The LGL (US:LGL)2021-11-15 21:50Financial Performance - Total revenues for the three months ended September 30, 2021, were $7,501,000, a decrease of 7.1% from $8,071,000 for the same period in 2020[90]. - For the nine months ended September 30, 2021, total revenues were $20,919,000, a decrease of 11.9% from $23,748,000 for the same period in 2020[99]. - For the three months ended September 30, 2021, revenues were $7.501 million, a decrease from $8.071 million for the same period in 2020, representing a decline of approximately 7%[114]. - For the nine months ended September 30, 2021, revenues totaled $20.919 million, down from $23.748 million in 2020, reflecting a decrease of about 13%[114]. - The operating loss for the three months ended September 30, 2021, was $(746,000), compared to an operating income of $709,000 for the same period in 2020[114]. Net Income and Gains - The company reported a net income of $31,780,000 for the three months ended September 30, 2021, compared to $629,000 for the same period in 2020, driven by a gain from the Sponsor investment[98]. - The company recognized a gain on equity investment in unconsolidated subsidiary of $59,453,000 for the nine months ended September 30, 2021, compared to a loss of ($200,000) for the same period in 2020[102]. Cash Flow and Working Capital - Cash provided by operating activities for the nine months ended September 30, 2021, was $227,000, a significant decrease of $1.603 million compared to $1.830 million in 2020[116]. - Cash used in investing activities increased to $2.996 million for the nine months ended September 30, 2021, from $329,000 in 2020, primarily due to funding for the Company's PIPE subscription agreement[117]. - As of September 30, 2021, consolidated working capital was $74.170 million, a substantial increase from $30.384 million as of December 31, 2020[119]. - The Company had current assets of $77.126 million and current liabilities of $2.956 million as of September 30, 2021, resulting in a current ratio of 26.09 to 1.00[120]. Order Backlog - As of September 30, 2021, the company's order backlog was $21,849,000, a 10.3% increase from $19,801,000 at December 31, 2020, and a 1.8% increase compared to $21,456,000 as of September 30, 2020[87]. - The company expects to fill substantially all of its order backlog within the next twelve months but cannot assure what portion will be fulfilled in a given year[89]. Marketable Securities and Investments - The company held 1,388,620 IRNT common shares as of October 31, 2021, including 1,250,000 restricted shares[112]. - As of October 31, 2021, the Company sold 1,405,315 shares of IRNT common stock for approximately $16.9 million, retaining 1,388,620 shares in its portfolio[125]. - The Company's IRNT securities held at September 30, 2021, were marked to fair value of $44.4 million, with an average fair value of $15.90 per share[127]. Tax and Expenses - The company recorded a tax expense of $9,080,000 for the nine months ended September 30, 2021, compared to $282,000 for the same period in 2020, primarily due to increased income from the Sponsor investment[106]. COVID-19 Impacts - The company has identified potential delivery impacts from suppliers due to COVID-19, which could adversely affect contract deliveries[133]. - Delays in inspection, acceptance, and payment by customers, particularly for classified work, may impact sales and cash flows[134]. - Government funding priorities may shift due to the costs associated with the COVID-19 pandemic, potentially affecting future contract awards[134]. - The company is monitoring the impacts of COVID-19 on the fair value of its assets, with no current material impairments anticipated[136]. - Future changes in expectations for sales, earnings, and cash flows could lead to impairments of intangible assets and goodwill[136]. Strategic Initiatives - The Company plans to proceed with a spin-off of its MTronPTI subsidiary, which will be submitted for shareholder approval, aiming to enhance strategic focus and value for both entities[124].