DI Third Quarter 2024 Earnings Results Thursday, November 14th, 2024 NYSE American: BKTI | --- ...

Revenue Performance - Revenue for Q3 2024 was $20.2 million, consistent with Q3 2023 revenue[3] - Revenue for the first nine months of 2024 was $58.7 million, compared to $57.8 million in the same period of 2023[12] - For the three months ended September 30, 2024, net sales increased to $20,179,000 compared to $20,069,000 for the same period in 2023, representing a growth of 0.55%[23] Profitability Metrics - Gross margin improved to 38.8% from 31.9% in Q3 2023 and 37.3% in Q2 2024[3] - GAAP earnings per share (EPS) were $0.67 basic and $0.63 diluted, compared to $0.03 EPS in Q3 2023[10] - Non-GAAP adjusted EPS increased to $0.75 basic and $0.71 diluted from $0.33 in Q3 2023[10] - Operating income for Q3 2024 was $2.6 million, compared to $594,000 in Q3 2023[9] - Non-GAAP adjusted EBITDA for Q3 2024 was $3.1 million, up from $662,000 in Q3 2023[11] - Net income for the three months ended September 30, 2024, was $2,357,000, compared to a net income of $90,000 for the same period in 2023, reflecting a substantial increase of 2,519%[23] - The company reported a net income per share (diluted) of $0.63 for the three months ended September 30, 2024, compared to $0.03 for the same period in 2023, a significant increase of 2,000%[23] Guidance and Future Outlook - Full year 2024 GAAP EPS guidance raised to exceed $1.65 from $1.50, and non-GAAP EPS target increased to $1.92 from $1.77[3] Order and Backlog Information - Order backlog reached $27.0 million, up from $21.8 million in Q3 2023 and $26.9 million in Q2 2024[3] Asset and Liability Management - Total current assets decreased to $34,916,000 as of September 30, 2024, down from $37,202,000 at the end of 2023, a decline of 8.66%[24] - Total liabilities decreased to $20,417,000 as of September 30, 2024, compared to $28,097,000 at the end of 2023, a reduction of 27.49%[25] - The accumulated deficit improved to $(19,507,000) as of September 30, 2024, from $(24,209,000) at the end of 2023, reflecting a reduction of 19.67%[25] Shareholder Information - The weighted average common shares outstanding, basic, increased to 3,539,841 for the three months ended September 30, 2024, compared to 3,411,813 for the same period in 2023, an increase of 3.77%[26] Investment in Development - The company has capitalized product development costs of $751,000 as of September 30, 2024, indicating ongoing investment in new product development[24]

Financial Performance - For the three months ended September 30, 2024, sales increased approximately 0.5% to approximately $20.2 million, compared to $20.1 million for the prior year period, primarily due to shipments of BKR 5000 radio product sales [84]. - Gross profit margins for the same period were 38.8%, up from 31.9% in the prior year, reflecting improvements in product sales mix and material costs [84]. - Operating income for the three months ended September 30, 2024, was approximately $2.6 million, compared to $0.1 million for the same period last year [84]. - Net income for the three months ended September 30, 2024, totaled approximately $2.4 million ($0.67 per basic and $0.63 per diluted share), compared to $0.1 million ($0.03 per basic and diluted share) for the same period last year [86]. - For Q3 2024, sales increased by 0.5% to approximately $20.2 million, compared to $20.1 million in Q3 2023 [97]. - Gross profit margin for Q3 2024 was approximately 38.8%, up from 31.9% in the same quarter last year [100]. - Operating income for Q3 2024 was approximately $2.6 million (12.9% of sales), compared to operating income of approximately $0.6 million (3.0% of sales) in Q3 2023 [106]. - Net income for Q3 2024 was approximately $2.4 million ($0.67 per basic share), compared to net income of approximately $0.1 million ($0.03 per basic share) in Q3 2023 [93]. - For the nine months ended September 30, 2024, sales totaled approximately $58.7 million, a 1.5% increase from $57.8 million in the same period last year [97]. - The gross profit margin for the nine months ended September 30, 2024, was approximately 36.9%, compared to 28.6% for the same period last year [100]. - The company reported a net income of approximately $4.7 million for the first nine months of 2024, compared to a net loss of approximately $2.5 million for the same period last year [116]. Customer Demand and Orders - Customer demand and new orders for products reached $21.8 million during the three months ended September 30, 2024, compared to $19.6 million for the same period of the prior year [90]. - The backlog of unshipped customer orders was approximately $27.0 million as of September 30, 2024, compared to $16.0 million as of December 31, 2023 [83]. Working Capital and Cash Flow - Working capital as of September 30, 2024, totaled approximately $22.7 million, an increase from $16.8 million at the end of 2023 [87]. - For the nine months ended September 30, 2024, net cash provided by operating activities was approximately $8.2 million, up from $3.9 million for the same period last year [115]. - Cash used in investing activities totaled approximately $0.9 million for the nine months ended September 30, 2024, down from $1.8 million for the same period last year, primarily for the development of the BKR mobile radio product [117]. - Approximately $6.6 million was used in financing activities for the nine months ended September 30, 2024, compared to cash provided by financing activities of approximately $0.1 million for the same period last year [118]. - The cash and cash equivalents balance on September 30, 2024, was approximately $4.2 million, which is expected to meet working capital requirements for the foreseeable future [119]. Expenses and Cost Management - SG&A expenses for Q3 2024 totaled approximately $5.2 million, a decrease of 10.1% from approximately $5.8 million in Q3 2023 [103]. - Engineering and product development expenses for Q3 2024 were approximately $1.9 million (9.2% of sales), down from $2.5 million (12.5% of sales) in Q3 2023 [104]. - The company recognized other expenses, net totaling less than seven thousand dollars for the three months ended September 30, 2024, compared to $0.5 million for the same period last year [85]. Development and Innovation - The SaaS business unit focuses on delivering innovative public safety smartphone applications, with one U.S. patent in force and two pending [81]. - The company began development of the BKR series LMR multi-band mobile radio product in the first quarter of 2024, with development costs to be amortized over periods not exceeding ten years [121]. Accounting and Controls - There were no changes to critical accounting policies during the three months ended September 30, 2024 [122]. - The company evaluated the effectiveness of its disclosure controls and procedures, concluding they were effective as of the end of the reporting period [124]. - No changes in internal control over financial reporting materially affected the company during the three months ended September 30, 2024 [125]. Investment Performance - The company recognized a net realized loss of approximately $0.1 million on its investment in FG Holdings, LLC for the nine months ended September 30, 2024 [92]. - Accounts receivable increased by approximately $1.6 million during the nine months ended September 30, 2024, while inventories decreased by approximately $5.3 million [116]. Industry Context - The company operates in a highly competitive industry, with a strong reliance on U.S. Government contracts [73].

Company Overview - BK Technologies Corporation (BKTI) specializes in public safety-grade communications products and services, including two-way land mobile radios for government and industrial markets such as emergency response, public safety, homeland security, and military agencies [2] - The company operates through its wholly-owned subsidiary, BK Technologies, Inc, and is headquartered in West Melbourne, FL [2] Financial Performance - In Q2 2024, BK Technologies reported GAAP earnings per share of $0.47, driven by strategic cost reductions and a solid gross margin of 37.3% [3] - The company maintains a strong financial position with $2.9 million in cash, no long-term debt, and $20.3 million in working capital as of Jun 30, 2024 [4] Growth Drivers - BK Technologies is experiencing rising demand for its BKR 9000 and BKR 5000 radios, supported by a $27 million order backlog as of Jun 30, 2024 [5] - The company has shifted to outsourced manufacturing through a partnership with East West Manufacturing, resulting in lower production costs and improved margins [5] - BK Technologies recently received a patent for its InteropONE solution, which enhances communication interoperability among public safety agencies [5] Market Position - BK Technologies' stock has significantly outperformed its industry peers and the broader market over the past year [7] - The company currently trades at low valuation multiples relative to industry standards, presenting a compelling entry point for investors [7] Industry Context - BK Technologies operates in the highly competitive land mobile radio industry, where technological advancements are critical [6] - The company faces risks related to reliance on government contracts, supply-chain vulnerabilities, and limited product diversification [6]

Financial Data and Key Metrics Changes - The company reported GAAP net income of $1.7 million or $0.47 per share for Q2 2024, compared to a net loss of $1.3 million or $0.39 per share in Q2 2023 [4][7][13] - Revenue for Q2 2024 totaled approximately $20.3 million, an increase from $19 million in the same quarter last year, and a sequential increase of approximately 11% [12][13] - Gross profit margin improved to 37.3%, surpassing the target margin of 35% for 2024, with expectations for continued improvement [6][13] Business Line Data and Key Metrics Changes - The BKR5000 and BKR9000 radios drove record new order bookings in Q2, with significant orders from agencies like CalFire totaling $15 million [6][8][9] - The BKR9000 is gaining traction, particularly among wildland fire customers, with many integrating its multiband capabilities into their operations [5][10] Market Data and Key Metrics Changes - The demand for reliable communications technology is increasing due to rising wildland fire activity, with fires quadrupling in frequency over the last 30 years [10] - The company received orders from various agencies, indicating growing market interest in the BKR Series radios [8][9] Company Strategy and Development Direction - The transition to East West manufacturing is progressing well, with the majority of BKR5000 radios shipped in Q2 manufactured by East West [11] - The company aims to achieve gross margins of 50% by 2025, supported by ongoing cost reduction initiatives and a diversified product mix [7][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year 2024 GAAP EPS exceeding $1.50 and non-GAAP adjusted EPS exceeding $1.77 [7][14] - The company is focused on enhancing profitability through cost reductions and improved gross margins, with a positive outlook for continued performance improvement [16][17] Other Important Information - The company has approximately $3 million in cash and cash equivalents and no long-term debt as of June 30, 2024, with working capital improved to approximately $20.3 million [15] Q&A Session Summary Question: Inquiry about software for first responders - Management confirmed that InteropONE provides interoperability solutions for different agencies, enhancing communication during critical events [19][20] Question: Future cash allocation and stock buyback considerations - Management indicated that there is a discussion at the Board level regarding reactivating a stock buyback program due to the recent decline in share price [23][25] Question: Clarification on gross margin targets - Management reiterated the goal of achieving 50% gross margins by 2025, emphasizing that this target remains achievable [27][28] Question: Bookings number for the quarter - The company reported second-quarter bookings of $28.2 million, with a total of $50.5 million in new orders for the first half of the year [30]

Core Viewpoint - BK Technologies Corporation reported significant improvements in both earnings and revenues for the second quarter of 2024, indicating a positive trend in financial performance and market demand for its products [1][2][10]. Financial Performance - Adjusted earnings per share (EPS) reached 55 cents, a turnaround from a loss of 25 cents in the same period last year [1] - GAAP EPS was 47 cents compared to a loss of 39 cents in the prior year [1] - Net income for the quarter was $1.7 million, recovering from a net loss of $1.3 million a year ago [7] - Operating income totaled $2 million, contrasting with an operating loss of $0.8 million in the previous year [7] - Adjusted EBITDA was a profit of $2.5 million, compared to a loss of $0.8 million in the same quarter last year [7] Revenue Details - Revenues amounted to $20.3 million, reflecting a year-over-year increase of 6.6% [2] - The revenue growth was primarily driven by shipments of BKR 9000 radio products and increased sales of radio accessories [2] Order Backlog - The order backlog stood at $26.9 million as of June 30, 2024, up from $24 million a year earlier, indicating growing market demand [3] - A significant purchase order from CalFire exceeded $15 million for various radio products, highlighting strong customer interest [3] Gross Margin and Operating Expenses - Gross profit margin improved to 37.3%, up from 27.4% in the previous year, attributed to cost-reduction initiatives [5] - Selling, general, and administrative expenses decreased by 7.8% to $5.5 million [6] Liquidity and Cash Flow - Cash and cash equivalents at the end of the second quarter were $2.9 million, down from $3.3 million at the end of the first quarter [8] - Cumulative net cash provided by operating activities was $2.9 million, an increase from $1.5 million a year ago [8] Guidance - Management has projected an adjusted EPS of $1.77 for the year 2024, indicating optimism for continued growth [9] Overall Assessment - The company demonstrated strong financial results with encouraging top-line and bottom-line performance, supported by robust purchase orders and a positive outlook for future earnings [10]

EX-99.1 2 bkti_ex991.htm PRESS RELEASE EXHIBIT 99.1 Second Quarter 2024 Financial and Operational Update BK Technologies Announces Second Quarter 2024 Results Second Quarter GAAP EPS of $0.47 Reiterates Target of Full Year 2024 GAAP EPS to exceed $1.50 WEST MELBOURNE, FL August 8, 2024 / BK Technologies Corporation (NYSE American: BKTI) (the "Company," "BK Technologies") today announced financial and operating results for the second quarter and six months ended June 30, 2024. The Company will host a confere ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to _________ Commission File Number: 001-32644 BK Technologies Corporation (Exact name of registrant as specified in its charter) | --- | --- | --- | |--------- ...

BKTI Technologies Corporation (NYSE:BKTI) Q1 2024 Earnings Conference Call May 9, 2024 9:00 AM ET Company Participants John Nesbett - IMS Investor Relations John Suzuki - Chief Executive Officer Scott Malmanger - Chief Financial Officer Conference Call Participants Aaron Martin - AIGH Investment Partners Jon Old - Long Meadow Investors LLC Operator Good morning, ladies and gentlemen, and welcome to the BK Technologies Corporation Conference Call for the First Quarter 2024. This call is being recorded. All p ...

EX-99.1 2 bkti_ex991.htm PRESS RELEASE EXHIBIT 99.1 BK Technologies Announces First Quarter 2024 Results First Quarter EPS of $0.19 Adjusted EBITDA of $1.4 Million WEST MELBOURNE, FL May 9, 2024 / BK Technologies Corporation (NYSE American: BKTI) (the "Company," "BK Technologies") today announced financial and operating results for the first quarter ended March 31, 2024. The Company will host a conference call today, May 9, 2024, at 9:00 a.m. Eastern Time. John Suzuki, CEO of BK Technologies commented, "Our ...