Exhibit
99.1
Company Contact:
BK Technologies, Inc.
William Kelly, EVP & CFO
(321) 984-1414
BK Technologies Reports Third Quarter and Nine Months 2018
Results
-Nine Months Sales Grow 29%; Operating Income Increases $3.0
Million from Prior Year-
WEST
MELBOURNE, Florida – November 7, 2018 – BK
Technologies, Inc. (NYSE American: BKTI) today announced financial
and operating results for the third quarter and nine months ended
September 30, 2018.
For the
third quarter ended September 30, 2018, revenues increased 12.4% to
approximately $13.3 million, compared with approximately $11.8
million for the third quarter of 2017. Operating income for the
third quarter of 2018 increased to approximately $878,000, compared
with $157,000 for the third quarter last year. Net income for the
third quarter of 2018 was approximately $650,000, or $0.05 per
basic and diluted share, compared with $600,000, or $0.04 per basic
and diluted share, for the same quarter in 2017.
The
Company had approximately $23.6 million in working capital as of
September 30, 2018, of which $18.8 million was comprised of cash,
cash equivalents and trade receivables. This compares with working
capital of approximately $26.7 million as of December 31, 2017, of
which $12.7 million was comprised of cash, cash equivalents and
trade receivables. As of September 30, 2018, the Company had no
borrowings outstanding under its revolving credit
facility.
Tim
Vitou, BK’s President, commented, “Consistent with the
first half of the year, our operating results through nine months
continued to show improvement, particularly in sales growth. Sales
through the first nine months have nearly equaled total sales for
the entire year of 2017. Federal agencies were the primary
contributors to sales for the third quarter, supplementing strong
sales from state and local public safety agencies during the first
half of the year. Operationally, gross profit margins continue to
be significantly higher than the prior year. For the year-to-date
we generated over $4 million in cash primarily through solid
operating results and inventory reductions.”
Mr.
Vitou continued, “These results have enabled us to invest
substantially in new product development; funding it internally
from operations, without incurring any debt. This investment is
anticipated to yield our first multiband products by the end of the
year, which we believe will serve as a cornerstone of our growth
strategy moving into 2019 and beyond.”
For the
nine months ended September 30, 2018, sales increased 29.1% to
approximately $38.7 million compared with approximately $30.0
million for the same period last year. Operating income for the
nine-month period of 2018 increased to approximately $3.0 million,
compared with an operating loss of approximately $76,000 for the
same period last year. Net income for the nine months ended
September 30, 2018 totaled approximately $1.2 million, or $0.09 per
basic and diluted share, compared with $650,000, or $0.05 per basic
and diluted share for the same period last year.
The
financial results for the nine months ended September 30, 2018
include a loss on investment in securities totaling approximately
$1.4 million, compared with a gain of approximately $1.3 million
for the nine-month period last year.
Conference Call and Webcast
The
Company will host a conference call and webcast for investors at
9:00 a.m., Eastern Time, on Thursday, November 8, 2018.
Shareholders and other interested parties may participate in the
conference call by dialing 877-407-8031 (international/local
participants dial 201-689-8031) and asking to be connected to the
“BK Technologies, Inc. Conference Call” a few minutes
before 9:00 a.m. Eastern Time, on November 8, 2018. The call will
also be webcast at http://www.bktechnologies.com.
Please allow extra time prior to the call to visit the site and
download any necessary software to listen to the Internet webcast.
An online archive of the webcast will be available on the
Company’s website for 30 days following the call at
http://www.bktechnologies.com.
A
replay of the conference call will be available one hour after the
completion of the call until November 15, 2018 by dialing
877-481-4010 PIN# 38730 (international/local participants dial
919-882-2331 PIN# 38730.
1
About BK Technologies
As an
American manufacturer for over 70 years, BK Technologies is deeply
rooted in the public safety communications industry, manufacturing
high-specification communications equipment of unsurpassed
reliability and value for use by public safety professionals and
government agencies. Advances include a broad new line of leading
digital two-way radios compliant with APCO Project 25
specifications. BK Technologies’ products are manufactured
and distributed worldwide under BK Radio and RELM brand names. The
Company maintains its headquarters in West Melbourne, Florida and
can be contacted through its web site at www.bktechnologies.com or
directly at 1-800-821-2900. The Company’s common stock trades
on the NYSE American market under the symbol
“BKTI”.
Forward-Looking Statements
This press release contains certain forward-looking statements that
are made pursuant to the “Safe Harbor” provisions of
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements concern the Company’s operations,
economic performance and financial condition and are based largely
on the Company’s beliefs and expectations. These statements
involve known and unknown risks, uncertainties and other factors
that may cause the actual results, performance or achievements of
the Company, or industry results, to be materially different from
any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors and risks
include, among others, the following: changes or advances in
technology; the success of our LMR product line; successful
introduction of new products and technologies; competition in the
land mobile radio industry; general economic and business
conditions, including federal, state and local government budget
deficits and spending limitations; the availability, terms and
deployment of capital; reliance on contract manufacturers and
suppliers; heavy reliance on sales to agencies of the U.S.
government; allocations by government agencies among multiple
approved suppliers under existing agreements; our ability to
utilize deferred tax assets; retention of executive officers and
key personnel; our ability to manage our growth; our ability to
identify potential candidates for, and consummate, acquisition or
investment transactions, and risks incumbent to being a minority
stockholder in a corporation; impact of our capital allocation
strategy; government regulation; our business with manufacturers
located in other countries; our inventory and debt levels;
protection of our intellectual property rights; fluctuation in our
operating results; acts of war or terrorism, natural disasters and
other catastrophic events; any infringement claims; data security
breaches, cyber attacks and other factors impacting our technology
systems; availability of adequate insurance coverage; maintenance
of our NYSE American listing; and the effect on our stock price and
ability to raise equity capital of future sales of shares of our
common stock. Certain of these factors and risks, as well as other
risks and uncertainties, are stated in more detail in the
Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2017 and in the Company’s subsequent
filings with the SEC. These forward-looking statements are made as
of the date of this press release, and the Company assumes no
obligation to update the forward-looking statements or to update
the reasons why actual results could differ from those projected in
the forward-looking statements.
# #
#
(Financial Tables To Follow)
2
BK TECHNOLOGIES, INC.
Condensed Consolidated Statements of Income
(In
thousands, except share and per share data) (Unaudited)
|
|
Three Months
Ended
|
Nine Months
Ended
|
||
|
|
September
30,
2018
|
September 30,
2017
|
September
30,
2018
|
September 30,
2017
|
|
|
|
|
|
|
|
Sales,
net
|
$13,302
|
$11,831
|
38,704
|
$29,973
|
|
Expenses
|
|
|
|
|
|
Cost of
products
|
7,839
|
8,014
|
22,519
|
19,425
|
|
Selling, general
and administrative
|
4,585
|
3,660
|
13,229
|
10,624
|
|
Total
expenses
|
12,424
|
11,674
|
35,748
|
30,049
|
|
|
|
|
|
|
|
Operating income
(loss)
|
878
|
157
|
2,956
|
(76)
|
|
|
|
|
|
|
|
Other (expense)
income:
|
|
|
|
|
|
Interest
income
|
28
|
14
|
63
|
32
|
|
(Loss) gain on
investment in securities
|
(191)
|
670
|
(1,392)
|
1,287
|
|
Gain (loss)
on disposal of property, plant and equipment
|
—
|
10
|
—
|
(94)
|
|
Other
(expense) income
|
(48)
|
1
|
(274)
|
(146)
|
|
Total other
(expense) income
|
(211)
|
695
|
(1,603)
|
1,079
|
|
|
|
|
|
|
|
Income before
income taxes
|
667
|
852
|
1,353
|
1,003
|
|
|
|
|
|
|
|
Income tax
expense
|
(17)
|
(252)
|
(200)
|
(353)
|
|
|
|
|
|
|
|
Net
income
|
$650
|
$600
|
1,153
|
$650
|
|
|
|
|
|
|
|
Net earnings per
share-basic
|
$0.05
|
$0.04
|
0.09
|
$0.05
|
|
Net earnings per
share-diluted
|
$0.05
|
$0.04
|
0.09
|
$0.05
|
|
13,479,759
|
13,665,976
|
13,538,116
|
13,602,207
|
|
|
Weighted average
shares outstanding-diluted
|
13,501,587
|
13,688,297
|
13,563,990
|
13,704,884
|
3
BK TECHNOLOGIES, INC.
Condensed Consolidated Balance Sheets
(In
thousands, except share data)
|
|
September
30,
2018
|
December
31,
2017
|
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$11,349
|
$7,147
|
|
Available-for-sale
securities
|
—
|
9,184
|
|
Trade accounts
receivable, net
|
7,407
|
5,524
|
|
Inventories,
net
|
10,688
|
14,358
|
|
Prepaid expenses
and other current assets
|
1,641
|
772
|
|
Total current
assets
|
31,085
|
36,985
|
|
|
|
|
|
Property, plant and
equipment, net
|
2,619
|
2,201
|
|
Investment in
securities
|
3,198
|
—
|
|
Deferred tax
assets, net
|
3,122
|
3,317
|
|
Other
assets
|
215
|
298
|
|
Total
assets
|
$40,239
|
$42,801
|
|
|
||
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$3,496
|
$5,971
|
|
Accrued
compensation and related taxes
|
1,652
|
1,364
|
|
Accrued warranty
expense
|
1,434
|
1,389
|
|
Accrued other
expenses and other current liabilities
|
414
|
1,159
|
|
Dividends
payable
|
268
|
273
|
|
Deferred
revenue
|
179
|
157
|
|
Total current
liabilities
|
7,443
|
10,313
|
|
|
|
|
|
Deferred
revenue
|
1,422
|
481
|
|
Total
liabilities
|
$8,865
|
$10,794
|
|
Commitments and
contingencies
|
|
|
|
Stockholders’
equity:
|
|
|
|
Preferred stock;
$1.00 par value; 1,000,000 authorized shares; none issued or
outstanding
|
—
|
—
|
|
Common stock; $.60
par value; 20,000,000 authorized shares; 13,882,937 and 13,844,584
issued and 13,389,519 and 13,652,490 outstanding shares at
September 30, 2018 and December 31, 2017, respectively
|
8,330
|
8,307
|
|
Additional paid-in
capital
|
25,796
|
25,642
|
|
Accumulated
deficit
|
(789)
|
(5,450)
|
|
Accumulated other
comprehensive income
|
—
|
4,318
|
|
Treasury stock, at
cost, 493,418 and 192,094 shares at September 30, 2018 and December
31, 2017, respectively
|
(1,963)
|
(810)
|
|
Total
stockholders’ equity
|
31,374
|
32,007
|
|
Total liabilities
and stockholders’ equity
|
$40,239
|
$42,801
|
4