Wireless Telecom Group, Inc. (NYSE American: WTT) (the “Company”)
announced today results for the fourth quarter and twelve months
ended December 31, 2019.
For the quarter ended December 31, 2019, the
Company reported consolidated net revenues of $11,569,000, compared
to $12,091,000 for the same period in 2018, a decrease of 4.3%. For
the twelve months ended December 31, 2019, the Company reported
consolidated net revenues of $48,921,000 compared to $52,788,000
for the same period in 2018, a decrease of 7.3%.
Tim Whelan, CEO of Wireless Telecom Group, Inc.,
commented, “We experienced a disappointing 2019, compared to our
expectations for the second half of the year. The uncertainty and
delays of telecom carrier project spend and lowered volume
expectations from our largest customer late in the year led to
lower than expected bookings and revenue. While the recent
Coronavirus outbreak clouds the picture for 2020, we have been
encouraged by strong customer interest and order flow thus far. A
contributing factor to increased customer engagement is Embedded
Solutions’ recent 5G Software release, enabling fast, low-risk
development of small cells and private networks, as well as the
recently announced collaboration agreement with NXP
Semiconductor.”
Mr. Whelan continued, “We remain committed to
our long term targets, vision and strategy to leverage our
technology leadership and innovative specialized solutions to drive
revenue growth, improved profitability and cash flow. Across all of
our segments, we are starting to benefit from the continuing
investment in 5G deployments, increasing demands for test &
measurement solutions and the requirements of private LTE
buildouts.”
Fourth Quarter and Year End 2019
Review
For the quarter ended December 31, 2019, net
revenues in the Network Solutions segment were $5,312,000, compared
to $5,094,000 for the same period in 2018, an increase of 4.3%. For
the twelve months ended December 31, 2019, net revenues in the
Network Solutions segment were $21,830,000 compared to $22,275,000
for the same period in 2018, a decrease of 2.0%. The revenue
decrease from prior year was due primarily to a highly competitive
pricing environment impacting the entire industry and fewer large
projects, slightly offset by increased sales of our new products
and customized integrated solutions.
For the quarter ended December 31, 2019, net
revenues in the Test & Measurement segment were $4,348,000,
compared to $3,231,000 for the same period in 2018, an increase of
34.6%. For the twelve months ended December 31, 2019, net revenues
in the Test & Measurement segment were $13,566,000 compared to
$14,212,000 for the same period in 2018, a decrease of 4.5%. The
decrease from 2018 reflected lower government orders and fewer
large projects.
For the quarter ended December 31, 2019, net
revenues in the Embedded Solutions segment were $1,909,000,
compared to $3,766,000 in the same period in 2018, a decrease of
49.3%. For the twelve months ended December 31, 2019, net revenues
in the Embedded Solutions segment were $13,525,000 compared to
$16,301,000 for the same period in 2018, a decrease of 17.0%. The
decrease in revenue from the prior year was primarily due to lower
sales of LTE software licenses offset only partially by increased
sales of digital processing hardware used in wireless network test
equipment to our largest customer.
The Company also reported consolidated gross
profit of $5,604,000, or 48.4%, for the quarter ended December 31,
2019, compared to $5,264,000, or 43.5%, for the same period in
2018. Consolidated gross profit was $22,289,000, or 45.6%, for the
year ended December 31, 2019, compared to $24,167,000, or 45.8%,
for the same period in 2018. The increase in gross profit margin in
the quarter was primarily due to favorable product mix in the Test
and Measurement segment, offset by lower margins at the Embedded
Solutions segment as higher margin software sales declined year
over year.
For the quarter ended December 31, 2019, the
Company reported consolidated operating expenses of $6,154,000,
compared to $6,006,000 for the same period in 2018, an increase of
$148,000. For the twelve months ended December 31, 2019, the
Company reported consolidated operating expenses of $23,768,000,
compared to $23,388,000 for the same period in 2018, an increase of
$380,000. The increase in operating expenses is primarily due to
increased research and development expenses on our 5G NR product
roadmap.
The net income for the quarter ended December
31, 2019 was $235,000, compared to a net loss of $717,000 for the
same period in 2018. Net loss for the year ended December 31, 2019
was $414,000 compared to net income of $35,000 for the year ended
December 31, 2018.
Non-GAAP Adjusted EBITDA for the quarter ended
December 31, 2019 was $895,000, compared to $386,000 of non-GAAP
Adjusted EBITDA for the same period in 2018. Non-GAAP Adjusted
EBITDA for the year ended December 31, 2019 was $2,475,000,
compared to $4,829,000 of non-GAAP Adjusted EBITDA for the same
period in 2018. The decrease in non-GAAP Adjusted EBITDA of
$2,354,000, or 48.7%, from 2018 is primarily attributable to the
$3,867,000 decrease in consolidated revenues. An explanation of our
non-GAAP measures and a reconciliation of net income to non-GAAP
Adjusted EBITDA are included as an attachment to this press
release.
The Company’s consolidated backlog of firm
orders to be shipped in the next twelve months was approximately
$3,817,000 at December 31, 2019, a decrease of $4,403,000, or 53.6%
compared to December 31, 2018. The backlog decrease is principally
attributable to lower bookings for the Embedded Solutions hardware
cards in the quarter ending December 31, 2019.
Outlook
The Company is currently evaluating the impact
of the Coronavirus outbreak on its operations and business outlook.
To date, there has not been any significant reduction in the
Company’s supply chain, and no impact on its U.S.-based operations
or purchase flow from customers. This situation is volatile,
however, and could change as the developments unfold.
Looking into 2020, the Company expects that its
previously disclosed cost reduction actions will reduce
approximately $1.5 million of annualized expenses across cost of
goods sold and operating expenses as compared to 2019. The Company
has also realized improving customer orders in the first quarter
related to its Network Solutions and Test & Measurement
segments and expects both segments to see improved order flow in
the quarter ending March 31, 2020 as compared to the same period in
2019. As previously disclosed, while Embedded Solutions order flow
in the quarter ending March 31, 2020 is expected to be
substantially less than the same period in 2019 due to a decline in
hardware orders, the segment is responding to increasing interest
in its 4G and 5G software offerings and the Company is encouraged
by initial results. The Company expects to provide additional
information regarding its financial outlook once the impact of the
Coronavirus outbreak is better understood and the situation
stabilizes.
Conference Call
As previously announced, Wireless Telecom Group
Inc. will host a conference call today at 8:30 a.m. ET in which
management will discuss fourth quarter and year end 2019 results
and related matters. To participate in the conference call, dial
800-346-7359 or 973-528-0008. The conference identification number
is 238612. The call will also be webcast over the internet at the
following URL:
https://www.webcaster4.com/Webcast/Page/1690/33512
A replay will be made available on the Wireless
Telecom website for a limited period of time following the
conference call.
Contact: Mike Kandell(973) 386-9696
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 EBITDA as its net earnings
before interest, taxes, depreciation and amortization. “Adjusted
EBITDA” is EBITDA excluding our stock compensation expense,
restructuring charges, acquisition expenses, integration expenses,
unrealized and realized foreign exchange gains and losses,
non-recurring legal fees associated with the Harris arbitration and
other non-recurring costs and includes cash received in 2018
related to revenue that would have been recognized in 2018 but for
the adoption of ASU Topic 606. A reconciliation of net income to
non-GAAP Adjusted EBITDA is included as an attachment to this press
release.
GAAP operating expenses (“GAAP opex”) includes
research and development expenses, sales and marketing expenses and
general and administrative expenses. The Company defines non-GAAP
Operating Expenses (“Non-GAAP Opex”) as GAAP opex excluding stock
compensation expense, restructuring charges, acquisition expenses,
integration expenses, depreciation and amortization expense,
non-recurring legal fees associated with the Harris arbitration and
other non-recurring costs and expenses.
The Company views Adjusted EBITDA and Non-GAAP
Opex as important indicators of performance, consistent with the
manner in which management measures and forecasts the Company’s
performance. We believe Adjusted EBITDA is an important performance
metric because it facilitates 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 Adjusted EBITDA and
Non GAAP Opex 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 we will reduce annualized costs and expenses
by $1.5 million in 2020 as compared to the prior year; that we
expect both the Test & Measurement and Network Solutions
segments to see improved order flow in the quarter ended March 31,
2020 as compared to the same quarter last year; and, that Embedded
Solutions order flow in the quarter ended March 31, 2020 will be
substantially less than the same period in the prior year due to a
decline in hardware orders. 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
demand for private 4G LTE and 5G private networks; the loss of any
significant customers of the Company; the ability of management to
successfully implement the Company’s business plan and strategy;
management’s ability to integrate the Holzworth business
successfully; the impact of the coronavirus outbreak on customer
orders, supply chain and the Company’s operations; the impact of
competitive products and pricing; 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, 2019. 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, Microlab 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,
semiconductor and medical industries, Wireless Telecom Group
products enable innovation across a wide range of traditional and
emerging wireless technologies. With a unique set of
high-performance products including peak power meters, signal
generators, phase noise analyzers, signal processing modules, LTE
PHY/stack software, power splitters and combiners, GPS repeaters,
public safety components, noise sources, and programmable noise
generators, Wireless Telecom Group enables the development,
testing, and deployment of wireless technologies around the globe.
Wireless Telecom Group is headquartered in Parsippany, New Jersey,
in the New York City metropolitan area, and maintains a global
network of Sales and Service offices for excellent product service
and support. Wireless Telecom Group’s website address is
http://www.wirelesstelecomgroup.com.
Wireless Telecom Group, Inc.
CONSOLIDATED STATEMENT OF OPERATIONS AND
COMPREHENSIVE INCOME/(LOSS)(In thousands, except
per share amounts)
|
|
For the Three Months Ended |
|
|
For the Twelve Months Ended |
|
|
|
December 31 |
|
|
December 31 |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
NET
REVENUES |
|
$ |
11,569 |
|
|
$ |
12,091 |
|
|
$ |
48,921 |
|
|
$ |
52,788 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COST OF REVENUES |
|
|
5,965 |
|
|
|
6,827 |
|
|
|
26,632 |
|
|
|
28,621 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GROSS
PROFIT |
|
|
5,604 |
|
|
|
5,264 |
|
|
|
22,289 |
|
|
|
24,167 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and Development |
|
|
1,361 |
|
|
|
1,249 |
|
|
|
5,917 |
|
|
|
4,909 |
|
Sales and Marketing |
|
|
1,959 |
|
|
|
1,956 |
|
|
|
7,677 |
|
|
|
7,595 |
|
General and Administrative |
|
|
2,834 |
|
|
|
2,436 |
|
|
|
10,174 |
|
|
|
10,306 |
|
Loss on Change in Fair Value of Contingent Consideration |
|
|
- |
|
|
|
365 |
|
|
|
- |
|
|
|
578 |
|
Total Operating Expenses |
|
|
6,154 |
|
|
|
6,006 |
|
|
|
23,768 |
|
|
|
23,388 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income/(Loss) |
|
|
(550 |
) |
|
|
(742 |
) |
|
|
(1,479 |
) |
|
|
779 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income/(Expense) |
|
|
(275 |
) |
|
|
(48 |
) |
|
|
(2 |
) |
|
|
(121 |
) |
Interest Expense |
|
|
(57 |
) |
|
|
(226 |
) |
|
|
(305 |
) |
|
|
(575 |
) |
Income/(Loss) before
taxes |
|
|
(882 |
) |
|
|
(1,016 |
) |
|
|
(1,786 |
) |
|
|
83 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax Provision/(Benefit) |
|
|
(1,117 |
) |
|
|
(299 |
) |
|
|
(1,372 |
) |
|
|
48 |
|
Net
Income/(Loss) |
|
$ |
235 |
|
|
$ |
(717 |
) |
|
$ |
(414 |
) |
|
$ |
35 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Comprehensive
Income/(Loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign Currency Translation Adjustments |
|
|
1,103 |
|
|
|
(294 |
) |
|
|
539 |
|
|
|
(892 |
) |
Comprehensive
Income/(Loss) |
|
$ |
1,338 |
|
|
$ |
(1,011 |
) |
|
$ |
125 |
|
|
$ |
(857 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings/(Loss) Per
Share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.01 |
|
|
$ |
(0.03 |
) |
|
$ |
(0.02 |
) |
|
$ |
0.00 |
|
Diluted |
|
$ |
0.01 |
|
|
$ |
(0.03 |
) |
|
$ |
(0.02 |
) |
|
$ |
0.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares
Outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
21,130 |
|
|
|
20,973 |
|
|
|
21,111 |
|
|
|
20,858 |
|
Diluted |
|
|
21,630 |
|
|
|
20,973 |
|
|
|
21,111 |
|
|
|
21,566 |
|
CONSOLIDATED BALANCE
SHEET(In thousands, except number of shares and
par value)
|
|
December 31 |
|
|
December 31 |
|
|
|
2019 |
|
|
2018 |
|
CURRENT
ASSETS |
|
|
|
|
|
|
|
|
Cash & Cash Equivalents |
|
$ |
4,245 |
|
|
$ |
5,015 |
|
Accounts Receivable - net of reserves of $69 and $44,
respectively |
|
|
6,152 |
|
|
|
8,638 |
|
Inventories - net of reserves of $969 and $1,910, respectively |
|
|
7,325 |
|
|
|
6,884 |
|
Prepaid Expenses and Other Current Assets |
|
|
1,871 |
|
|
|
1,689 |
|
|
|
|
|
|
|
|
|
|
TOTAL CURRENT
ASSETS |
|
|
19,593 |
|
|
|
22,226 |
|
|
|
|
|
|
|
|
|
|
PROPERTY PLANT AND
EQUIPMENT - NET |
|
|
2,147 |
|
|
|
2,578 |
|
|
|
|
|
|
|
|
|
|
OTHER
ASSETS |
|
|
|
|
|
|
|
|
Goodwill |
|
|
10,069 |
|
|
|
9,778 |
|
Acquired Intangible Assets, net |
|
|
2,219 |
|
|
|
3,206 |
|
Deferred Income Taxes |
|
|
6,013 |
|
|
|
5,592 |
|
Right Of Use Assets |
|
|
1,436 |
|
|
|
- |
|
Other |
|
|
874 |
|
|
|
787 |
|
|
|
|
|
|
|
|
|
|
TOTAL OTHER
ASSETS |
|
|
20,611 |
|
|
|
19,363 |
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS |
|
$ |
42,351 |
|
|
$ |
44,167 |
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES |
|
|
|
|
|
|
|
|
Short Term Debt |
|
$ |
2,696 |
|
|
$ |
2,016 |
|
Accounts Payable |
|
|
2,227 |
|
|
|
3,252 |
|
Short Term Leases |
|
|
440 |
|
|
|
- |
|
Accrued Expenses and Other Current Liabilities |
|
|
2,657 |
|
|
|
6,083 |
|
Deferred Revenue |
|
|
42 |
|
|
|
103 |
|
|
|
|
|
|
|
|
|
|
TOTAL CURRENT
LIABILITIES |
|
|
8,062 |
|
|
|
11,454 |
|
|
|
|
|
|
|
|
|
|
LONG TERM
LIABILITIES |
|
|
|
|
|
|
|
|
Long Term Leases |
|
|
1,018 |
|
|
|
- |
|
Other Long Term Liabilities |
|
|
77 |
|
|
|
115 |
|
Deferred Tax Liability |
|
|
503 |
|
|
|
616 |
|
TOTAL LONG TERM
LIABILITIES |
|
|
1,598 |
|
|
|
731 |
|
|
|
|
|
|
|
|
|
|
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,
34,488,252 and 34,393,252 shares issued, 21,300,252 and 21,205,251
shares outstanding |
|
|
345 |
|
|
|
344 |
|
Additional Paid in Capital |
|
|
49,062 |
|
|
|
48,479 |
|
Retained Earnings |
|
|
7,142 |
|
|
|
7,556 |
|
Treasury Stock at Cost, 13,188,000 |
|
|
(24,509 |
) |
|
|
(24,509 |
) |
Accumulated Other Comprehensive Income |
|
|
651 |
|
|
|
112 |
|
TOTAL SHAREHOLDERS’
EQUITY |
|
|
32,691 |
|
|
|
31,982 |
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
$ |
42,351 |
|
|
$ |
44,167 |
|
CONSOLIDATED STATEMENT OF CASH
FLOWS(In thousands)
|
|
For the Twelve Months |
|
|
|
Ended December 31 |
|
|
|
2019 |
|
|
2018 |
|
CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
Net Income/(Loss) |
|
$ |
(414 |
) |
|
$ |
35 |
|
Adjustments to reconcile net income/(loss) to net cash provided
by/(used) by operating activities: |
|
|
|
|
|
|
|
|
Depreciation and Amortization |
|
|
2,151 |
|
|
|
2,305 |
|
Amortization of Debt Issuance Fees |
|
|
63 |
|
|
|
78 |
|
Share-based Compensation Expense |
|
|
584 |
|
|
|
702 |
|
Deferred Rent |
|
|
(24 |
) |
|
|
11 |
|
Deferred Income Taxes |
|
|
(551 |
) |
|
|
233 |
|
Provision for Doubtful Accounts |
|
|
25 |
|
|
|
- |
|
Inventory Reserves |
|
|
103 |
|
|
|
359 |
|
Changes in Assets and
Liabilities: |
|
|
|
|
|
|
|
|
Accounts Receivable |
|
|
2,465 |
|
|
|
231 |
|
Inventories |
|
|
(502 |
) |
|
|
(751 |
) |
Prepaid Expenses and Other Assets |
|
|
42 |
|
|
|
(850 |
) |
Accounts Payable |
|
|
(1,055 |
) |
|
|
(735 |
) |
Payment of Contingent Consideration |
|
|
(772 |
) |
|
|
- |
|
Accrued Expenses and Other Liabilities |
|
|
(2,035 |
) |
|
|
2,372 |
|
Net Cash Provided by Operating Activities |
|
|
80 |
|
|
|
3,990 |
|
|
|
|
|
|
|
|
|
|
CASH FLOWS USED BY
INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
Capital Expenditures |
|
|
(392 |
) |
|
|
(853 |
) |
Acquisition of Business |
|
|
(426 |
) |
|
|
(805 |
) |
Net Cash Used by Investing Activities |
|
|
(818 |
) |
|
|
(1,658 |
) |
|
|
|
|
|
|
|
|
|
CASH FLOWS
PROVIDED/(USED) BY FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
Revolver Borrowings |
|
|
36,544 |
|
|
|
37,695 |
|
Revolver Repayments |
|
|
(35,712 |
) |
|
|
(37,355 |
) |
Term Loan Repayments |
|
|
(152 |
) |
|
|
(152 |
) |
Debt Issuance Fees |
|
|
(110 |
) |
|
|
- |
|
Payment of Contingent Consideration |
|
|
(782 |
) |
|
|
- |
|
Proceeds from Exercise of Stock Options |
|
|
- |
|
|
|
288 |
|
Net Cash Provided/(Used) by Financing
Activities |
|
|
(212 |
) |
|
|
476 |
|
|
|
|
|
|
|
|
|
|
Effect of Exchange Rate
Changes on Cash and Cash Equivalents |
|
|
180 |
|
|
|
(251 |
) |
NET INCREASE/(DECREASE) IN
CASH AND CASH EQUIVALENTS |
|
|
(770 |
) |
|
|
2,557 |
|
|
|
|
|
|
|
|
|
|
Cash and Cash Equivalents, at Beginning of Period |
|
|
5,015 |
|
|
|
2,458 |
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, AT END OF PERIOD |
|
$ |
4,245 |
|
|
$ |
5,015 |
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL INFORMATION: |
|
|
|
|
|
|
|
|
Cash Paid During the Period for Interest |
|
$ |
185 |
|
|
$ |
176 |
|
Cash Paid During the Period for Income Taxes |
|
$ |
108 |
|
|
$ |
41 |
|
NET REVENUE AND GROSS PROFIT BY
SEGMENT(In thousands)
|
|
Three months ended December 31 |
|
|
|
Revenue |
|
|
% of Revenue |
|
|
Change |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
Amount |
|
|
Pct. |
|
Network Solutions |
|
$ |
5,312 |
|
|
$ |
5,094 |
|
|
|
45.9 |
% |
|
|
42.1 |
% |
|
$ |
218 |
|
|
|
4.3 |
% |
Test and Measurement |
|
|
4,348 |
|
|
|
3,231 |
|
|
|
37.6 |
% |
|
|
26.7 |
% |
|
|
1,117 |
|
|
|
34.6 |
% |
Embedded Solutions |
|
|
1,909 |
|
|
|
3,766 |
|
|
|
16.5 |
% |
|
|
31.1 |
% |
|
|
(1,857 |
) |
|
|
-49.3 |
% |
Total Net Revenues |
|
$ |
11,569 |
|
|
$ |
12,091 |
|
|
|
100.0 |
% |
|
|
100.0 |
% |
|
$ |
(522 |
) |
|
|
-4.3 |
% |
|
|
Three months ended December 31 |
|
|
|
Gross Profit |
|
|
Gross Profit % |
|
|
Change |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
Amount |
|
|
Pct. |
|
Network Solutions |
|
$ |
2,323 |
|
|
$ |
2,204 |
|
|
|
43.7 |
% |
|
|
43.3 |
% |
|
$ |
119 |
|
|
|
5.4 |
% |
Test and Measurement |
|
|
2,478 |
|
|
|
1,509 |
|
|
|
57.0 |
% |
|
|
46.7 |
% |
|
|
969 |
|
|
|
64.2 |
% |
Embedded Solutions |
|
|
803 |
|
|
|
1,551 |
|
|
|
42.1 |
% |
|
|
41.2 |
% |
|
|
(748 |
) |
|
|
-48.2 |
% |
Total Gross Profit |
|
$ |
5,604 |
|
|
$ |
5,264 |
|
|
|
48.4 |
% |
|
|
43.5 |
% |
|
$ |
340 |
|
|
|
6.5 |
% |
|
|
Twelve months ended December 31 |
|
|
|
Revenue |
|
|
% of Revenue |
|
|
Change |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
Amount |
|
|
Pct. |
|
Network Solutions |
|
$ |
21,830 |
|
|
$ |
22,275 |
|
|
|
44.6 |
% |
|
|
42.2 |
% |
|
$ |
(445 |
) |
|
|
-2.0 |
% |
Test and Measurement |
|
|
13,566 |
|
|
|
14,212 |
|
|
|
27.7 |
% |
|
|
26.9 |
% |
|
|
(646 |
) |
|
|
-4.5 |
% |
Embedded Solutions |
|
|
13,525 |
|
|
|
16,301 |
|
|
|
27.7 |
% |
|
|
30.9 |
% |
|
|
(2,776 |
) |
|
|
-17.0 |
% |
Total Net Revenues |
|
$ |
48,921 |
|
|
$ |
52,788 |
|
|
|
100.0 |
% |
|
|
100.0 |
% |
|
$ |
(3,867 |
) |
|
|
-7.3 |
% |
|
|
Twelve months ended December 31 |
|
|
|
Gross Profit |
|
|
Gross Profit % |
|
|
Change |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
|
Amount |
|
|
Pct. |
|
Network Solutions |
|
$ |
9,216 |
|
|
$ |
9,756 |
|
|
|
42.2 |
% |
|
|
43.8 |
% |
|
$ |
(540 |
) |
|
|
-5.5 |
% |
Test and Measurement |
|
|
7,320 |
|
|
|
7,018 |
|
|
|
54.0 |
% |
|
|
49.4 |
% |
|
|
302 |
|
|
|
4.3 |
% |
Embedded Solutions |
|
|
5,753 |
|
|
|
7,393 |
|
|
|
42.5 |
% |
|
|
45.4 |
% |
|
|
(1,640 |
) |
|
|
-22.2 |
% |
Total Gross Profit |
|
$ |
22,289 |
|
|
$ |
24,167 |
|
|
|
45.6 |
% |
|
|
45.8 |
% |
|
$ |
(1,878 |
) |
|
|
-7.8 |
% |
RECONCILIATION OF NET INCOME TO NON-GAAP
EBITDA AND NON-GAAP ADJUSTED EBITDA(In thousands,
unaudited)
|
|
Three Months Ended |
|
|
Twelve Months Ended |
|
|
|
December 31 |
|
|
December 31 |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
GAAP Net
Income/(Loss), as reported |
|
$ |
235 |
|
|
$ |
(717 |
) |
|
$ |
(414 |
) |
|
$ |
35 |
|
Tax Provision/(Benefit) |
|
|
(1,117 |
) |
|
|
(299 |
) |
|
|
(1,372 |
) |
|
|
48 |
|
Depreciation and Amortization Expense |
|
|
480 |
|
|
|
532 |
|
|
|
2,151 |
|
|
|
2,305 |
|
Interest Expense |
|
|
57 |
|
|
|
226 |
|
|
|
305 |
|
|
|
575 |
|
Non-GAAP
EBITDA |
|
|
(345 |
) |
|
|
(258 |
) |
|
|
670 |
|
|
|
2,963 |
|
Stock Compensation Expense |
|
|
24 |
|
|
|
197 |
|
|
|
584 |
|
|
|
702 |
|
ASC 606 Adjustment |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
345 |
|
Merger and Acquisition Expenses |
|
|
845 |
|
|
|
- |
|
|
|
845 |
|
|
|
- |
|
Integration Expenses |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
60 |
|
Restructuring Costs |
|
|
127 |
|
|
|
- |
|
|
|
250 |
|
|
|
- |
|
Inventory Recovery |
|
|
(2 |
) |
|
|
(5 |
) |
|
|
(20 |
) |
|
|
(28 |
) |
FX (Gain)/Loss |
|
|
286 |
|
|
|
47 |
|
|
|
29 |
|
|
|
104 |
|
US GAAP Purchase Accounting |
|
|
- |
|
|
|
40 |
|
|
|
- |
|
|
|
105 |
|
Change in Fair Value of Contingent Consideration |
|
|
- |
|
|
|
365 |
|
|
|
- |
|
|
|
578 |
|
Non Recurring Arbitration Legal Costs |
|
|
(39 |
) |
|
|
- |
|
|
|
117 |
|
|
|
- |
|
Non-GAAP Adjusted
EBITDA |
|
$ |
895 |
|
|
$ |
386 |
|
|
$ |
2,475 |
|
|
$ |
4,829 |
|
RECONCILIATION OF OPEX TO NON-GAAP
OPEX(In thousands, unaudited)
|
|
Three Months Ended |
|
|
Twelve Months Ended |
|
|
|
December 31 |
|
|
December 31 |
|
|
|
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
GAAP
Opex |
|
$ |
6,154 |
|
|
$ |
6,005 |
|
|
$ |
23,768 |
|
|
$ |
23,388 |
|
M&A/Integration |
|
|
(845 |
) |
|
|
- |
|
|
|
(845 |
) |
|
|
(60 |
) |
Restructuring |
|
|
(127 |
) |
|
|
- |
|
|
|
(250 |
) |
|
|
- |
|
Stock Comp |
|
|
(24 |
) |
|
|
(197 |
) |
|
|
(584 |
) |
|
|
(702 |
) |
Depreciation &
Amortization (ex. COGS) |
|
|
(429 |
) |
|
|
(455 |
) |
|
|
(1,908 |
) |
|
|
(1,783 |
) |
Contingent Consideration |
|
|
- |
|
|
|
(365 |
) |
|
|
- |
|
|
|
(578 |
) |
Non Recurring Arbitration
Legal Costs |
|
|
39 |
|
|
|
- |
|
|
|
(117 |
) |
|
|
- |
|
Tax Bonus/Purchase
Accounting |
|
|
- |
|
|
|
(40 |
) |
|
|
- |
|
|
|
(105 |
) |
Non GAAP
Opex |
|
$ |
4,768 |
|
|
$ |
4,948 |
|
|
$ |
20,064 |
|
|
$ |
20,160 |
|
Wireless Telecom (AMEX:WTT)
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