PRINCETON, N.J., Nov. 15, 2017 (GLOBE NEWSWIRE) -- Mikros Systems Corporation (OTCQB:MKRS), an advanced technology company specializing in electronic systems technology for advanced maintenance in military, industrial and commercial applications, reported financial results for the third quarter and first nine months of 2017.
Third-quarter revenue increased 31% to $1.55 million from $1.18 million in the third quarter of 2016. Net income increased 40% to $29,005 from $20,726 in 2016. Cost of sales as a percentage of revenue in the third quarter was 41% as compared to 38% during the third quarter of 2016. Engineering costs increased 26% to $530,477 as compared to $421,296 during the third quarter of 2016, generally in line with the increase in revenues, while general and administrative expenses increased 45% to $379,407 from $261,528 during the third quarter of 2016 as the Company continued to grow its core defense business and invest in commercial markets.
Year-to-date results also showed substantial increases over the prior year period. Revenue for the first nine months of 2017 increased 60% to $5.04 million as compared to $3.14 million in the corresponding period in 2016 and net income increased 539% to $195,537 from $30,599 in the corresponding period in 2016. Cost of sales as a percentage of revenue year-to-date was 38% as compared to 36% during the first nine months of 2016. Engineering costs increased 49% to $1.59 million during the first nine months of 2017 as compared to $1.06 million during the corresponding period in 2016, while general and administrative expenses increased 36% to $1.22 million from $894,430 during the third quarter of 2016.
The increases in profits and revenue resulted primarily from a large production order for the Company’s ADEPT® system received in February 2017 and the receipt of additional contracts for engineering services, support, repairs, and calibration services for the U.S. Navy.
During the third quarter, the Company continued to invest in the research, development, and marketing of its key commercial offerings. This included the launch of two pilot systems of a condition-based maintenance system for heating, ventilation, air conditioning, and refrigeration (HVAC) equipment based on the Company’s proprietary prognostics solution. In addition to progress in the commercial initiatives, Mikros also announced over $3.4 million in new defense orders including:
- a $0.5 million modification to delivery order 2 under the ADEPT IDIQ Contract to continue to support the ADEPT product line in the fleet, implement necessary software enhancements, and provide general support of the program;
- a $0.5 million modification to the sustainment delivery order to provide for bi-annual sustainment services for ADEPT units cycling through the Company’s depot center; and
- a $2.4 million order for the production and delivery of ADEPT units for installation on Aegis cruisers and destroyers in the U.S. Navy.
“We are pleased to report another excellent quarter for our investors. For the third straight quarter we delivered meaningful increases in both revenue and profitability over the prior year period,” stated Mikros CEO, Tom Meaney. “We remain on pace to finish strong in 2017 as we continue to generate multiple orders and new contracts from our Navy customers and extend our ADSSS and ADEPT offerings to additional radar systems and ship classes. To sustain this momentum and better serve our important customers, we have made a number of strategic hires in our engineering department and dedicated additional key personnel to focus on program management. Our balance sheet remains strong and we have increased our cash reserves by more than 20% in 2017.”
Mikros President Mark Malone added, “Building on the steady orders and backlog generated from our $80 million of IDIQ contracts with the Department of Defense, we significantly advanced the expansion of our military grade security and condition based maintenance expertise to select commercial markets. We believe that commercial opportunities represent a vast and relatively untapped market for us to substantially increase our business over the next 12 to 24 months and we will continue to invest engineering, marketing and other resources to execute this strategic initiative.”
Additional information regarding the Company’s financial data may be found in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 filed with the U.S. Securities and Exchange Commission. The Form 10-Q may be accessed at www.sec.gov or at the Company’s website at www.mikrossystems.com
ABOUT MIKROS SYSTEMS CORPORATION
Mikros Systems Corporation is an advanced technology company specializing in the development and production of electronic systems technology for advanced maintenance in military, industrial and commercial applications. Classified by the U.S. Department of Defense as a small business, its capabilities include technology management, electronic systems engineering and integration, radar systems engineering, command, control, communications, computers and intelligence systems engineering, and communications engineering.
CONTACT: Mark Malone (609) 987-1513
Important Information about Forward-Looking Statements
All statements in this news release other than statements of historical facts are forward-looking statements which contain our current expectations about our future results. Forward-looking statements involve numerous risks and uncertainties. We have attempted to identify any forward-looking statements by using words such as "anticipates," "believes," "could," "expects," "intends," "may," "should" and other similar expressions. Although we believe that the expectations reflected in all of our forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Such statements are not guarantees of future performance or events and are subject to known and unknown risks and uncertainties that could cause the Company's actual results, events or financial positions to differ materially from those included within or implied by such forward-looking statements. Such factors include, but are not limited to, changes in business conditions, a decline or redirection of the U.S. Defense budget, significant delays or reductions in appropriations for our projects, the termination of any contracts with the U.S. Government, changes in our sales strategy and product development plans, changes in the marketplace, continued services of our executive management team, our limited marketing experience, competition between us and other companies seeking SBIR grants, competitive pricing pressures, market acceptance of our products under development, delays in the development of products, our ability to adequately integrate our software offerings into our business model, our ability to market our solutions to commercial customers, numerous other matters of national, regional and global scale, including those of a political, economic, business and competitive nature, statements of assumption underlying any of the foregoing, and other factors disclosed in our annual report on Form 10-K for the year ended December 31, 2016 and other filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, we undertake no obligation to disclose any revision to these forward-looking statements.
Source:Mikros Systems Corp.