PHAZAR CORP Reports First Quarter Fiscal Year 2012 Financial Results

Commenting on operations and financial results, Garland P. Asher, Chairman and Chief Executive Officer, said, “Two events negatively impacted sales in the quarter. The two-week plus shutdown of the FAA halted virtually all FAA infrastructure activity during a period that usually is seasonally peaking. And the Justice Department suit seeking to halt the proposed AT&T-T-Mobile merger has raised the uncertainty of the proposed transaction even further, which is continuing to delay wireless network infrastructure projects.”

More information and analysis of PHAZAR CORP’s financial results will be provided in the management discussion and analysis of financial condition and results of operations in the Form 10-Q for the three month period ended September 30, 2011, estimated to be filed with the Securities and Exchange Commission on or around November 14, 2011.

The Form 10-Q will be available at the SEC’s website at www.sec.gov and PHAZAR CORP’S website at www.phazarcorp.com.

Product information is available at www.antennaproducts.com and www.phazar.com.

The common stock of PHAZAR CORP is listed on the NASDAQ Capital Market under the trading symbol “ANTP”. This press release contains forward-looking information within the meaning of Section 29A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performances and underlying assumption and other statements, which are other than statements of historical facts. Certain statements contained herein are forward-looking statements and, accordingly, involve risks and uncertainties, which could cause actual results, or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections are expressed in good faith and are believed by the Company to have a reasonable basis, including without limitations, management’s examination of historical operating trends, data contained in the Company’s records and other data available from third parties, but there can be no assurance that management’s expectations, beliefs or projections will result, or be achieved, or accomplished.

PHAZAR CORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
			Three Months Ended
			September 30, 2011					September 30, 2010
Sales and contract revenues			$	1,415,218				$	2,524,139
Cost of sales and contracts				779,319					1,259,767
Gross profit				635,899					1,264.372
Gross profit margin %				45	%				50	%
Selling, general and administration expenses				745,370					581,143
Research and development costs				99,462					14,264
Total selling, general and administration expenses				844,832					595,407
Operating income (loss)				(208,933	)				668,965
Other income
Interest income (net)				38,292					13,289
Other income				6,480					12,674
Total other income				44,772					25,963
Income (loss) from operations before income taxes				(164,161	)				694,928
Income tax expense (benefit)				(55,815	)				236,276
Net income (loss) before discontinued operations				(108,346	)				458,652
Loss from discontinued operations				(18,044	)				(312,044	)
Income tax benefit from discontinued operations				6,135					106,095
Net loss from discontinued operations expense			$	(11,909	)			$	(205,949	)
Net income (loss)			$	(120,255	)			$	252,703
Basic income (loss) per common share
Continuing operations			$	(0.05	)			$	0.20
Discontinued operations				(0.00	)				(0.09	)
Net income (loss)			$	(0.05	)			$	0.11
Diluted income (loss) per common share
Continuing operations			$	(0.05	)			$	0.20
Discontinued operations				(0.00	)				(0.09	)
Net income (loss)			$	(0.05	)			$	0.11
Basic weighted average of common shares outstanding				2,311,124					2,304,659
Diluted weighted average of common shares outstanding				2,311,124					2,304,659

PHAZAR CORP AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
			September 30, 2011					June 30, 2011
CURRENT ASSETS			$	1,277,849				$	1,169,318
Cash and cash equivalents				449,966					785,664
Accounts receivable:
Trade, net of allowance for doubtful accounts of $- 0-
as of September 30, 2011 and June 30, 2011
Inventories				2,862,915					2,732,232
Prepaid expenses and other assets				81,847					125,989
Income taxes receivable				292,945					236,366
Deferred income taxes				224,875					224,875
Total current assets				5,190,397					5,274,444
Property and equipment, net				1,048,339					1,043,435
Note receivable				1,111,718					963,684
Long - term deferred income tax				256,808					252,617
TOTAL ASSETS			$	7,607,262				$	7,534,180
CURRENT LIABILITIES
Accounts payable			$	307,221				$	216,575
Accrued liabilities				435,437					284,969
Deferred revenues				0					2,355
Liabilities held for discontinued operations				114,571					178,060
Total current liabilities			$	857,229				$	681,959
TOTAL LIABILITIES			$	857,229				$	681,959
COMMITMENTS AND CONTINGENCIES				-					-
SHAREHOLDERS’ EQUITY
Preferred Stock, $1 par, 2,000,000 shares authorized, none issued
or outstanding, attributes to be determined when issued				-					-
Common stock, $0.01 par, 6,000,000 shares authorized
and 2,387,528, and 2,385,128 issued and outstanding on September 30, 2011 and June 30, 2011, respectively				23,876					23,852
Additional paid in capital				4,535,277					4,517,234
Treasury stock, at cost, 74,691 shares on September 30, 2011 and
June 30, 2011				(215,918	)				(215,918	)
Retained earnings				2,406,798					2,527,053
Total shareholders’ equity				6,750,033					6,852,221
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY			$	7,607,262				$	7,534,180

PHAZAR CORP AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
			Three Months Ended
			September 30, 2011					September 30, 2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)			$	(120,255	)			$	252,703
Adjustments to reconcile net income (loss) to net cash
provided (used in) operating activities:
Depreciation				32,346					32,842
Loss from discontinued operations				11,909					205,949
Stock based compensation				18,067					31,947
Deferred federal income tax				(4,191	)				(13,306	)
Changes in operating assets and liabilities:
Accounts receivable				335,698					(179,600	)
Inventories				(130,683	)				562,920
Income taxes receivable				(56,579	)				(29,605	)
Prepaid expenses				44,142					(14,292	)
Accounts payable				90,646					(277,810	)
Accrued expenses				150,468					106,815
Federal income tax liability				0					142,594
Deferred revenues				(2,355	)				30,960
Net cash used in discontinued operations				(75,398	)				(871,398	)
Net cash provided by (used in) operating activities				293,815					(19,281	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Funding of note receivable				(148,034	)				(80,000	)
Purchase of property and equipment				(37,250	)				(16,003	)
Purchase of treasury stock				-					-
Net cash used in investing activities				(185,284	)				(96,003	)
Net decrease in cash and cash equivalents				108,531					(115,284	)
CASH AND CASH EQUIVALENTS, beginning of period				1,169,318					1,403,839
CASH AND CASH EQUIVALENTS, end of period			$	1,277,849				$	1,288,555

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