- Record Quarterly Revenue of $39.4 Million, Up 36.6% on
Acquisition of Astro Machine and Base Business Growth in Both
Segments
- GAAP Operating Income of $1.3 Million, Margin Up 240 Basis
Points; Adjusted Operating Income of $2.1 Million, Margin Up 420
Basis Points
- GAAP Earnings Per Diluted Share Improves to $0.04, Non-GAAP EPS
Increases to $0.11
- Company to Host Earnings Call at 9:00 a.m. ET Today
AstroNova, Inc. (Nasdaq: ALOT), a global leader in data
visualization technologies, today announced financial results for
its fiscal 2023 third quarter ended October 29, 2022.
“We posted solid results in the third quarter, generating record
revenue that reflected a better-than-expected contribution from our
August acquisition of Astro Machine coupled with growth across our
base business,” said Greg Woods, AstroNova’s President and Chief
Executive Officer. “While the macroeconomic environment has
remained difficult, marked by ongoing supply chain disruptions and
continued inflationary pressures, we navigated those challenges to
deliver improved profitability in the quarter.
“Product Identification revenue grew more than 36 percent in the
quarter, contributing to a 160 basis-point increase in segment
product margin,” Woods said. “The Astro Machine integration is
proceeding smoothly, with strong performance that was already
modestly accretive in Q3 after $1 million in transaction costs and
incremental interest expense. While much integration remains to be
done, we are excited about the many synergistic benefits of this
acquisition.
“Additionally, we have maintained a steady pace of new product
innovation, highlighted by the launch of our entry-level QL-E100
full-color tabletop label printer, as well as several technology
innovations. The QL-E100, which we introduced to a great customer
response at PACK EXPO International in October, is purpose-built
for customers just beginning to capitalize on the benefits of
in-house label printing, as well as larger organizations that need
multi-unit widespread distribution of their label printing.
“In the Test & Measurement segment, our third-quarter
performance continued to benefit from the resurgence of commercial
air travel and the production growth of key aerospace programs such
as the Boeing 737 MAX and the Airbus A320,” Woods said. “Segment
revenue was up nearly 38 percent in the quarter, with contributions
from both the Aerospace and T&M product lines.
“With record backlog and healthy order demand exiting Q3, we are
well positioned to continue executing on our growth strategy as we
move through the fourth quarter of the year and into fiscal 2024,”
Woods concluded.
Q3 FY 2023 Operating Segment
Results
Product Identification segment revenue in the third
quarter of fiscal 2023 increased 36.3% to $29.9 million from $21.9
million in the same period of fiscal 2022, primarily reflecting the
acquisition of Astro Machine. Segment operating income was $3.0
million, or 9.9% of revenue, compared with $1.8 million, or 8.3% of
revenue, in the year-earlier period.
Test & Measurement segment revenue in the third
quarter of fiscal 2023 increased 37.5% to $9.5 million from $6.9
million in the same period of fiscal 2022. Segment operating income
was $1.7 million, or 18.0% of revenue, compared with operating
income of $0.8 million, or 12.2% of revenue, in the third quarter
of fiscal 2022.
Q3 FY 2023 Results
Summary
Revenue for the third quarter of fiscal 2023 increased 36.6% to
$39.4 million from $28.9 million in the year-earlier period, driven
by higher revenue in both segments.
Hardware revenue increased 56.7% to $11.9 million from $7.6
million in the prior-year period. Supplies revenue grew 27.1% to
$22.9 million from $18.1 million in the fiscal 2022 third quarter.
Revenue from Service/Other increased 41.9% to $4.5 million from
$3.2 million a year earlier.
Gross profit for the third quarter of fiscal 2023 was $12.5
million, up 20.2% from $10.4 million in the third quarter of fiscal
2022. Gross margin of 31.7% was down from 36.0% in the year-earlier
period, primarily reflecting less favorable mix in the Product
Identification segment.
On a GAAP basis, operating expenses for the third quarter of
fiscal 2023 totaled $11.1 million, compared with $10.1 million in
the third quarter of fiscal 2022. The 2023 period included $0.7
million in operating expenses related to the Astro Machine
acquisition. On a non-GAAP basis, excluding transaction costs,
operating expenses for the fiscal 2023 third quarter were $10.4
million.
GAAP operating income for the third quarter of fiscal 2023 was
$1.3 million, or 3.4% of revenue, compared with $0.3 million, or
1.0% of revenue, for the same period in fiscal 2022. On a non-GAAP
basis, excluding transaction costs, operating income for the third
quarter of fiscal 2023 was $2.1 million, or 5.2% of revenue,
primarily reflecting the contribution of the Astro Machine
acquisition to improved operating efficiencies.
GAAP net income for the third quarter of fiscal 2023 was $0.3
million, or $0.04 per diluted share, compared with a net loss of
$0.4 million, or $0.06 per share, in the year-earlier period. On a
non-GAAP basis, excluding transaction costs, net income for the
third quarter of fiscal 2023 was $0.8 million, or $0.11 per diluted
share. This compared with non-GAAP net income of $0.1 million, or
$0.01 per diluted share, in the comparable period of fiscal 2022,
which excluded after-tax costs of $0.5 million associated with the
write-off of the Company’s legacy enterprise resource planning
(ERP) system.
Earnings before interest, taxes, depreciation, and amortization
(EBITDA) was $2.0 million for the third quarter of fiscal 2023,
compared with $0.3 million for the same period in fiscal 2022.
Excluding transaction costs, EBITDA for the third quarter of fiscal
2023 was $2.7 million. This compared with EBITDA for the comparable
period of 2022 of $1.0 million, which excludes the ERP
write-off.
Adjusted earnings before interest, taxes, depreciation,
amortization, and share-based compensation (Adjusted EBITDA) for
the third quarter of 2023 was $2.4 million, and $3.1 million
excluding transaction costs. For the comparable period of fiscal
2022, Adjusted EBITDA was $0.7 million and $1.4 million excluding
ERP write-off costs.
Non-GAAP operating expenses, non-GAAP operating income, non-GAAP
net income, non-GAAP earnings per share, EBITDA, EBITDA excluding
transaction costs, ERP write-off costs, impact of employee
retention credit and PPP loan forgiveness, net of tax, Adjusted
EBITDA, which AstroNova defines as earnings before interest, taxes,
depreciation, amortization, and share-based compensation, Adjusted
EBITDA excluding transaction costs, ERP write-off costs, impact of
employee retention credit and PPP loan forgiveness, net of tax,
non-GAAP gross profit, and non-GAAP segment operating profit are
non-GAAP financial measures explained in greater detail below under
“Use of Non-GAAP Financial Measures.” Please refer to the financial
reconciliation tables in this news release for a reconciliation of
non-GAAP measures to the closest comparable GAAP measures for the
three and nine months ended October 29, 2022, and October 30,
2021.
Bookings for the third quarter of fiscal 2023 increased 8.4% to
$35.0 million from $32.3 million in the third quarter of fiscal
2022.
Backlog as of October 29, 2022 increased 46.6% to $39.3 million
from $26.8 million as of October 30, 2021.
Q3 FY 2023 Conference Call
Details
AstroNova will discuss its third-quarter fiscal 2023 results in
an investor conference call at 9:00 a.m. ET today. To participate
in the conference call, please dial (844) 200-6205 (U.S. and
Canada) or (929) 526-1599 (International) approximately 10 minutes
prior to the start time and enter access code 816175.
A real-time and archived audio webcast of the call will be
available through the “Investors” section of the AstroNova website,
https://investors.astronovainc.com.
Use of Non-GAAP Financial
Measures
In addition to financial measures prepared in accordance with
generally accepted accounting principles (GAAP), this news release
contains the non-GAAP financial measures non-GAAP operating
expenses, non-GAAP operating income, non-GAAP net income, non-GAAP
earnings per share, EBITDA, EBITDA excluding transaction costs, ERP
write-off costs, impact of employee retention credit and PPP loan
forgiveness, net of tax, Adjusted EBITDA, which AstroNova defines
as earnings before interest, taxes, depreciation, amortization, and
share-based compensation, Adjusted EBITDA excluding transaction
costs, ERP write-off costs, impact of employee retention credit and
PPP loan forgiveness, net of tax, non-GAAP gross profit, and
non-GAAP segment operating profit. AstroNova believes that the
inclusion of these non-GAAP financial measures helps investors gain
a meaningful understanding of changes in the Company’s core
operating results and can help investors who wish to make
comparisons between AstroNova and other companies on both a GAAP
and a non-GAAP basis. AstroNova’s management uses these non-GAAP
financial measures, in addition to GAAP financial measures, as the
basis for measuring its core operating performance and comparing
such performance to that of prior periods and to the performance of
its competitors. These measures are also used by the Company’s
management to assist with their financial and operating
decision-making.
About AstroNova
AstroNova (Nasdaq: ALOT), a global leader in data visualization
technologies since 1969, designs, manufactures, distributes, and
services a broad range of products that acquire, store, analyze,
and present data in multiple formats.
The Product Identification segment provides a wide array of
digital, end-to-end product marking and identification solutions,
including hardware, software, and supplies for OEMs, commercial
printers, and brand owners. The Test and Measurement segment
provides products designed for airborne printing solutions,
avionics, and data acquisition. Our aerospace products include
flight deck printing solutions, networking hardware, and
specialized aerospace-grade supplies. Our data acquisition systems
are used in research and development, flight testing, missile, and
rocket telemetry production monitoring, power, and maintenance
applications.
AstroNova is a member of the Russell Microcap® Index and the LD
Micro Index (INDEXNYSEGIS: LDMICRO). Additional information is
available by visiting www.astronovainc.com.
Forward-Looking Statements
Information included in this news release may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are not statements of historical fact, but reflect our
current expectations concerning future events and results. These
statements may include the use of the words “believes,” “expects,”
“intends,” “plans,” “anticipates,” “likely,” “continues,” “may,”
“will,” and similar expressions to identify forward-looking
statements. Such forward-looking statements, including those
concerning the Company’s anticipated performance, and the benefits
expected to be realized from the acquisition of Astro Machine,
involve risks, uncertainties and other factors, some of which are
beyond our control, which may cause our actual results, performance
or achievements to be materially different from those expressed or
implied by such forward-looking statements. These risks,
uncertainties and factors include, but are not limited to, the risk
that we may not successfully integrate Astro Machine or otherwise
realize the expected benefits of that transaction, as well as those
factors set forth in the Company’s Annual Report on Form 10-K for
the fiscal year ended January 31, 2022, and subsequent filings
AstroNova makes with the Securities and Exchange Commission. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. The reader is cautioned not to unduly
rely on such forward-looking statements when evaluating the
information presented in this news release.
ASTRONOVA, INC. Condensed Consolidated Statements
of Income In Thousands Except for Per Share Data
(Unaudited)
Three Months Ended
Nine Months Ended
October 29, 2022
October 30, 2021
October 29, 2022
October 30, 2021
Revenue
$
39,405
$
28,857
$
102,674
$
87,780
Cost of Revenue
26,923
18,472
68,080
53,792
Gross Profit
12,482
10,385
34,594
33,988
Total Gross Profit Margin
31.7
%
36.0
%
33.7
%
38.7
%
Operating Expenses: Selling & Marketing
5,908
5,777
17,771
16,931
Research & Development
1,903
1,948
5,021
5,203
General & Administrative
3,325
2,364
8,456
7,372
Total Operating Expenses
11,136
10,089
31,248
29,506
Operating Income
1,346
296
3,346
4,482
Total Operating Margin
3.4
%
1.0
%
3.3
%
5.1
%
Other Income (Expense), net: Extinguishment of Debt - PPP
Loan
-
-
-
4,466
Loss on Disposal of Assets
-
(696
)
-
(696
)
Interest Expense
(701
)
(135
)
(1,086
)
(526
)
Gain (Loss) on Foreign Currency Transactions
(237
)
(117
)
(614
)
(231
)
Other, net
(17
)
53
35
(11
)
(955
)
(895
)
(1,665
)
3,002
Income (Loss) Before Taxes
391
(599
)
1,681
7,484
Income Tax (Benefit) Provision
102
(174
)
383
297
Net Income (Loss)
$
289
$
(425
)
$
1,298
$
7,187
Net Income (Loss) per Common Share - Basic
$
0.04
$
(0.06
)
$
0.18
$
1.00
Net Income (Loss) per Common Share - Diluted
$
0.04
$
(0.06
)
$
0.18
$
0.98
Weighted Average Number of Common Shares - Basic
7,324
7,234
7,299
7,196
Weighted Average Number of Common Shares - Diluted
7,379
7,234
7,363
7,325
ASTRONOVA, INC. Balance Sheet In
Thousands (Unaudited)
October 29, 2022
January 31, 2022
ASSETS CURRENT ASSETS Cash and Cash Equivalents
$
4,496
$
5,276
Accounts Receivable, net
21,919
17,124
Inventories, net
49,992
34,609
Employee Retention Credit Receivable
-
3,135
Prepaid Expenses and Other Current Assets
4,682
3,634
Total Current Assets
81,089
63,778
PROPERTY, PLANT AND EQUIPMENT
57,221
50,821
Less Accumulated Depreciation
(43,180
)
(39,380
)
Property, Plant and Equipment, net
14,041
11,441
OTHER ASSETS Intangible Assets, net
18,866
19,200
Goodwill
17,885
12,156
Deferred Tax Assets
5,567
5,591
Right of Use Asset
800
1,094
Other Assets
1,581
1,695
TOTAL ASSETS
$
139,829
$
114,955
LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES Accounts
Payable
$
9,644
$
8,590
Accrued Compensation
2,814
3,512
Other Liabilities and Accrued Expenses
4,006
4,113
Revolving Line of Credit
19,900
-
Current Portion of Royalty Obligation
1,750
2,000
Current Portion of Long-Term Debt
1,800
1,000
Current Liability – Excess Royalty Payment Due
255
235
Income Taxes Payable
912
323
Deferred Revenue
362
262
Total Current Liabilities
41,443
20,035
NON-CURRENT LIABILITIES Long-Term Debt, net of current portion
12,732
8,154
Royalty Obligation, net of current portion
3,298
4,361
Lease Liability, net of current portion
550
808
Income Taxes Payable
399
399
Deferred Tax Liabilities
79
186
TOTAL LIABILITIES
58,501
33,943
SHAREHOLDERS’ EQUITY Common Stock
534
528
Additional Paid-in Capital
60,774
59,692
Retained Earnings
57,812
56,514
Treasury Stock
(34,227
)
(33,974
)
Accumulated Other Comprehensive Loss, net of tax
(3,565
)
(1,748
)
TOTAL SHAREHOLDERS’ EQUITY
81,328
81,012
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
$
139,829
$
114,955
ASTRONOVA, INC. Revenue and Segment Operating
Profit (Loss) In Thousands (Unaudited)
Revenue
Segment Operating Profit
(Loss)
Revenue
Segment Operating Profit
(Loss)
Three Months Ended
Three Months Ended
Nine Months Ended
Nine Months Ended
October 29, 2022
October 30, 2021
October 29, 2022
October 30, 2021
October 29, 2022
October 30, 2021
October 29, 2022
October 30, 2021
Product Identification
$
29,879
$
21,928
$
2,960
$
1,818
$
74,985
$
68,519
$
6,019
$
8,952
Test & Measurement
9,526
6,929
1,711
842
27,689
19,261
5,783
2,902
Total
$
39,405
$
28,857
4,671
2,660
$
102,674
$
87,780
11,802
11,854
Corporate Expenses
3,325
2,364
8,456
7,372
Operating Income
1,346
296
3,346
4,482
Other Income (Expense), net
(955
)
(895
)
(1,665
)
3,002
Income (Loss) Before Income Taxes
391
(599
)
1,681
7,484
Income Tax (Benefit) Provision
102
(174
)
383
297
Net Income (Loss)
$
289
$
(425
)
$
1,298
$
7,187
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
- Gross Profit Amounts in Thousands (Unaudited)
Three Months Ended Nine Months Ended
October 29, 2022
October 30, 2021
October 29, 2022 October 30, 2021 Gross
Profit − GAAP
$
12,482
$
10,385
$
34,594
$
33,988
Employee Retention Credit, net
-
-
-
(1,641
)
Gross Profit − Non-GAAP
$
12,482
$
10,385
$
34,594
$
32,347
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
- Operating Expenses Amounts in Thousands
(Unaudited) Three Months Ended Nine Months Ended
October 29, 2022 October 30, 2021
October 29, 2022
October 30, 2021 Operating Expenses − GAAP
$
11,136
$
10,089
$
31,248
$
29,506
Transaction Costs
(717
)
-
(717
)
-
Employee Retention Credit, net
-
-
-
489
Operating Expenses − Non-GAAP
$
10,419
$
10,089
$
30,531
$
29,995
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
- Operating Income Amounts in Thousands
(Unaudited) Three Months Ended Nine Months Ended
October 29, 2022 October 30, 2021
October 29, 2022
October 30, 2021 Operating Income − GAAP
$
1,346
$
296
$
3,346
$
4,482
Transaction Costs
717
-
717
-
Employee Retention Credit, net
-
-
-
(2,130
)
Operating Income − Non-GAAP
$
2,063
$
296
$
4,063
$
2,352
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
- Net Income (Loss) Amounts in Thousands
(Unaudited) Three Months Ended Nine Months Ended
October 29, 2022 October 30, 2021
October 29, 2022
October 30, 2021 Net Income (Loss) − GAAP
$
289
$
(425
)
$
1,298
$
7,187
Transaction Costs
540
-
540
-
Oracle EnterpriseOne ERP Write-off
-
528
-
528
Employee Retention Credit, net
-
-
-
(1,615
)
PPP Loan Forgiveness
-
-
-
(4,426
)
Net Income (Loss) − Non-GAAP
$
829
$
103
$
1,838
$
1,674
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
- Diluted Earnings Per Share (Unaudited) Three
Months Ended Nine Months Ended
October 29, 2022 October 30,
2021
October 29, 2022 October 30, 2021 Diluted Earnings Per
Share − GAAP
$
0.04
$
(0.06
)
$
0.18
$
0.98
Transaction Costs
0.07
0.07
Oracle EnterpriseOne ERP Write-off
-
0.07
-
0.07
Employee Retention Credit, net
-
-
-
(0.22
)
PPP Loan Forgiveness
-
-
-
(0.60
)
Diluted Earnings Per Share − Non-GAAP
$
0.11
$
0.01
$
0.25
$
0.23
ASTRONOVA, INC. Reconciliation of Net Income
(Loss) to EBITDA Amounts in Thousands (Unaudited)
Three Months Ended Nine Months Ended
October 29, 2022
October 30, 2021
October 29, 2022
October 30, 2021
Net Income (Loss) − GAAP
$
289
$
(425
)
$
1,298
$
7,187
Interest Expense
701
135
1,086
526
Income Tax Expense (Provision)
102
(174
)
383
297
Depreciation/Amortization
915
796
2,737
3,070
EBITDA
$
2,007
$
332
$
5,504
$
11,080
Net Income - Transaction Costs
540
-
540
-
Net Income - Employee Retention Credit
-
-
-
(1,615
)
Net Income - PPP Loan Forgiveness
-
-
-
(4,426
)
Net Income - Oracle EnterpriseOne ERP Write-off
-
528
-
528
Income Tax Expense - Transaction Costs
176
-
176
-
Income Tax Expense - Employee Retention Credit
-
-
-
(515
)
Income Tax Expense - PPP Loan Forgiveness
-
-
-
(40
)
Income Tax Expense - Oracle EnterpriseOne ERP Write-off
-
168
-
168
EBITDA Excluding Transaction Costs, ERP Write-off Costs, Impact of
Employee Retention Credit and PPP Loan Forgiveness, net of tax
$
2,723
$
1,028
$
6,220
$
5,180
ASTRONOVA, INC. Reconciliation of Net Income
(Loss) to Adjusted EBITDA Amounts in Thousands
(Unaudited) Three Months Ended Nine Months Ended
October 29, 2022
October 30, 2021
October 29, 2022
October 30, 2021
Net Income (Loss) − GAAP
$
289
$
(425
)
$
1,298
$
7,187
Interest Expense
701
135
1,086
526
Income Tax (Provision) Expense
102
(174
)
383
297
Depreciation/Amortization
915
796
2,737
3,070
Share-Based Compensation
405
398
977
1,345
Adjusted EBITDA
$
2,412
$
730
$
6,481
$
12,425
Net Income - Transaction Costs
540
-
540
-
Net Income - Employee Retention Credit
-
-
-
(1,615
)
Net Income - PPP Loan Forgiveness
-
-
-
(4,426
)
Net Income - Oracle EnterpriseOne ERP Write-off
-
528
-
528
Income Tax Expense - Transaction Costs
176
-
176
-
Income Tax Expense - Employee Retention Credit
-
-
-
(515
)
Income Tax Expense - PPP Loan Forgiveness
-
-
-
(40
)
Income Tax Expense - Oracle EnterpriseOne ERP Write-off
-
168
-
168
Adjusted EBITDA Excluding Transaction Costs, ERP Write-off Costs,
Impact of Employee Retention Credit and PPP Loan Forgiveness, net
of tax
$
3,128
$
1,426
$
7,197
$
6,525
ASTRONOVA, INC. Reconciliation of Segment GAAP to
Non-GAAP Operating Income (Loss) Amounts in Thousands
(Unaudited) Three Months
Ended Nine Months Ended
October 29, 2022 October 30, 2021
October 29, 2022
October 30, 2021
ProductIdentification Test
&Measurement Total ProductIdentification Test
&Measurement Total
ProductIdentification Test
&Measurement Total ProductIdentification Test
&Measurement Total Segment Operating Profit (Loss) - GAAP
$
2,960
$
1,711
$
4,671
$
1,818
$
842
$
2,660
$
6,019
$
5,783
$
11,802
$
8,952
$
2,902
$
11,854
Employee Retention Credit, net
-
-
-
-
-
-
-
-
-
(1,430
)
(802
)
(2,232
)
Segment Operating Profit - Non-GAAP
$
2,960
$
1,711
$
4,671
$
1,818
$
842
$
2,660
$
6,019
$
5,783
$
11,802
$
7,522
$
2,100
$
9,622
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221206006065/en/
Scott Solomon Senior Vice President Sharon Merrill Associates,
Inc. (857) 383-2409 ALOT@investorrelations.com
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