Frequency Electronics, Inc. (NASDAQ:FEIM) Q1 2022 Results Earnings Conference Call September 13, 2021 4:30 PM ET Company Participants Stan Sloane - President, Chief Executive Officer Steve Bernstein - Chief Financial Officer Conference Call Participants Michael Cooper - Private Investor Richard John - Private Investor Sam Rebotsky - SER Asset Management Brett Reiss - Janney Michael Eisner - Private Investor Operator Greetings and welcome to the Frequency Electronics first quarter fiscal year 2022 earnings r ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark one) ☒QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period ended July 31, 2021 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 No. 1-8061 FREQUENCY ELECTRONICS, INC. (Exact name of Registrant as specified in its charter) Delaware 11-1986657 (State ...

Frequency Electronics, Inc. (NASDAQ:FEIM) Q4 2021 Earnings Conference Call June 29, 2021 4:30 PM ET Company Participants Stanton Sloane - President and Chief Executive Officer Steven Bernstein - Chief Financial Officer Conference Call Participants Brett Reiss - Janney Montgomery Scott Sam Rebotsky - SER Asset Management Michael Eisner - Private Investor Operator Greetings and welcome to the Frequency Electronics Fourth Quarter and Fiscal Year End 2021 Earnings Release Conference Call. [Operator Instructions ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark one) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year ended April 30, 2021 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 No. 1-8061 FREQUENCY ELECTRONICS, INC. (Exact name of Registrant as specified in its charter) Delaware 11-1986657 (State or o ...

Frequency Electronics, Inc. (NASDAQ:FEIM) Q3 2021 Earnings Conference Call March 11, 2021 4:30 PM ET Company Participants Stanton Sloane – President and Chief Executive Officer Steve Bernstein – Chief Financial Officer Conference Call Participants Michael Eisner – Private Investor Sam Rebotsky – SER Asset Management Brett Reiss – Janney Montgomery Scott Walter Sturm – Private Investor Joe Gersky – Private Investor Operator Greetings, and welcome to the Frequency Electronics Third Quarter Fiscal Year 2021 Ea ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark one) ☒QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period ended January 31, 2021 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 No. 1-8061 FREQUENCY ELECTRONICS, INC. (Exact name of Registrant as specified in its charter) Delaware 11-1986657 (St ...

Frequency Electronics, Inc. NASDAQ: FEIM Providing High-Precision Timing & Frequency Generation and RF/Microwave Technology for Space and Terrestrial Applications Stanton Sloane President & CEO Steven Bernstein CFO Needham Growth Conference 1/12/2021 Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The Statements in this presentation regarding the future constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of th ...

[Part I. Financial Information](index=4&type=section&id=Part%20I.%20Financial%20Information) [Item 1. Financial Statements](index=4&type=section&id=Item%201%20-%20Financial%20Statements) Unaudited financial statements for October 31, 2020, show improved performance, shifting from net loss to net income, with a strong balance sheet and increased operating cash flow [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of October 31, 2020, total assets were **$89.6 million**, liabilities decreased, and stockholders' equity increased to **$54.7 million**, improving liquidity Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | Oct 31, 2020 (Unaudited) | Apr 30, 2020 | | :--- | :--- | :--- | | **Total Current Assets** | $50,922 | $51,235 | | **Total Assets** | $89,619 | $91,276 | | **Total Current Liabilities** | $11,243 | $12,988 | | **Total Liabilities** | $34,963 | $37,040 | | **Total Stockholders' Equity** | $54,656 | $54,236 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Revenues increased by **24.5%** to **$26.9 million** for the six months ended October 31, 2020, resulting in a net income of **$67 thousand**, a significant turnaround from a prior-year loss Statement of Operations Summary (in thousands, except per share data) | Metric | Six Months Ended Oct 31, 2020 | Six Months Ended Oct 31, 2019 | Three Months Ended Oct 31, 2020 | Three Months Ended Oct 31, 2019 | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | $26,940 | $21,641 | $13,990 | $9,087 | | **Gross Margin (Loss)** | $9,410 | $2,771 | $5,322 | $(1,182) | | **Operating (Loss) Income** | $(119) | $(5,703) | $219 | $(4,922) | | **Net Income (Loss)** | $67 | $(5,500) | $329 | $(4,909) | | **Basic EPS** | $0.01 | $(0.61) | $0.04 | $(0.54) | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities significantly increased to **$2.0 million** for the six months ended October 31, 2020, with a period-end cash balance of **$3.7 million** Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended Oct 31, 2020 | Six Months Ended Oct 31, 2019 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $1,980 | $180 | | **Net cash used in investing activities** | $(169) | $(1,257) | | **Net cash used in financing activities** | $(1,965) | - | | **Net decrease in cash and cash equivalents** | $(154) | $(1,077) | | **Cash and cash equivalents at end of period** | $3,654 | $2,606 | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, COVID-19 impact, segment revenue growth, an OFAC investigation regarding Morion, Inc., and ongoing legal proceedings - The company is actively monitoring the impact of the COVID-19 pandemic, but cannot estimate the potential adverse effects on its fiscal year 2021 results; vendor delays have had a minor impact on production schedules to date[33](index=33&type=chunk)[34](index=34&type=chunk) - The company has an investment in Morion, Inc., a Russian company, and due to Morion's relationship with a sanctioned entity, the company voluntarily disclosed potentially untimely payments to the Office of Foreign Assets Control (OFAC), which has opened a civil investigation with unknown outcome and potential liability[61](index=61&type=chunk)[66](index=66&type=chunk)[67](index=67&type=chunk) - The company is involved in multiple legal proceedings with its former Chief Scientist, Martin B. Bloch, concerning allegations of wrongful termination and disputes over deferred compensation benefits, which the company is vigorously defending against, but the outcome is uncertain[82](index=82&type=chunk)[83](index=83&type=chunk) - In April 2020, the company received a PPP loan of approximately **$5.0 million**, which was fully repaid in May 2020; as of October 31, 2020, the company has borrowed **$3 million** under a credit facility with UBS Bank USA[79](index=79&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202%20-%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes improved financial results to increased revenues, higher gross margin from program completion, decreased R&D, and a strong liquidity position with growing backlog [Results of Operations](index=21&type=section&id=Results%20of%20Operations) Revenues grew **24.5%** to **$26.9 million**, driven by satellite and government programs, with gross margin rate improving to **34.9%** and operating loss significantly reduced Revenue by Segment (in thousands) | Segment | Six Months Ended Oct 31, 2020 | Six Months Ended Oct 31, 2019 | Change (%) | | :--- | :--- | :--- | :--- | | FEI-NY | $20,996 | $16,794 | 25.0% | | FEI-Zyfer | $7,353 | $5,701 | 29.0% | - For the six months ended Oct 31, 2020, revenue from satellite programs increased by **$4.8 million**, accounting for **53%** of consolidated revenues, up from **44%** in the prior year[110](index=110&type=chunk) - Gross margin and GM Rate increased significantly due to several programs moving from a high-cost development phase to completion or near-completion[112](index=112&type=chunk) - SG&A expenses increased, mainly due to a **$1.6 million** rise in professional fees for the six-month period, related to litigation for which the company expects partial insurance reimbursement[113](index=113&type=chunk) - R&D expenses decreased as previous R&D efforts have ended and transitioned into production, with the R&D rate as a percentage of sales dropping from **17%** to **8%** for the six-month period[116](index=116&type=chunk) [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity remains strong with **$39.7 million** in working capital and a **4.5:1** current ratio, cash from operations improved, and funded backlog increased to **$42 million** - Working capital stood at **$39.7 million** at October 31, 2020, up from **$38.3 million** at April 30, 2020, with the current ratio improving from **3.9 to 1** to **4.5 to 1**[126](index=126&type=chunk) - Net cash provided by operating activities for the six months ended October 31, 2020, was **$1.9 million**, compared to **$180 thousand** in the prior year period[127](index=127&type=chunk) - Consolidated funded backlog increased to approximately **$42 million** as of October 31, 2020, compared to **$36 million** at April 30, 2020[134](index=134&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=26&type=section&id=Item%203%20-%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not applicable as the company qualifies as a smaller reporting company - Disclosure about market risk is not required for smaller reporting companies[139](index=139&type=chunk) [Item 4. Controls and Procedures](index=26&type=section&id=Item%204%20-%20Controls%20and%20Procedures) Management, including CEO and CFO, concluded disclosure controls and procedures were effective as of October 31, 2020, with no material changes to internal controls - The company's chief executive officer and chief financial officer concluded that as of October 31, 2020, the company's disclosure controls and procedures were effective[140](index=140&type=chunk) - No changes in internal control over financial reporting occurred during the three months ended October 31, 2020, that have materially affected, or are reasonably likely to materially affect, the company's internal controls[142](index=142&type=chunk) [Part II. Other Information](index=27&type=section&id=Part%20II.%20Other%20Information) [Item 1. Legal Proceedings](index=27&type=section&id=Item%201%20-%20Legal%20Proceedings) The company is involved in ongoing legal disputes with former Chief Scientist Martin B. Bloch regarding wrongful termination, age discrimination, and deferred compensation benefits - Martin B. Bloch, former Chief Scientist, filed a complaint alleging wrongful termination "for cause" and age discrimination; while most claims were dismissed, one claim for breach of contract against the company remains, and an appeal is pending[146](index=146&type=chunk) - Mr. Bloch has also initiated two arbitration proceedings claiming denial of deferred compensation benefits in violation of ERISA rules[147](index=147&type=chunk) - The company has filed a petition to stay the arbitration, claiming Mr. Bloch did not follow proper procedures, and the court has granted an interim stay of arbitration pending further rulings[148](index=148&type=chunk)[149](index=149&type=chunk) [Item 6. Exhibits](index=28&type=section&id=Item%206%20-%20Exhibits) This section lists exhibits filed with Form 10-Q, including CEO and CFO certifications and XBRL-formatted financial statements - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Sections 302 and 906[151](index=151&type=chunk)[152](index=152&type=chunk) - The filing includes financial data formatted in eXtensible Business Reporting Language (XBRL)[153](index=153&type=chunk) [Signatures](index=29&type=section&id=Signatures) - The report was duly signed on December 11, 2020, by Steven L. Bernstein, the Chief Financial Officer, Secretary, and Treasurer[156](index=156&type=chunk)

[Part I. Financial Information](index=4&type=section&id=Part%20I.%20Financial%20Information) This section covers the company's financial statements, management's analysis, market risk disclosures, and internal controls [Item 1. Financial Statements](index=4&type=section&id=Item%201%20-%20Financial%20Statements) The company reported increased revenues and narrowed losses for the quarter, with stable assets and ongoing legal and regulatory matters [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a slight decrease in total assets and liabilities, with stable stockholders' equity as of July 31, 2020 Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | July 31, 2020 | April 30, 2020 | | :--- | :--- | :--- | | **Total Current Assets** | $49,633 | $51,235 | | **Total Assets** | **$88,944** | **$91,276** | | **Total Current Liabilities** | $10,738 | $12,988 | | **Total Liabilities** | **$34,609** | **$37,040** | | **Total Stockholders' Equity** | **$54,335** | **$54,236** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The company reported increased revenues and a narrowed operating and net loss for the three months ended July 31, 2020 Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended July 31, 2020 | Three Months Ended July 31, 2019 | | :--- | :--- | :--- | | **Revenues** | $12,951 | $12,554 | | **Gross Margin** | $4,088 | $3,953 | | **Operating Loss** | $(337) | $(780) | | **Net Loss** | **$(262)** | **$(591)** | | **Basic and Diluted Loss Per Share** | **$(0.03)** | **$(0.07)** | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flow analysis shows a net decrease in cash due to financing activities, despite positive operating and investing cash flows Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended July 31, 2020 | Three Months Ended July 31, 2019 | | :--- | :--- | :--- | | Net cash provided by operating activities | $62 | $153 | | Net cash provided by (used in) investing activities | $514 | $(1,597) | | Net cash used in financing activities | $(1,953) | $0 | | **Net decrease in cash and cash equivalents** | **$(1,377)** | **$(1,444)** | | **Cash and cash equivalents at end of period** | **$2,431** | **$2,239** | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Key notes disclose the impact of COVID-19, segment performance, an OFAC investigation, and ongoing legal proceedings with a former executive - The company is actively monitoring the impact of the COVID-19 pandemic, which has caused some vendor delays but has not significantly impacted production[30](index=30&type=chunk)[31](index=31&type=chunk) The full financial effect for fiscal year 2021 remains uncertain[32](index=32&type=chunk) - The company made a voluntary disclosure to the Office of Foreign Assets Control (OFAC) regarding untimely payments from its Russian investment, Morion, Inc., which may have violated U.S. sanctions[61](index=61&type=chunk) OFAC has initiated a civil investigation, the outcome and potential liability of which are currently unknown[62](index=62&type=chunk) - The company is engaged in litigation and arbitration with a former executive, Martin B. Bloch, over claims of wrongful termination, age discrimination, and denial of deferred compensation benefits[79](index=79&type=chunk) The company is defending itself vigorously but cannot predict the outcome or estimate potential losses[80](index=80&type=chunk) Revenue by Segment (in thousands) | Segment | Three Months Ended July 31, 2020 | Three Months Ended July 31, 2019 | | :--- | :--- | :--- | | FEI-NY | $9,839 | $9,010 | | FEI-Zyfer | $3,922 | $3,701 | | Intersegment | $(810) | $(157) | | **Total** | **$12,951** | **$12,554** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202%20-%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses increased revenue, narrowed operating loss due to R&D reductions, and a strong liquidity position with growing backlog [Results of Operations](index=20&type=section&id=Results%20of%20Operations) Revenue increased by 3.2% driven by satellite programs, while operating loss narrowed due to reduced R&D expenses despite higher SG&A costs Revenue Analysis (in thousands) | Revenue Source | Q1 FY2021 | Q1 FY2020 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Satellite Programs | $6,651 | $3,895 | $2,756 | 70.8% | | Government Non-Space | $5,335 | $6,744 | $(1,409) | (20.9)% | | Other Commercial | $965 | $1,915 | $(950) | (49.6)% | | **Total Revenues** | **$12,951** | **$12,554** | **$397** | **3.2%** | - Selling and administrative (SG&A) expenses increased by **$775,000 (31.6%)** year-over-year, attributed to higher professional fees related to litigation and increased insurance costs[109](index=109&type=chunk) - Research and development (R&D) expenses decreased by **$1.1 million (47.5%)** compared to the prior year, as previous R&D efforts have concluded and transitioned into production phases[110](index=110&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with $38.9 million in working capital and a growing funded backlog of $38 million - The company maintains a strong working capital position of **$38.9 million** and a current ratio of **4.6 to 1** at July 31, 2020[120](index=120&type=chunk) - Consolidated funded backlog increased to approximately **$38 million** as of July 31, 2020, up from $36 million at April 30, 2020[128](index=128&type=chunk) Approximately **81%** of this backlog is expected to be realized in the next twelve months[128](index=128&type=chunk) - Management believes that its liquidity is adequate to meet its operating and investment needs through at least September 14, 2021[129](index=129&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Item%203%20-%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not applicable as the company qualifies as a smaller reporting company - Disclosure is not applicable to smaller reporting companies[133](index=133&type=chunk) [Item 4. Controls and Procedures](index=24&type=section&id=Item%204%20-%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting - The Company's chief executive officer and chief financial officer concluded that as of July 31, 2020, the Company's disclosure controls and procedures were effective[134](index=134&type=chunk) - There were no changes in the Company's internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, the controls[136](index=136&type=chunk) [Part II. Other Information](index=25&type=section&id=Part%20II.%20Other%20Information) This section details the company's ongoing legal proceedings and lists the exhibits filed with the quarterly report [Item 1. Legal Proceedings](index=25&type=section&id=Item%201%20%E2%80%93%20Legal%20Proceedings) The company is engaged in multiple legal disputes and arbitration with a former executive regarding termination and deferred compensation claims - Former Chief Scientist Martin B. Bloch filed a complaint against the Company alleging wrongful termination "for cause" and age discrimination[140](index=140&type=chunk) - Mr. Bloch also initiated two arbitration proceedings claiming denial of deferred compensation benefits under ERISA rules[141](index=141&type=chunk) - The Company has filed a petition to stay the arbitration and intends to vigorously defend against all of Mr. Bloch's allegations, but cannot determine the probability of liability or estimate any potential loss at this time[140](index=140&type=chunk)[142](index=142&type=chunk) [Item 6. Exhibits](index=26&type=section&id=Item%206%20-%20Exhibits) This section lists the exhibits filed, including CEO and CFO certifications and financial statements in XBRL format - Exhibits filed include CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906[145](index=145&type=chunk)[146](index=146&type=chunk) - The report includes financial data formatted in eXtensible Business Reporting Language (XBRL)[147](index=147&type=chunk)

Financial Data and Key Metrics Changes - For the three months ended July 31, 2020, consolidated revenue was $13 million, up 3% compared to $12.6 million for the same period of the prior fiscal year [8] - The company recorded a net loss of $262,000 or $0.03 per diluted share, compared to a net loss of $591,000 or $0.07 per diluted share in the previous year [14] - The gross margin and gross margin rate both increased marginally over the same period in fiscal 2020, primarily due to product mix [10] Business Line Data and Key Metrics Changes - Revenue from commercial and U.S. government satellite programs was $6.7 million, accounting for approximately 51% of consolidated revenues, compared to 31% for the same period of the prior fiscal year [8] - Revenues from non-space U.S. Government and DOD customers were $5.3 million, accounting for approximately 41% of consolidated revenue, down from 54% in the prior fiscal year [9] - Other commercial and industrial revenues decreased to $1 million from $1.9 million in the prior fiscal year [9] Market Data and Key Metrics Changes - The fully funded backlog at the end of July 2020 was approximately $38 million, up approximately $2 million from the previous year-end [15] - The company believes that its liquidity is adequate to meet its operating and investing needs for the next 12 months and the foreseeable future [15] Company Strategy and Development Direction - The company is focusing on internal operational improvements and cost reductions, including the rollout of a new ERP system to streamline manufacturing and program management processes [7] - The company is well positioned to service the space market as the U.S. increases its focus there, leveraging over 50 years of experience in space operations [5] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the direction of the business and expects overall financial performance to continue to improve as programs are completed [4][7] - The company anticipates continuing growth in the space domain, particularly as it relates to U.S. military applications [5] Other Important Information - R&D expenses decreased to $1.2 million from $2.3 million, reflecting previous R&D efforts that have transitioned to production [12] - Selling and administrative costs increased to approximately 25% of consolidated revenue due to additional insurance costs and professional fees related to litigation [11] Q&A Session Summary Question: What is the current status of bids and nonfunded backlog? - The company does not report nonfunded backlog, only the funded backlog of approximately $38 million [18] - The total number of outstanding bids is around 600 to 625 [19] Question: Does the company participate in missile contracts? - Yes, the company provides various electronics, including small quartz oscillators, for missile contracts in addition to satellite contracts [20] Question: Are there expectations for multiple precision oscillator contracts? - The company hopes to see more contracts as they have several pending in the competitive process [22] Question: What percentage of funded backlog is expected to ship in the current fiscal year? - The company expects to ship between 70% and 80% of the funded backlog [36]