LGL - Earnings call transcript Q4 2021

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Operator

Please stand by, we’re about to begin. Good day and welcome to the LGL Group Incorporated Annual Earnings Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mike Ferrantino. Please go ahead, sir.

Michael Ferrantino

you. Thank thank the today’s months three XX, and financial covering ended for XXXX. for results months you morning, call attending our December Good and XX was to have our a you opening chance Hopefully, XX-K, had which released premarket yesterday. review our available If on it website. not, is our Tivy, time. review CFO, financial will results James this at our James?

James Tivy

on note after thanks anticipate will call be call. and we Yes. and our year this for Good morning, sometime XXXX that full the our recording available making joining the everyone, earnings website call. Please recorded

We quarter before the have the market results for our XX-K issued yesterday year opened our and XXXX. reporting fourth of fiscal full

Section XXXX statements we’re Before notes sorry of the within forward-looking contained XXXX the should of underway, Securities should taken discussion which SEC. and meaning within statements there note XX-K, the involve you the our Securities been filed of forward-looking contain which our of Securities of required the This getting financial and SEC. of and in be all and with the participants with and to advise may Exchange filings with known Act XXXX. the in statements too discussion are following uncertainties, conjunction has risks Act the that XXE recent These XXA Act Section unknown and detailed – most

future performance. forward-looking result of actual business obligation revise company’s company believes company’s the market are Any future and conditions, any its will upon company based assurances no results publicly there to materially update of regarding that events statements from statements. the future Although forward-looking be otherwise. or as any guarantees assumptions The statements that whether its are not forward-looking reasonable the by expressed or can not no a forward-looking new differ statements results information, implied or undertakes

the and Let LGL summarize for me of for the fourth you for year full stands now quarter where XXXX.

$X.X the XXXX. million. X.X% quarter at costs million, of Current defense of a order XXXX XXXX. was and $XX.X quarter from This quarter the of profitability. and XXXX. Operating including recovering quarter fourth $XXX,XXX of $XX.X million quarter backlog was of related which and to orders, period XXXX versus million was loss to was spin-off million major subsequent million is quarter $XXX,XXX shipments as below of pressures, revenues $X.X the Our fourth missile $X.X the $X.X MTronPTI reduced compared $XX.X for strong of expected inflationary year for revenues most or to fourth the a to in Quarter of $XXX,XXX the beginning the million avionics market third defense fourth program, improvement ship lower

our $XX.X million year, $X.X were million year. or $XX.X XXXX, which prior full revenues the X.X% for was million the below For versus

of decline first during XX.X% to lower quarter pre-COVID revenue the in Our Gross reflects XX.X% conditions to and annual year. significant the shipments improved avionics compared last to market. the XXXX margins

inflationary compared favorable significant SPAC-related triggered share per compared the for of income earnings million was by the the reflects to our result XXXX as the Net XXXX. to mix. also our on largely SPAC-related in was investment company’s the and For excluding in and operating million reductions, benefit of cost company a million loss, $X.XX favorable $X.X a were certain costs income from elimination impacts COVID-XX the offset and operating product year, million common business, million $X.X the a the stock, from to compared $X.X results non-cash donation charitable IronNet was reported business year, IronNet increase $X.XX share of last the $X.X benefits Diluted pressures there including capabilities response costs sales per investment. Lower to $X combination. The required spin-off XXXX. manufacturing preserve previously to of million $XX.X the

securities, marketable the including Ferrantino. position, a cash is net back Michael now share. call I’ll million, was turn to than XXXX which With over $XX.X year-end $X.X that, more Our

Michael Ferrantino

James. you, Thank

ended As strong proud team’s facing backlog, chain sheet LGL the a the and success the and you’ve challenge headwinds. entire of herd, inflation, balance dedication year strong. and improving with we’ve supply is growing I’m and margins the while workforce are of disruption

progressing We in future on market several the second These now quarter our more approval control and and open to backlog reach of of We year. targeted products to control any contributed extend new call distinct clearly standalone for to questions. its have potential the growth entity with our please believe and pursue while products and product growth. our MTronPTI both enable shareholder shareholders plan XXXX The have the each aerospace frequency released in I’ll spin-off in into basis, spectrum areas. the own this is to each solicitation the would floor open to strategic evaluate a Operator, that performance opportunities. questions. of plans spin-off the military allowing

Operator

question come Soderstrom Anja first will [Operator with you. And Thank from our Instructions] Sidoti.

Anja Soderstrom

questions. taking for my you thank Hi,

related first so that growth to much a the challenges? backlog, how much Can nice may you chain related supply how And versus to be there. quantify is business new very

Michael Ferrantino

Sure.

is but In to that or supply been products There amount some XX new in chain-related have small. orders to roughly terms is issues, business, it’s introduced of the advanced so. past relatively to related months XX% related of that XX new from

Anja Soderstrom

is it the with And customers? there Or there? current you. mainly in any customers are thank expansion new Okay,

Michael Ferrantino

some is penetration. customer new There

with However, customers. a of large that part backlog existing is

Anja Soderstrom

if of able on? to for thank there the Okay, material, the customers, your is be being of quarter margin there you’ve lag And of to due is fourth what to that been on to you that to terms you raw but in for able on was and pass And you. pass some the passed alluded to also more that can? room

Michael Ferrantino

that. or lag beyond costs slightly generally which Sure. as from eight the There’s vary from XX weeks – on increases time is some lead the The on to room pass our costs tied up. go to really to to supply orders,

Anja Soderstrom

also And the avionics you you. thank the talking in recovering about Okay, market.

innings think the you in that? You’re Where of benefits seeing that? from we are do

Michael Ferrantino

– think in early the long go. recovery, that the there’s stages a of still we’re way to I

Anja Soderstrom

Okay.

quarters? the to coming So potential that increase there’s more for in you

Michael Ferrantino

That correct. is

Anja Soderstrom

anything else you. And of in you affected how the that? you sort shortages if and thank of is are Okay, by us combating if talk you’re terms through labor you inflationary can pressures there –

Michael Ferrantino

the in we So of sources looking as inflationary are identifying sources. constantly them terms well pressures, with as at working our additional and

done continue the front, a will good our maintaining workforce, we we’ve On do labor job of pretty to that. and

Anja Soderstrom

last, business, shareholder of vote very thank right? terms you. of second have the then Okay, the the you’ll quarter, And the in spin-off MTronPTI in

Michael Ferrantino

That targeting. correct. is we’re what That’s

Anja Soderstrom

through set up a term terms I team and actually to with to timeframe the what’s in of entity? – – would spin-off then that And for a for management manage that actually ready of going be

Michael Ferrantino

that. that And completed far Yes, the team is that’s third of would to as a been in quarter. identified has The we that, timing correct. that we’ll process be but as there expect for the go management through,

Anja Soderstrom

Okay. of revealed will be before? or And the something management hasn’t presented team going vote, to the before be sort that or after that’s is

Michael Ferrantino

be would within the It proxy.

Anja Soderstrom

the Within proxy.

you. That was all for Thank Okay. me.

Michael Ferrantino

Thank Anja. you,

Operator

[Operator Instructions] with Moving Mishra on, we’ll go to Mishra Vishal Capital.

Vishal Mishra

order, from and just be about in million will Hi, $XX Mike, million $X James, a on the of shipped most it new XXXX. clarification the backlog, or

give number backlog the you on be will the convertible next – us provide So than the can months, more like is that? XX more is you next wondering three I’m that XX-month, into sort for or maybe clarity a what of just that

James Tivy

pretty is, having what we’ve back to obviously, until coming Yeah, order ship XXXX. I just good a is with existing big we think until avionics which – there’s we’re and It’s don’t our million really customers. – seen $X XXXX expect after been success

Vishal Mishra

That’s Okay. all. Thank you.

Operator

Greg to Greenberg, Instructions] we’ll Investor. [Operator on, go Moving

Unidentified Analyst

Hi, and it’s to gentlemen. you going LGL it or I’m RemainCo. companies give to like public can if we more us cash to we with think Should SPAC how the think be of investing that bring it? more merger a color a little for wondering bit partner on about should management in Group

Michael Ferrantino

LGL MTronPTI, have growth its operating still will also of spin-off entity post but it on profitable be PTF, acquisition. So focusing through will

Unidentified Analyst

spin, what investor have help Okay. be outside outside that or business reference may worth? any is valuation on the And that for may there us a then

Michael Ferrantino

at outside this conducted an not have We point. evaluation

Unidentified Analyst

occurs? then finally, warrants can be you And that assuming over just how the the Okay. will spend go affected

Michael Ferrantino

it recent period. set It’s spin-off the the two most subsequent the out. the to Yeah, new formula of prices Greg, each and going companies subsequent in the of just measuring disclosed on to percentage warrants, over preliminary we the proxy was short related – approximately a pre-proxy, a their over there’s to –

the So if, the trading XX% the reduced for prices and XX% of the adjusted. also value will strike of then two example, spin, the be the of the prices warrants numbers, after LGL companies by the MTron two is

Unidentified Analyst

very Thank much. you Okay.

Operator

Hutton. on, go to [Operator Reilly we’ll Instructions] moving with And EF Eddie

Eddie Reilly

companies of the the was I could for acquire the Hey, you just you’re to types maybe wondering guys, question. RemainCo maybe if looking thanks unpack within taking spin-off? after at my

Michael Ferrantino

spin, looking for. post a be we’re there’ll companies that Not to this much wide of say at that really would I time. the variety criteria think fit

Eddie Reilly

Okay, great. guys. really it me. That’s you, Thank for

Operator

to And next we’ll Family [ph]. Practice] Vanderwel with Vanderwel [Mark go

Unidentified Analyst

in Hello, defense I’m business? or you your the is you war comment have Ukraine what on might effect if on having wondering expect could

Michael Ferrantino

Sure.

I that, for we effects. Obviously, Also, think defense there’s put potential increased that the is, through any through budgets a couple some company. opportunities the opportunities of Russia where there spending potential of now. evaluating are be being there at where created benefit are are on looking a sanctions would in the we’re

Unidentified Analyst

benefit them will on put you? being Sanctions actually

Michael Ferrantino

of Russia, acquire be Potentially, capitalize that there to might countries we is out harder on. would be that supply come certain might able to that for

Unidentified Analyst

very anticipated have much. Thank you would Never that.

Operator

additional further comments. like it gentlemen, in At And any this time, questions for turn to closing there are the or queue. I’d back you to no

Michael Ferrantino

for you. to for this I thank our their stockholders again Well, our – great day. our Sure, stockholders joining concludes and more no company. continued a joining Have like call. you support would for are if there the thank of questions,

Operator

that does We’d for call. conclude participation. to everyone you. Thank their And thank like today’s

disconnect. now may You

The LGL Group, Inc. (LGL) 29 Mar 222021 Q4 Earnings call transcript