Wireless Telecom Group Inc. will host a conference call on August 11, 2021, at 8:30 a.m. EDT
https://www.webcaster4.com/Webcast/Page/1690/42411
Highlights for the quarter ended June 30, 2021:
- Net revenues of $12.0 million, an increase of 8.2% from the same period last year, and up 6.2% from the 2021 first quarter
- Gross profit of $6.1 million, gross profit margin of 51.0%, representing the fifth straight quarter of consolidated gross profit margin greater than 50%
- Operating income of $165,000, compared to an operating loss of $59,000 in the same period last year
- Net income of $1.5 million which includes gain on extinguishment of PPP loan of $2.0 million, compared to a net loss of $668,000 in the same period last year
- Non-GAAP adjusted EBITDA of $864,000, compared to a non-GAAP adjusted EBITDA of $794,000 in the same period last year
- New customer orders of $14.5 million, a book-to-bill ratio of 1.21
- Backlog of $12.5 million, an increase of $6.3 million compared to June 30, 2020, the highest backlog in over 4 years
August 11, 2021
Parsippany, New Jersey – Wireless Telecom Group, Inc. (NYSE American: WTT) (the “Company”) today announced results for the three months ended June 30, 2021.
Tim Whelan, CEO of Wireless Telecom Group, Inc. stated, “Strong second quarter operating and financial performance is encouraging, which reflects the benefits of our long-term strategic plan and improving end-market demand. We ended the second quarter with record quarterly new bookings, as we experience strong orders across all our product groups. This was our fifth straight positive book-to-bill outcome and helped drive an increase in our second quarter backlog to $12.5 million, which is the highest quarterly backlog in the last several years.”
Mr. Whelan continued, “During the quarter, we continued our streak of new 5G software customers, with two new customers for our Radio, Baseband and Software solutions. In fact, over the past 5 quarters, we have added 10 new customers demonstrating increasing demand for our leading LTE/5G software and service solutions. We also realized our highest quarter of bookings in Test & Measurement with strength across all our brands. Within RF components, we realized a second quarter of higher sequential bookings and a return to over $5.0 million of quarterly bookings for our Microlab products, driven, in part, by larger project order flow. In addition, we are pleased with the forgiveness of our PPP loan, and we feel more confident about the health of the business and our ability to achieve our strategic goals of double-digit organic sales growth, gross margins above 50% and improving operating margins in 2021.”
Second Quarter 2021 Operating Results:
- Net revenues of $12.0 million, an increase of $915,000, or 8.2% over the prior year period primarily due to increased sales of our digital signal processing cards at our Radio, Baseband and Software (“RBS”) product group, and higher Test & Measurement (“T&M”) revenues, partially offset by lower revenue at our RF Components (“RFC”) product group.
- Gross profit of $6.1 million, an increase of $466,000, or 8.2% over the prior year period due to higher revenues at T&M and RBS, partially offset by lower revenues at RFC. Gross profit margin was stable with the prior year at 51.0%.
- Backlog of $12.5 million, an increase of $2.5 million, or 25%, compared to March 31, 2021, and an increase of $6.3 million, or 100% year-over-year.
- As a percent of revenue, total operating expenses were 49.6%, compared to 51.6% for the same period last year. Operating expenses of $6.0 million, an increase of $242,000, or 4.2% from the prior year period primarily due to an increase in headcount related expenses.
- GAAP net income of $1.5 million compared to a net loss of $668,000 in the prior year period due primarily to the recognition of a gain on extinguishment of debt related to the forgiveness of the PPP loan in the current year as well as improved operating income.
- Non-GAAP adjusted EBITDA of $864,000 compared to $794,000 in the prior year due primarily to higher revenues and gross profit. Non-GAAP adjusted EBITDA is a metric the Company uses to measure our core operations. A reconciliation of non-GAAP adjusted EBITDA to GAAP net income is provided later in this press release.
Cash Flow and Balance Sheet:
- Cash provided by operations of $394,000 compared to cash used by operations of $616,000 in the prior year period, due primarily to an increase in operating income as compared to the prior year.
- Net debt of $3.6 million as of June 30, 2021 compared to $5.4 million as of December 31, 2020.
- No outstanding borrowings under the asset-based revolver and availability of $7.6 million after giving effect to borrowing base calculations as of June 30, 2021.
Conference Call
Wireless Telecom Group Inc. will host a conference call on August 11, 2021, at 8:30 a.m. EDT in which management will discuss second quarter 2021 results and related matters. To participate in the conference call, dial 800-346-7359 or 973-528-0008. The conference identification number is 248319. The call will also be webcast over the internet at the following URL:
https://www.webcaster4.com/Webcast/Page/1690/42411
A replay will be made available on the Wireless Telecom website following the conference call.
Wireless Telecom GroupINC.
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS)
(UNAUDITED)
(In thousands, except per share amounts)
| |
For the Three Months Ended
|
|
For the Six Months Ended
|
| |
June 30
|
|
June 30
|
|
|
|
|
|
|
| |
2021
|
2020
|
|
2021
|
2020
|
|
Net revenues
|
$ 12,023
|
$ 11,108
|
|
$ 23,344
|
$ 20,536
|
| |
|
|
|
|
|
|
Cost of revenues
|
5,889
|
5,440
|
|
11,265
|
10,441
|
| |
|
|
|
|
|
|
Gross profit
|
6,134
|
5,668
|
|
12,079
|
10,095
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
|
|
Research and development
|
1,464
|
1,675
|
|
2,846
|
3,254
|
|
Sales and marketing
|
1,699
|
1,661
|
|
3,412
|
3,379
|
|
General and administrative
|
2,806
|
2,391
|
|
5,668
|
4,878
|
|
Total operating expenses
|
5,969
|
5,727
|
|
11,926
|
11,511
|
|
|
|
|
|
|
|
|
Operating income/(loss)
|
165
|
(59)
|
|
153
|
(1,416)
|
| |
|
|
|
|
|
|
Extinguishment of PPP loan
|
2,045
|
-
|
|
2,045
|
-
|
|
Other income/(expense)
|
(15)
|
56
|
|
8
|
295
|
|
Interest expense
|
(285)
|
(246)
|
|
(582)
|
(471)
|
| |
|
|
|
|
|
|
Income/(Loss) before taxes
|
1,910
|
(249)
|
|
1,624
|
(1,592)
|
| |
|
|
|
|
|
|
Tax provision/(benefit)
|
373
|
419
|
|
321
|
225
|
| |
|
|
|
|
|
|
Net income/(loss)
|
$ 1,537
|
$ (668)
|
|
$ 1,303
|
$ (1,817)
|
|
|
|
|
|
|
|
|
Other comprehensive income/(loss):
|
|
|
|
|
|
|
Foreign currency translation adjustments
|
12
|
(35)
|
|
87
|
(971)
|
|
Comprehensive income/(loss)
|
$ 1,549
|
$ (703)
|
|
$ 1,390
|
$ (2,788)
|
| |
|
|
|
|
|
| |
|
|
|
|
|
|
Income/(Loss) per share:
|
|
|
|
|
|
|
Basic
|
$ 0.07
|
$ (0.03)
|
|
$ 0.06
|
$ (0.08)
|
|
Diluted
|
$ 0.06
|
$ (0.03)
|
|
$ 0.05
|
$ (0.08)
|
| |
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
Basic
|
21,763
|
21,707
|
|
21,728
|
21,626
|
|
Diluted
|
24,343
|
21,707
|
|
24,063
|
21,626
|
CONSOLIDATED BALANCE SHEET
(In thousands, except number of shares and par value)
|
|
(Unaudited)
|
|
|
|
June 30
2021
|
December 31
2020
|
|
CURRENT ASSETS
|
|
|
|
Cash & cash equivalents
|
$ 4,213
|
$ 4,910
|
|
Accounts receivable - net of reserves of $214 and $143, respectively
|
6,532
|
5,520
|
|
Inventories - net of reserves of $1,216 and $1,129 respectively
|
9,365
|
8,796
|
|
Prepaid expenses and other current assets
|
2,152
|
2,172
|
|
TOTAL CURRENT ASSETS
|
22,262
|
21,398
|
|
|
|
|
|
PROPERTY PLANT AND EQUIPMENT - NET
|
1,731
|
1,824
|
|
|
|
|
|
OTHER ASSETS
|
|
|
|
Goodwill
|
11,564
|
11,512
|
|
Acquired intangible assets, net
|
4,602
|
5,242
|
|
Deferred income taxes
|
5,455
|
5,701
|
|
Right of use assets
|
1,417
|
1,680
|
|
Other assets
|
509
|
561
|
|
TOTAL OTHER ASSETS
|
23,547
|
24,696
|
|
|
|
|
|
TOTAL ASSETS
|
$ 47,540
|
$ 47,918
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
Short term debt
|
$ 84
|
$ 512
|
|
Accounts payable
|
2,094
|
1,546
|
|
Short term leases
|
559
|
534
|
|
Accrued expenses and other current liabilities
|
6,705
|
7,997
|
|
Deferred revenue
|
598
|
924
|
|
TOTAL CURRENT LIABILITIES
|
10,040
|
11,513
|
|
|
|
|
|
LONG TERM LIABILITIES
|
|
|
|
Long term debt
|
6,925
|
8,895
|
|
Long term leases
|
914
|
1,200
|
|
Other long-term liabilities
|
1,778
|
82
|
|
Deferred tax liability
|
455
|
377
|
|
TOTAL LONG-TERM LIABILITIES
|
10,072
|
10,554
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
Preferred stock, $.01 par value, 2,000,000 shares authorized, none issued
|
-
|
-
|
|
Common stock, $.01 par value, 75,000,000 shares authorized
35,112,421 and 34,888,904 shares issued, 21,883,235 and 21,669,361 shares outstanding
|
351
|
349
|
|
Additional paid in capital
|
50,364
|
50,163
|
|
Retained earnings
|
358
|
(946)
|
|
Treasury stock at cost, 13,229,186 and 13,219,543 shares
|
(24,573)
|
(24,556)
|
|
Accumulated other comprehensive income
|
928
|
841
|
|
TOTAL SHAREHOLDERS' EQUITY
|
27,428
|
25,851
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$ 47,540
|
$ 47,918
|
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
(In thousands)
|
|
For the Six Months
|
|
|
Ended June 30
|
|
|
2021
|
2020
|
|
CASH FLOWS PROVIDED/(USED) BY OPERATING ACTIVITIES
|
|
|
|
Net Income/(Loss)
|
$ 1,303
|
$ (1,817)
|
|
Adjustments to reconcile net loss to net cash used by operating activities:
|
|
|
|
Depreciation and amortization
|
1,065
|
1,049
|
|
Extinguishment of PPP loan
|
(2,045)
|
-
|
|
Amortization of debt issuance fees
|
150
|
137
|
|
Share-based compensation expense
|
203
|
210
|
|
Deferred rent
|
(15)
|
(14)
|
|
Deferred income taxes
|
320
|
695
|
|
Provision for doubtful accounts
|
71
|
2
|
|
Inventory reserves
|
85
|
90
|
|
Changes in assets and liabilities, net of acquisition:
|
|
|
|
Accounts receivable
|
(1,079)
|
(1,351)
|
|
Inventories
|
(645)
|
(260)
|
|
Prepaid expenses and other assets
|
319
|
(110)
|
|
Accounts payable
|
585
|
16
|
|
Accrued expenses and other liabilities
|
77
|
737
|
|
Net cash provided/(used) by operating activities
|
394
|
(616)
|
|
|
|
|
|
CASH FLOWS PROVIDED/(USED) BY INVESTING ACTIVITIES
|
|
|
|
Capital expenditures
|
(313)
|
(100)
|
|
Acquisition of business, net of cash acquired
|
(200)
|
(7,189)
|
|
Net cash provided/(used) by investing activities
|
(513)
|
(7,289)
|
|
|
|
|
|
CASH FLOWS PROVIDED/(USED) BY FINANCING ACTIVITIES
|
|
|
|
Revolver borrowings
|
-
|
16,856
|
|
Revolver repayments
|
-
|
(18,840)
|
|
Term loan borrowings
|
-
|
8,400
|
|
Term loan repayments
|
(470)
|
(384)
|
|
Debt issuance fees
|
-
|
(1,261)
|
|
PPP loan
|
|
2,045
|
|
Payment of contingent consideration
|
(105)
|
-
|
|
Shares withheld for employee taxes
|
(17)
|
(26)
|
|
Net cash provided/(used) by financing activities
|
(592)
|
6,790
|
|
|
|
|
|
Effect of Exchange Rate Changes on Cash and Cash Equivalents
|
14
|
(236)
|
|
NET DECREASE IN CASH AND CASH EQUIVALENTS
|
(697)
|
(1,351)
|
|
|
|
|
|
Cash and Cash Equivalents, at Beginning of Period
|
4,910
|
4,245
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, AT END OF PERIOD
|
$ 4,213
|
$ 2,894
|
|
|
|
|
|
SUPPLEMENTAL INFORMATION:
|
|
|
|
Cash paid during the period for interest
|
$ 204
|
$ 347
|
|
Cash paid during the period for income taxes
|
$ 110
|
$ 40
|
NET REVENUE AND GROSS PROFIT BY PRODUCT GROUP
(In thousands, unaudited)
|
|
Three months ended June 30,
|
|
|
Revenue
|
% of Revenue
|
Change
|
|
|
2021
|
2020
|
2021
|
2020
|
Amount
|
Pct.
|
|
RF components
|
$ 4,235
|
$ 5,861
|
35.2%
|
52.7%
|
$ (1,626)
|
-27.7%
|
|
Test and measurement
|
5,521
|
4,472
|
45.9%
|
40.3%
|
1,049
|
23.5%
|
|
Radio, baseband, software
|
2,267
|
775
|
18.9%
|
7.0%
|
1,492
|
192.5%
|
|
Total net revenues
|
$ 12,023
|
$ 11,108
|
100.0%
|
100.0%
|
$ 915
|
8.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30,
|
|
|
Gross Profit
|
Gross Profit %
|
Change
|
|
|
2021
|
2020
|
2021
|
2020
|
Amount
|
Pct.
|
|
RF components
|
$ 1,757
|
$ 2,707
|
41.5%
|
46.2%
|
$ (950)
|
-35.1%
|
|
Test and measurement
|
3,269
|
2,365
|
59.2%
|
52.9%
|
904
|
38.2%
|
|
Radio, baseband, software
|
1,108
|
596
|
48.9%
|
76.9%
|
512
|
85.9%
|
|
Total gross profit
|
$ 6,134
|
$ 5,668
|
51.0%
|
51.0%
|
$ 466
|
8.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30,
|
|
|
Revenue
|
% of Revenue
|
Change
|
|
|
2021
|
2020
|
2021
|
2020
|
Amount
|
Pct.
|
|
RF components
|
$ 7,372
|
$ 10,137
|
31.6%
|
49.4%
|
$ (2,765)
|
-27.3%
|
|
Test and measurement
|
10,848
|
8,216
|
46.5%
|
40.0%
|
2,632
|
32.0%
|
|
Radio, baseband, software
|
5,124
|
2,183
|
21.9%
|
10.6%
|
2,941
|
134.7%
|
|
Total net revenues
|
$ 23,344
|
$ 20,536
|
100.0%
|
100.0%
|
$ 2,808
|
13.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended June 30,
|
|
|
Gross Profit
|
Gross Profit %
|
Change
|
|
|
2021
|
2020
|
2021
|
2020
|
Amount
|
Pct.
|
|
RF components
|
$ 2,848
|
$ 4,649
|
38.6%
|
45.9%
|
$ (1,801)
|
-38.7%
|
|
Test and measurement
|
6,323
|
4,269
|
58.3%
|
52.0%
|
2,054
|
48.1%
|
|
Radio, baseband, software
|
2,908
|
1,177
|
56.8%
|
53.9%
|
1,731
|
147.1%
|
|
Total gross profit
|
$ 12,079
|
$ 10,095
|
51.7%
|
49.2%
|
$ 1,984
|
19.7%
|
RECONCILIATION OF NET INCOME TO NON-GAAP EBITDA AND NON-GAAP ADJUSTED EBITDA
(In thousands, unaudited)
| |
Three Months Ended
|
|
Six Months Ended
|
| |
June 30
|
|
June 30
|
| |
2021
|
2020
|
|
2021
|
2020
|
|
GAAP Net Income/(Loss), as reported
|
$ 1,537
|
$ (668)
|
|
$ 1,303
|
$ (1,817)
|
|
Tax Provision/(Benefit)
|
373
|
418
|
|
321
|
225
|
|
Depreciation and Amortization Expense
|
534
|
525
|
|
1,065
|
1,049
|
|
Interest Expense
|
285
|
246
|
|
582
|
471
|
|
Non-GAAP EBITDA
|
2,729
|
521
|
|
3,271
|
(72)
|
|
Stock Compensation
|
89
|
128
|
|
203
|
210
|
|
Merger and Acquisition/Integration
|
72
|
37
|
|
72
|
228
|
|
Restructuring Costs
|
-
|
-
|
|
36
|
73
|
|
Inventory Impairment Recovery
|
-
|
(12)
|
|
-
|
(13)
|
|
US GAAP Purchase Accounting
|
-
|
114
|
|
-
|
290
|
|
FX (Gain)/Loss
|
19
|
4
|
|
(6)
|
(235)
|
|
PPP Loan Forgiveness
|
(2,045)
|
-
|
|
(2,045)
|
-
|
|
Non-Recurring Arbitration Legal Costs
|
-
|
2
|
|
4
|
3
|
|
Non-GAAP Adjusted EBITDA
|
$ 864
|
$ 794
|
|
$ 1,535
|
$ 484
|
RECONCILIATION OF OPEX TO NON-GAAP OPEX
(In thousands, unaudited)
| |
Three Months Ended
|
|
Six Months Ended
|
| |
June 30
|
|
June 30
|
| |
2021
|
2020
|
|
2021
|
2020
|
|
GAAP Opex
|
$ 5,969
|
$ 5,727
|
|
$ 11,926
|
$ 11,511
|
|
Stock Compensation
|
(89)
|
(128)
|
|
(203)
|
(210)
|
|
Merger and Acquisition/Integration
|
(72)
|
(37)
|
|
(72)
|
(228)
|
|
Restructuring Costs
|
-
|
-
|
|
(36)
|
(73)
|
|
US GAAP Purchase Accounting
|
-
|
-
|
|
-
|
(100)
|
|
Depreciation & Amortization (ex. COGS)
|
(452)
|
(432)
|
|
(899)
|
(877)
|
|
Non-Recurring Arbitration Legal Costs
|
-
|
(2)
|
|
(4)
|
(3)
|
|
Non-GAAP Opex
|
$ 5,356
|
$ 5,128
|
|
$ 10,712
|
$ 10,020
|