PHAZAR CORP, (NASDAQ: ANTP) announced today the unaudited results of operations for the one month period ended June 30, 2010 and the three month period ended September 30, 2010.

First Quarter Fiscal Year 2011

Revenues of $2,536,304 for the first quarter ended September 30, 2010 increased 36% compared to the prior year recast first quarter of $1,864,411, reflecting a significant upturn in both the commercial products and traditional governmental segments of our business. Prior year’s numbers are recast to reflect the change in our fiscal year end to June 30 th from May 31 st. Gross profit margin for the quarter, at 50% continues to remain strong, up 13 percentage points from the 37% gross margin reported in the comparable period last year. Lower raw material costs, an improved product mix and longer production runs were responsible for the improvement.

Sales and administrative expenses were down 21% to $682,966 from $867,058 in the prior year, reflecting continued robust indirect expense control and a significant increase in plant utilization rates. Research and Development costs of $218,397 were also down from $301,760 last year, but this is a timing issue, as the Company intends to maintain a vigorous R&D effort. The costs incurred are a combination of continued development on the mesh product line and new antenna designs for the commercial market.

The Company earned a profit of $252,703 or $.11 per share for the first quarter, compared to net loss of $285,606 or $.12 per share, in last year's recast fiscal first quarter.

Commenting on the quarter, Garland P. Asher, Chairman and CEO, said, “On several occasions over recent quarters, I’ve observed that the gross margin improvement we were working diligently to achieve and the strict expense control would hopefully be reflected in improved profitably once revenue levels returned to acceptable levels. That scenario unfolded in textbook fashion in our first quarter. Sales were up by 36%, led by a more than doubling of commercial sales of DAS antennas to the cell phone carriers. But our traditional governmental customer base also showed substantial recovery and revenue growth. With sales gains of that magnitude combined with the above mentioned gross margin expansion, the Company was able to show the best quarterly earnings in more than two years.”

Backlog of Orders

Additionally Mr. Asher stated, “Also encouraging as we go forward, we were able to add to our backlog. The backlog of orders was $3,263,000 at September 30, 2010, 12% ahead of the $2,908,000 at our May 31, 2010 year-end and up 59% from September 30, 2009. Incoming orders for the three month period totaled $3,298,468, versus $2,447,530 for the comparable period last year.”

In closing Mr. Asher remarked, “I have been too chastened by the economic events of the last two years and its effects on PHAZAR CORP to hazard a specific projection of results going forward. Having said that, when I see the explosive growth in smart phones and other wireless devices and the resulting taxing of available bandwidth in virtually all of the major metropolitan areas, I am encouraged. By not retreating from our robust R&D program during the downturn, we have developed the most extensive family of DAS (Distributed Antenna Systems) right when the industry needs them.”

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 first quarter ended September 30, 2010, to be filed with the Securities and Exchange Commission on or before November 13, 2010.

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, www.truemeshnetworks.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 STATEMENT OF OPERATIONS

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2010 AND 2009

AND ONE MONTH ENDED JUNE 30, 2010
 
 
 
Three Months Ended One Month Ended
September 30, September 30, June 30,
2010 2009 2010
(Unaudited) (Unaudited) (Unaudited)
 
Sales and contract revenues $ 2,536,304 $ 1,864,411 $ 1,005,372
Cost of sales and contracts   1,278,020     1,177,733     476,675  
Gross Profit 1,258,284 686,678 528,697
Gross Profit Margin % 50 % 37 % 53 %
 
Selling, general and administration expenses 682,966 867,058 352,827
Research and development costs   218,397     301,760     92,690  
Total selling, general and administration expenses 901,363 1,168,818 455,517
 
Operating Income (loss) 356,921 (482,140 ) 83,180
 
Other Income
Interest income 13,289 35,243 (3,333 )
Other income   12,674     9,027     1,264  
Total Other Income (expense)   25,963     44,270     (2,069 )
 
Income (loss) from operations before income taxes 382,884 (437,870 ) 81,111
 
Income tax provision (benefit)   130,181     (152,264 )   44,622  
 
Net Income (Loss) $ 252,703   $ (285,606 ) $ 36,489  
 
Basic income (loss) per common share $ 0.11   $ (0.12 ) $ 0.02  
 
Diluted income (loss) per common share $ 0.11   $ (0.12 ) $ 0.02  
 
Weighted Average of Common Shares Outstanding
Basic 2,304,659 2,297,730 2,303,807
Diluted 2,304,659 2,297,730 2,303,807

 

PHAZAR CORP AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

SEPTEMBER 30, 2010, JUNE 30, 2010 AND MAY 31, 2010
 
 
ASSETS
     
September 30 June 30 May 31
2010 2010 2010
(Unaudited) (Unaudited) (Audited)
 
CURRENT ASSETS
Cash and cash equivalents $ 1,288,555 $ 1,403,839 $ 2,030,774
Account receivable:
Trade, net of allowance for doubtful accounts of $0 1,386,657 1,207,057 748,671
as of September 30, 2010, June 30, 2010 and May 31, 2010
Note receivable 554,993 474,993 432,146
Inventories 3,534,248 3,431,719 3,481,074
Prepaid expenses and other assets 89,835 75,543 95,586
Income taxes receivable 316,374 286,769 316,374
Deferred income taxes   96,171     96,171     105,314  
Total current assets 7,266,833 6,976,091 7,209,939
 
Property and equipment, net 1,142,354 1,159,193 1,170,090
 
Long – term deferred income tax   239,620     226,317     232,188  

TOTAL ASSETS
$ 8,648,807   $ 8,361,601   $ 8,612,217  
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
CURRENT LIABILITIES
Accounts payable $ 519,259 $ 797,069 $ 477,111
Accrued liabilities 566,895 460,080 899,072
Federal income tax liability 142,594 - -
Deferred revenues   59,664     28,704     207,514  
Total current liabilities 1,288,412 1,285,853 1,583,697
 
TOTAL LIABILITIES   1,288,412     1,285,853     1,583,697  
 
COMMITMENTS AND CONTINGENCIES - - -
 
SHAREHOLDERS' EQUITY
Preferred stock, $1 par, 2,000,000 shares authorized, non
Issued or outstanding, attributes to be determined when issued - - -
 
Common stock, $0.01 par, 6,000,000 shares authorized
2,379,528, 2,378,728 and 2,378,428 issued and outstanding 23,796 23.788 23,785
Additional paid in capital 4,445,987 4,414,053 4,403,261
Treasury stock, at cost, 74,691 shares for all periods (215,918 ) (215,918 ) (215,918 )
Retained earnings   3,106,530     2,853,825     2,817,392  
Total shareholders equity   7,360,395     7,075,748     7,028,520  
 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 8,648,807   $ 8,361,601   $ 8,612,217  

       

PHAZAR CORP AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2010 AND 2009

AND ONE MONTH ENDED JUNE 30, 2010
 
 
Three Months Ended One Month Ended
September 30, September 30, June 30,
2010 2009 2010
(Unaudited) (Unaudited) (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss) $ 252,703 $ (285,606) $ 36,489
Adjustments to reconcile net income (loss) to net

Cash provided (used) by operating activities:
Depreciation 32,842 33,693 10,897
Stock based compensation 31,947 111,674 10,739
Tax benefit for employee stock options - - (3,650)
Deferred federal income tax (13,306) 7,233 15,014
Changes in operating assets and liabilities:
Accounts receivable (179,600) 255,083 (458,386)
Inventories (102,529) (80,570) 49,355
Income taxes receivable (29,605) (549,880) 29,605
Prepaid expenses and other assets (14,292) (20,157) 20,043
Accounts payable (277,810) 64,287 319,958
Accrued liabilities 106,815 (15,643) (438,992)
Deferred federal income tax liability 142,594 - -
Deferred revenues 30,960 - (178,810)
Net cash, used by operating activities (19,281) (479,886) (587,738)
 
CASH FLOWS FROM INVESTING ACTIVITIES:
Funding of note receivable (80,000) - (42,847)
Purchase of property and equipment (16,003) (7,712) -
Net cash used in investing activities (96,003) (7,712) (42,847)
 
CASH FLOWS FROM FINANCING ACTIVITIES:
Federal income tax benefit-stock options expenses - - 3,650
Net cash provided by financing activities - - 3,650
 
Net decrease in cash and cash equivalents (115,284) (487,598) (626,935)
 
CASH AND CASH EQUIVALENTS, beginning of period 1,403,839 3,036,602 2,030,774
 
CASH AND CASH EQUIVALENTS, end of period $ 1,288,555 $ 2,549,004 $ 1,403,839
 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFO:
Cash paid during the period for:
Interest expense $ - $ - $ -
Income taxes $ 30,500 $ - $ -

Copyright Business Wire 2010

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