Commercial Air Travel’s Continued Recovery and
the Product Identification Segment’s Solid Performance Drive
Sequential and Year-Over-Year Growth
Second-Quarter Fiscal 2022 Summary
- Bookings of $30.6 million, up 18% year-over-year
- Revenue of $29.8 million, up 8% year-over-year
- Backlog of $24.3 million
- GAAP operating income of $3.5 million
- Non-GAAP operating income of $1.3 million
- GAAP net income of $7.0 million, or $0.96 per diluted share,
including $0.83 per diluted share in CARES Act benefits
- Non-GAAP net income of $978,000, or $0.13 per diluted share,
compared with break-even results in the prior year’s second
quarter
- Adjusted EBITDA of $9.2 million, or 30.8% of revenue
- Excluding CARES Act benefits, Adjusted EBITDA of $2.6 million
or 8.7% or revenue
- Company anticipates sequential and year-over-year top-line
growth in the second half of fiscal 2022
AstroNova, Inc. (NASDAQ: ALOT), a global leader in data
visualization technologies, today announced financial results for
the fiscal 2022 second quarter ended July 31, 2021.
CEO Commentary
“We reported year-over-year and sequential revenue growth in the
second quarter in both the Test & Measurement and Product
Identification segments, as we capitalized on an improved demand
picture across the business,” said Gregory A. Woods, President and
Chief Executive Officer of AstroNova. “In the Test &
Measurement segment, revenue from hardware, supplies, and parts and
repairs all increased as air passenger traffic continued to
rebound. We also saw solid contributions across the Product
Identification product line, with another strong quarter from the
T3-OPX wide-format durable direct-to-package printing system. We
performed particularly well given the ongoing global supply chain
constraints and continuing COVID-19 headwinds.”
Business Outlook
“We expect to report year-over-year and sequential top-line
growth for the second half of fiscal 2022,” continued Woods. “The
aerospace market is recovering a bit more quickly than we had
anticipated, and we expect continued improved demand in the Product
Identification segment. At the same time, we recognize the
uncertainty caused by supply chain constraints and the continuing
pandemic. Looking further ahead, we believe that we are well
positioned to capitalize on many growth opportunities across both
our Test & Measurement and Product Identification segments when
markets fully recover.”
CARES Act Benefits
During the second quarter of this fiscal year, the principal and
interest were forgiven on the Paycheck Protection Program (PPP)
loan AstroNova received last year. In addition, the Company became
eligible for an Employee Retention Credit (ERC) authorized under
the Coronavirus Aid, Relief, and Economic Security (CARES) Act. In
total for the second quarter, these two items (the CARES Act
benefits) benefited net income by $6.0 million and earnings per
diluted share by $0.83.
Q2 FY 2022 Operating Segment
Results
Product Identification segment revenue in the second
quarter of fiscal 2022 increased 8.6% to $23.5 million, with gains
in both hardware and supplies, versus $21.6 million in the
prior-year period. GAAP segment operating income was $4.4 million,
or 18.8% of revenue, compared with $3.1 million, or 14.5% of
revenue, in the prior year. On a non-GAAP basis, excluding the
CARES Act benefits, segment operating income in the second quarter
of fiscal 2022 was $3.0 million, or 12.7% of revenue.
Test & Measurement segment revenue in the second
quarter of fiscal 2022 was $6.4 million, compared with $6.0 million
in the same period of fiscal 2021. The Test & Measurement
segment recorded GAAP operating income of $1.7 million, or 26.9% of
revenue, compared with a segment operating loss of $0.4 million, or
negative 6.8% of revenue, in the comparable period of fiscal 2021.
Non-GAAP segment operating income in the second quarter of fiscal
2022, excluding the CARES Act benefits, was $908,000, or 14.3% of
sales, helped by lower manufacturing costs and operating expenses
versus the year-earlier period, as well as a change in amortization
for aerospace-related intangibles that resulted in an additional
$587,000 in operating profit. This is the best result since the
second half of fiscal 2020, when revenue was significantly
higher.
Q2 FY 2022 Results
Summary
Revenue for the second quarter of fiscal 2022 totaled $29.8
million, up 8% compared with $27.7 million in the year-earlier
period.
GAAP gross profit for the second quarter of fiscal 2022 was
$12.7 million, or 42.6% of revenue, compared with $9.8 million, or
35.4% of revenue, in the same period of fiscal 2021. Non-GAAP gross
profit in the second quarter of fiscal 2022, excluding the CARES
Act benefits, was $11.1 million, or 37.1% of revenue, up 170 basis
points from the gross profit in the same period of the prior year.
The increase compared with the same quarter last year reflects
higher revenue and the impact of favorable product mix.
GAAP operating expenses for the second quarter of fiscal 2022
totaled $9.3 million, down approximately 3.3% compared with $9.6
million in the second quarter fiscal 2021. On a non-GAAP basis,
excluding the CARES Act benefits, operating expenses for the second
quarter of fiscal 2022 were $9.8 million, primarily due to higher
wages and benefits compared with the prior-year second quarter,
when COVID-related furloughs and work-share programs were in
effect.
Other income of $4.3 million included a $4.5 million gain,
related to the forgiveness indebtedness income related to the PPP
loan.
GAAP net income for the second quarter of fiscal 2022 was $7.0
million, or $0.96 per diluted share, compared with net income of
$3,000, or $0.00 per diluted share, in the second quarter of fiscal
2021. On a non-GAAP basis, excluding the CARES Act benefits, net
income for the second quarter of fiscal 2022 was $978,000, or $0.13
per diluted share.
Earnings before interest, taxes, depreciation and amortization
(EBITDA) were $8.7 million, compared with $2.4 million in the
second quarter of fiscal 2021. Second-quarter fiscal 2022 EBITDA,
excluding the CARES Act benefits, was $2.1 million, or 7.2% of
revenue. Adjusted EBITDA was $9.2 million, or 30.8% of revenue, and
$2.6 million, or 8.7% of revenue, excluding the effect of the CARES
Act benefits. This compares with Adjusted EBITDA of $3.0 million,
or 10.7% of revenue, for the comparable period of fiscal 2021.
Non-GAAP net income, non-GAAP earnings per diluted share,
non-GAAP gross profit, non-GAAP operating expenses, non-GAAP
segment operating income, EBITDA, EBITDA excluding the effect of
the PPP loan forgiveness and ERC, Adjusted EBITDA and Adjusted
EBITDA excluding the CARES Act benefits are non-GAAP financial
measures explained in greater detail below under “Use of Non-GAAP
Financial Measures.” Please refer to the financial reconciliation
table included in this news release for a reconciliation of
non-GAAP measures to the closest comparable GAAP measures for the
fiscal second quarters ended July 31, 2021 and August 1, 2020.
Bookings for the second quarter of fiscal 2022 were $30.6
million, compared with $25.3 million in the second quarter of
fiscal 2021.
Backlog at July 31, 2021 was $24.4 million versus $23.7 million
on August 1, 2020.
Second-Quarter Fiscal 2022 Conference
Call
AstroNova will discuss its second-quarter fiscal 2022 financial
results in an investor conference call at 9:00 a.m. ET today. To
participate on the conference call, please dial (800) 437-2398
(U.S. and Canada) or (929) 477-0577 (International) approximately
10 minutes prior to the start time and enter confirmation code
1881865.
You can hear a replay of the conference call from 12:00 p.m. ET
Tuesday, September 14, 2021 until 12:00 p.m. ET on Tuesday,
September 21, 2021 by dialing (888) 203-1112 (U.S. and Canada) or
(719) 457-0820 (International). The passcode is 1881865. A
real-time and an archived audio webcast of the call will be
available through the “Investors” section of the AstroNova website,
https://investors.astronovainc.com.
Use of Non-GAAP Financial Measures
In addition to financial measures prepared in accordance with
generally accepted accounting principles (GAAP), this news release
contains the non-GAAP financial measures: non-GAAP net income,
non-GAAP net income per diluted share, non-GAAP gross profit,
non-GAAP operating expenses, non-GAAP segment operating income,
earnings before interest, taxes, depreciation and amortization
(EBITDA), EBITDA excluding the CARES Act benefits, and Adjusted
EBITDA and Adjusted EBITDA excluding the CARES Act benefits.
AstroNova believes that the inclusion of these non-GAAP financial
measures helps investors gain a meaningful understanding of changes
in the Company's core operating results, and also can help
investors who wish to make comparisons between AstroNova and other
companies on both a GAAP and a non-GAAP basis. AstroNova’s
management uses these measures, in addition to GAAP financial
measures, as the basis for measuring its core operating performance
and comparing such performance to that of prior periods and to the
performance of its competitors. These measures also are used by the
Company’s management to assist with their financial and operating
decision-making.
About AstroNova
AstroNova, Inc. (NASDAQ: ALOT), a global leader in data
visualization technologies since 1969, is focused on designing,
manufacturing, distributing and servicing a broad range of products
that acquire, store, analyze and present data in multiple formats.
The Company's Product Identification segment offers a complete
line-up of label and direct-to-package printing hardware and
supplies, allowing customers to mark, track and enhance their
products' appearance. Supported by AstroNova's customer application
experts and technology leadership in printing, material science and
high-speed data processing, customers benefit from an optimized,
"total solution" approach. The Test and Measurement segment
includes the AstroNova Aerospace business unit. This segment
designs and manufactures flight deck printers, networking hardware
and related accessories serving the world's aerospace and defense
industries with proven advanced airborne technology solutions for
the cockpit, the cabin and so much more. AstroNova is a member of
the Russell Microcap® Index and the LD Micro Index (INDEXNYSEGIS:
LDMICRO). Additional information is available by visiting
www.astronovainc.com.
Forward-Looking
Statements
Information included in this news release may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are not statements of historical fact, but rather
reflect our current expectations concerning future events and
results. These statements may include the use of the words
“believes,” “expects,” “intends,” “plans,” “anticipates,” “likely,”
“continues,” “may,” “will,” and similar expressions to identify
forward-looking statements. Such forward-looking statements,
including those concerning the Company’s anticipated performance,
involve risks, uncertainties and other factors, some of which are
beyond our control, which may cause our actual results, performance
or achievements to be materially different from those expressed or
implied by such forward-looking statements. These risks,
uncertainties and factors include, but are not limited to, those
factors set forth in the Company’s Annual Report on Form 10-K for
the fiscal year ended January 31, 2021 and subsequent filings
AstroNova makes with the Securities and Exchange Commission. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. The reader is cautioned not to unduly
rely on such forward-looking statements when evaluating the
information presented in this news release.
ASTRONOVA, INC. Condensed Consolidated Statements of
Income In Thousands Except for Per Share Data
(Unaudited) Three Months Ended Six Months Ended
July 31, 2021 August 1, 2020
July 31, 2021 August 1,
2020 Revenue
$ 29,845
$ 27,658
$ 58,923
$ 58,578
Cost of Revenue
17,129
17,871
35,320
37,935
Gross Profit
12,716
9,787
23,603
20,643
Total Gross Profit Margin
42.6%
35.4%
40.1%
35.2%
Operating Expenses: Selling & Marketing
5,061
5,555
11,154
11,481
Research & Development
1,539
1,493
3,255
3,433
General & Administrative
2,664
2,535
5,008
4,861
Total Operating Expenses
9,264
9,583
19,417
19,775
Operating Income
3,452
204
4,186
868
Total Operating Margin
11.6%
0.7%
7.1%
1.5%
Other Income (Expense) , net: Extinguishment of Debt - PPP Loan
4,466
-
4,466
-
Interest Expense
(171)
(259)
(392)
(490)
Gain (Loss) on Foreign Currency Transactions
50
553
(114)
399
Other, net
(79)
34
(63)
68
4,266
328
3,897
(23)
Income Before Taxes
7,718
532
8,083
845
Income Tax (Benefit) Provision
699
529
471
411
Net Income
$ 7,019
$ 3
$ 7,612
$ 434
Net Income per Common Share - Basic
$ 0.97
$ 0.00
$ 1.06
$ 0.06
Net Income per Common Share - Diluted
$ 0.96
$ 0.00
$ 1.04
$ 0.06
Weighted Average Number of Common Shares - Basic
7,209
7,105
7,177
7,089
Weighted Average Number of Common Shares - Diluted
7,329
7,123
7,297
7,114
ASTRONOVA, INC. Balance Sheet In Thousands
(Unaudited) July 31, 2021 January 31, 2021
ASSETS CURRENT ASSETS Cash and Cash Equivalents
$ 11,389
$ 11,439
Accounts Receivable, net
15,603
17,415
Inventories, net
29,090
30,060
Prepaid Expenses and Other Current Assets
5,317
1,807
Total Current Assets
61,399
60,721
PROPERTY, PLANT AND EQUIPMENT
51,963
50,839
Less Accumulated Depreciation
(39,656)
(38,828)
Property, Plant and Equipment, net
12,307
12,011
OTHER ASSETS Intangible Assets, net
20,074
21,502
Goodwill
12,623
12,806
Deferred Tax Assets
5,942
5,941
Right of Use Asset
1,209
1,389
Other Assets
1,680
1,103
TOTAL ASSETS
$ 115,234
$ 115,473
LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES Accounts
Payable
$ 6,131
$ 5,734
Accrued Compensation
3,917
2,852
Other Liabilities and Accrued Expenses
3,666
3,939
Current Portion of Long-Term Debt
875
5,326
Current Portion of Royalty Obligation
2,000
2,000
Current Liability – Excess Royalty Payment Due
24
177
Deferred Revenue
324
285
Income Taxes Payable
-
655
Total Current Liabilities
16,937
20,968
NON-CURRENT LIABILITIES Long-Term Debt, net of current portion
8,641
7,109
Royalty Obligation, net of current portion
5,261
6,161
Long-Term Debt - PPP Loan
-
4,422
Lease Liability, net of current portion
907
1,065
Other Long-Term Liabilities
557
681
Deferred Tax Liabilities
354
384
TOTAL LIABILITIES
32,657
40,790
SHAREHOLDERS’ EQUITY Common Stock
526
521
Additional Paid-in Capital
59,078
58,049
Retained Earnings
57,697
50,085
Treasury Stock
(33,942)
(33,588)
Accumulated Other Comprehensive Loss, net of tax
(782)
(384)
TOTAL SHAREHOLDERS’ EQUITY
82,577
74,683
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
$ 115,234
$ 115,473
ASTRONOVA, INC. Revenue and Segment Operating Profit
In Thousands (Unaudited) Revenue
Segment Operating Profit (Loss) Revenue Segment
Operating Profit (Loss) Three Months Ended Three Months Ended
Six Months Ended Six Months Ended
July 31, 2021 August 1,
2020
July 31, 2021 August 1, 2020
July 31, 2021
August 1, 2020
July 31, 2021 August 1, 2020 Product
Identification
$ 23,492
$ 21,629
$ 4,406
$ 3,146
$ 46,590
$ 44,009
$ 7,134
$ 6,292
Test & Measurement
6,353
6,029
1,710
(407)
12,333
14,569
2,060
(563)
Total
$ 29,845
$ 27,658
6,116
2,739
$ 58,923
$ 58,578
9,194
5,729
Corporate Expenses
2,664
2,535
5,008
4,861
Operating Income
3,452
204
4,186
868
Other Income (Expense), net
4,266
328
3,897
(23)
Income Before Income Taxes
7,718
532
8,083
845
Income Tax Provision
699
529
471
411
Net Income
$ 7,019
$ 3
$ 7,612
$ 434
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP Gross
Profit Amounts in Thousands (Unaudited)
Three Months Ended Six Months Ended
July 31, 2021 August 1,
2020
July 31, 2021 August 1, 2020 Gross Profit − GAAP
$ 12,716
$ 9,787
$ 23,603
$ 20,643
Employee Retention Credit
$ (1,641)
$ -
$ (1,641)
$ -
Gross Profit − Non-GAAP
$ 11,075
$ 9,787
$ 21,962
$ 20,643
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
Operating Expenses Amounts in Thousands
(Unaudited) Three Months Ended Six Months Ended
July 31, 2021 August 1, 2020
July 31, 2021 August 1,
2020 Operating Expenses − GAAP
$ 9,264
$ 9,583
$ 19,417
$ 19,775
Employee Retention Credit
$ 489
$ -
$ 489
$ -
Operating Expenses − Non-GAAP
$ 9,753
$ 9,583
$ 19,906
$ 19,775
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
Operating Income Amounts in Thousands (Unaudited)
Three Months Ended Six Months Ended
July 31, 2021
August 1, 2020
July 31, 2021 August 1, 2020 Operating Income
− GAAP
$ 3,452
$ 204
$ 4,186
$ 868
Employee Retention Credit
$ (2,130)
$ -
$ (2,130)
$ -
Operating Income − Non-GAAP
$ 1,322
$ 204
$ 2,056
$ 868
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP Net
Income Amounts in Thousands (Unaudited)
Three Months Ended Six Months Ended
July 31, 2021 August 1,
2020
July 31, 2021 August 1, 2020 Net Income − GAAP
$ 7,019
$ 3
$ 7,612
$ 434
Employee Retention Credit
$ (1,615)
$ -
$ (1,615)
$ -
PPP Loan Forgiveness
$ (4,426)
$ -
$ (4,426)
$ -
Net Income − Non-GAAP
$ 978
$ 3
$ 1,571
$ 434
ASTRONOVA, INC. Reconciliation of GAAP to Non-GAAP
Diluted Earnings Per Share (Unaudited) Three
Months Ended Six Months Ended
July 31, 2021 August 1, 2020
July 31, 2021 August 1, 2020 Diluted Earnings Per Share −
GAAP
$ 0.96
$ -
$ 1.04
$ 0.06
Employee Retention Credit
$ (0.22)
$ -
$ (0.22)
$ -
PPP Loan Forgiveness
$ (0.60)
$ -
$ (0.60)
$ -
Diluted Earnings Per Share − Non-GAAP
$ 0.13
$ -
$ 0.22
$ 0.06
ASTRONOVA, INC. Reconciliation of Net Income to EBITDA
and EBITDA Excluding the CARES Act Benefits Amounts in
Thousands (Unaudited) Three Months Ended Six
Months Ended
July 31, 2021 August 1, 2020
July 31,
2021 August 1, 2020 Net Income − GAAP
$ 7,019
$ 3
$ 7,612
$ 434
Interest Expense
171
259
392
490
Income Tax Expense
699
529
471
411
Depreciation/Amortization
849
1,565
2,276
3,133
EBITDA
$ 8,738
$ 2,356
$ 10,751
$ 4,468
Net Income - Employee Retention Credit
(1,615)
----
(1,615)
----
Net Income - PPP Loan Forgiveness
(4,426)
----
(4,426)
----
Income Tax Expense - Employee Retention Credit
(515)
----
(515)
----
Income Tax Expense - PPP Loan Forgiveness
(40)
----
(40)
----
EBITDA Excluding the CARES Act Benefits
$ 2,142
$ 2,356
$ 4,155
$ 4,468
ASTRONOVA, INC. Reconciliation of Net Income to Adjusted
EBITDA and Adjusted EBITDA Excluding the CARES Act Benefits
Amounts in Thousands (Unaudited) Three Months
Ended Six Months Ended
July 31, 2021 August 1, 2020
July
31, 2021 August 1, 2020 Net Income − GAAP
$ 7,019
$ 3
$ 7,612
$ 434
Interest Expense
171
259
392
490
Income Tax Expense
699
529
471
411
Depreciation/Amortization
849
1,565
2,276
3,133
Share-Based Compensation
469
601
947
1,096
Adjusted EBITDA
$ 9,207
$ 2,957
$ 11,698
$ 5,564
Net Income - Employee Retention Credit
(1,615)
----
(1,615)
----
Net Income - PPP Loan Forgiveness
(4,426)
----
(4,426)
----
Income Tax Expense - Employee Retention Credit
(515)
----
(515)
----
Income Tax Expense - PPP Loan Forgiveness
(40)
----
(40)
----
Adjusted EBITDA Excluding the CARES Act Benefits
$ 2,611
$ 2,957
$ 5,102
$ 5,564
ASTRONOVA, INC. Reconciliation of GAAP Segment Operating
Profit to Non-GAAP Segment Operating Profit Amounts in
Thousands (Unaudited) Three
Months Ended Six Months Ended
July 31, 2021 August 1, 2020
July 31, 2021 August 1,
2020
Product Identification Test & Measurement
Total Product Identification Test & Measurement Total
Product Identification Test & Measurement
Total Product Identification Test & Measurement Total
Segment Operating Profit - GAAP
$ 4,406
$ 1,710
$ 6,116
$ 3,146
$ (407)
$ 2,739
$ 7,134
$ 2,060
$ 9,194
$ 6,292
$ (563)
$ 5,729
Employee Retention Credit
$ (1,430)
$ (802)
$ (2,232)
$ -
$ -
$ -
$ (1,430)
$ (802)
$ (2,232)
$ -
$ -
$ -
Segment Operating Profit - Non-GAAP
$ 2,976
$ 908
$ 3,884
$ 3,146
$ (407)
$ 2,739
$ 5,705
$ 1,258
$ 6,963
$ 6,292
$ (563)
$ 5,729
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210914005512/en/
Scott Solomon Senior Vice President Sharon Merrill Associates
(617) 542-5300 ALOT@investorrelations.com
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