CVD Equipment Corporation (NASDAQ: CVV), today announced its
financial results for the fourth quarter and fiscal year ended
December 31, 2023.
Manny Lakios, President and CEO of CVD Equipment Corporation,
commented, “Fourth quarter 2023 revenue was $4.1 million, down
significantly versus the prior year period, as our business
continues to experience fluctuations in revenue given the nature of
the emerging growth end markets we serve. While we are disappointed
with both our fourth quarter and full year performance, we’ll stay
the course on our strategy to return to consistent profitability,
with a focus on growth and return on investment.”
Mr. Lakios added, “Our primary goal is to expand penetration of
our equipment solutions into high power electronics, battery
material, aerospace and industrial applications. To this end, I am
very pleased to announce that we started off 2024 with several key
new order wins. First, we successfully penetrated a second PVT
equipment customer, with an evaluation order for our newly launched
PVT200 system used to grow 200 mm silicon carbide crystals. This
represents an important milestone for CVD, with potential follow-on
production orders should our equipment effectively meet the
customers’ needs. Second, we received a $10 million multisystem
order for a SiC CVD coating reactor from an industrial customer,
which will be used to deposit a silicon carbide protective coating
on OEM components. We are encouraged by these orders, as we
continue to make investments in both research and development and
sales and marketing, including direct engagement with multiple
potential customers, focused on our key markets.”
Fourth Quarter 2023 Financial Performance
- Revenue of $4.1 million, down $3.1 million or 43.2% year over
year primarily due to lower system revenues.
- Gross profit margin percentage was a negative 8.5% due to a
large contract that experienced significant cost overruns during
the quarter.
- Operating loss of $2.5 million.
- Net loss of $2.3 million or $0.33 basic and diluted share,
compared to a net income of $1.5 million or $0.23 per basic and
diluted share during the prior year fourth quarter. Net income in
2022 included $1.5 million of other income related to the
recognition of Employee Retention Credits related to fiscal
2021.
- Cash and cash equivalents of $14.0 million as of December 31,
2023.
Full Year 2023 Financial Performance
- Revenue of $24.1 million, down $1.7 million or 6.6% year over
year primarily due to the disposition of Tantaline and the wind
down of MesoScribe’s operations.
- Our gross profit margin percentage was 21.0% in 2023 as
compared to 25.7% in the prior year due to a large contract in 2023
that experienced significant cost overruns and other higher margin
system contracts in 2022.
- Operating loss of $4.9 million.
- Net loss of $4.2 million or $0.62 basic and diluted share,
compared to a net loss of $0.2 million or $0.03 per basic and
diluted share in the prior year. Net loss in 2022 included $1.5
million of other income related to the recognition of Employee
Retention Credits.
Fourth Quarter 2023 Operational Performance
- Orders for the fourth quarter were $5.8 million driven by
continued demand in the aerospace sector and in our SDC segment for
gas delivery equipment.
- Received a $2.1 million system order in the aerospace sector
that will be delivered over the next 12 months.
- Received a $1.0 million order in our SDC segment for gas
delivery equipment.
- During the fourth quarter, we developed a plan to reduce our
operating costs to be consistent with current customer demand. This
resulted in a reduction in our work force in early January 2024. We
continue to evaluate opportunities to reduce our operating
costs.
Full Year 2023 Operational Performance
- Booking of new orders from customers was $25.8 million,
representing a decrease of approximately 22.1% compared to 2022
bookings of $33.1 million. The decline in bookings was related to
large orders of PVT150 systems that were received in 2022.
- Backlog as of December 31, 2023 of $18.4 million, an increase
from $17.8 million from the prior year end.
The success of our PVT150 and PVT200 marketing efforts is
dependent on the performance of our equipment in the field, overall
market conditions, our customers’ ability to qualify their end
product with their customers and our customers’ ability to obtain
the funding necessary to purchase our equipment.
Management Conference Call and Webcast
The Company will hold a conference call to discuss its results
today at 5:00 pm (Eastern Time). To participate in the live
conference call, please dial toll free (877) 407-2991 or
international (201) 389-0925. A telephone replay will be available
for 7 days. To access the replay, dial (877) 660-6853 or
international (201) 612-7415. The replay passcode is 13744891.
A live and archived webcast of the call will also be available
on the company's website at www.cvdequipment.com/events. The
archived webcast will be available at the same location
approximately two hours following the end of the live event.
About CVD Equipment Corporation
CVD Equipment Corporation (NASDAQ: CVV) designs, develops, and
manufactures a broad range of chemical vapor deposition, thermal
processing, physical vapor transport, gas and chemical delivery
control systems, and other equipment and process solutions used to
develop and manufacture materials and coatings for industrial
applications and research. Our products are used in production
environments as well as research and development centers, both
academic and corporate. Major target markets include high power
electronics (silicon carbide), EV battery materials / energy
storage (carbon nanotubes, graphene and silicon nanowires),
aerospace & defense (ceramic matrix composites) and industrial
applications. Through its application laboratory, the Company
allows customers the option to bring their process tools to our
laboratory and to work collaboratively with our scientists and
engineers to optimize process performance.
The Private Securities Litigation Reform Act of 1995 provides a
“safe harbor” for forward-looking statements. Certain information
included in this press release (as well as information included in
oral statements or other written statements made or to be made by
CVD Equipment Corporation) contains statements that are
forward-looking. All statements other than statements of historical
fact are hereby identified as “forward-looking statements, “as such
term is defined in Section 27A of the Securities Exchange Act of
1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. Such forward looking information involves a
number of known and unknown risks and uncertainties that could
cause actual results to differ materially from those discussed or
anticipated by management. Potential risks and uncertainties
include, among other factors, market and business conditions, the
success of CVD Equipment Corporation’s growth and sales strategies,
the possibility of customer changes in delivery schedules,
cancellation of, or failure to receive orders, potential delays in
product shipments, delays in obtaining inventory parts from
suppliers and failure to satisfy customer acceptance requirements,
competition in our existing and potential future product lines of
business, including our PVT systems; our ability to obtain
financing on acceptable terms if and when needed; uncertainty as to
our ability to develop new products for the high power electronics
market; uncertainty as to our future profitability; uncertainty as
to any future expansion of the Company; uncertainty as to our
ability to adequately obtain raw materials and components from
foreign markets in light of geopolitical developments; and other
risks and uncertainties that are described in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2023 and the
Company’s other filings with the Securities and Exchange
Commission. For forward-looking statements in this release, the
Company claims the protection of the safe harbor of the Private
Securities Litigation Reform Act of 1995. The Company assumes no
obligations to update or supplement any forward-looking statements
whether as a result of new information, future events or otherwise.
Past performance is not a guarantee of future results.
CVD EQUIPMENT CORPORATION AND
SUBSIDIARIES
Condensed Consolidated
Statements of Operations
(In thousands, except per share
data - Unaudited)
Three Months Ended
December 31,
Year Ended December 31,
2023
2022
2023
2022
Revenue
$
4,111
$
7,234
$
24,109
$
25,813
Cost of revenue
4,459
5,234
19,038
19,186
Gross profit
(348
)
2,000
5,071
6,627
Operating expenses
Research and development
731
509
2,596
1,906
Selling
351
321
1,632
1,216
General and administrative and other
1,041
1,391
(2) 5,724
5,328
Total operating expenses
2,123
2,221
9,952
8,450
Operating loss
(2,471
)
(221
)
(4,881
)
(1,823
)
Net income (loss)
$
(2,274
)
$
(1) 1,549
$
(4,180
)
$
(224
)
Basic and diluted income (loss) per
share
$
(0.33
)
$
0.23
$
(0.62
)
$
(0.03
)
(1) Net income for three months and year
ended December 31, 2022 includes $1.5 million of other income
related to recognition of Employee Retention Credits related to
2021.
(2) Year ended December 31, 2023 includes
loss on sale of Tantaline subsidiary of $0.2 million and an
impairment charge related to MesoScribe’s fixed assets of $0.1
million.
CVD EQUIPMENT CORPORATION AND
SUBSIDIARIES
Condensed Consolidated Balance
Sheets
(In thousands - Unaudited)
December 31,
2023
December 31,
2022
Assets
Current assets:
Cash and cash equivalents
$
14,025
$
14,365
Accounts receivable, net
1,906
3,788
Contract assets
1,604
2,170
Inventories, net
4,454
2,538
Other current assets
852
797
Total current assets
22,841
23,658
Employee retention credit receivable
-
1,529
Property, plant and equipment, net
12,166
12,596
Intangible assets, net
9
119
Other assets
9
10
Total assets
$
35,025
$
37,912
Liabilities and Stockholders'
Equity
Current liabilities
$
8,554
$
8,164
Long-term debt, net of current portion
268
349
Total stockholders’ equity
26,203
29,399
Total liabilities and stockholders’
equity
$
35,025
$
37,912
This earnings release should be read in conjunction with the
Company’s filings with the Securities and Exchange Commission,
including the Annual Report on Form 10-K for fiscal year ended
December 31, 2023.
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version on businesswire.com: https://www.businesswire.com/news/home/20240328335104/en/
For further information about this topic please contact:
Richard Catalano, Executive Vice President & CFO
Phone: (631) 981-7081 Email:
investorrelations@cvdequipment.com
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