The LGL Group, Inc. (the “Company” or “LGL”; NYSE American:
LGL), announced its financial results for the year ended December
31, 2019.
Management will host a conference call today at 4:30 p.m. ET to
review the Company's 2019 annual results. Participants are invited
to access the call by dialing (844) 401-3350 (United States), or
(248) 847-2523 (international) approximately fifteen minutes before
the conference start time and provide the conference ID
1164487.
- Balance Sheet Cash Strength bolstered by approximately $3.6
million as a result of sales of 263,725 shares under the Company’s
ATM Program.
- Positive January and February Monthly order trends were
roughly in line with internal expectations for the First
Quarter.
- COVID-19 impact to customers or the supply chain is still
evolving. Orlando headquarters is operating as an essential
business however its supply chain may be impacted with its India
facility suspending operations due to local government
decree.
Fourth Quarter
- Revenues increased 37.5%; increase for the fourth quarter of
2019 is $8.8 versus $6.4 million reported for the fourth quarter of
2018, and up from revenues of $8.6 million reported for the third
quarter of 2019.
- Adjusted EBITDA grew to $1.2 million from $0.4 million.
- EPS rose to $0.19 per share from $0.05 per share, on a diluted
basis.
Full Year
- Annual revenues increased 28.3% to $31.9 million versus $24.9
million reported for 2019, an increase of $7.0 million.
- Adjusted EBITDA was $4.0 million versus $1.9 million.
- EPS rose to $1.41 per share from $0.29 per share, on a diluted
basis.
- Backlog up 24.9% at $21.9 million as of the fourth quarter of
2019 vs. $17.5 million for the fourth quarter of 2018, with a
decrease of $1.4 million from the third quarter of 2019 of $23.3
million.
Ivan Arteaga, President and Chief Executive Officer said, “The
balance sheet cash position has improved into the year by the
addition of $3.6 million from the successful implementation of the
Company’s ATM Program. We also saw positive monthly sales trends
continued from the 4th quarter as defense customers added to their
bookings since December.”
Regarding the COVID-19 impacts, Mr. Arteaga added, “While our
current business and visibility appears to remain healthy, it is
still too early to have complete visibility on the COVID-19 impact
to supply chains, customers, or production. Our Noida, India
facility has been impacted by the Indian government’s nationwide
lockdown, beginning March 25, 2019 until April 15, 2019, and all
production activities have ceased, and our contingency initiative
has been activated. The production from Noida historically
represents about one-third of our consolidated revenues.”
FOURTH QUARTER RESULTS – In 2019, LGL’s fourth quarter revenues
increased $2.4 million, or 37.5%, to $8.8 million compared to $6.4
million for the corresponding quarter in 2018. Adjusted EBITDA was
$1.2 million in the fourth quarter of 2019 versus $0.4 million in
the fourth quarter of 2018.
FULL YEAR RESULTS – The Company recorded revenues of $31.9
million for 2019 and adjusted EBITDA of $4.0 million compared to
2018 revenues of $24.9 million and adjusted EBITDA of $1.9 million.
Almost 60% of the revenue improvement resulted from our top four
customers.
EARNINGS PER SHARE – Diluted earnings per share from ongoing
operations, during the fourth quarter were $0.19 per share in 2019
as compared to $0.05 per share in 2018. The full year diluted
earnings per share were $1.41 in 2019 and $0.29 in 2018. Included
within the diluted earnings was $3.3 million, or $0.67 per diluted
share from the reversal of valuation allowances on our deferred tax
assets. Weighted average shares outstanding at December 31, 2019
were 4.98 million versus 4.88 million at December 31, 2018.
BALANCE SHEET – LGL’s balance sheet continued to improve in 2019
as a result of strong cash from operations. The balance sheet at
yearend 2019 reflects a net cash position, including marketable
securities and with no financial debt of $18.1 million at December
31, 2019 compared to $19.3 million at December 31, 2018. The 2019
cash balance was reduced by LGL’s investment in an unconsolidated
subsidiary (see below) in November 2019.
EQUITY INVESTMENT IN UNCONSOLIDATED SUBSIDIARY – In the fourth
quarter of 2019, LGL invested $3.35 million into LGL Acquisition
Holdings (“Sponsor”), the sponsor of LGL Acquisition Inc. (the
“SPAC”), a blank-check holding company created to identify and
approve an acquisition in the Aerospace and Defense industries. In
the fourth quarter of 2019, the SPAC raised $172.5 million from
investors that will be held in trust for its acquisition purpose.
Our investment in the Sponsor is recorded as an equity method
investment.
CAPITAL EXPENDITURES – For 2019, capital expenditures were $1.0
million, of which $0.6 million was for ongoing maintenance
expenditure, including a new roof for our Orlando facility and $0.3
million was expended to increase capacity for certain high demand
products. Our current capital plan calls for modest incremental
year over year investment to improve direct labor efficiency and
enhance line capacity in targeted high demand product lines.
OPERATING STATISTICS – As of December 31, 2019, the company’s
backlog increased 24.9% to $21.9 million as compared to $17.5
million in 2018. Book-to-bill declined to 1.136:1 as shipments
increased while backlog continued to grow. LGL continues to benefit
from strong performance from the Company’s sales teams.
Our summary operating statistics are as follows:
Quarter ended
December 31,
Change
(Amounts in millions, except
book:bill)
2019
2018
$
%
Bookings (Sales)
7,411
7,874
(463
)
(5.9
%)
Shipments (Revenues)
8,839
6,430
2,409
37.5
%
Book:Bill
0.838
1.225
(0.386
)
(31.5
%)
Fiscal Year ended
December 31,
Change
(Amounts in millions, except
book:bill)
2019
2018
$
%
Bookings (Sales)
36,248
30,662
5,586
18.2
%
Shipments (Revenues)
31,897
24,870
7,027
28.3
%
Book:Bill
1.136
1.233
(0.096
)
(7.8
%)
Ending Backlog
21,856
17,505
4,351
24.9
%
About The LGL Group, Inc.
The LGL Group, Inc., through its two principal subsidiaries
MtronPTI and PTF, designs, manufactures and markets
highly-engineered electronic components used to control the
frequency or timing of signals in electronic circuits, and designs
high performance frequency and time reference standards that form
the basis for timing and synchronization in various
applications.
Headquartered in Orlando, Florida, the Company has additional
design and manufacturing facilities in Yankton, South Dakota,
Wakefield, Massachusetts and Noida, India, with local sales offices
in Hong Kong, Sacramento, California and Austin, Texas.
For more information on the Company and its products and
services, contact James Tivy at The LGL Group, Inc., 2525 Shader
Rd., Orlando, Florida 32804, (407) 298-2000, or visit
www.lglgroup.com and www.mtronpti.com.
Caution Concerning Forward Looking Statements
This press release may contain forward-looking statements made
in reliance upon the safe harbor provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21 E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements include all statements that do not relate solely to
historical or current facts, and can be identified by the use of
words such as “may,” “will,” “expect,” “project,” “estimate,”
“anticipate,” “plan,” “believe,” “potential,” “should,” “continue”
or the negative versions of those words or other comparable words.
These forward-looking statements are not guarantees of future
actions or performance. These forward-looking statements are based
on information currently available to us and our current plans or
expectations, and are subject to a number of uncertainties and
risks that could significantly affect current plans, anticipated
actions and our future financial condition and results. Certain of
these risks and uncertainties are described in greater detail in
our filings with the Securities and Exchange Commission. We are
under no obligation to (and expressly disclaim any such obligation
to) update or alter our forward-looking statements, whether as a
result of new information, future events or otherwise.
THE LGL GROUP, INC.
Consolidated Statements of
Operations
(Dollars in Thousands, Except
Shares and Per Share Amounts)
Quarter ended
Fiscal Year ended
December 31,
December 31,
(Amounts in thousands, except share
amounts)
2019
2018
2019
2018
REVENUES
$
8,839
$
6,430
$
31,897
$
24,870
Costs and expenses:
Manufacturing cost of sales
5,411
4,068
19,381
15,211
Engineering, selling and
administrative
2,401
2,056
9,077
8,229
OPERATING INCOME
1,027
306
3,439
1,430
Total other income (expense), net
117
(25
)
470
140
INCOME BEFORE INCOME TAXES
1,144
281
3,909
1,570
Income tax provision (benefit)
179
19
(3,107
)
165
NET INCOME
$
965
$
262
$
7,016
$
1,405
Weighted average number of shares used in
basic EPS calculation
4,917,854
4,825,521
4,883,923
4,748,609
Weighted average number of shares used in
diluted EPS calculation
4,978,336
4,951,977
4,977,595
4,875,031
BASIC NET INCOME PER COMMON SHARE
$
0.20
$
0.05
$
1.44
$
0.30
DILUTED NET INCOME PER COMMON SHARE
$
0.19
$
0.05
$
1.41
$
0.29
THE LGL GROUP, INC.
Condensed Consolidated Balance
Sheets
(Dollars in Thousands)
December 31, 2019
December 31, 2018
ASSETS
Cash and cash equivalents
$
12,453
$
15,508
Marketable securities
5,631
3,775
Accounts receivable, net
4,445
3,394
Inventories, net
6,016
4,466
Prepaid expenses and other current
assets
365
242
Total Current Assets
28,910
27,385
Property, plant, and equipment, net
2,831
2,086
Right-of-use lease asset
331
-
Equity investment in unconsolidated
subsidiary
3,334
-
Intangible assets, net
402
477
Deferred income taxes, net
3,307
127
Other assets, net
102
-
Total Assets
$
39,217
$
30,075
LIABILITIES AND STOCKHOLDERS' EQUITY
Total Current Liabilities
4,324
2,752
Total Stockholders' Equity
34,893
27,323
Total Liabilities and Stockholders'
Equity
$
39,217
$
30,075
Reconciliations of GAAP to Non-GAAP Measures
To supplement our consolidated financial statements presented on
a GAAP (generally accepted accounting principles) basis, the
Company uses certain non-GAAP measures, including Adjusted EBITDA,
which we define as net income adjusted to exclude depreciation and
amortization expense, interest income (expense), provision
(benefit) for income taxes, stock-based compensation expense and
other items we believe are discrete events which have a significant
impact on comparable GAAP measures and could distort an evaluation
of our normal operating performance. These adjustments to our GAAP
results are made with the intent of providing both management and
investors a more complete understanding of the underlying
operational results and trends and our marketplace performance. The
presentation of this additional information is not meant to be
considered in isolation or as a substitute for net earnings or
diluted earnings per share prepared in accordance with generally
accepted accounting principles in the United States.
Reconciliation of GAAP Income Before
Income Taxes to Non-GAAP Adjusted EBITDA:
Quarter ended
Fiscal Year ended
December 31,
December 31,
(Amounts in thousands, except share
amounts)
2019
2018
2019
2018
Net income before income taxes
$
1,144
$
281
$
3,909
$
1,570
Interest income
(1
)
(1
)
(2
)
(2
)
Depreciation and amortization
128
121
493
492
Non-cash stock compensation
95
45
112
64
Investment (income) loss
(147
)
3
(493
)
(203
)
Recovery of note receivable
—
—
—
(4
)
Adjusted EBITDA
$
1,219
$
449
$
4,019
$
1,917
Basic per share information:
Weighted average shares outstanding
4,917,854
4,825,521
4,883,923
4,748,609
Adjusted EBITDA per share
$
0.25
$
0.09
$
0.82
$
0.40
Diluted per share information:
Weighted average shares outstanding
4,978,336
4,951,977
4,977,595
4,875,031
Adjusted EBITDA per share
$
0.24
$
0.09
$
0.81
$
0.39
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200330005410/en/
The LGL Group, Inc. Ivan Arteaga, 407-298-2000 CEO
iarteaga@lglgroup.com or James Tivy, (407) 298-2000 CFO
jtivy@lglgroup.com
LGL (AMEX:LGL)
Historical Stock Chart
From Mar 2024 to Apr 2024
LGL (AMEX:LGL)
Historical Stock Chart
From Apr 2023 to Apr 2024