Frequency Electronics Announces Results for 3rd Quarter FY 2000
Operating profit was $511 thousand compared to an operating loss of $2.06 million in the year-ago period. Other income for the fiscal 2000 quarter was $1.29 million compared to $406 thousand in fiscal 1999. During the current quarter operating profits were impacted by $280 thousand in reserves and expenses related to certain litigation matters while other income included a realized net gain of $947 thousand from the sale of certain marketable securities.
Chief Financial Officer Alan Miller noted that "We have experienced growth in sales and improved operating profits over the past 4 quarters. Based upon our current order backlog and projections of future requirements from Motorola, Lucent Technologies and our other wireless communications customers, we expect to see continued growth in revenues and operating profits in fiscal 2001 and beyond."
In the current quarter, product development costs were $1.14 million, down from $1.67 million in the same period last year. Further reductions in research and development spending are expected in the 4th quarter and, on an ongoing basis, the Company is targeting research and development spending at approximately 10% of sales. According to Chairman Joseph Franklin, "FEI will continue to emphasize investment in new product development to support the emerging synchronization requirements of the wireless communications industry. We are presently providing newly developed synchronization products for high data rate, voice, video and Internet access applications." The Company is supplying products in support of third generation (3G) systems being developed by Motorola, Lucent Technologies and other companies, including DoCoMo i-mode. The Company is also developing product for Enhanced Data Rates for Global Evolution (EDGE) systems which increase the capability of existing TDMA and GSM systems.
The Company continues to pursue corporate development opportunities, seeking joint ventures, alliances, acquisitions or mergers with other companies in the wireless communications industry. During this fiscal year, the Company established two key alliances with manufacturers in Europe and Asia for the supply of assemblies which will enable the Company to meet the expanding world-wide demand for rubidium, quartz and GPS synchronization systems.
Frequency Electronics is a wireless communications company which designs, develops, manufactures and markets high technology precision time and frequency products used to synchronize the wireless transmission of voice, video, and data communications for terrestrial and space applications. Additional information is available on FEI's website.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this release which are forward-looking statements and not based on historical facts are subject to risks and uncertainties that could cause actual results to differ materially from those set forth or implied herein.
|
Frequency Electronics, Inc. and Subsidiaries Consolidated Condensed Summary of Operations | ||||
|---|---|---|---|---|
| Quarter Ended | Nine Months Ended | |||
| January 31, | January 31, | |||
| 2000 | 1999 | 2000 | 1999 | |
| (unaudited) | ||||
| (in thousands except per share data) | ||||
| Net Sales | $ 7,117 | $ 3,060 | $18,617 | $16,255 |
| Cost of Sales | 3,973 | 2,172 | 10,400 | 10,953 |
| Insurance Reimbursement | - | - | - | (4,500) |
| Selling and Administrative | 1,498 | 1,277 | 3,822 | 3,597 |
| Research and Development | 1,135 | 1,674 | 3,625 | 3,640 |
| Operating Profit (Loss) | 511 | (2,063) | 770 | 2,565 |
| Other Income, net | 1,292 | 406 | 2,465 | 1,305 |
| Earnings (Loss) before income taxes | 1,803 | (1,657) | 3,235 | 3,870 |
| Income Tax Provision (Benefit) | 600 | (300) | 1,110 | 1,500 |
| Net Earnings (Loss) | $ 1,203 | ($1,357) | $ 2,125 | $ 2,370 |
| Net Earnings per Share: | ||||
| Basic | $ 0.16 | ($ 0.18) | $ 0.28 | $ 0.32 |
| Diluted | $ 0.15 | ($ 0.18) | $ 0.27 | $ 0.30 |
| Average Shares Outstanding | ||||
| Basic | 7,543,659 | 7,502,916 | 7,583,586 | 7,488,435 |
| Diluted | 7,945,919 | 7,502,916 | 7,950,670 | 7,831,931 |
| Frequency Electronics, Inc. and Subsidiaries Consolidated Condensed Balance Sheets | ||
|---|---|---|
| January 31, 2000 | April 30, 1999 | |
| (in thousands) | ||
| ASSETS | ||
| Cash & Marketable Securities | $40,669 | $39,287 |
| Other Current Assets | 24,601 | 25,404 |
| Property, Plant & Equipment | 9,273 | 9,489 |
| Other Assets | 4,279 | 4,175 |
| Total | $78,822 | $78,355 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Current Liabilities | $ 4,006 | $ 4,889 |
| Long-term Obligations | 16,878 | 16,959 |
| Stockholders' Equity | 57,938 | 56,507 |
| Total | $78,822 | $78,355 |