Welcome!

News Feed Item

Orbit International Corp. Reports 2014 Second Quarter Results

Company Returns to Profitability, Exclusive of Facility Consolidation Costs

HAUPPAUGE, NY -- (Marketwired) -- 08/07/14 -- Orbit International Corp. (NASDAQ: ORBT) today announced results for the second quarter ended June 30, 2014.

Second Quarter 2014 vs. Second Quarter 2013

  • Net sales were $5,396,000, as compared to $6,475,000.
  • Gross margin was 41.5%, as compared to 38.6%.
  • Net loss was $171,000 ($0.04 loss per share), as compared to net income of $109,000 ($0.02 per diluted share).
  • Net loss for the second quarter of 2014 includes $351,000 of costs associated with the completion of our consolidation of our Quakertown, PA facility into our Hauppauge, NY facility. Exclusive of these costs, net income for the second quarter was $180,000 ($0.04 per diluted share). As of June 30, 2014, substantially all consolidation related costs have been incurred.
  • Earnings before interest, taxes, depreciation and amortization and stock based compensation (EBITDA, as adjusted) was a loss of $62,000 ($0.01 loss per share), as compared to earnings of $244,000 ($0.05 per diluted share).

First Half 2014 vs. First Half 2013

  • Net sales were $10,403,000, as compared to $12,922,000.
  • Gross margin was 35.9%, as compared to 38.6%.
  • Net loss was $1,233,000 ($0.28 loss per share), as compared to net income of $29,000 ($0.01 per diluted share).
  • Net loss for the first half of 2014 includes $1,079,000 of costs associated with the consolidation of our Quakertown, PA facility into our Hauppauge, NY facility. Exclusive of these costs, net loss for the first half of 2014 was $154,000 ($0.04 loss per share).
  • Earnings before interest, taxes, depreciation and amortization and stock based compensation (EBITDA, as adjusted) was a loss of $823,000 ($0.19 loss per share), as compared to earnings of $303,000 ($0.07 per diluted share).

Mitchell Binder, President & Chief Executive Officer, stated, "Our second quarter was a continuation of our efforts to restructure our business to significantly reduce our costs in order to offset difficult industry conditions. For the second quarter, our net income and EBITDA, as adjusted, improved year-over-year, exclusive of the costs associated with the completion of our consolidation of our Quakertown operations into our Hauppauge facility."

Mr. Binder added, "Despite a reduction in sales for the quarter, we recorded gross margin improvement resulting from these cost cutting initiatives and product mix. With the completion of the consolidation of Quakertown into Hauppauge, we should further benefit from the cost savings in the second half of 2014. However, these cost savings will be partially offset by lower revenues due to challenging industry conditions and more specifically, the delay in the award of certain legacy contracts, particularly for our Electronics Group, that will not have delivery schedules until 2015."

Mr. Binder continued, "Our operating performance for the second quarter of 2014 benefitted from the improved performance of our Power Group, which was insufficient to offset the results from our Electronics Group which included the costs associated with the completion of the consolidation of our Quakertown, PA facility into our Hauppauge, NY facility. For each of the third and the fourth quarters of 2014, we expect the results from our Power Group to be comparable to the second quarter but as mentioned earlier, we expect continued weakness from our Electronics Group."

Mr. Binder added, "Our backlog at June 30, 2014 was $8.2 million as compared to $9.6 million at March 31, 2014 due principally to a lower backlog at our Electronics Group. Our June 30, 2014 backlog for our Power Group was comparable to the backlog at March 31, 2014. However, the Company has received some significant contracts during the current third quarter and our bid and proposal pipeline continues to grow, particularly for our legacy business."

David Goldman, Chief Financial Officer, noted, "Our financial condition remains strong. At June 30, 2014, total current assets were approximately $16.7 million versus total current liabilities of approximately $1.8 million for a 9.3 to 1 current ratio. Cash, cash equivalents and marketable securities as of June 30, 2014, aggregated approximately $2.9 million. To offset future federal and state taxes resulting from profits, we have approximately $8 million and $7 million in available federal and state net operating loss carryforwards, respectively, which should enhance future cash flow. We were in compliance with our financial covenants at June 30, 2014."

Mr. Goldman added, "During the quarter, we continued to pay down our debt. In addition, since January 1, 2012, we have repurchased in excess of 368,000 shares of our stock in the marketplace at an average price of $3.55 per share. Our tangible book value at June 30, 2014 was $3.07 as compared to $3.09 at March 31, 2014 and $3.32 per share at December 31, 2013."

Mr. Binder concluded, "We remain encouraged that our new VPX technologies will layer onto our existing business in our marketplace. Our industry-leading VPXtra power supplies, GUI driven health monitors as well as backplanes and related items can be found on our recently launched web portal -- vmevpx.com. However, the timing of awards, particularly in this environment, remains uncertain. We remain very cautious of challenging business conditions and continue to reduce costs wherever possible in order to improve our operating margins."

Orbit International Corp., through its Electronics Group, is involved in the manufacture of customized electronic components and subsystems for military and nonmilitary government applications through its production facility in Hauppauge, New York and designs and manufactures combat systems and gun weapons systems, provides system integration and integrated logistics support and documentation control at its facility in Louisville, Kentucky. The Power Group, through its Behlman Electronics, Inc. subsidiary, manufactures and sells high quality commercial power units, AC power sources, frequency converters, uninterruptible power supplies and inverters. The Behlman COTS division designs, manufactures and sells highly reliable power units for industrial and military applications.

Certain matters discussed in this news release and oral statements made from time to time by representatives of the Company including, statements regarding our expectations of Orbit's operating plans, deliveries under contracts and strategies generally; statements regarding our expectations of the performance of our business; expectations regarding costs and revenues, future operating results, additional orders, future business opportunities and continued growth, may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the Federal securities laws. Although Orbit believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved.

Forward-looking information is subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Many of these factors are beyond Orbit International's ability to control or predict. Important factors that may cause actual results to differ materially and that could impact Orbit International and the statements contained in this news release can be found in Orbit's filings with the Securities and Exchange Commission including quarterly reports on Form 10-Q, current reports on Form 8-K, annual reports on Form 10-K and its other periodic reports. For forward-looking statements in this news release, Orbit claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Orbit assumes no obligation to update or supplement any forward-looking statements whether as a result of new information, future events or otherwise.



                         Orbit International Corp.
                     Consolidated Statements of Income
                   (in thousands, except per share data)
                                (unaudited)

                                  Three Months Ended     Six Months Ended
                                       June 30,              June 30,
                                    2014       2013       2014       2013
                                 ---------  ---------  ---------  ---------

Net sales                        $   5,396  $   6,475  $  10,403  $  12,922

Cost of sales                        3,159      3,978      6,666      7,934
                                 ---------  ---------  ---------  ---------

Gross profit                         2,237      2,497      3,737      4,988

Selling general and
 administrative expenses             2,384      2,355      4,927      4,886

Interest expense                        10         15         29         32

Investment and other (income)
 expense                                 3         (2)        (7)        (5)
                                 ---------  ---------  ---------  ---------

(Loss) income before taxes            (160)       129     (1,212)        75

Income tax provision                    11         20         21         46
                                 ---------  ---------  ---------  ---------

Net (loss) income                $    (171) $     109  $  (1,233) $      29
                                 =========  =========  =========  =========


Basic (loss) earnings per share  $   (0.04) $    0.02  $   (0.28) $    0.01

Diluted (loss) earnings per
 share                           $   (0.04) $    0.02  $   (0.28) $    0.01

Weighted average number of
 shares outstanding:
  Basic                              4,373      4,425      4,376      4,456
  Diluted                            4,373      4,459      4,376      4,491



                          Orbit International Corp.
                      Consolidated Statements of Income
                    (in thousands, except per share data)
                                 (unaudited)

                                    Three Months Ended    Six Months Ended
                                         June 30,             June 30,
                                      2014       2013      2014       2013
                                   ---------  --------- ---------  ---------

EBITDA (as adjusted)
 Reconciliation
Net (loss) income                  $    (171) $     109 $  (1,233) $      29
Interest expense                          10         15        29         32
Tax expense                               11         20        21         46
Depreciation and amortization             62         72       308        140
Stock based compensation                  26         28        52         56
                                   ---------  --------- ---------  ---------
EBITDA (as adjusted) (1)           $     (62) $     244 $    (823) $     303
                                   =========  ========= =========  =========

EBITDA (as adjusted) Per Diluted
 Share Reconciliation
Net (loss) income                  $   (0.04) $    0.02 $   (0.28) $    0.01
Interest expense                        0.00       0.00      0.01       0.01
Tax expense                             0.00       0.00      0.00       0.01
Depreciation and amortization           0.02       0.02      0.07       0.03
Stock based compensation                0.01       0.01      0.01       0.01
                                   ---------  --------- ---------  ---------
EBITDA (as adjusted), per diluted
 share (1)                         $   (0.01) $    0.05 $   (0.19) $    0.07
                                   =========  ========= =========  =========

(1) The EBITDA (as adjusted) tables presented are not determined in accordance with accounting principles generally accepted in the United States of America. Management uses EBITDA (as adjusted) to evaluate the operating performance of its business. It is also used, at times, by some investors, securities analysts and others to evaluate companies and make informed business decisions. EBITDA (as adjusted) is also a useful indicator of the income generated to service debt. EBITDA (as adjusted) is not a complete measure of an entity's profitability because it does not include costs and expenses for interest, depreciation and amortization, income taxes and stock based compensation. EBITDA (as adjusted) as presented herein may not be comparable to similarly named measures reported by other companies.


                                                        Six Months Ended
                                                            June 30,
Reconciliation of EBITDA (as adjusted)
to cash flows provided by operating activities (1)     2014         2013
                                                   ------------ ------------

EBITDA (as adjusted)                                    $ (823)        $ 303
Interest expense                                           (29)         (32)
Income tax expense                                         (21)         (46)
Gain (loss) on sale of marketable securities                (2)            2
Loss on disposal of property and equipment                   11            -
Bond amortization                                           (3)            6
Net change in operating assets and liabilities            1,350        1,226
                                                   ------------ ------------
Cash flows provided by operating activities               $ 483      $ 1,459
                                                   ============ ============



                         Orbit International Corp.
                        Consolidated Balance Sheets

                                               June 30, 2014  December 31,
                                                (unaudited)        2013
                                               -------------  -------------
ASSETS
Current assets:
  Cash and cash equivalents                    $   2,672,000  $   2,562,000
  Investments in marketable securities               252,000        243,000
  Accounts receivable, less allowance for
   doubtful accounts                               2,402,000      2,981,000
  Inventories                                     11,188,000     11,803,000
  Other current assets                               218,000        264,000
                                               -------------  -------------

    Total current assets                          16,732,000     17,853,000

Property and equipment, net                          724,000        975,000
Goodwill                                             868,000        868,000
Other assets                                          40,000         35,000
                                               -------------  -------------

    Total assets                               $  18,364,000  $  19,731,000
                                               =============  =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Note payable-bank                                        -      2,100,000
  Accounts payable                                   523,000        510,000
  Liability associated with non-renewal of
   senior
  officer contract                                    20,000         36,000
  Accrued expenses                                 1,075,000      1,149,000
  Income tax payable                                  13,000         25,000
  Customer advances                                  177,000         17,000
                                               -------------  -------------

    Total current liabilities                      1,808,000      3,837,000

Note payable-bank                                  1,885,000              -
Liability associated with non-renewal of
 senior officer contract, net of current
 portion                                                   -          4,000
Other liabilities                                     48,000              -
                                               -------------  -------------

    Total liabilities                              3,741,000      3,841,000

Stockholders' Equity
  Common stock                                       522,000        523,000
  Additional paid-in capital                      22,877,000     22,824,000
  Treasury stock                                  (2,225,000)    (2,133,000)
  Accumulated other comprehensive gain (loss)          1,000         (5,000)
  Accumulated deficit                             (6,552,000)    (5,319,000)
                                               -------------  -------------

    Stockholders' equity                          14,623,000     15,890,000
                                               -------------  -------------

    Total liabilities and stockholders' equity $  18,364,000  $  19,731,000
                                               =============  =============

CONTACT
Mitchell Binder
President & Chief Executive Officer
631-435-8300

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
When you focus on a journey from up-close, you look at your own technical and cultural history and how you changed it for the benefit of the customer. This was our starting point: too many integration issues, 13 SWP days and very long cycles. It was evident that in this fast-paced industry we could no longer afford this reality. We needed something that would take us beyond reducing the development lifecycles, CI and Agile methodologies. We made a fundamental difference, even changed our culture...
The proper isolation of resources is essential for multi-tenant environments. The traditional approach to isolate resources is, however, rather heavyweight. In his session at 18th Cloud Expo, Igor Drobiazko, co-founder of elastic.io, drew upon his own experience with operating a Docker container-based infrastructure on a large scale and present a lightweight solution for resource isolation using microservices. He also discussed the implementation of microservices in data and application integrat...
All organizations that did not originate this moment have a pre-existing culture as well as legacy technology and processes that can be more or less amenable to DevOps implementation. That organizational culture is influenced by the personalities and management styles of Executive Management, the wider culture in which the organization is situated, and the personalities of key team members at all levels of the organization. This culture and entrenched interests usually throw a wrench in the work...
Containers have changed the mind of IT in DevOps. They enable developers to work with dev, test, stage and production environments identically. Containers provide the right abstraction for microservices and many cloud platforms have integrated them into deployment pipelines. DevOps and containers together help companies achieve their business goals faster and more effectively. In his session at DevOps Summit, Ruslan Synytsky, CEO and Co-founder of Jelastic, reviewed the current landscape of Dev...
In his General Session at DevOps Summit, Asaf Yigal, Co-Founder & VP of Product at Logz.io, will explore the value of Kibana 4 for log analysis and will give a real live, hands-on tutorial on how to set up Kibana 4 and get the most out of Apache log files. He will examine three use cases: IT operations, business intelligence, and security and compliance. This is a hands-on session that will require participants to bring their own laptops, and we will provide the rest.
IoT is at the core or many Digital Transformation initiatives with the goal of re-inventing a company's business model. We all agree that collecting relevant IoT data will result in massive amounts of data needing to be stored. However, with the rapid development of IoT devices and ongoing business model transformation, we are not able to predict the volume and growth of IoT data. And with the lack of IoT history, traditional methods of IT and infrastructure planning based on the past do not app...
"LinearHub provides smart video conferencing, which is the Roundee service, and we archive all the video conferences and we also provide the transcript," stated Sunghyuk Kim, CEO of LinearHub, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
"We're bringing out a new application monitoring system to the DevOps space. It manages large enterprise applications that are distributed throughout a node in many enterprises and we manage them as one collective," explained Kevin Barnes, President of eCube Systems, in this SYS-CON.tv interview at DevOps at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
@DevOpsSummit at Cloud taking place June 6-8, 2017, at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long developm...
In a recent research, analyst firm IDC found that the average cost of a critical application failure is $500,000 to $1 million per hour and the average total cost of unplanned application downtime is $1.25 billion to $2.5 billion per year for Fortune 1000 companies. In addition to the findings on the cost of the downtime, the research also highlighted best practices for development, testing, application support, infrastructure, and operations teams.
Updating DevOps to the latest production data slows down your development cycle. Probably it is due to slow, inefficient conventional storage and associated copy data management practices. In his session at @DevOpsSummit at 20th Cloud Expo, Dhiraj Sehgal, in Product and Solution at Tintri, will talk about DevOps and cloud-focused storage to update hundreds of child VMs (different flavors) with updates from a master VM in minutes, saving hours or even days in each development cycle. He will also...
"There's a growing demand from users for things to be faster. When you think about all the transactions or interactions users will have with your product and everything that is between those transactions and interactions - what drives us at Catchpoint Systems is the idea to measure that and to analyze it," explained Leo Vasiliou, Director of Web Performance Engineering at Catchpoint Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York Ci...
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
@DevOpsSummit taking place June 6-8, 2017 at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. @DevOpsSummit at Cloud Expo New York Call for Papers is now open.