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Innovative Solutions & Support, Inc. (NASDAQ: ISSC) today announced its financial results for the fourth quarter and full year fiscal 2012 ended September 30, 2012.
Three Month Results
For the fourth quarter, the Company reported revenue of $6.9 million, up 7% from revenue of $6.5 million in the fourth quarter of 2011. The Company reported fourth quarter 2012 net income of $2.8 million, or $0.17 per share, compared to $12,000, or $0.00 per share in the same quarter a year ago. For the fourth quarter, the Company generated positive operating cash flow of $1.3 million, up from $0.4 million in the fourth quarter of fiscal 2011.
Of the reported net income and earnings per share, $2.4 million and $0.15, respectively, resulted from the reversal of income tax valuation allowances related to book to tax temporary differences and to research and development credits. The Company established the valuation allowances in 2008, following several years of losses, at which time the realization of certain deferred tax assets was considered unlikely in accordance with the requirements of ASC Topic 740
“Income Taxes”. Over the past several years, the Company has been profitable, and, in accordance with the requirements of ASC Topic 740, has concluded that, based upon an analysis of past results and future projections, the valuation allowances for certain deferred tax assets should be reversed.
Geoffrey Hedrick, Chairman and Chief Executive Officer of Innovative Solutions & Support, Inc. (“ISSC”), said, “Revenues for the last three months of the year increased for the third consecutive quarter, which, together with continued operating efficiency, enabled us to achieve full year profitability for the fourth consecutive year. The results were accomplished while we were investing in new product development programs to leverage our core technology, expand our market opportunities, and increase our growth potential. Consequently, we not only ended fiscal 2012 in a strong financial position, but we entered fiscal 2013 with a more robust product portfolio and a larger addressable market. While economic uncertainty will present challenges to the health of our end markets in the near term, we are confident that the investments which we are making to strengthen the Innovative Solutions & Support franchise will create value for our shareholders over the longer term.”