BROKEN ARROW, Okla., May 10, 2016 (GLOBE NEWSWIRE) -- ADDvantage Technologies Group, Inc. (NASDAQ:AEY), today announced its financial results for the three and six month periods ended March 31, 2016.

"The sales activity in the second fiscal quarter of 2016 rebounded from the fiscal first quarter of 2016, as we reported $10.6 million in revenue for the second quarter, a 28% increase sequentially, though revenue was down 7% compared to the second quarter of fiscal 2015. The sequential improvement was largely driven by a positive change in market dynamics as we witnessed greater demand across both the Telco and Cable TV segments compared with the first fiscal quarter of 2016," commented David Humphrey, President and CEO of ADDvantage Technologies.  "The results for the quarter were in line with our expectations that market forces would begin to stabilize this quarter, enabling our customers to gain greater visibility into their budgetary constraints and thereby allowing them to make purchase decisions."

"Our ability to rapidly regain customers as market conditions improved reflects the proactivity of our sales team and its strong industry relationships. This ability to withstand market fluctuations, combined with our recently announced strategic joint venture with YKTG, positions us to grow the business in the second half of the year. Furthermore, our balance sheet remains strong, and we continue to seek out acquisition opportunities in the broader telecommunications sector with a view to expanding market share over the long term," concluded Mr. Humphrey.

Consolidated sales for the three months ended March 31, 2016 decreased $0.8 million, or 7%, to $10.6 million compared with $11.4 million for the same period ended March 31, 2015.  The decrease in consolidated sales is attributable to a decrease in sales of $1.2 million from the Telco segment, and was partially offset by an increase in sales of $0.2 million for the Cable TV segment sales.

Consolidated operating, selling, general and administrative expenses decreased $0.5 million, or 14%, to $3.3 million for the three months ended March 31, 2016 from $3.8 million for the same period last year.  This decrease was primarily due to a $0.7 million decrease in Telco segment expenses, and was partially offset by an increase of $0.2 million in Cable TV segment expenses.  The decrease in the Telco segment included a $0.4 million decrease in expenses for the annual earn-out payments related to the acquisition of Nave Communications.

Net income for the three months ended March 31, 2016, was $146 thousand, or $0.01 per diluted share, compared with $234 thousand, or $0.02 per diluted share, for the same period of 2015. 

Consolidated EBITDA for the three months ended March 31, 2016 was $0.6 million compared with $0.7 million for the same period ended March 31, 2015.

Consolidated sales for the six months ended March 31, 2016 decreased $3.4 million, or 15%, to $18.8 million compared with $22.2 million for the same period ended March 31, 2015.  Sales for the Cable TV segment decreased by $1.6 million to $11.0 million for the six months ended March 31, 2016 from $12.6 million for the same period last year, while sales for the Telco segment decreased $2.0 million to $7.9 million for the six months ended March 31, 2016 from $9.9 million for the same period last year.

Consolidated operating, selling, general and administrative expenses decreased $1.0 million to $5.9 million for the six months ended March 31, 2016 from $6.9 million for the same period last year. This decrease was primarily due to a $1.1 million decrease in Telco segment expenses and was partially offset by an increase of $0.1 million in expenses in the Cable TV segment.  The decrease in the Telco segment included a $0.7 million decrease in expenses for the annual earn-out payments related to the acquisition of Nave Communications.

Net income for the six month period ended March 31, 2016 was $170 thousand, or $0.02 per diluted share, compared with $650 thousand, or $0.06 per diluted share, for the same period of 2015.

Consolidated EBITDA for the six months ended March 31, 2016 was $1.0 million compared with $1.8 million for the same period ended March 31, 2015.

Cash and cash equivalents were $5.0 million as of March 31, 2016, compared with $6.1 million as of September 30, 2015.  As of March 31, 2016, the Company had inventory of $21.8 million compared with $23.6 million as of September 30, 2015.

Earnings Conference Call

The Company will host a conference call today, Tuesday, May 10 th, at 12:00 p.m. Eastern Time featuring remarks by David Humphrey, President and Chief Executive Officer, Dave Chymiak, Chief Technology Officer, and Scott Francis, Chief Financial Officer.  The conference call will be available via webcast and can be accessed through the Investor Relations section of ADDvantage's website, www.addvantagetechnologies.com.  Please allow extra time prior to the call to visit the site and download any necessary software to listen to the Internet broadcast.

The dial-in number for the conference call is 888-438-5535 (domestic) or 719-325-2472 (international). All dial-in participants must use the following code to access the call: 4740927. Please call at least five minutes before the scheduled start time.

About ADDvantage Technologies Group, Inc. ADDvantage Technologies Group, Inc. (NASDAQ:AEY) supplies the cable television (Cable TV) and telecommunications industries with a comprehensive line of new and used system-critical network equipment and hardware from a broad range of leading manufacturers. The equipment and hardware ADDvantage distributes is used to acquire, distribute, and protect the communications signals carried on fiber optic, coaxial cable and wireless distribution systems, including television programming, high-speed data (Internet) and telephony. In addition, ADDvantage operates a national network of technical repair centers focused primarily on Cable TV equipment and recycles surplus and obsolete Cable TV and telecommunications equipment.

ADDvantage operates through its subsidiaries, Tulsat, Tulsat-Atlanta, Tulsat-Arizona, Tulsat-Nebraska, Tulsat-Tennessee, Tulsat-Texas, NCS Industries, ComTech Services and Nave Communications. For more information, please visit the corporate web site at www.addvantagetechnologies.com.

The information in this announcement may include forward-looking statements.  All statements, other than statements of historical facts, which address activities, events or developments that the Company expects or anticipates will or may occur in the future, are forward-looking statements.  These statements are subject to risks and uncertainties, which could cause actual results and developments to differ materially from these statements.  A complete discussion of these risks and uncertainties is contained in the Company's reports and documents filed from time to time with the Securities and Exchange Commission.

Non-GAAP Financial Measures EBITDA is a supplemental, non-GAAP financial measure.  EBITDA is defined as earnings before interest expense, income taxes, depreciation and amortization.  Management believes providing EBITDA in this release is useful to investors' understanding and assessment of the Company's ongoing continuing operations and prospects for the future and it is a used by the financial community to evaluate the market value of companies considered to be in similar businesses.  Since EBITDA is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, net earnings as an indicator of operating performance.  EBITDA, as calculated in the table below, may not be comparable to similarly titled measures employed by other companies.  In additions, EBITDA is not necessarily a measure of our ability to fund our cash needs.

(Tables follow)
 
 
ADDVANTAGE TECHNOLOGIES GROUP, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(UNAUDITED)
 
    Three Months Ended March 31,     Six Months Ended March 31,  
      2016        2015        2016        2015   
Sales $ 10,587,187   $ 11,366,539   $ 18,836,855   $ 22,203,697  
Cost of sales     7,002,575       7,123,027      12,486,863     14,128,382  
Gross profit   3,584,612     4,243,512     6,349,992     8,075,315  
Operating, selling, general and administrative expenses   3,256,403     3,803,155     5,925,028     6,878,614  
Income from operations   328,209     440,357     424,964     1,196,701  
Other income (expense):        
Other income   109,554     -     109,554     -  
Interest income   2,172     -     2,172     -  
Loss from equity method investment   (140,998 )   -     (140,998 )   -  
Interest expense     (62,307 )     (79,102 )     (130,068 )     (164,523 )
Total other income (expense), net     (91,579 )     (79,102 )     (159,340 )     (164,523 )
                         
Income before provision for income taxes   236,630     361,255     265,624     1,032,178  
Provision for income taxes     91,000       127,000       96,000       382,000  
                         
Net income $   145,630   $   234,255   $   169,624   $   650,178  
                         
Earnings per share:        
Basic $ 0.01   $ 0.02   $ 0.02   $ 0.06  
Diluted $ 0.01   $ 0.02   $ 0.02   $ 0.06  
Shares used in per share calculation:        
Basic   10,092,319     10,051,844     10,080,729     10,046,525  
Diluted   10,092,319     10,051,844     10,080,729     10,046,525  

    Three Months Ended March 31, 2016     Three Months Ended March 31, 2015  
    Cable TV     Telco     Total     Cable TV     Telco     Total  
                                     
Income (loss) from operations $ 336,279   $ (8,070 ) $ 328,209   $ 347,839   $ 92,518   $ 440,357  
Depreciation   80,802     27,367     108,169     70,149     29,930     100,079  
Amortization   -       206,451       206,451     -       206,451       206,451  
EBITDA $   417,081   $   225,748   $   642,829   $   417,988   $   328,899   $   746,887  

    Six Months Ended March 31, 2016     Six Months Ended March 31, 2015  
    Cable TV     Telco     Total     Cable TV     Telco     Total  
                                     
Income (loss) from operations $ 453,119   $ (28,155 ) $ 424,964   $ 966,650   $ 230,051   $ 1,196,701  
Depreciation   153,266     50,083     203,349     141,713     57,174     198,887  
Amortization   -       412,902       412,902     -       412,903       412,903  
EBITDA $   606,385   $   434,830   $ 1,041,215   $ 1,108,363   $   700,128   $ 1,808,491  

 
 
ADDVANTAGE TECHNOLOGIES GROUP, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED)
 
    March 31,2016     September30, 2015   
Assets            
Current assets:            
Cash and cash equivalents $ 4,969,254   $ 6,110,986  
Accounts receivable, net of allowance for doubtful accounts of $250,000   5,650,300     4,286,377  
Income tax receivable   175,096     -  
Inventories, net of allowance for excess and obsolete    
inventory of $3,056,628 and $2,756,628, respectively   21,757,901     23,600,996  
Prepaid expenses   354,962     153,454  
Deferred income taxes     1,740,000       1,776,000  
Total current assets   34,647,513     35,927,813  
     
Property and equipment, at cost   11,066,923     10,785,799  
Less: Accumulated depreciation   (4,774,500 )   (4,584,796 )
Net property and equipment   6,292,423     6,201,003  
     
Investment in and loans to equity method investee   280,562     -  
Intangibles, net of accumulated amortization   5,386,571     5,799,473  
Goodwill   3,910,089     3,910,089  
Other assets     135,988       134,678  
             
Total assets $ 50,653,146   $ 51,973,056  
             
Liabilities and Shareholders' Equity    
Current liabilities:    
Accounts payable $ 2,055,719   $ 1,784,482  
Accrued expenses   979,778     1,358,681  
Income tax payable   -     122,492  
Notes payable - current portion   888,845     873,752  
Other current liabilities     941,534       982,094  
Total current liabilities   4,865,876     5,121,501  
     
Notes payable, less current portion   3,917,289     4,366,130  
Deferred income taxes   296,000     286,000  
Other liabilities     114,679       1,064,717  
Total liabilities   9,193,844     10,838,348  
     
Shareholders' equity:    
Common stock, $.01 par value; 30,000,000 shares authorized; 10,634,893 and 10,564,221 shares issued, respectively; 10,134,235 and 10,063,563 shares outstanding, respectively   106,349     105,642  
Paid in capital   (4,958,006 )   (5,112,269 )
Retained earnings   47,310,973     47,141,349  
Total shareholders' equity before treasury stock   42,459,316     42,134,722  
     
Less: Treasury stock, 500,658 shares, at cost   (1,000,014 )   (1,000,014 )
Total shareholders' equity   41,459,302     41,134,708  
             
Total liabilities and shareholders' equity $ 50,653,146   $ 51,973,056  
For further information	Company Contact:Scott Francis	(918) 251-9121	KCSA Strategic CommunicationsGarth Russell(212) 896-1250grussell@kcsa.com