Innovative Solutions & Support, Inc. (“IS&S” or the
“Company”) (ISSC) today announced its financial results for the
first quarter of fiscal 2018 ended December 31, 2017.
For the first quarter of fiscal 2018, the Company reported net
sales of $3.1 million, down 10% from the first quarter a year ago.
The Company reported a net loss of $0.9 million, or ($0.05) per
share, for the quarter, an improvement from the net loss of $1.2
million, or ($0.07) per share, recorded in the first quarter of
fiscal 2017.
Geoffrey Hedrick, Chairman and Chief Executive Officer of
IS&S, said, “Results in the first quarter reflect the low
beginning backlog at the beginning of the fiscal year. While
revenues were down in the first quarter, our focus on more
profitable production sales and tight cost control has enabled us
to generate gross margins approaching 50%, and, we remain committed
to internal research and development, with over $900,000, or 30% of
revenue, invested in new product work this quarter. We have further
broadened our product portfolio with the recent introduction of our
patent-pending Autothrottle. The recent Business & Commercial
Aviation February 2018 cover story, has created interest in the
Autothrottle’s application into several other aircraft. We
anticipate rapidly growing demand with the receipt of an STC for
the standalone version of our PC-12 Autothrottle with a market of
over 1,400 aircraft, which we believe is imminent. Once the King
Air Autothrottle is certified, we expect to have Autothrottle
certifications that will open up a market in excess of 10,000
aircraft for which we will be the sole source of the industry’s
leading Autothrottle retrofit, which we believe will be an engine
of future growth.”
At December 31, 2017, the Company had $24.7 million of cash on
hand, virtually unchanged from fiscal year end September 30,
2017.
New orders in the first quarter of fiscal 2018 were $3.4 million
and backlog as of December 31, 2017 was $3.3 million, up 10% from
September 30, 2017. Backlog does not include follow on production
orders from products developed under the Company’s engineering
development contracts, including the Pilatus PC-24, and the KC-46A,
all of which the Company expects to remain in production for a
decade. The Company expects that these contracts will add to
production sales already in backlog.
Shahram Askarpour, President of IS&S, added, “I am pleased
with the progress we have achieved in establishing a strong market
presence solely on the foundation of products we have internally
developed. We believe the strength of this strategy can be seen in
our gross profits, which reflect the attractive margins of
production orders, even at volumes below our historic norms. With
the introduction of the only FAA-certified Turboprop Autothrottle,
we are essentially creating an entirely new market. Now, we are
adding a retrofit standalone version, which significantly reduces
the price point, making this a more economical, accessible choice
and expanding the products applications. Over the past few years,
we have transitioned IS&S away from large burdensome
engineering programs and towards opportunities that we believe
better leverage our proprietary technology with significantly lower
risk. As we add more internally developed products to our growing
portfolio, we can better capitalize on the growth opportunities
emerging from impending FAA mandates and the industry’s increasing
emphasis on price-for-performance procurement.”
Conference Call
The Company will be hosting a conference call on Wednesday,
February 14, 2018 at 10:00 a.m. ET to discuss these results and its
business outlook. Please use the following dial in number to
register your name and company affiliation for the conference call:
877-883-0383 and enter the PIN Number 4678791. 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 Statements of Operations (unaudited)
Three months ended December 31, 2017
2016 Gross sales $ 3,087,984 $ 3,824,047
Returns and allowances - (458,181 ) Net Sales
3,087,984 3,365,866 Cost of sales 1,593,268
1,828,052 Gross profit 1,494,716 1,537,814
Operating expenses: Research and development 923,721
1,085,988 Selling, general and administrative 1,622,555
2,047,121 Total operating expenses 2,546,276
3,133,109 Operating loss (1,051,560 ) (1,595,295 )
Interest income 9,624 9,876 Other income 21,431
19,114 Loss before income taxes (1,020,505 )
(1,566,305 ) Income tax expense (benefit) (138,886 )
(371,331 ) Net loss $ (881,619 ) $ (1,194,974 )
Net loss per common share: Basic $ (0.05 ) $ (0.07 ) Diluted
$ (0.05 ) $ (0.07 ) Weighted average shares outstanding:
Basic
16,783,129
16,716,014 Diluted
16,783,129 16,716,014
Innovative Solutions and Support, Inc.
Consolidated Balance Sheets December 31, September
30, 2017 2017 (unaudited)
ASSETS
Current assets Cash and cash equivalents $ 24,662,454 $ 24,680,301
Accounts receivable, net 1,480,622 2,748,597 Unbilled receivables,
net 1,083,165 1,480,822 Inventories 4,495,051 4,179,654 Prepaid
expenses and other current assets 1,102,047 1,092,064
Total current assets 32,823,339 34,181,438 Property and
equipment, net 6,649,220 6,669,011 Other assets 187,016 187,315
Total assets $ 39,659,575 $ 41,037,764
LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities Accounts payable $ 926,766 $ 1,321,251
Accrued expenses 1,739,028 1,760,037 Deferred revenue 137,465
280,354 Total current liabilities 2,803,259 3,361,642
Non-current deferred income taxes 129,555 67,742
Total liabilities 2,932,814 3,429,384
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
December 31, 2017 and September 30, 2017
$ - $ -
Common stock, $.001 par value: 75,000,000
shares authorized, 18,879,580 issued at December 31, 2017 and
September 30, 2017
18,880 18,880 Additional paid-in capital 51,583,841
51,583,841 Retained earnings 6,492,577 7,374,196
Treasury stock, at cost, 2,096,451 shares
at December 31, 2017 and September 30, 2017
(21,368,537 ) (21,368,537 ) Total shareholders'
equity 36,726,761 37,608,380 Total liabilities and
shareholders' equity $ 39,659,575 $ 41,037,764
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version on businesswire.com: http://www.businesswire.com/news/home/20180213006586/en/
Innovative Solutions & Support, Inc.Relland Winand, Chief
Financial Officer610-646-0350
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