Tel-Instrument Electronics Corp Announces Third Quarter Results, AIMS Testing Completed for the TS-4530A Program and Expected Production Release for the ITATS Program
EAST RUTHERFORD, N.J.--(BUSINESS WIRE)-- Tel-Instrument Electronics Corp ("TIC" or the "Company") (NYSE MKT: TIK) announced results for its third quarter and first nine months of fiscal year 2013 as well as two milestones on the TS-4530A and ITATS programs.
For the three months ended December 31, 2012, sales decreased $1,323,215 to $2,350,020, as compared to $3,673,235 for the same period in the prior year. The Company recorded a net loss of $545,177 or $0.19 per share for the three months ended December 31, 2012, as compared to net income of $97,431 or $0.04 per share for the three months ended December 31, 2011
The Company recorded sharply reduced revenues and a significant loss for the nine months ended December 31, 2012 due mainly to the limited production for the CRAFT 708 program and delays in securing a production release for the TS-4530A program from the U.S. Army. For the nine months ended December 31, 2012, sales decreased $5,415,542 to $5,922,258, as compared to $11,337,800 for the same period in the prior year. The Company recorded a net loss of $1,643,682 or $0.59 per share for the nine months ended December 31, 2012, as compared to net income of $119,952 or $0.04 per share (fully-diluted) for the nine months ended December 31, 2011.
The production delays for the CRAFT and TS-4530A programs have negatively impacted the Company's cash flow. As such, the Company secured additional short-term financing in July for $600,000, received a progress payment from the government on the CRAFT program for approximately $990,000 (which has been repaid as of December 31, 2012), received an equity purchase for $500,000 from the Company's Chief Executive Officer, a director and an affiliate to the Company, and in November 2012 received approximately $500,000 from an investment group in exchange for approximately 149,254 shares of newly issued common stock.
Update of Major Programs
The Company has resolved the issues on the CRAFT program, and has received U.S. Navy approval to increase CRAFT production levels, and is now in the process of ramping up production. The Company has also started to receive additional orders from the Navy for additional CRAFT units. In February 2013, TIC received a $435,000 order for 16 CRAFT 719 units. TIC also expects additional orders from the Navy for CRAFT 708 units.
In February 2013, the TS-4530A test set completed testing conducted by the Department of Defense (DOD) AIMS Program Office on the TS-4530A Flight Line Test Set. TIC anticipates receipt of the official AIMS certification letter in the near future. With this critical milestone completed, TIC is working with the U.S. Army to secure a near-term production release as well as a progress payment. The TS-4530A program is a critical program with almost $20,000,000 of booked production orders.
The AN/ARM-206 ITATS development program is completed and the Company completed its Production Readiness Review with the U.S. Navy in February 2013. A production release is expected in the next two weeks. The Company currently has orders for 102 units for approximately $5.3 million. It is expected that shipments will commence in the first half of calendar year 2013.
If the Company is unable to obtain production releases within a reasonable period of time and/or our vendors or lenders begin to pursue legal action demanding payments, it would result in a material adverse effect on the Company's operations and its ability to pay its obligations. As such, the Company may need to pursue additional sources of financing and/or additional progress payments.
TIC encourages everyone to read the full results of operations contained in the Form 10-Q filed on February 19, 2013 at sec.gov.
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 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.
TEL-INSTRUMENT ELECTRONICS CORPORATION
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Common stock, par value $.10 per share, 3,000,639 and 2,684,215 issued and outstanding as of December 31, 2012 and March 31, 2012, respectively
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TEL-INSTRUMENT ELECTRONICS CORPORATION
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