The LGL (US:LGL)2023-11-14 21:46Financial Performance - Total revenues for the electronic instruments segment were $438,000 for the three months ended September 30, 2023, representing a 27.3% increase from $344,000 for the same period in 2022[92] - The electronic instruments segment reported an operating income of $70,000 for the three months ended September 30, 2023, compared to an operating loss of $39,000 for the same period in 2022[95] - Net income attributable to LGL Group was $108,000 for the three months ended September 30, 2023, compared to losses of $1,459,000 for the same period in 2022[104] - Consolidated gross margin increased to 55.5% for the three months ended September 30, 2023, up from 41.0% for the same period in 2022, reflecting changes in product mix[93] Order Backlog - As of September 30, 2023, the order backlog for the electronic instruments segment was $313,000, a decrease of 13.1% from $360,000 at December 31, 2022, but an increase of 144.5% compared to $128,000 as of September 30, 2022[91] Cash and Investments - Cash and cash equivalents increased to $40,777,000 as of September 30, 2023, from $21,507,000 as of December 31, 2022[105] - Cash provided by investing activities for the nine months ended September 30, 2023 was $18,816,000, reflecting the sale of investments and a shift to U.S. Treasury money market funds[106] - The company aims to invest available cash and cash equivalents in liquid investments to enhance returns while assessing further acquisitions[107] - The company believes existing cash, cash equivalents, and marketable securities will provide sufficient liquidity for the next 12 months[107] Interest Income - The merchant investment segment reported $287,000 of interest income during the three months ended September 30, 2023, and $542,000 during the nine months ended September 30, 2023[96] - Corporate interest income was $257,000 for the three months ended September 30, 2023, compared to $52,000 for the same period in 2022, driven by higher interest rates[98] Tax and Expenses - The company recorded a tax expense of $69,000 for the three months ended September 30, 2023, compared to a tax benefit of $648,000 for the same period in 2022[101] Working Capital - As of September 30, 2023, consolidated working capital was $40,891,000, an increase from $38,753,000 as of December 31, 2022[107] - Current assets as of September 30, 2023, were $41,502,000, with current liabilities of $611,000, resulting in a current assets to current liabilities ratio of 67.92 to 1.00[107] Dividends - The company has not paid cash dividends since January 30, 1989, and none are expected to be paid in the foreseeable future[108] Economic Conditions - Inflation in the U.S. is expected to remain elevated, potentially impacting manufacturing costs and administrative expenses[112] - The U.S. Federal Reserve raised the federal funds rate a total of eleven times from 2022 to 2023, currently ranging from 5.25% to 5.50%[112] - Rising interest rates are anticipated to benefit the company due to a significant portion of its portfolio being invested in U.S. Treasury money market funds[112] - There are no material trends or uncertainties expected to significantly impact revenues or income, aside from national economic conditions[111] Acquisitions - The company continues to evaluate potential acquisitions and investments in operating businesses[107]