Exhibit 99.1
Innovative Solutions & Support, Inc. Announces Fourth Quarter and Full Year Fiscal 2019 Financial Results
EXTON, Pa.--(BUSINESS WIRE)--Innovative Solutions & Support, Inc. (“IS&S”or the“Company”) (ISSC) today announced its financial results for the fourth quarter and full year fiscal 2019, ended September 30, 2019.
For the fourth quarter of fiscal 2019, the Company reported net sales of $4.8 million, up 33% from $3.6 million in the fourth quarter a year ago. The Company reported fourth quarter net income of $1.0 million, or $0.06 per share, compared to a net loss of $414,000, or ($0.03) per share, in the fourth quarter of fiscal 2018. Revenues were also up sequentially for the seventh time in the last eight quarters.
Geoffrey Hedrick, Chairman and Chief Executive Officer of IS&S, said, “The fourth quarter was a strong finish to a year in which we generated growth in revenues, earnings and cash flow. For the year, revenues were up 27%. These results reflect the strategy I discussed last year to focus on fewer, but potentially more lucrative, growth opportunities. We also ended fiscal 2019 with our best quarter of new orders, the highest quarterly order intake rate in more than two years. In addition, we received a Federal Aviation Administration (FAA) Supplemental Type Certificate (STC) for our patented ThrustSense® Auto-throttle retrofit for the King Air included revolutionary aircraft safety system integrated into the auto-throttle.”
The ThrustSense® system, designed to prevent Engine-out loss-of-control accidents was recently reviewed in the aircraft industry periodical Aviation International News:
“…the King Air ThrustSense system adds more than just easier speed control and engine management. In the King Air, the IS&S auto-throttles also offer a significant safety benefit in case of failure of one engine, especially on takeoff. This hazard has come under the microscope as a result of a pair of King Air takeoff accidents: in Wichita in 2014; and Addison, Texas, on July 1 this year.”
“This FAA STC,” continued Hedrick, “establishes a solid foundation to expand our technology throughout the King Air and other families of twin-engine equipped aircraft.”
At September 30, 2019, the Company had $22.4 million of cash on hand, up over two million dollars from September 30, 2018 as net cash flows from operating activities were in excess of $2.1 million for the year. New orders in the fourth quarter of fiscal 2019 were over $6 million, the highest new order quarter this year, and backlog as of September 30, 2019, was $5.9 million. Backlog excludes potential future ongoing production orders from the Pilatus PC-24 and the KC-46A programs both of which are currently in production. The Company expects both programs to remain in production for multiple years and that these contracts will add to production sales already in backlog.
Full Year Results
Total sales for the fiscal year ended September 30, 2019, were $17.6 million, up 27% from $13.9 million for full year 2018. The company reported fiscal 2019 net income of $1.9 million, or $0.11 per share, a significant improvement from a net loss of $3.7 million, or ($0.22) per share for fiscal 2018.
Conference Call
The Company will be hosting a conference call on Thursday, December 12, 2019, at 10:00 a.m. ET to discuss these results and the Company’s business outlook and product development. Please use the following dial in number to register your name and company affiliation for the conference call: 877-270-2148 and ask to be joined into the Innovative Solutions & Support call. The call will also be carried live on the Investor Relations page of the Company website atwww.innovative-ss.com.
About Innovative Solutions & Support, Inc.
Headquartered in Exton, Pa., Innovative Solutions & Support, Inc. (www.innovative-ss.com) is a systems integrator designs, develops, manufactures, sells and services air data equipment, engine display systems, standby equipment, primary flight guidance, auto-throttles and cockpit display systems for retrofit applications and original equipment manufacturers (OEMs). The Company supplies integrated Flight Management Systems (“FMS”), Flat Panel Display Systems (FPDS), Auto-throttle Systems, air data equipment, Integrated Standby Units (ISU) and advanced Global Positioning System (GPS) receivers that enable reduced carbon footprint navigation.
Certain matters contained herein that are not descriptions of historical facts are “forward-looking” (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, those discussed in filings made by the Company with the Securities and Exchange Commission. Many of the factors that will determine the Company’s future results are beyond the ability of management to control or predict. Readers should not place undue reliance on forward-looking statements, which reflect management’s views only as of the date hereof. The Company undertakes no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
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Innovative Solutions and Support, Inc.
Consolidated Balance Sheets
(unaudited)
| September 30, | September 30, | |||||||
| 2019 | 2018 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 22,416,830 | $ | 20,390,713 | ||||
| Accounts receivable | 2,348,537 | 3,449,893 | ||||||
| Contract asset | 80,182 | - | ||||||
| Inventories | 4,470,694 | 4,280,108 | ||||||
| Prepaid expenses and other current assets | 642,049 | 544,234 | ||||||
| Total current assets | 29,958,292 | 28,664,948 | ||||||
| Property and equipment, net | 8,444,692 | 8,786,737 | ||||||
| Other assets | 154,041 | 181,993 | ||||||
| Total assets | $ | 38,557,025 | $ | 37,633,678 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 1,079,073 | $ | 1,529,792 | ||||
| Accrued expenses | 1,110,918 | 1,463,021 | ||||||
| Contract liability | 29,231 | 356,801 | ||||||
| Total current liabilities | 2,219,222 | 3,349,614 | ||||||
| Non-current deferred income taxes | 129,651 | 129,594 | ||||||
| Total liabilities | 2,348,873 | 3,479,208 | ||||||
| Commitments and contingencies | - | - | ||||||
| Shareholders' equity | ||||||||
| Preferred stock, 10,000,000 shares authorized, $.001 par value, of which 200,000 shares are authorized as Class A Convertible stock. No shares issued and outstanding at September 30, 2019 and 2018 | - | - | ||||||
| Common stock, $.001 par value: 75,000,000 shares authorized, 19,005,487 and 18,937,050 issued at September 30, 2019 and 2018, respectively | 19,006 | 18,937 | ||||||
| Additional paid-in capital | 51,987,096 | 51,783,779 | ||||||
| Retained earnings | 5,570,587 | 3,720,291 | ||||||
| Treasury stock, at cost, 2,096,451 shares at September 30, 2019 and at September 30, 2018 | (21,368,537 | ) | (21,368,537 | ) | ||||
| Total shareholders' equity | 36,208,152 | 34,154,470 | ||||||
| Total liabilities and shareholders' equity | $ | 38,557,025 | $ | 37,633,678 | ||||
Innovative Solutions and Support, Inc.
Consolidated Statements of Operations
(unaudited)
| Three months ended | Twelve months ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2019 | 2018 | 2019 | 2018 | |||||||||||||
| Sales | $ | 4,801,988 | $ | 3,645,521 | $ | 17,572,589 | $ | 13,850,372 | ||||||||
| Cost of sales | 1,942,734 | 1,829,327 | 7,676,119 | 7,311,923 | ||||||||||||
| Gross profit | 2,859,254 | 1,816,194 | 9,896,470 | 6,538,449 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 522,427 | 592,187 | 2,489,806 | 3,575,801 | ||||||||||||
| Selling, general and administrative | 1,463,794 | 1,668,245 | 5,877,920 | 6,674,187 | ||||||||||||
| Total operating expenses | 1,986,221 | 2,260,432 | 8,367,726 | 10,249,988 | ||||||||||||
| Operating income (loss) | 873,033 | (444,238 | ) | 1,528,744 | (3,711,539 | ) | ||||||||||
| Interest income | 101,672 | 17,092 | 249,620 | 53,561 | ||||||||||||
| Other income | 16,423 | 14,500 | 73,737 | 67,724 | ||||||||||||
| Income (loss) before income taxes | 991,128 | (412,646 | ) | 1,852,101 | (3,590,254 | ) | ||||||||||
| Income tax (benefit) expense | (5,989 | ) | 1,731 | 1,805 | 63,651 | |||||||||||
| Net income (loss) | $ | 997,117 | $ | (414,377 | ) | $ | 1,850,296 | $ | (3,653,905 | ) | ||||||
| Net income (loss) per common share: | ||||||||||||||||
| Basic | $ | 0.06 | $ | (0.03 | ) | $ | 0.11 | $ | (0.22 | ) | ||||||
| Diluted | $ | 0.06 | $ | (0.03 | ) | $ | 0.11 | $ | (0.22 | ) | ||||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic | 16,888,692 | 16,823,754 | 16,867,550 | 16,805,991 | ||||||||||||
| Diluted | 17,074,825 | 16,823,754 | 16,942,447 | 16,805,991 | ||||||||||||