss to net cash provided/(used) by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

751

 

 

 

1,065

 

Extinguishment of PPP loan

 

 

-

 

 

 

(2,045

)

Loss on extinguishment of term debt

 

 

792

 

 

 

-

 

Gain on sale of Microlab

 

 

(16,403

)

 

 

-

 

Amortization of debt issuance fees

 

 

55

 

 

 

150

 

Share-based compensation expense

 

 

650

 

 

 

203

 

Deferred rent

 

 

(15

)

 

 

(15

)

Deferred income taxes

 

 

2,677

 

 

 

320

 

Provision for doubtful accounts

 

 

(16

)

 

 

71

 

Inventory reserves

 

 

28

 

 

 

85

 

Changes in assets and liabilities, net of divestiture:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(1,581

)

 

 

(1,079

)

Inventories

 

 

(457

)

 

 

(645

)

Prepaid expenses and other assets

 

 

(57

)

 

 

319

 

Accounts payable

 

 

304

 

 

 

585

 

Deferred revenue

 

 

(257

)

 

 

-

 

Accrued expenses and other liabilities

 

 

(842

)

 

 

77

 

Net cash provided/(used) by operating activities

 

 

(5,534

)

 

 

394

 

 

 

 

 

 

 

 

 

 

CASH FLOWS PROVIDED/(USED) BY INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

Capital expenditures

 

 

(326

)

 

 

(313

)

Deferred purchase price payment

 

 

(250

)

 

 

(200

)

Divestiture of Microlab, net

 

 

22,753

 

 

 

-

 

Net cash provided/(used) by investing activities

 

 

22,177

 

 

 

(513

)

 

 

 

 

 

 

 

 

 

CASH FLOWS USED BY FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Term loan repayments

 

 

(4,432

)

 

 

(470

)

Acquisition of treasury stock

 

 

(2,525

)

 

 

-

 

Payment of contingent consideration

 

 

(658

)

 

 

(105

)

Proceeds from exercise of stock options

 

 

24

 

 

 

-

 

Shares withheld for employee taxes

 

 

(19

)

 

 

(17

)

Net cash used by financing activities

 

 

(7,610

)

 

 

(592

)

 

 

 

 

 

 

 

 

 

Effect of Exchange Rate Changes on Cash and Cash Equivalents

 

 

(167

)

 

 

14

 

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS

 

 

8,866

 

 

 

(697

)

 

 

 

 

 

 

 

 

 

Cash and Cash Equivalents, at Beginning of Period

 

 

4,472

 

 

 

4,910

 

 

 

 

 

 

 

 

 

 

CASH AND CASH EQUIVALENTS, AT END OF PERIOD

 

$

13,338

 

 

$

4,213

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL INFORMATION:

 

 

 

 

 

 

 

 

Cash paid during the period for interest

 

$

122

 

 

$

204

 

Cash paid during the period for income taxes

 

$

597

 

 

$

110

 


NET REVENUE AND GROSS PROFIT BY SEGMENT

(In thousands)
Unaudited

 

 

Three months ended June 30,

 

 

 

Revenue

 

 

% of Revenue

 

 

Change

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

Amount

 

 

Pct.

 

Test and measurement

 

$

5,489

 

 

$

5,521

 

 

 

90.5

%

 

 

70.9

%

 

$

(32

)

 

 

-0.6

%

Radio, baseband, software

 

 

579

 

 

 

2,267

 

 

 

9.5

%

 

 

29.1

%

 

 

(1,688

)

 

 

-74.5

%

Total net revenues

 

$

6,068

 

 

$

7,788

 

 

 

100.0

%

 

 

100.0

%

 

$

(1,720

)

 

 

-22.1

%


 

 

Three months ended June 30,

 

 

 

Gross Profit

 

 

Gross Profit %

 

 

Change

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

Amount

 

 

Pct.

 

Test and measurement

 

$

3,170

 

 

$

3,270

 

 

 

57.8

%

 

 

59.2

%

 

$

(100

)

 

 

-3.0

%

Radio, baseband, software

 

 

245

 

 

 

1,108

 

 

 

42.3

%

 

 

48.9

%

 

 

(863

)

 

 

-77.9

%

Total gross profit

 

$

3,415

 

 

$

4,378

 

 

 

56.3

%

 

 

56.2

%

 

$

(963

)

 

 

-22.0

%


 

 

Six months ended June 30,

 

 

 

Revenue

 

 

% of Revenue

 

 

Change

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

Amount

 

 

Pct.

 

Test and measurement

 

$

11,548

 

 

$

10,848

 

 

 

84.5

%

 

 

67.9

%

 

$

700

 

 

 

6.5

%

Radio, baseband, software

 

 

2,116

 

 

 

5,124

 

 

 

15.5

%

 

 

32.1

%

 

 

(3,008

)

 

 

-58.7

%

Total net revenues

 

$

13,664

 

 

$

15,972

 

 

 

100.0

%

 

 

100.0

%

 

$

(2,308

)

 

 

-14.5

%


 

 

Six months ended June 30,

 

 

 

Gross Profit

 

 

Gross Profit %

 

 

Change

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

Amount

 

 

Pct.

 

Test and measurement

 

$

6,678

 

 

$

6,324

 

 

 

57.8

%

 

 

58.3

%

 

$

354

 

 

 

5.6

%

Radio, baseband, software

 

 

1,092

 

 

 

2,908

 

 

 

51.6

%

 

 

56.8

%

 

 

(1,816

)

 

 

-62.4

%

Total gross profit

 

$

7,770

 

 

$

9,232

 

 

 

56.9

%

 

 

57.8

%

 

$

(1,462

)

 

 

-15.8

%


SEGMENT FINANCIAL STATEMENTS

(In thousands, unaudited)

 

 

Three months ended

 

 

Three months ended

 

 

Six months ended

 

 

Six months ended

 

 

 

June 30, 2022

 

 

June 30, 2021

 

 

June 30, 2022

 

 

June 30, 2021

 

 

 

T&M

 

 

RBS

 

 

Total

 

 

T&M

 

 

RBS

 

 

Total

 

 

T&M

 

 

RBS

 

 

Total

 

 

T&M

 

 

RBS

 

 

Total

 

Net revenues

 

$

5,489

 

 

$

579

 

 

$

6,068

 

 

$

5,521

 

 

$

2,267

 

 

$

7,788

 

 

$

11,548

 

 

$

2,116

 

 

$

13,664

 

 

$

10,848

 

 

$

5,124

 

 

$

15,972

 

Cost of revenues

 

 

2,319

 

 

 

334

 

 

 

2,653

 

 

 

2,251

 

 

 

1,159

 

 

 

3,410

 

 

 

4,870

 

 

 

1,024

 

 

 

5,894

 

 

 

4,524

 

 

 

2,216

 

 

 

6,740

 

Gross profit

 

 

3,170

 

 

 

245

 

 

 

3,415

 

 

 

3,270

 

 

 

1,108

 

 

 

4,378

 

 

 

6,678

 

 

 

1,092

 

 

 

7,770

 

 

 

6,324

 

 

 

2,908

 

 

 

9,232

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

1,987

 

 

 

1,440

 

 

 

3,427

 

 

 

1,808

 

 

 

1,788

 

 

 

3,596

 

 

 

3,857

 

 

 

3,038

 

 

 

6,895

 

 

 

3,480

 

 

 

3,623

 

 

 

7,103

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment profitability

 

 

1,183

 

 

 

(1,195

)

 

 

(12

)

 

 

1,462

 

 

 

(680

)

 

 

782

 

 

 

2,821

 

 

 

(1,946

)

 

 

875

 

 

 

2,844

 

 

 

(715

)

 

 

2,129

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate expenses

 

 

 

 

 

 

 

 

 

 

1,666

 

 

 

 

 

 

 

 

 

 

 

1,579

 

 

 

 

 

 

 

 

 

 

 

4,008

 

 

 

 

 

 

 

 

 

 

 

3,274

 

Operating loss

 

 

 

 

 

 

 

 

 

 

(1,678

)

 

 

 

 

 

 

 

 

 

 

(797

)

 

 

 

 

 

 

 

 

 

 

(3,133

)

 

 

 

 

 

 

 

 

 

 

(1,145

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income/(expense)

 

 

 

 

 

 

 

 

 

 

32

 

 

 

 

 

 

 

 

 

 

 

2,028

 

 

 

 

 

 

 

 

 

 

 

(659

)

 

 

 

 

 

 

 

 

 

 

2,055

 

Interest expense

 

 

 

 

 

 

 

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

(285

)

 

 

 

 

 

 

 

 

 

 

(177

)

 

 

 

 

 

 

 

 

 

 

(582

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income/(loss) before taxes

 

 

 

 

 

 

 

 

 

 

(1,646

)

 

 

 

 

 

 

 

 

 

 

946

 

 

 

 

 

 

 

 

 

 

 

(3,969

)

 

 

 

 

 

 

 

 

 

 

328

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tax provision/(benefit)

 

 

 

 

 

 

 

 

 

 

(286

)

 

 

 

 

 

 

 

 

 

 

(179

)

 

 

 

 

 

 

 

 

 

 

(1,136

)

 

 

 

 

 

 

 

 

 

 

(323

)

Net income/(loss) from continuing operations

 

 

 

 

 

 

 

 

 

 

(1,360

)

 

 

 

 

 

 

 

 

 

 

1,125

 

 

 

 

 

 

 

 

 

 

 

(2,833

)

 

 

 

 

 

 

 

 

 

 

651

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income from discontinued operations, net of tax

 

 

 

 

 

 

 

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

412

 

 

 

 

 

 

 

 

 

 

 

11,670

 

 

 

 

 

 

 

 

 

 

 

652

 

Net income/(loss)

 

 

 

 

 

 

 

 

 

$

(1,360

)

 

 

 

 

 

 

 

 

 

$

1,537

 

 

 

 

 

 

 

 

 

 

$

8,837

 

 

 

 

 

 

 

 

 

 

$

1,303

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and Amortization

 

$

255

 

 

$

63

 

 

$

317

 

 

$

225

 

 

$

249

 

 

$

473

 

 

$

534

 

 

$

217

 

 

$

751

 

 

$

448

 

 

$

494

 

 

$

942

 


RECONCILIATION OF NON GAAP MEASURES

(In thousands, unaudited)

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30

 

 

June 30

 

 

 

(Unaudited)

 

 

(Unaudited)

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net Income/(loss) from continuing operations

 

$

(1,360

)

 

$

1,125

 

 

$

(2,833

)

 

$

651

 

Tax (Provision)/Benefit

 

 

(286

)

 

 

(179

)

 

 

(1,136

)

 

 

(323

)

Depreciation and amortization expense

 

 

317

 

 

 

473

 

 

 

751

 

 

 

942

 

Interest expense

 

 

-

 

 

 

285

 

 

 

177

 

 

 

582

 

Non-GAAP EBITDA

 

 

(1,329

)

 

 

1,704

 

 

 

(3,041

)

 

 

1,852

 

Stock compensation expense

 

 

320

 

 

 

89

 

 

 

650

 

 

 

203

 

Divestiture and strategic initiative expenses

 

 

213

 

 

 

72

 

 

 

743

 

 

 

72

 

Restructuring Costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

25

 

FX (Gain)/Loss

 

 

18

 

 

 

19

 

 

 

10

 

 

 

(6

)

PPP Loan Forgiveness

 

 

-

 

 

 

(2,045

)

 

 

-

 

 

 

(2,045

)

Loss on Extinguishment of Debt

 

 

-

 

 

 

-

 

 

 

792

 

 

 

-

 

Non Recurring Arbitration Legal Costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4

 

Non-GAAP Adjusted EBITDA

 

$

(778

)

 

$

(161

)

 

$

(846

)

 

$

105

 


 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30

 

 

June 30

 

 

 

(Unaudited)

 

 

(Unaudited)

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

GAAP Operating Income/(Loss), as reported

 

$

(1,678

)

 

$

(797

)

 

$

(3,133

)

 

$

(1,145

)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of acquired intangible assets

 

 

143

 

 

 

331

 

 

 

378

 

 

 

660

 

Divestiture and strategic initiative expenses

 

 

213

 

 

 

72

 

 

 

743

 

 

 

72

 

Stock Compensation Expense

 

 

320

 

 

 

89

 

 

 

650

 

 

 

203

 

Restructuring costs

 

 

-

 

 

 

-

 

 

 

-

 

 

 

25

 

Total Adjustments to operating income/(loss)

 

 

676

 

 

 

492

 

 

 

1,771

 

 

 

960

 

Non-GAAP Adjusted Operating Income/(Loss)

 

$

(1,002

)

 

$

(305

)

 

$

(1,362

)

 

$

(185

)


 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30

 

 

June 30

 

 

 

(Unaudited)

 

 

(Unaudited)

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net Income/(loss) from continuing operations, as reported

 

$

(1,360

)

 

$

1,125

 

 

$

(2,833

)

 

$

651

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total pretax adjustments to operating income/(loss)

 

 

676

 

 

 

492

 

 

 

1,771

 

 

 

960

 

Loss/(Gain) on Extinguishment of Debt

 

 

-

 

 

 

(2,045

)

 

 

792

 

 

 

(2,045

)

Total Adjustments to Net loss from continuing operations

 

 

676

 

 

 

(1,553

)

 

 

2,563

 

 

 

(1,085

)

Tax effects of adjustments

 

 

203

 

 

 

(887

)

 

 

768

 

 

 

(620

)

Non-GAAP Adjusted Net Income/(loss) from continuing operations

 

$

(887

)

 

$

459

 

 

$

(1,038

)

 

$

186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic EPS, as reported

 

$

(0.06

)

 

$

0.05

 

 

$

(0.13

)

 

$

0.03

 

Diluted EPS, as reported

 

$

(0.06

)

 

$

0.05

 

 

$

(0.13

)

 

$

0.03

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP Adjusted Basic EPS

 

$

(0.04

)

 

$

0.02

 

 

$

(0.05

)

 

$

0.01

 

Non-GAAP Adjusted Diluted EPS

 

$

(0.04

)

 

$

0.02

 

 

$

(0.05

)

 

$

0.01

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic Shares

 

 

21,857

 

 

 

21,763

 

 

 

22,151

 

 

 

21,728

 

Diluted Shares

 

 

21,857

 

 

 

24,343

 

 

 

22,151

 

 

 

24,063