Reports Cash Flow from Operations of
$150,000 for Quarter, $913,000 for Year-to-Date, increases of
approximately $950,000 and $2.5 million, respectively, from year
earlier periods
Innovative Solutions & Support, Inc. (NASDAQ: ISSC) today
announced its financial results for the third quarter of fiscal
2015 ended June 30, 2015.
For the third quarter of fiscal 2015, the Company reported
revenues of $4.9 million, compared to revenues of $10.6 million for
the third quarter of fiscal 2014. Cash provided by operating
activities was $150,000 for the quarter, a significant turnaround
from $813,000 used in operating activities in the third quarter of
fiscal 2014. The Company reported a third quarter 2015 operating
loss of $0.3 million, which included an increased investment in
internal research and development and new product development, and
a net loss of $3.5 million, or $0.21 per share, of which $3.3
million was attributable to a non-cash, valuation allowance of the
Company’s deferred tax assets.
In the third quarter of 2014, the Company reported net income of
$497,000, or $0.03 per share.
Geoffrey Hedrick, Chairman and Chief Executive Officer of
Innovative Solutions & Support, Inc. said, “On the strength of
growing interest in our expanding portfolio of products that we
believe provide the industry's best price-for-performance, we were
able to increase our product revenues in the quarter versus the
quarter ended March 31, 2015. Gross margins in the quarter were up
from a year ago as production volume increased and development
contracts continue to wind down. We also further reduced operating
expenses in the quarter. While we reported an operating loss for
the quarter, we increased cash flow from operations by nearly a
million dollars from the third quarter of last year, adding to our
already strong balance sheet. We are focused on rebuilding our
backlog through aggressive marketing and product innovation. During
the quarter we introduced our new Integrated Global Navigation
System (IGNS) that we believe addresses the need for an economical
solution that enables aging Flight Management Systems to be updated
to today's NexGen standards without the downtime or expense of
replacing the entire system. This is just another example of
Innovative Solutions and Support's legacy of developing exciting
new technologies that provide cost effective solutions to the
military, commercial air transport, and business jet markets.”
At June 30, 2015, the Company had $15.8 million of cash on hand
and remained debt free.
New orders for the quarter were $3.4 million, and backlog at
June 30, 2015 was $4.8 million, compared to backlog of $6.3 million
at March 31, 2015. Backlog excludes potential future sole-source
production orders from products in development under the Company’s
engineering development contracts, including the Eclipse 550, the
Pilatus PC-24, and the KC-46A, all of which the Company expects to
remain in production for a decade following completion of their
development phases. The Company expects that these sole-source
contracts will add to production sales already in backlog.
Nine Months Results
Total sales for the nine months ended June 30, 2015 were $16.9
million compared to sales of $34.2 million for the nine months
ended June 30, 2014. Net loss for the nine months ended June 30,
2015 was $3.3 million, compared to net income of $2.3 million in
the comparable year earlier period. The company had a $0.20 loss
per share for the first nine months of fiscal 2015, compared to
earnings per share of $0.13 for the first nine months of fiscal
2014. Cash provided by operating activities was $913,000 for the
first nine months of fiscal 2015, up significantly from $1.6
million of cash used in operations during the first nine months of
fiscal 2014.
Shahram Askarpour, President of ISSC, commented, "Our focus is
on rebuilding backlog, particularly new production contracts, while
continuing to improve operational efficiencies. Consequently,
during the quarter we reduced total operating expenses while still
increasing our investment in internal research and development.
Those efforts yielded the rapid and timely development of our
latest new product, the IGNS. On the new business front, we are
experiencing increased activity levels in select markets, such as
Europe, where we are seeing a concerted sales and marketing effort
turn into new orders and opportunities. Our goal is to build on the
success we have achieved introducing new technologies that have
been employed by industry leaders such as Boeing, Lockheed and
others and to expand our product portfolio into new and emerging
applications that help owners and operators improve safety,
increase efficiency and reduce costs."
Conference Call
The Company will be hosting a conference call August 6, 2015 at
10:00 AM ET to discuss these results and its business outlook.
Those planning to dial in to the call should dial the following
number and register their names and company affiliations:
1-877-883-0383 and enter the PIN Number 5343401. The call will also
be carried live on the Investor Relations page of the Company web
site at www.innovative-ss.com.
About Innovative Solutions &
Support, Inc.
Headquartered in Exton, Pa., Innovative Solutions & Support,
Inc. (www.innovative-ss.com) is a systems integrator that designs
and manufactures flight guidance and cockpit display systems for
Original Equipment Manufacturers (OEM’s) and retrofit applications.
The company supplies integrated Flight Management Systems (FMS) and
advanced GPS receivers for precision low carbon footprint
navigation.
Certain matters contained herein that are not descriptions of
historical facts are “forward-looking” (as such term is defined in
the Private Securities Litigation Reform Act of 1995). Because such
statements include risks and uncertainties, actual results may
differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause results to
differ materially from those expressed or implied by such
forward-looking statements include, but are not limited to, those
discussed in filings made by the Company with the Securities and
Exchange Commission. Many of the factors that will determine the
Company’s future results are beyond the ability of management to
control or predict. Readers should not place undue reliance on
forward-looking statements, which reflect management’s views only
as of the date hereof. The Company undertakes no obligation to
revise or update any forward-looking statements, or to make any
other forward-looking statements, whether as a result of new
information, future events or otherwise.
Innovative Solutions and Support, Inc.
Consolidated Balance Sheets June 30, September
30, 2015 2014 (unaudited)
ASSETS
Current assets Cash and cash equivalents $ 15,759,516 $ 15,214,584
Accounts receivable 3,903,094 4,419,863 Unbilled receivables, net
4,865,158 7,425,728 Inventories 4,138,705 5,470,786 Deferred income
taxes 471,387 3,245,223 Prepaid expenses and other current assets
827,426 750,108 Total current assets 29,965,286
36,526,292 Property and equipment, net 7,225,633 7,467,663
Non-current deferred income taxes - 57,707 Other assets 168,949
110,848 Total assets $ 37,359,868 $ 44,162,510
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities Accounts payable $ 359,498 $ 2,402,652
Accrued expenses 2,298,990 4,077,290 Deferred revenue 739,538
526,320 Total current liabilities 3,398,026 7,006,262
Deferred income taxes 139,344 132,999 Other liabilities
11,991 11,725 Total liabilities 3,549,361
7,150,986 Commitments and contingencies
- - Shareholders' equity
Preferred stock, 10,000,000 shares
authorized, $.001 par value, of which 200,000 shares are authorized
as Class A Convertible stock. No shares issued and outstanding at
June 30, 2015 and September 30, 2014
- -
Common stock, $.001 par value: 75,000,000
shares authorized, 18,736,089 and 18,714,449 issued at June 30,
2015 and September 30, 2014, respectively
18,736 18,715 Additional paid-in capital 51,052,953
50,697,497 Retained earnings 3,382,580 6,684,902
Treasury stock, at cost, 1,846,451 shares
at June 30, 2015 and 1,756,807 at September 30, 2014
(20,643,762 ) (20,389,590 ) Total
shareholders' equity 33,810,507 37,011,524
Total liabilities and shareholders' equity $
37,359,868 $ 44,162,510
Innovative Solutions and Support, Inc.
Consolidated Statements of Operations (unaudited)
Three months ended Nine months ended June 30, June 30, 2015
2014 2015 2014 Net sales $ 4,919,689 $ 10,575,976 16,929,995
34,176,802 Cost of sales 2,988,044
7,413,849 10,653,149 23,449,115 Gross
profit 1,931,645 3,162,127 6,276,846 10,727,687 Operating
expenses: Research and development 799,340 647,894 2,101,812
1,935,692 Selling, general and administrative 1,397,165
1,854,332 4,911,546 5,633,832
Total operating expenses 2,196,505 2,502,226 7,013,358 7,569,524
Operating income (loss) (264,860 ) 659,901 (736,512 )
3,158,163 Interest income 6,372 5,280 18,269 16,246 Other
income 11,173 7,939 31,405
27,307 Income (loss) before income taxes (247,315 ) 673,120
(686,838 ) 3,201,716 Income tax expense 3,284,658
176,090 2,615,484 911,874
Net income (loss) $ (3,531,973 ) $ 497,030 $ (3,302,322 ) $
2,289,842 Net income (loss) per common share: Basic $ (0.21
) $ 0.03 $ (0.20 ) $ 0.14 Diluted $ (0.21 ) $ 0.03 $ (0.20 ) $ 0.13
Weighted average shares outstanding: Basic
16,910,475 16,951,360
16,930,522
16,918,423 Diluted
16,910,475
17,177,572
16,930,522 17,141,532
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version on businesswire.com: http://www.businesswire.com/news/home/20150805006792/en/
Innovative Solutions & Support, Inc.Relland Winand, Chief
Financial Officer610-646-0350
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