Form 8-K - Current report

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 6, 2024

CPS TECHNOLOGIES CORP.
(Exact Name of Registrant as Specified in its Charter)

Delaware	0-16088	04-2832509
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

111 South Worcester Street, Norton, Massachusetts		02766
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code

508-222-0614

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4( c)) under the Exchange Act (17 CFR 240.13e-4(c)).

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

☐ Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	CPSH	Nasdaq Capital Market

Item 2.02 Results of Operations and Financial Condition

On March 6, 2024, the Company issued a press release announcing its financial results for the quarter and year ended December 30, 2023. A copy of the press release is attached hereto as Exhibit 99 and is incorporated herein in its entirety by reference.

The information in this Item 2.02, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (The “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Cautionary Note Regarding Forward-Looking Statements.
Except for historical information contained in the press release attached as an exhibit hereto, the press release contains forward-looking statements which involve certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these statements. Please refer to the cautionary note in the press release regarding these forward-looking statements.

Item 8.01 Other Events

Exhibit 99.2 is incorporated herein in its entirety by reference.

Item 9.01 Financial Statements and Exhibits

EXHIBIT NUMBER	DESCRIPTION
99.1	Press release dated March 6, 2024 of CPS Technologies Corp. announcing its financial results for the quarter and year ended December 30, 2023
99.2	Financial results for the quarter ended December 30, 2023
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CPS Technologies Corp. (Registrant)
Date: March 8, 2024	/s/ Charles K. Griffith, Jr. Charles K. Griffith Jr. Chief Financial Officer

Exhibit 99.1

FOR RELEASE: IMMEDIATE

CPS Technologies Corporation Announces Fourth Quarter 2023 Financial Results

Finished Year with Record Top Line Results; Large Pipeline of Opportunities for 2024 & Beyond

Norton, Massachusetts – March 6, 2024 – CPS Technologies Corporation (NASDAQ:CPSH) (“CPS” or the “Company”) today announced financial results for the fiscal fourth quarter ended December 30, 2023.

Fourth Quarter Highlights

●

Revenue of $6.7 million for the fourth quarter of 2023 versus $6.1 million in the prior-year period, primarily due to growth in shipments

●

Gross margin of 17.0 percent versus 26.6 percent in the fourth quarter of 2022, reflecting certain quality issues with a major customer

●

Operating profit of $0.1 million for the quarter ended December 30, 2023 compared to $0.3 million in the prior-year period

“We finished the year with the highest annual revenue in the Company’s history – $27.6 million – driven by 10 percent growth in the fourth quarter versus the prior-year period,” said Brian Mackey, President and CEO. “We are cautiously optimistic that the quality issues previously disclosed have been largely mitigated and should not have a material impact on 2024 results. While the Continuing Resolution in Washington has hampered certain decision making, impacting some of our new business development initiatives, we believe our strong position across the Company’s diverse end markets provides plenty of opportunity for further top line expansion. That said, the U.S. Navy contract for HybridTech Armor® panels is, as previously discussed, expected to be completed during the second quarter of this year. We remain steadfast in our mission to pursue other fast-growing industrial and technological applications that can accelerate demand and drive CPS to new levels of performance. We continue to invest for the future, and I am confident that order flow will improve as the year plays out. Even as short-term headwinds exist, the future is bright for CPS.”

Results of Operations

CPS reported revenue of $6.7 million in the fourth quarter of fiscal 2023 versus $6.1 million in the prior-year period, reflecting overall growth in product shipments. Gross profit was $1.1 million, or 17.0 percent of revenue, versus $1.6 million, or 26.6 percent of revenue, in the fiscal 2022 fourth quarter, with the lower gross margin year-over-year largely due to quality issues with one of the Company’s major customers.

Operating profit was $0.1 million in the fiscal 2023 fourth quarter compared with $0.3 million in the prior-year period. Reported net income was also $0.2 million, or $0.01 per diluted share, versus $0.3 million, or $0.02 per diluted share, in the quarter ended December 31, 2022.

Conference Call

The Company will be hosting its fourth quarter 2023 earnings call at 9:00 am on March 7, 2024. Those interested in participating in the conference call should dial the following:

Call in Number: 1-844-943-2942

Participant Passcode: 531915

The Company encourages those who wish to participate to call in 10 minutes before the scheduled start time to ensure the operator can connect all participants.

Page 2

About CPS

CPS is a technology and manufacturing leader in producing high-performance materials solutions for its customers. The company’s products and intellectual property address critical needs in a variety of applications, including electric trains and subway cars, wind turbines, hybrid vehicles, electric vehicles, Navy ships, the smart electric grid, 5G infrastructure and others. CPS hermetic packages can be found in many Aerospace and Satellite applications. CPS’ armor products provide exceptional ballistic protection and environmental durability at very light weight. CPS is committed to innovation and to supporting our customers in building solutions for the transition to clean energy.

Safe Harbor

Statements made in this document that are not historical facts or which apply prospectively, including those relating to 2024 financial results, are forward-looking statements that involve risks and uncertainties. These forward-looking statements are identified by the use of terms and phrases such as "will," "intends," "believes," "expects," "plans," "anticipates" and similar expressions. Investors should not rely on forward looking statements because they are subject to a variety of risks and uncertainties and other factors that could cause actual results to differ materially from the company's expectation. Additional information concerning risk factors is contained from time to time in the company's SEC filings, including its Annual Report on Form 10-K and other periodic reports filed with the SEC. Forward-looking statements contained in this press release speak only as of the date of this release. Subsequent events or circumstances occurring after such date may render these statements incomplete or out of date. The company expressly disclaims any obligation to update the information contained in this release.

CPS Technologies Corporation
111 South Worcester Street
Norton, MA 02766

www.cpstechnologysolutions.com

Investor Relations:

Chris Witty

646-438-9385

cwitty@darrowir.com

Page 3

CPS TECHNOLOGIES CORPORATION

Statements of Operations (Unaudited)

	Three Months Ended				Year Ended
	December 30,		December 31,		December 30,		December 31,
	2023		2022		2023		2022
Revenues:
Product sales	$	6,747,199	$	6,115,352	$	27,550,646	$	26,586,926
Total revenues	$	6,747,199	$	6,115,352	$	27,550,646	$	26,586,926

Cost of product sales		5,598,616		4,489,640		20,725,237		19,285,846
Gross Margin		1,148,583		1,625,712		6,825,409		7,301,080

Selling, general, and administrative expense		1,004,948		1,316,530		5,126,046		5,066,660
Income from operations		143,635		309,182		1,699,363		2,234,420

Interest/Other income (expense)		80,823		9,866		253,018		635,248
Net income before income tax		224,458		319,048		1,952,381		2,887,668
Income tax provision (benefit)		84,948		50,057		582,085		756,268
Net income	$	139,510	$	268,991	$	1,370,296	$	2,131,400

Wtd. Avg. basic common shares outstanding - diluted		14,617,473		14,649,719		14,628,811		14,675,646

Net income per basic common share	$	0.01	$	0.02	$	0.09	$	0.15

Page 4

CPS TECHNOLOGIES CORP.

Balance Sheets (Unaudited)

	December 30,		December 31,
	2023		2022
ASSETS

Current assets:
Cash and cash equivalents	$	8,813,626	$	8,266,753
Accounts receivable-trade, net		4,389,155		3,777,975
Accounts Receivable - other		83,191		685,668
Inventories, net		4,581,930		4,875,901
Prepaid expenses and other current assets		276,349		211,242
Total current assets		18,144,251		17,817,539
Net property and equipment		1,556,139		1,326,968

Right-of-use lease asset		332,000		466,000
Deferred taxes, net		1,569,726		2,069,436
Total Assets	$	21,602,116	$	21,679,943

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Note payable, current portion		46,797		43,711
Accounts payable		2,535,086		1,836,865
Accrued expenses		1,075,137		820,856
Deferred revenue		251,755		2,521,128
Lease liability, current portion		160,000		157,000
Total current liabilities		4,068,775		5,379,560
Note payable less current portion		8,090		54,847
Deferred revenue – long term		31,277		231,020
Long term lease liability		172,000		309,000
Total liabilities		4,280,142		5,974,427

Total stockholders’ equity		17,321,974		15,705,516
Total liabilities and stockholders’ equity	$	21,602,116	$	21,679,943

Exhibit 99.2

CPS TECHNOLOGIES CORPORATION

Statements of Operations (Unaudited)

	Three Months Ended				Year Ended
	December 30,		December 31,		December 30,		December 31,
	2023		2022		2023		2022
Revenues:
Product sales	$	6,747,199	$	6,115,352	$	27,550,646	$	26,586,926
Total revenues	$	6,747,199	$	6,115,352	$	27,550,646	$	26,586,926

Cost of product sales		5,598,616		4,489,640		20,725,237		19,285,846
Gross Margin		1,148,583		1,625,712		6,825,409		7,301,080

Selling, general, and administrative expense		1,004,948		1,316,530		5,126,046		5,066,660
Income from operations		143,635		309,182		1,699,363		2,234,420

Interest/Other income (expense)		80,823		9,866		253,018		635,248
Net income before income tax		224,458		319,048		1,952,381		2,887,668
Income tax provision (benefit)		84,948		50,057		582,085		756,268
Net income	$	139,510	$	268,991	$	1,370,296	$	2,131,400

Wtd. Avg. basic common shares outstanding - diluted		14,617,473		14,649,719		14,628,811		14,675,646

Net income per basic common share	$	0.01	$	0.02	$	0.09	$	0.15

Page 2

CPS TECHNOLOGIES CORP.

Balance Sheets (Unaudited)

	December 30,		December 31,
	2023		2022
ASSETS
Current assets:
Cash and cash equivalents	$	8,813,626	$	8,266,753
Accounts receivable-trade, net		4,389,155		3,777,975
Accounts Receivable - other		83,191		685,668
Inventories, net		4,581,930		4,875,901
Prepaid expenses and other current assets		276,349		211,242
Total current assets		18,144,251		17,817,539
Net property and equipment		1,556,139		1,326,968

Right-of-use lease asset		332,000		466,000
Deferred taxes, net		1,569,726		2,069,436
Total Assets	$	21,602,116	$	21,679,943

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Note payable, current portion		46,797		43,711
Accounts payable		2,535,086		1,836,865
Accrued expenses		1,075,137		820,856
Deferred revenue		251,755		2,521,128
Lease liability, current portion		160,000		157,000
Total current liabilities		4,068,775		5,379,560
Note payable less current portion		8,090		54,847
Deferred revenue – long term		31,277		231,020
Long term lease liability		172,000		309,000
Total liabilities		4,280,142		5,974,427

Total stockholders’ equity		17,321,974		15,705,516
Total liabilities and stockholders’ equity	$	21,602,116	$	21,679,943

Document And Entity Information	Mar. 06, 2024
Document Information [Line Items]
Entity, Registrant Name	CPS TECHNOLOGIES CORP.
Document, Type	8-K
Document, Period End Date	Mar. 06, 2024
Entity, Incorporation, State or Country Code	DE
Entity, File Number	0-16088
Entity, Tax Identification Number	04-2832509
Entity, Address, Address Line One	111 South Worcester Street
Entity, Address, City or Town	Norton
Entity, Address, State or Province	MA
Entity, Address, Postal Zip Code	02766
City Area Code	508
Local Phone Number	222-0614
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity, Emerging Growth Company	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	CPSH
Security Exchange Name	NASDAQ
Amendment Flag	false
Entity, Central Index Key	0000814676