Financial Data and Key Metrics Changes - For the six months ended October 31, 2021, consolidated revenue was 27 million in the same period of the prior fiscal year [8] - The consolidated net loss for the six months ending October 31, 2021, was 0.12 per share, compared to a net income of 0.01 per share in the previous fiscal year [20] - The company recorded an operating loss of 120,000 in the prior year [16] Business Line Data and Key Metrics Changes - Revenue from commercial and US Government satellite programs was approximately 14.2 million or 53% in the same period of the prior fiscal year [9] - Revenues from non-space US Government and DOD customers were 10.9 million in the same period of the prior fiscal year, accounting for approximately 41% of consolidated revenue [10] - Other commercial and industrial revenues increased to 1.8 million in the prior fiscal year [11] Market Data and Key Metrics Changes - The company's fully funded backlog at the end of October 2021 was approximately 2 million from the previous fiscal year ended April 30, 2021 [20] - The balance sheet reflects a strong working capital position of approximately 40 million on October 31, 2021, with a current ratio of approximately 5 to 1 [21] Company Strategy and Development Direction - The company is focusing on advanced technology developments, particularly in atomic clocks and low-noise oscillators, with increased internal R&D investments [6][15] - Management is optimistic about receiving additional contract awards for groundbreaking product developments [7] - The company aims to position itself at the forefront of precision and time generation products for government space and telecom applications [8] Management's Comments on Operating Environment and Future Outlook - Management noted that while revenues were lower due to delays in bookings, they anticipate these will come in, indicating a focus on long-term growth despite short-term challenges [5] - The company is experiencing longer lead times for parts and materials, a challenge faced across the industry [22] - Management expressed optimism about the market opportunities driven by government investments in new technologies, particularly in the context of US-China competition in the satellite space arena [40][42] Other Important Information - The company continues to be debt-free and believes its liquidity is adequate to meet operating and investing needs for the foreseeable future [21] - R&D expenses increased to 2.7 million from 2.2 million, reflecting higher investments in new technology developments [14] Q&A Session Summary Question: What percent of the last two contracts is in the backlog? - Management indicated that collectively, the contracts amount to around 5 million [22] Question: How are the supply chains and any delays? - Management acknowledged longer times to get parts and materials, noting that this is a universal issue affecting customers as well [22][23] Question: What is the status of qualifications for GPS IIIF? - Management stated that the qualification program is nearing completion and should be finished within a month or two [25] Question: Are there plans to hire more employees? - Management confirmed that the total number of employees has remained stable, with some job openings planned to be filled [27] Question: What is a low-noise oscillator used for? - Management explained that low-noise oscillators are critical for communications and radar systems where frequency purity is essential [29] Question: What is the market size for low-noise oscillators? - Management estimated the market size for their type of oscillators to be a couple of hundred million dollars [30] Question: Is R&D investment divided between atomic clocks and low-noise oscillators? - Management indicated that the R&D program is currently more focused on atomic clocks, which present significant market opportunities [34] Question: Will the company see a surge in revenues from past bids? - Management expressed hope for revenue increases as bids are adjudicated and contracts are secured [47]
Frequency Electronics(FEIM) - 2022 Q2 - Earnings Call Transcript