BK Technologies(BKTI) - 2019 Q3 - Quarterly Report

Sales Performance - For Q3 2019, sales decreased by 11.3% to approximately $11.8 million compared to $13.3 million in Q3 2018[89] - For the nine months ended September 30, 2019, sales totaled approximately $32.7 million, down 15.4% from $38.7 million in the same period last year[89] - The company anticipates sales growth and the expected production and sale of new products to favorably impact overall gross profit margins in the future[102] - The sales funnel includes potential new customers in federal, state, and local public safety agencies, with strengthened sales and marketing resources[99] Profitability - Gross profit margin for Q3 2019 improved to approximately 43.3%, compared to 41.1% in Q3 2018[90] - For the nine-month period ended September 30, 2019, gross profit margin was approximately 40.4%, down from 41.8% in the same period last year[90] - The company recognized operating income of approximately $295,000 in Q3 2019, compared to $878,000 in Q3 2018[91] - Operating income for Q3 2019 was approximately $295,000, or 2.5% of sales, down from $878,000, or 6.6% of sales in Q3 2018[111] - Net income for Q3 2019 was approximately $238,000 ($0.02 per share), down from $650,000 ($0.05 per share) in Q3 2018[94] - The company recorded a net loss of approximately $1.3 million for the nine months ended September 30, 2019, compared to net income of approximately $1.2 million for the same period last year[122] Expenses - SG&A expenses for Q3 2019 totaled approximately $4.8 million, representing 40.8% of sales, a decline of 15.3% from the previous quarter[91] - SG&A expenses for Q3 2019 totaled approximately $4.8 million, or 40.8% of sales, compared to $4.6 million, or 34.5% of sales in Q3 2018[105] - Engineering and product development expenses for Q3 2019 were approximately $2.4 million, representing 20.1% of total sales, up from $2.1 million, or 15.9% of total sales in Q3 2018[106] - Marketing and selling expenses for Q3 2019 were approximately $1.4 million, or 11.5% of sales, unchanged from the same quarter last year[109] - General and administrative expenses for Q3 2019 totaled approximately $1.1 million, or 9.1% of total sales, compared to $1.1 million, or 8.3% of total sales in Q3 2018[110] Cash Flow and Working Capital - As of September 30, 2019, working capital totaled approximately $17.1 million, down from $21.0 million as of December 31, 2018[95] - Cash provided by operating activities for the nine months ended September 30, 2019, totaled approximately $1.0 million, down from $2.6 million for the same period last year[121] - As of September 30, 2019, the company's cash and cash equivalents balance was approximately $8.8 million, which is expected to meet working capital requirements for the foreseeable future[131] Investments and Future Products - The company recognized an unrealized loss of approximately $258,000 on its investment in 1347 Property Insurance Holdings, Inc. for Q3 2019, compared to a loss of $191,000 in Q3 2018[113] - The company anticipates introducing a new multi-band product in the market in the second half of 2020, following design changes aimed at improving functionality and performance[107] Accounting Policies - No changes were made to critical accounting policies during the quarter ended September 30, 2019[133]