NEWARK, N.Y., Feb. 11, 2016 (GLOBE NEWSWIRE) -- Ultralife Corporation (NASDAQ:ULBI) reported operating income of $0.5 million on revenue of $19.3 million for the quarter ended December 31, 2015 compared to operating income of $1.0 million on revenue of $19.9 million for the fourth quarter of 2014.  For total-year 2015, Ultralife produced operating income of $3.3 million on revenue of $76.4 million compared to an operating loss of $1.4 million on revenue of $66.5 million for 2014.

"Fiscal 2015 was a strong year for Ultralife," said Michael D. Popielec, Ultralife's President and Chief Executive Officer.  "We achieved our objective of producing profitable revenue growth by increasing revenue 15%, expanding gross margin 140 basis points to 30.5% and turning earnings per share to a positive $0.18 compared to a loss of $0.12 per share last year.  Revenue growth was balanced between government/defense and commercial customers and included an increasing contribution from high value proposition new products. In addition, building on the operating leverage we began to realize in 2014, we generated operating income growth of $4.8 million on a $9.9 million increase in revenue, a 48% incremental return, while continuing to invest in new product development." 

Popielec added, "Our performance during the fourth quarter was solid as we ramped up production of new products, began to deliver shipments under the VIPER program and prepared to acquire Accutronics, a transaction we completed in January.   We ended the year in a strong position to deliver profitable growth in 2016 through continued maturation of diverse market opportunities, ongoing new product development and disciplined adherence to our business model parameters."

Fourth Quarter 2015 Financial Results

Revenue was $19.3 million compared to $19.9 million for the fourth quarter of 2014 with nearly all of the $0.7 million reduction due to lower Communications Systems sales.  Battery & Energy Products sales were $16.6 million, $0.1 million lower than last year with increased sales to government/defense customers partially offsetting a decline in commercial sales reflecting large stock-in orders to some customers in the prior year.  Communications Systems sales declined to $2.6 million from $3.2 million for the same period last year reflecting the fulfillment of a large order in the fourth quarter of 2014.

Gross profit declined to $5.6 million from $6.3 million for the fourth quarter a year ago.  As a percentage of revenue, gross profit declined 290 basis points to 28.8% from 31.7% last year, primarily driven by a greater weighting of government/defense sales, costs in our Communications Systems' segment associated with the ramp-up of some new products to large scale production, and incremental social pension costs related to increased employment levels in our China battery operation.   Accordingly, Battery & Energy Products' gross margin was 27.6% compared to 30.0% last year, a decrease of 240 basis points, and Communications Systems gross margin was 36.4% compared to 40.6% last year, a decrease of 420 basis points.

Operating expenses were $5.0 million compared to $5.3 million for the fourth quarter of 2014, reflecting higher new product development spending, a non-cash charge of $0.15 million to write down the value of a Communications Systems trademark, and expenses related to the acquisition of Accutronics, offset by continued control over discretionary spending.  The trademark impairment charge is based on compliance with Generally Accepted Accounting Principles, taking into account time delays in the awarding by government/defense customers in recent years of certain large projects in our Communications Systems pipeline.  As a percentage of revenue, operating expenses declined 40 basis points to 26.1% compared to 26.5% a year ago. 

Operating income was $0.5 million compared to $1.0 million for the fourth quarter of 2014 reflecting lower gross profit partially offset by lower operating expenses.  Operating margin was 2.7% compared to 5.2% for the year-earlier period.

Net income was $0.5 million, or $0.03 per share, compared to net income of $0.9 million, or $0.05 per share, for the fourth quarter of 2014.  The after-tax impact of the non-cash trademark impairment charge on fourth quarter EPS was $.01.

Share Repurchase Program

During fiscal 2015, Ultralife repurchased 2,225,437 shares under its current 3.4 million share repurchase program, which will end April 30, 2016. Since the inception of the share repurchase program on May 1, 2014, the Company has repurchased 2,442,191 shares at an average cost of $4.04 per share. 

About Ultralife Corporation

Ultralife Corporation serves its markets with products and services ranging from power solutions to communications and electronics systems. Through its engineering and collaborative approach to problem solving, Ultralife serves government, defense and commercial customers across the globe.

Headquartered in Newark, New York, the company's business segments include:  Battery & Energy Products and Communications Systems. Ultralife has operations in North America, Europe and Asia. For more information, visit www.ultralifecorp.com.

Conference Call Information

Ultralife will hold its fourth quarter earnings conference call today at 10:00 AM ET. To participate in the live call, please dial (800) 915-4836 at least ten minutes before the scheduled start time, identify yourself and ask for the Ultralife call.  A live webcast of the conference call will be available to investors in the Events & Presentations section of the Company's website at http://investor.ultralifecorporation.com.  For those who cannot listen to the live broadcast, a replay of the webcast will be available shortly after the call at the same location.

This press release may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties.  The potential risks and uncertainties that could cause actual results to differ materially include:  potential reductions in U.S. military spending, uncertain global economic conditions and acceptance of our new products on a global basis.  The Company cautions investors not to place undue reliance on forward-looking statements, which reflect the Company's analysis only as of today's date. The Company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances.  Further information on these factors and other factors that could affect Ultralife's financial results is included in Ultralife's Securities and Exchange Commission (SEC) filings, including the latest Annual Report on Form 10-K. 

ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Dollars in Thousands)
(unaudited)
       
ASSETS
  December 31,
    2015   2014 
Current assets:      
Cash and cash equivalents $ 14,533     $ 17,866  
Trade accounts receivable, net   11,430       11,295  
Inventories, net   23,814       26,086  
Prepaid expenses and other current assets   2,174       1,603  
Total current assets   51,951       56,850  
Property, equipment and improvements, net   9,038       9,812  
Goodwill, intangibles and other assets   20,582       20,980  
Total assets $ 81,571     $ 87,642  
       
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:      
Accounts payable $   6,494     $   6,996  
Accrued compensation and related benefits   2,377       1,725  
Accrued expenses and other current liabilities   1,987       2,490  
Total current liabilities   10,858       11,211  
Deferred income taxes and other non-current liabilities         4,653       4,518  
Total liabilities   15,511       15,729  
       
Commitments and contingencies (Note 10)      
       
Shareholders' equity:      
Common stock   1,918       1,895  
Capital in excess of par value   177,007       175,939  
Accumulated deficit   (94,051 )     (96,920 )
Accumulated other comprehensive loss   (863 )     (467 )
Treasury stock   (17,808 )     (8,420 )
Total Ultralife equity   66,203       72,027  
Noncontrolling interest   (143 )     (114 )
Total shareholders' equity   66,060       71,913  
       
Total liabilities and shareholders' equity $ 81,571     $ 87,642  
       
 

ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands except per share amounts)
(unaudited)
 
 
  Three month periods ended   Year ended
  December 31,   December 31,
    2015     2014      2015      2014 
Revenues:              
Battery & energy products $ 16,634     $ 16,772     $ 65,272     $ 56,772  
Communication systems   2,617       3,176       11,155       9,722  
Total revenues  $ 19,251      $ 19,948     $ 76,427     $ 66,494  
               
Cost of products sold:              
Battery & energy products   12,036       11,745       46,574       41,256  
Communication systems   1,665       1,886       6,537       5,888  
Total cost of products sold   13,701       13,631       53,111       47,144  
               
Gross profit   5,550       6,317       23,316       19,350  
               
Operating expenses:              
Research and development   1,686       1,323       5,603       5,333  
Selling, general and administrative   3,196       3,962       14,233       15,460  
Intangible asset impairment   150       -       150       -  
Total operating expenses   5,032       5,285       19,986       20,793  
               
Operating income (loss)   518       1,032       3,330       (1,443 )
               
Other (expense) income:              
Interest income   1       1       3       13  
Interest and financing expense   (51 )     (65 )     (248 )     (218 )
Miscellaneous   26       (26 )     65       (154 )
Income (loss) from continuing operations before income taxes   494       942       3,150       (1,802 )
Income tax (benefit) provision   (2 )     91       310       268  
               
Net income (loss) from continuing operations   496       851       2,840       (2,070 )
Income (loss) from discontinued operations, net of tax   -       -       -       (61 )
Net income (loss)   496       851       2,840       (2,131 )
Net loss attributable to non-controlling interest   6       2       29       15  
               
Net income (loss) attributable to Ultralife   502       853       2,869       (2,116 )
               
Other comprehensive income:              
Foreign currency translation adjustments   (113 )     (17 )     (396 )     147  
Comprehensive income (loss) attributable to Ultralife $   389     $   836     $ 2,473     $ (1,969 )
               
Net income (loss) per share attributable to Ultralife common shareholders - basic:              
Continuing operations $.03   $.05   $.18   $(.12)
Discontinued operations .00   .00   .00   (.00)
Total $.03   $.05   $.18   $(.12)
Net income per share attributable to Ultralife common shareholders - diluted:              
Continuing operations $.03   $.05   $.17    
Discontinued operations .00   .00   .00    
Total $.03   $.05   $.17    
               
Weighted average shares outstanding - basic   15,271       17,374       16,182       17,475  
Weighted average shares outstanding - diluted   15,757       17,513       16,419      

 
Company Contact:	Ultralife CorporationPhilip A. Fain 	(315) 332-7100	pfain@ulbi.com	Investor Relations Contact:LHA Jody Burfening(212) 838-3777jburfening@lhai.com

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