Ultralife Corporation (NASDAQ:ULBI) Q1 2020 Earnings Conference Call April 30, 2020 8:30 AM ET Company Participants Jody Burfening – Investor Relations Mike Popielec – President and Chief Executive Officer Phil Fain – Chief Financial Officer Conference Call Participants Gary Siperstein – Eliot Rose Wealth Management Operator Good day, and welcome to the Ultralife Corporation First Quarter 2020 Earnings Release Conference Call. As a reminder, today’s call is being recorded. At this time, for opening remarks ...

PART I. FINANCIAL INFORMATION [Item 1. Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents Ultralife Corporation's unaudited consolidated financial statements for Q1 2020, highlighting a significant revenue increase to **$25.81 million** and net income of **$1.06 million** [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased slightly to **$146.15 million** as of March 31, 2020, driven by higher trade accounts receivable, with total liabilities and shareholders' equity also rising Consolidated Balance Sheet Highlights (In Thousands) | Account | March 31, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total Current Assets** | $73,568 | $70,373 | | **Total Assets** | $146,150 | $144,557 | | **Total Current Liabilities** | $18,928 | $17,190 | | **Total Liabilities** | $35,881 | $34,807 | | **Total Shareholders' Equity** | $110,269 | $109,750 | [Consolidated Statements of Income and Comprehensive Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Q1 2020 revenues increased **36.7%** year-over-year to **$25.81 million**, with gross profit rising to **$7.33 million** and net income more than doubling to **$1.06 million** Q1 2020 vs. Q1 2019 Income Statement (In Thousands, except per share data) | Metric | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | **Revenues** | $25,814 | $18,882 | | **Gross Profit** | $7,334 | $5,084 | | **Operating Income** | $1,485 | $548 | | **Net Income Attributable to Ultralife** | $1,059 | $425 | | **Diluted EPS** | $0.07 | $0.03 | [Consolidated Statements of Cash Flows](index=5&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Q1 2020 operating activities used **$365 thousand** in cash, primarily due to increased accounts receivable, resulting in an overall **$1.30 million** decrease in cash for the quarter Q1 2020 vs. Q1 2019 Cash Flow Summary (In Thousands) | Activity | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | **Net cash used in operating activities** | $(365) | $(545) | | **Net cash used in investing activities** | $(445) | $(2,581) | | **Net cash used in financing activities** | $(322) | $(1,609) | | **Decrease in Cash** | $(1,296) | $(4,694) | | **Cash, End of period** | $6,109 | $21,240 | [Notes to Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, the SWE acquisition contributing **$5,437 thousand** revenue and **$271 thousand** net income in Q1 2020, and the repayment of a **$3.459 million** PPP loan - On April 14, 2020, the company entered into a **$3.459 million** PPP loan agreement, which it repaid on April 27, 2020, to ensure compliance with revised government guidelines[21](index=21&type=chunk)[22](index=22&type=chunk) - The acquisition of Southwest Electronic Energy Corporation (SWE) on May 1, 2019, contributed revenue of **$5,437 thousand** and net income of **$271 thousand** for the three months ended March 31, 2020[31](index=31&type=chunk) Segment Revenue by Source - Q1 2020 vs Q1 2019 (In Thousands) | Segment & Source | Q1 2020 Revenue | Q1 2019 Revenue | | :--- | :--- | :--- | | **Battery & Energy Products** | | | | Commercial | $14,802 | $10,010 | | Government/Defense | $5,959 | $5,988 | | *Total Battery & Energy* | *$20,761* | *$15,998* | | **Communications Systems** | | | | Government/Defense | $5,053 | $2,884 | | *Total Communications* | *$5,053* | *$2,884* | | **Total Company** | **$25,814** | **$18,882** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported a **36.7%** increase in Q1 2020 consolidated revenues, with operating income rising **170.5%** to **$1.485 million**, despite an estimated **$500 thousand** COVID-19 impact on net income - The COVID-19 pandemic adversely impacted net income by an estimated **$500 thousand** for the quarter ended March 31, 2020, mainly from the temporary shutdown of the China facility and supply chain disruptions[86](index=86&type=chunk) Q1 2020 Performance Summary (In Thousands) | Metric | Q1 2020 | Q1 2019 | Change | | :--- | :--- | :--- | :--- | | **Revenues** | $25,814 | $18,882 | +36.7% | | **Gross Profit** | $7,334 | $5,084 | +44.3% | | **Operating Income** | $1,485 | $548 | +170.5% | | **Net Income (to Ultralife)** | $1,059 | $425 | +149.2% | - Revenue growth was driven by the SWE acquisition in the Battery & Energy Products segment and higher shipments of vehicle amplifier-adaptor systems in the Communications Systems segment[97](index=97&type=chunk)[98](index=98&type=chunk) Reconciliation of Net Income to Adjusted EBITDA (In Thousands) | Line Item | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | **Net income attributable to Ultralife** | $1,059 | $425 | | Interest expense | 174 | 5 | | Income tax provision | 319 | 41 | | Depreciation expense | 579 | 447 | | Amortization & financing fees | 161 | 101 | | Stock-based compensation expense | 230 | 185 | | **Adjusted EBITDA** | **$2,522** | **$1,204** | [Item 4. Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) As of March 31, 2020, the company's disclosure controls and procedures were deemed effective, with no material changes to internal control over financial reporting during Q1 2020 - The Principal Executive Officer and Principal Financial Officer concluded that disclosure controls and procedures were effective as of the end of the period covered by the report[125](index=125&type=chunk) - No changes in internal control over financial reporting occurred during the fiscal quarter that materially affected, or are reasonably likely to materially affect, these controls[126](index=126&type=chunk) PART II. OTHER INFORMATION [Item 1A. Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) The primary risk factor is the adverse impact of the COVID-19 pandemic on business, operating results, and financial condition, including supply chain and demand disruptions - The company's business, operating results, and financial condition may be adversely impacted by the COVID-19 pandemic, which already affected Q1 2020 results through a facility closure in China and supply chain disruptions[129](index=129&type=chunk)[130](index=130&type=chunk) - Potential future effects of COVID-19 that pose a material risk include: limited availability or increased cost of raw materials and components; reduced demand and/or pricing for products; inability of customers to pay or remain solvent; reduced availability of the workforce; and increased cyber threats[130](index=130&type=chunk) [Item 6. Exhibits](index=29&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications required by Sarbanes-Oxley Act and XBRL data files List of Filed Exhibits | Exhibit Index | Description | | :--- | :--- | | 31.1 | Rule 13a-14(a) / 15d-14(a) CEO Certifications | | 31.2 | Rule 13a-14(a) / 15d-14(a) CFO Certifications | | 32 | Section 1350 Certifications | | 101 | XBRL Data Files (Instance, Schema, etc.) | [Signatures](index=30&type=section&id=Signatures) The quarterly report was signed on April 30, 2020, by the company's principal executive and financial officers, authorizing its submission - The report was signed on April 30, 2020, by Michael D. Popielec (President and CEO) and Philip A. Fain (CFO and Treasurer)[136](index=136&type=chunk)

Ultralife Corporation (NASDAQ:ULBI) Q4 2019 Earnings Conference Call February 6, 2020 8:30 AM ET Company Participants Jody Burfening - Investor Relations Mike Popielec - President & Chief Executive Officer Phil Fain - Chief Financial Officer Conference Call Participants Operator Good day, ladies and gentlemen, and welcome to this Ultralife Corporation Fourth Quarter 2019 Earnings Release Conference Call. At this time for opening remarks and introductions, I'd like to turn the call over to Ms. Jody Burfening ...

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 December 31, 2019 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: 0-20852 ULTRALIFE CORPORATION (Exact name of registrant as specified in its charter) Delaware 16-1387013 (Stat ...

Ultralife Corporation (NASDAQ:ULBI) Q3 2019 Earnings Conference Call October 31, 2019 8:30 AM ET Company Participants Jody Burfening – Investor Relations Mike Popielec – President and Chief Executive Officer Phil Fain – Chief Financial Officer Conference Call Participants Gary Siperstein – Eliot Rose Wealth Management Operator Good day, and welcome to the Ultralife Corporation Third Quarter 2019 Earnings Release Conference Call. As a reminder, today's conference is being recorded. At this time, for opening ...

Ultralife Corporation (NASDAQ:ULBI) Q2 2019 Earnings Conference Call August 1, 2019 8:30 AM ET Company Participants Jody Burfening - Investor Relations Mike Popielec - President & Chief Executive Officer Phil Fain - Chief Financial Officer Conference Call Participants Gary Siperstein - Eliot Rose Wealth Management Operator Good day, and welcome to this Ultralife Corporation's Second Quarter 2019 Earnings Release Conference Call. At this time, I'll like to turn the conference over to Jody Burfening. Please g ...

Ultralife Corporation Investor Presentation Michael D. Popielec PRESIDENT & CEO Philip A. Fain CFO & TREASURER Updated August 1, 2019 1 IMPORTANT REMINDER – FORWARD LOOKING STATEMENTS This presentation may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties. The Company cautions investors not to place undue reliance on forward-looking statements, which reflect the Company's analysis only as of today's date. The Company undertakes no obligation to ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☐ 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: 0-20852 (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 OR ULTRALIFE CORPORATION (Exact name of registrant as specified in its charter) Delaware (State or ot ...

Ultralife Corp. (NASDAQ:ULBI) Q1 2019 Earnings Conference Call May 2, 2019 8:30 AM ET Company Participants Jody Burfening - Investor Relations Mike Popielec - President and Chief Executive Officer Phil Fain - Chief Financial Officer Conference Call Participants Gary Siperstein - Eliot Rose Wealth Management Operator Good day and welcome to Ultralife Corporation First Quarter 2019 Earnings Release Call. At this time for opening remarks and introductions, I would like to turn the call over to Ms. Jody Burfeni ...

PART I. FINANCIAL INFORMATION [Item 1. Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) The consolidated financial statements for Q1 2019 report **$18.9 million in revenues** and **$0.4 million in net income**, a significant decline from the prior year Consolidated Statement of Income Highlights (Q1 2019 vs Q1 2018) | Metric | Q1 2019 (ended Mar 31) ($ thousands) | Q1 2018 (ended Apr 1) ($ thousands) | Change | | :--- | :--- | :--- | :--- | | Revenues | $18,882 | $23,069 | -18.1% | | Gross Profit | $5,084 | $7,282 | -30.2% | | Operating Income | $548 | $2,356 | -76.7% | | Net Income Attributable to Ultralife | $425 | $2,151 | -80.2% | | Diluted EPS | $0.03 | $0.13 | -76.9% | Consolidated Balance Sheet Highlights (As of Mar 31, 2019) | Account | March 31, 2019 ($ thousands) | December 31, 2018 ($ thousands) | | :--- | :--- | :--- | | Cash | $21,240 | $25,934 | | Total Current Assets | $65,481 | $67,160 | | Total Assets | $120,951 | $120,848 | | Total Current Liabilities | $15,996 | $15,386 | | Total Liabilities | $17,028 | $16,385 | | Total Shareholders' Equity | $103,923 | $104,463 | Consolidated Statement of Cash Flows Highlights (Q1 2019 vs Q1 2018) | Cash Flow Activity | Q1 2019 (ended Mar 31) ($ thousands) | Q1 2018 (ended Apr 1) ($ thousands) | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | ($545) | ($921) | | Net Cash Used In Investing Activities | ($2,581) | ($172) | | Net Cash (Used In) Provided By Financing Activities | ($1,609) | $939 | | **Decrease in Cash** | **($4,694)** | **-** | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes disclose the adoption of ASC 842, the **$25.0 million acquisition** of SWE, credit facility amendments, and segment performance - On May 1, 2019, the company completed the acquisition of Southwest Electronic Energy Corporation ("SWE") for an aggregate purchase price of **$25.0 million in cash**, intended to support commercial revenue diversification, particularly in the oil & gas and subsea electrification markets[32](index=32&type=chunk)[33](index=33&type=chunk) - To fund the SWE acquisition, on May 1, 2019, the company amended its credit agreement to include a five-year, **$8.0 million senior secured term loan** and extended its **$30.0 million senior secured revolving credit facility** through May 31, 2022[39](index=39&type=chunk)[40](index=40&type=chunk) - During Q1 2019, the company repurchased **267,300 shares** of its common stock for an aggregate consideration of **$1.957 million** under its Share Repurchase Program[51](index=51&type=chunk) Segment Performance (Q1 2019 vs Q1 2018) | Segment | Metric | Q1 2019 ($ thousands) | Q1 2018 ($ thousands) | | :--- | :--- | :--- | :--- | | **Battery & Energy Products** | Revenues | $15,998 | $17,224 | | | Segment Contribution | $4,410 | $5,036 | | **Communications Systems** | Revenues | $2,884 | $5,845 | | | Segment Contribution | $674 | $2,246 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a challenging Q1, with consolidated revenues decreasing **18.1% to $18.9 million** and gross margin compressing to **26.9%** [Results of Operations](index=23&type=section&id=Results%20of%20Operations) Consolidated revenues decreased **18.1% to $18.9 million**, with Battery & Energy Products down **7.1%** and Communications Systems down **50.7%**, impacting gross margin - Battery & Energy Products revenues decreased **7.1%** due to a **21.2% drop** in government and defense sales, partially offset by a **4.0% increase** in commercial revenues, led by medical customers[103](index=103&type=chunk) - Communications Systems revenues decreased **50.7%** due to the timing of shipments, transitioning from a large Q1 2018 contract to initial production for new U.S. Army Network Modernization orders in Q1 2019[104](index=104&type=chunk) - Consolidated gross margin fell to **26.9%** from **31.6%** in the prior year, primarily due to unfavorable sales mix and costs incurred to commence initial production for large Communications Systems program awards[105](index=105&type=chunk) [Adjusted EBITDA (Non-GAAP Measure)](index=24&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA, a non-GAAP measure, significantly decreased to **$1.2 million** (6.4% of revenues) in Q1 2019 from **$3.0 million** in Q1 2018 Reconciliation of Net Income to Adjusted EBITDA | Line Item | Q1 2019 ($ thousands) | Q1 2018 ($ thousands) | | :--- | :--- | :--- | | Net Income Attributable to Ultralife | $425 | $2,151 | | Interest and Financing Expense, Net | $5 | $33 | | Income Tax Provision | $41 | $55 | | Depreciation Expense | $447 | $484 | | Amortization of Intangible Assets and Financing Fees | $101 | $111 | | Stock-Based Compensation Expense | $185 | $139 | | **Adjusted EBITDA** | **$1,204** | **$2,973** | [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) Cash decreased by **$4.7 million** to **$21.2 million** as of March 31, 2019, primarily due to inventory build-up, capital expenditures, and share repurchases - Cash decreased by **$4.7 million** during Q1 2019, from **$25.9 million** to **$21.2 million**[121](index=121&type=chunk) - Key uses of cash during the quarter included[122](index=122&type=chunk)[123](index=123&type=chunk) - A **$5.0 million increase** in inventory, primarily for Communications Systems program awards - **$2.6 million** in capital expenditures, mainly for automation equipment in the Battery & Energy Products business - **$2.0 million** for common stock repurchases [Item 4. Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2019[130](index=130&type=chunk) - No changes occurred during the fiscal quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[131](index=131&type=chunk) PART II. OTHER INFORMATION [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=28&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's share repurchase activity, with **267,300 shares** repurchased in Q1 2019, leaving **2.1 million shares** authorized for repurchase Share Repurchases in Q1 2019 | Period | Total Number of Shares Purchased | Weighted Average Price Paid Per Share ($) | Maximum Shares Remaining for Purchase (shares) | | :--- | :--- | :--- | :--- | | January 2019 | 267,100 | $7.29 | 2,127,226 | | February 2019 | 200 | $7.49 | 2,127,026 | | March 2019 | - | - | 2,127,026 | | **Total Q1** | **267,300** | | | [Item 6. Exhibits](index=29&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO/CFO certifications and XBRL interactive data files - The exhibits filed with this report include CEO/CFO certifications and XBRL data files[137](index=137&type=chunk)