Ultralife(ULBI) - 2024 Q3 - Quarterly Results

Financial Performance - Sales for Q3 2024 were $35.7 million, a decrease of 9.6% from $39.5 million in Q3 2023, with Battery & Energy Products sales growing 1.9% to $32.5 million, while Communications Systems sales fell 58.2% to $3.2 million[1][2] - Gross profit was $8.7 million, representing 24.3% of revenue, compared to $9.8 million or 24.8% of revenue in Q3 2023[1][3] - Operating income decreased to $0.5 million, down from $2.1 million in the same quarter last year, resulting in an operating margin of 1.4% compared to 5.4%[1][5] - Net income was $0.3 million, or $0.02 per diluted share, compared to $1.3 million or $0.08 per diluted share in Q3 2023[1][5] - Adjusted EBITDA for Q3 2024 was $1.9 million, or 5.4% of sales, down from $3.5 million, or 8.8% of sales, in the prior year[1][6] - Total revenues for the three-month period ended September 30, 2024, were $35,694, a decrease of 9.0% compared to $39,488 for the same period in 2023[13] - Operating income for the three-month period ended September 30, 2024, was $511, a decline of 76.1% compared to $2,135 in the same period last year[13] Backlog and Debt - Total backlog at the end of Q3 2024 was $78.0 million[2] - Debt was reduced by $4.1 million, or 33.4%, to $8.0 million from $12.1 million at the end of Q2 2024, marking a total reduction of $17.2 million, or 68.2%, over the last two quarters[1] Expenses and Investments - Operating expenses increased to $8.2 million, or 22.9% of revenue, compared to $7.6 million, or 19.3% of revenue, in Q3 2023, reflecting investments in new product development and acquisition-related costs[1][4] - Total operating expenses for the three-month period ended September 30, 2024, were $8,171, an increase of 7.0% from $7,639 in the same period last year[13] - Research and development expenses increased to $5,854 for the nine-month period ended September 30, 2024, from $5,679 in the same period last year, marking a rise of 3.1%[13] Acquisition - The acquisition of Electrochem Solutions, Inc. was completed on October 31, 2024, with plans to implement integration strategies to enhance operational leverage and revenue growth[1] Product Performance - Battery & Energy Products gross margin improved by 50 basis points to 24.7%, while Communications Systems gross margin decreased to 20.1% due to lower production volume[1][3] - Battery & Energy Products revenue increased to $32,529 for the three-month period ended September 30, 2024, from $31,919 in the same period last year, representing a growth of 1.9%[13] Year-to-Date Performance - Gross profit for the nine-month period ended September 30, 2024, was $31,715, up 14.0% from $27,798 for the same period in 2023[13] - Net income attributable to Ultralife Corporation for the nine-month period ended September 30, 2024, was $6,118, an increase of 41.6% from $4,324 for the same period in 2023[16] - Adjusted EBITDA for the nine-month period ended September 30, 2024, was $12,577, compared to $10,931 for the same period in 2023, reflecting a growth of 15.1%[15] - The company reported a net income per share attributable to Ultralife common shareholders of $0.37 for the nine-month period ended September 30, 2024, compared to $0.27 for the same period in 2023, an increase of 37.0%[16] - The weighted average shares outstanding for the nine-month period ended September 30, 2024, were 16,530, compared to 16,172 for the same period in 2023, indicating an increase of 2.2%[16]