SAN RAMON, Calif., Oct. 31, 2011 (GLOBE NEWSWIRE) -- Giga-tronics Incorporated (Nasdaq:GIGA) reported today a net loss of $287,000 or $0.06 per fully diluted share for the quarter ended September 24, 2011. This compares with a net loss of $78,000 or $0.02 per fully diluted share for the same period a year ago. Net sales decreased 14% to $4,086,000 in the second quarter of fiscal 2012 compared to $4,749,000 in the second quarter of fiscal 2011. Gross margin of $1,532,000 was lower by $378,000 over the same quarter last year. Gross margin as a percentage of net sales decreased by 2.7% to 37.5% in the second quarter of fiscal 2012 as compared to 40.2% in the second quarter of fiscal 2011. Operating expenses increased 5% or $111,000 in the second quarter of fiscal 2012 over fiscal 2011 primarily due to an increase of $71,000 in product development expenses. Orders were $2,465,000 in the second quarter of fiscal 2012 compared to $3,610,000 for the second quarter of fiscal 2011.
Net loss for the six month period ended September 24, 2011 was $754,000 or $0.15 per fully diluted share. This compares with a net profit of $13,547,000 or $2.71 per fully diluted share for the same period a year ago primarily due to a reversal of the valuation allowance against the Company's deferred tax assets. Net sales decreased 20% to $7,583,000 in the first half of fiscal 2012 compared to $9,450,000 in the first half of fiscal 2011. Gross margin of $2,975,000 was lower by $868,000 over the same six month period last year. Gross margin as a percentage of net sales decreased by 1.5% to 39.2% in the first half of fiscal 2012 as compared to 40.7% in the first half of fiscal 2011. Operating expenses increased $349,000 in the first half of fiscal 2012 primarily due to an increase of $266,000 in product development expenses over the first six months of fiscal 2011. Orders improved by 20% in the first half of fiscal 2012 to $8,013,000 from $6,689,000 for the same period last year.
Backlog for the quarter ended September 24, 2011 was $4.0 million (approximately $2.9 million shippable within one year) as compared to $5.7 million (approximately $4.5 million shippable within one year) for the quarter ended September 25, 2010.
Cash and cash equivalents at September 24, 2011 were $2,880,000 compared to $3,592,000 as of June 25, 2011.
Giga-tronics will host a conference call today at 4:30 p.m. ET to discuss the second quarter results. To participate in the call, dial (866) 551-3680 domestically or (212) 401-6760 for international, and enter PIN Code 59993711#. The call will also be broadcast over the internet at www.gigatronics.com under "Investor Relations." The conference call discussion reflects management's views as of October 31, 2011 only.
Giga-tronics is a publicly held company, traded on the NASDAQ Capital Market under the symbol "GIGA." Giga-tronics produces instruments, subsystems and sophisticated microwave components that have broad applications in defense electronics, aeronautics and wireless telecommunications.
This press release contains forward-looking statements concerning profitability, backlog, shipments and the likelihood of realizing certain tax benefits. Actual results may differ significantly due to risks and uncertainties, such as future orders, cancellations or deferrals, disputes over performance, the ability to collect receivables and general market conditions. For further discussion, see Giga-tronics' most recent annual report on Form 10-K for the fiscal year ended March 26, 2011, Part I, under the heading "Certain Factors Which May Adversely Affect Future Operations or an Investment in Giga-tronics" and Part II, under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations".
The Giga-tronics Incorporated logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6087
| CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) | ||
| (In thousands except share data) |
September 24, 2011 |
March 26, 2011 |
| Assets | ||
| Current assets: | ||
| Cash and cash-equivalents | $2,880 | $1,408 |
| Trade accounts receivable, net of allowance | ||
| of $160 and $248, respectively | 2,251 | 5,632 |
| Inventories, net | 5,545 | 5,386 |
| Prepaid expenses and other current assets | 325 | 420 |
| Deferred income taxes | 2,905 | 2,320 |
| Total current assets | 13,906 | 15,166 |
| Property and equipment, net | 586 | 530 |
| Deferred income taxes - long term | 10,936 | 10,936 |
| Other assets | 16 | 16 |
| Total assets | $25,444 | $26,648 |
| Liabilities and shareholders' equity | ||
| Current liabilities: | ||
| Accounts payable | $887 | $972 |
| Accrued commission | 256 | 139 |
| Accrued payroll and benefits | 441 | 455 |
| Accrued warranty | 191 | 200 |
| Income taxes payable | -- | 30 |
| Deferred revenue | 2 | 586 |
| Deferred rent | 45 | 36 |
| Capital lease obligations | 43 | 93 |
| Other current liabilities | 271 | 193 |
| Total current liabilities | 2,136 | 2,704 |
| Long term obligations - deferred rent | 383 | 413 |
| Long term obligations - capital lease | -- | 10 |
| Total liabilities | 2,519 | 3,127 |
| Commitments | ||
| Shareholders' equity: | ||
| Preferred stock of no par value; | ||
| Authorized - 1,000,000 shares; no shares issued or | ||
| outstanding at September 24, 2011 and March 26, 2011 | -- | -- |
| Common stock of no par value; | ||
| Authorized - 40,000,000 shares; 5,023,782 shares at | ||
| September 24, 2011 and 4,994,157 shares at March 26, 2011 | ||
| issued and outstanding | 14,643 | 14,485 |
| Retained earnings | 8,282 | 9,036 |
| Total shareholders' equity | 22,925 | 23,521 |
| Total liabilities and shareholders' equity | $25,444 | $26,648 |
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | ||||
| Three Months Ended | Six Months Ended | |||
| September 24, | September 25, | September 24, | September 25, | |
| (In thousands except per share data) | 2011 | 2010 | 2011 | 2010 |
| Net sales | $4,086 | $4,749 | $7,583 | $9,450 |
| Cost of sales | 2,554 | 2,839 | 4,608 | 5,607 |
| Gross profit | 1,532 | 1,910 | 2,975 | 3,843 |
| Engineering | 635 | 564 | 1,315 | 1,049 |
| Selling, general and administrative | 1,562 | 1,522 | 2,996 | 2,913 |
| Total operating expenses | 2,197 | 2,086 | 4,311 | 3,962 |
| Operating loss | (665) | (176) | (1,336) | (119) |
| Interest (expense) income, net | (1) | 1 | (1) | -- |
| Loss before income taxes | (666) | (175) | (1,337) | (119) |
| Benefit from income taxes | (379) | (97) | (583) | (13,666) |
| Net (loss) income | ($287) | ($78) | ($754) | $13,547 |
| (Loss) earnings per share - basic | ($0.06) | ($0.02) | ($0.15) | $2.76 |
| (Loss) earnings per share - diluted | ($0.06) | ($0.02) | ($0.15) | $2.71 |
|
Weighted average shares used in per share calculation: |
||||
| Basic | 5,006 | 4,913 | 5,000 | 4,907 |
| Diluted | 5,006 | 4,913 | 5,000 | 5,002 |