inTEST First Quarter 2022 Revenue Up 23% Year-over-Year and Up

inTEST First Quarter 2022 Revenue Up 23% Year-over-Year and Up 8% Sequentially, Demonstrating Solid Execution of 5-Point Strategy

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Conference Call and Webcast

The Company will host a conference call and webcast today at 8:30 am ET. During the conference call, management will review the financial and operating results and discuss inTEST’s corporate strategy and outlook. A question and answer session will follow. To listen to the live call, dial (201) 689-8263. In addition, the webcast and slide presentation may be found at: https://ir.intest.com/.

A telephonic replay will be available from 11:30 am ET on the day of the call through Friday, May 13, 2022. To listen to the archived call, dial (412) 317-6671 and enter replay pin number 13728796 or access the webcast replay via the Company’s website. A transcript will also be posted to the website once available.

About inTEST Corporation

inTEST Corporation is a global supplier of innovative test and process solutions for use in manufacturing and testing in target markets which include automotive, defense/aerospace, industrial, life sciences, and security, as well as both the front-end and back-end of the semiconductor manufacturing industry. Backed by decades of engineering expertise and a culture of operational excellence, inTEST solves difficult thermal, mechanical, and electronic challenges for customers worldwide while generating strong cash flow and profits. inTEST’s strategy leverages these strengths to grow organically and with acquisitions through the addition of innovative technologies, deeper and broader geographic reach, and market expansion. For more information, visit www.intest.com.

Non-GAAP Financial Measures

In addition to disclosing results that are determined in accordance with GAAP, we also disclose non-GAAP financial measures. These non-GAAP financial measures consist of adjusted net earnings (loss), adjusted earnings (loss) per diluted share, adjusted EBITDA, and adjusted EBITDA margin. Adjusted net earnings (loss) is derived by adding acquired intangible amortization, adjusted for the related income tax expense (benefit), to net earnings (loss). Adjusted earnings (loss) per diluted share is derived by dividing adjusted net earnings (loss) by diluted weighted average shares outstanding. Adjusted EBITDA is derived by adding acquired intangible amortization, interest expense, income tax expense, depreciation, and stock-based compensation expense to net earnings (loss). Adjusted EBITDA margin is derived by dividing adjusted EBITDA by revenue. These results are provided as a complement to the results provided in accordance with GAAP. Adjusted net earnings (loss) and adjusted earnings (loss) per diluted share are non-GAAP financial measures presented to provide investors with meaningful, supplemental information regarding our baseline performance before acquired intangible amortization charges as this expense may not be indicative of our underlying operating performance. Adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures presented primarily as a measure of liquidity as they exclude non-cash charges for acquired intangible amortization, depreciation and stock-based compensation. In addition, adjusted EBITDA and adjusted EBITDA margin also exclude the impact of interest income or expense and income tax expense or benefit, as these expenses may not be indicative of our underlying operating performance. The non-GAAP financial measures presented in this press release are used by management to make operational decisions, to forecast future operational results, and for comparison with our business plan, historical operating results and the operating results of our peers. Reconciliations from net earnings (loss) and earnings (loss) per diluted share to adjusted net earnings (loss) and adjusted earnings (loss) per diluted share and from net earnings (loss) to adjusted EBITDA and adjusted EBITDA margin, are contained in the tables below. The non-GAAP financial measures discussed in this press release may not be comparable to similarly titled measures used by other companies. The presentation of non-GAAP financial measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These statements do not convey historical information but relate to predicted or potential future events and financial results, such as statements of the Company’s plans, strategies and intentions, or our future performance or goals, that are based upon management's current expectations. These forward-looking statements can often be identified by the use of forward-looking terminology such as “believes,” “expects,” “intends,” “may,” “will,” “should,” “plans,” “projects,” “forecasts,” “outlook,” “anticipates,” “targets,” “estimates,” or similar terminology. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements.

Such risks and uncertainties include, but are not limited to, any mentioned in this press release as well as the Company’s ability to execute on its 5-Point Strategy, realize the potential benefits of acquisitions and successfully integrate any acquired operations, grow the Company’s presence in the life sciences, security, industrial and international markets, manage supply chain challenges, convert backlog to sales and to ship product in a timely manner; the success of the Company’s strategy to diversify its markets; the impact of inflation on the Company’s business and financial condition; the impact of the COVID-19 pandemic on the Company’s business, liquidity, financial condition and results of operations; indications of a change in the market cycles in the semi market or other markets served; changes in business conditions and general economic conditions both domestically and globally; changes in the demand for semiconductors; the ability to borrow funds or raise capital to finance potential acquisitions or for working capital; changes in the rates and timing of capital expenditures by the Company’s customers; and other risk factors set forth from time to time in the Company’s Securities and Exchange Commission filings, including, but not limited to, the Annual Report on Form 10-K for the year ended December 31, 2021. Any forward-looking statement made by the Company in this press release is based only on information currently available to management and speaks to circumstances only as of the date on which it is made. The Company undertakes no obligation to update the information in this press release to reflect events or circumstances after the date hereof or to reflect the occurrence of anticipated or unanticipated events.

– FINANCIAL TABLES FOLLOW –


inTEST CORPORATION
Consolidated Statements of Operations
*(In thousands, except share and per share data)*
(Unaudited)

	Three Months Ended March 31,
	2022			2021

Revenue	$	24,081		$	19,556
Cost of revenue		13,068			10,035
Gross profit		11,013			9,521

Operating expenses:
Selling expense		3,456			2,403
Engineering and product development expense		1,924			1,322
General and administrative expense		4,831			3,161
Restructuring and other charges		-			55
Total operating expenses		10,211			6,941

Operating income		802			2,580
Other expense		(147	)		(2	)

Earnings before income tax expense		655			2,578
Income tax expense		78			366

Net earnings	$	577		$	2,212

Earnings per common share – basic	$	0.05		$	0.21
Weighted average common shares outstanding – basic		10,617,271			10,329,449

Earnings per common share – diluted	$	0.05		$	0.21
Weighted average common shares and common share equivalents outstanding – diluted		10,842,592			10,525,826


inTEST CORPORATION
Consolidated Balance Sheets
*(In thousands)*

	March 31,			December 31,
	2022			2021
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	17,211		$	21,195
Trade accounts receivable, net of allowance for doubtful accounts of $212 and $213, respectively		17,292			16,536
Inventories		14,913			12,863
Prepaid expenses and other current assets		1,853			1,483
Total current assets		51,269			52,077
Property and equipment:
Machinery and equipment		5,801			5,733
Leasehold improvements		3,193			3,001
Gross property and equipment		8,994			8,734
Less: accumulated depreciation		(6,190	)		(6,046	)
Net property and equipment		2,804			2,688
Right-of-use assets, net		5,657			5,919
Goodwill		21,863			21,448
Intangible assets, net		20,905			21,634
Restricted certificates of deposit		100			100
Other assets		336			39
Total assets	$	102,934		$	103,905

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of Term Note	$	4,100		$	4,100
Current portion of operating lease liabilities		1,444			1,371
Accounts payable		5,896			4,281
Accrued wages and benefits		2,898			4,080
Accrued professional fees		527			1,048
Customer deposits and deferred revenue		5,425			6,038
Accrued sales commission		842			863
Domestic and foreign income taxes payable		1,625			2,024
Other current liabilities		1,390			1,267
Total current liabilities		24,147			25,072
Operating lease liabilities, net of current portion		4,876			5,248
Term Note, net of current portion		15,117			16,000
Deferred tax liabilities		941			1,379
Contingent consideration		1,369			930
Other liabilities		483			453
Total liabilities		46,933			49,082

Commitments and Contingencies
Stockholders' equity:
Preferred stock, $0.01 par value; 5,000,000 shares authorized; no shares issued or outstanding		-			-
Common stock, $0.01 par value; 20,000,000 shares authorized; 10,995,194 and 10,910,460 shares issued, respectively		110			109
Additional paid-in capital		30,358			29,931
Retained earnings		24,970			24,393
Accumulated other comprehensive earnings		767			594
Treasury stock, at cost; 33,077 shares		(204	)		(204	)
Total stockholders' equity		56,001			54,823
Total liabilities and stockholders' equity	$	102,934		$	103,905


inTEST CORPORATION
Consolidated Statements of Cash Flows
*(In thousands)*
(Unaudited)

	Three Months Ended March 31,
	2022			2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings	$	577		$	2,212
Adjustments to reconcile net earnings to net cash used in operating activities:
Depreciation and amortization		1,279			740
Provision for excess and obsolete inventory		123			39
Foreign exchange loss		40			8
Amortization of deferred compensation related to stock-based awards		372			269
Loss on disposal of property and equipment		-			22
Proceeds from sale of demonstration equipment, net of gain		19			7
Deferred income tax benefit		(438	)		(9	)
Changes in assets and liabilities:
Trade accounts receivable		(832	)		(5,082	)
Inventories		(2,177	)		(783	)
Prepaid expenses and other current assets		(374	)		212
Other assets		(8	)		(8	)
Accounts payable		1,592			1,235
Accrued wages and benefits		(1,179	)		103
Accrued professional fees		(520	)		(261	)
Customer deposits and deferred revenue		(608	)		799
Accrued sales commission		(20	)		232
Operating lease liabilities		(346	)		(343	)
Domestic and foreign income taxes payable		(395	)		335
Other current liabilities		40			(57	)
Other liabilities		60			(7	)
Net cash used in operating activities		(2,795	)		(337	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		(335	)		(388	)
Net cash used in investing activities		(335	)		(388	)

CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of Term Note		(883	)		-
Proceeds from shares sold under Employee Stock Purchase Plan		56			-
Proceeds from stock options exercised		-			717
Net cash provided by (used in) financing activities		(827	)		717

Effects of exchange rates on cash		(27	)		(74	)

Net cash used in all activities		(3,984	)		(82	)
Cash and cash equivalents at beginning of period		21,195			10,277
Cash and cash equivalents at end of period	$	17,211		$	10,195

Cash payments for:
Domestic and foreign income taxes	$	966		$	41

inTEST CORPORATION
Revenue by Market
*(In thousands)*
(Unaudited)

($ in 000s)	Three Months Ended
									Change								Change
	3/31/2022				12/31/2021				$		%		3/31/2021				$		%
Revenue
Semi	$	13,390	55.6	%	$	12,284	54.9	%	$	1,106	9.0	%	$	13,320	68.1	%	$	70	0.5	%
Industrial		2,799	11.6	%		2,172	9.7	%		627	28.9	%		1,427	7.3	%		1,372	96.1	%
Auto/EV Life Sciences Defense/Aerospace Security Other		2,756 699 1,493 574 2,370	11.4 2.9 6.2 2.4 9.8	% % % % %		2,697 409 1,322 693 2,781	12.1 1.8 5.9 3.1 12.4	% % % % %		59 290 171 (119) (411)	2.2 70.9 12.9 -17.2 -14.8	% % % % %		1,327 643 1,252 - 1,587	6.8 3.3 6.4 0.0 8.1	% % % % %		1,429 56 241 574 783	107.7 8.7 19.2 NM 49.3	% % % %
	$	24,081	100.0	%	$	22,358	100.0	%	$	1,723	7.7	%	$	19,556	100.0	%	$	4,525	23.1	%

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