MINNEAPOLIS — (BUSINESS WIRE) — November 12, 2019 — Nortech Systems Incorporated (Nasdaq: NSYS), a leading provider of engineering and manufacturing solutions for complex electromechanical products, reported net sales of $30.1 million for the third quarter ended September 30, 2019, compared with $29.6 million for the third quarter of 2018.
Operating income for the third quarter of 2019 was $713,000, which is a 10% increase compared to operating income of $649,000 for the third quarter of 2018. Net income for the third quarter of 2019 was $413,000, or $0.16 per diluted common share. This is a 13% increase compared to net income for third quarter of 2018 of $364,000, or $0.14 per diluted common share. September 30, 2019 backlog was $58.1 million vs. $43.1 million on September 30, 2018.
“We are pleased with our third quarter improvements in margin and operating income. Revenue met our expectations and our margins were positively impacted by the continuation of strategic operational efficiencies while we manage through component shortages,” said Jay D. Miller, president and CEO. “We continue to expect to deliver on our backlog for the remainder of the year, which is amongst the highest Nortech backlog in 10 years.”
The mission of Nortech Systems is to be the most trusted, innovative, and nimble design and manufacturing services and solutions provider, while taking great care of its employees, customers, and supplier partners.
About Nortech Systems Incorporated Nortech Systems is a leading provider of design and manufacturing solutions for complex electromechanical systems, assemblies, and components. Nortech Systems primarily serves the medical, aerospace & defense, and industrial markets. Its design services span concept development to commercial design, and include software, electrical, mechanical, and biomedical engineering. Its manufacturing and supply chain capabilities are vertically integrated around wire/cable/interconnect assemblies, printed circuit board assemblies, as well as system-level assembly, integration, and final test. Headquartered in Maple Grove, Minn., Nortech currently has seven manufacturing locations and design centers across the U.S., Latin America, and Asia. Nortech Systems is traded on the NASDAQ Stock Market under the symbol NSYS. Nortech’s website is www.nortechsys.com.
Forward-Looking Statements This press release contains forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. While this release is based on management’s best judgment and current expectations, actual results may differ and involve a number of risks and uncertainties. Important factors that could cause actual results to differ materially from the forward-looking statements include, without limitation: volatility in market conditions which may affect market supply of and demand for the company’s products; increased competition; changes in the reliability and efficiency of operating facilities or those of third parties; risks related to availability of labor; commodity and energy cost instability; general economic, financial and business conditions that could affect the company’s financial condition and results of operations; as well as risk factors listed from time to time in the company’s filings with the SEC.
Condensed Consolidated Statements of Operations
|
||||||||
| THREE MONTHS ENDED | ||||||||
September 30, |
||||||||
Unaudited |
Unaudited |
|||||||
2019 |
2018 |
|||||||
| Net Sales | $ |
30,058 |
|
$ |
29,558 |
|
||
| Cost of Goods Sold | 26,423 |
|
26,171 |
|
||||
| Gross Profit | 3,635 |
|
3,387 |
|
||||
12.1 |
% |
11.5 |
% |
|||||
| Operating Expenses | ||||||||
| Selling Expenses | 589 |
|
717 |
|
||||
| General and Administrative Expenses | 2,333 |
|
2,021 |
|
||||
| Total Operating Expenses | 2,922 |
|
2,738 |
|
||||
| Income From Operations | 713 |
|
649 |
|
||||
| Other Expense | ||||||||
| Interest Expense | (256 |
) |
(170 |
) |
||||
| Income Before Income Taxes | 457 |
|
479 |
|
||||
| Income Tax Expense | 44 |
|
115 |
|
||||
| Net Income | $ |
413 |
|
$ |
364 |
|
||
| Income Per Common Share - Diluted | $ |
0.16 |
|
$ |
0.14 |
|
||
| Weighted Average Number of Common Shares Outstanding - Diluted | 2,657,911 |
|
2,682,901 |
|
||||
Condensed Consolidated Balance Sheets
|
||||||
| September 30, 2019 | December 31, 2018 | |||||
| Unaudited | Audited | |||||
| Cash | $ |
160 |
$ |
480 |
||
| Restricted Cash | 1,794 |
467 |
||||
| Accounts Receivable | 20,135 |
20,093 |
||||
| Inventories | 16,941 |
17,004 |
||||
| Contract Assets | 7,211 |
6,431 |
||||
| Prepaid Expenses and Other Current Assets | 2,019 |
1,381 |
||||
| Property and Other Long-term Assets | 14,747 |
10,178 |
||||
| Goodwill and Other Long-term Assets, Net | 3,772 |
3,926 |
||||
| Total Assets | $ |
66,779 |
$ |
59,960 |
||
| Accounts Payable | $ |
18,384 |
$ |
18,142 |
||
| Current Portion of Lease Obligation | 476 |
337 |
||||
| Other Current Liabilities | 6,756 |
6,413 |
||||
| Long Term Line of Credit | 12,430 |
9,264 |
||||
| Long-term Debt and Other Long-term Liabilities | 4,581 |
4,714 |
||||
| Long Term Operating Lease Obligation, Net | 4,517 |
- |
||||
| Shareholders’ Equity | 19,635 |
21,090 |
||||
| Total Liabilities and Shareholders’ Equity | $ |
66,779 |
$ |
59,960 |
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20191112006080/en/
Contact:
Connie Beck, VP & CFO
Nortech Systems Incorporated
(952) 345-2244