Innovative Solutions and Support(ISSC) - 2024 Q4 - Annual Results

Financial Performance - Fourth quarter net revenue was $15.4 million, an increase of 18.4% year-over-year[3] - Full year net revenue reached $47.2 million, representing a 35.6% increase compared to the previous year[4] - Fourth quarter gross profit was $8.5 million, with a gross margin of 55.4%[3] - Full year adjusted EBITDA was $13.7 million, up 42.5% from the prior year[4] - Total net sales for the three months ended September 30, 2024, reached $15,384,806, a 18.4% increase from $12,992,596 in the same period of 2023[30] - Gross profit for the three months ended September 30, 2024, was $8,528,245, compared to $8,112,471 for the same period in 2023, reflecting a gross margin improvement[30] - Operating income increased to $4,366,168 for the three months ended September 30, 2024, up from $3,652,599 in the prior year, indicating a 19.5% growth[30] - Net income for the three months ended September 30, 2024, was $3,180,194, compared to $2,634,622 in the same period of 2023, representing a 20.7% increase[30] - Adjusted EBITDA for the twelve months ended September 30, 2024, was $13,672,080, compared to $9,593,262 for the same period in 2023, indicating a 42.5% increase[31] Cash Flow and Debt - Cash flow from operations for fiscal 2024 was $5.8 million, compared to $2.1 million in the previous year[15] - Free cash flow increased to $5.1 million during fiscal 2024, up from $1.8 million in the same period last year[15] - Total debt as of September 30, 2024, was $28.0 million, with net debt of $27.5 million[14] - Long-term debt increased to $28,027,002 as of September 30, 2024, compared to $17,500,000 in the previous year, reflecting a 60.0% rise[29] - The leverage ratio improved to 1.3x as of September 30, 2024, down from 2.0x in the previous year, indicating a stronger balance sheet[31] Orders and Growth Strategy - New orders in the fourth quarter totaled $95.4 million, including $74.3 million of backlog from recent acquisitions[13] - The company aims to continue growth in retrofit markets and pursue strategic acquisitions to enhance its advanced avionics capabilities[5] Research and Development - Research and development expenses for the three months ended September 30, 2024, were $1,106,355, up from $741,579 in the same period of 2023, showing a 49.2% increase[30] - The company plans to launch the next generation Utility Management System (UMS2) in 2025, which will feature AI capabilities[7]