Attached files
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| 8-K - CURRENT REPORT - SOLITRON DEVICES INC | sodi_8k.htm |
Exhibit 99.1
SOLITRON
DEVICES, INC. ANNOUNCES PRELIMINARY UNAUDITED FIRST QUARTER SALES
AND BOOKINGS
WEST
PALM BEACH, FL – Solitron Devices, Inc. (OTCBB: SODI)
(“Solitron” or the “Company”) today
announced an update on recent financial results.
For the
quarter ended May 31, 2018 (unaudited) (first quarter of fiscal
2019):
➢
Sales in the first
quarter of fiscal 2019 decreased by 37% to approximately $1.9
million versus approximately $3.0 million in the first quarter of
fiscal 2018.
➢
Bookings in the
first quarter of fiscal 2019 increased by 25% to approximately $1.5
million versus approximately $1.2 million in the first quarter of
fiscal 2018.
➢
Backlog at the end
of the first quarter of fiscal 2019 increased by 6% to
approximately $6.9 million versus approximately $6.5 million at the
end of the first quarter of fiscal 2018.
➢
Total cash and
securities was approximately $1.5 million at the end of the first
quarter of fiscal 2019 versus approximately $2.5 million at the end
of the first quarter of fiscal 2018.
➢
Accounts receivable
at the end of the first quarter of fiscal 2019 was approximately
$1.3 million versus approximately $1.9 million at the end of the
first quarter of fiscal 2018.
➢
Total liabilities
at the end of the first quarter of fiscal 2019 was approximately
$1.4 million versus approximately $1.1 million at the end of first
quarter of fiscal 2018.
Sales
decreased by 37% from the prior year fiscal quarter. The prior year
fiscal quarter was a record high quarter where we intentionally
ramped up volume to test our people and systems. Management
expected a decrease in sales in the quarter. We continue to
encounter various challenges related to expanding our product line
and delivery problems from a key supplier. The supplier who had
initially solved their issues ended up delivering materials that
had to be returned due to failing testing. This resulted in lower
sales during the quarter.
As we
noted in our fiscal 2018 press release, the Company is seeking to
grow revenues and expects growing pains to be a natural part of
that process. We have materially added to our engineering staff in
order to address the growing pains and expand our capabilities.
While the additional cost results in a reduction in earnings in the
short term, we believe that it will broaden and strengthen our
capabilities which will in the long term lead to higher sales and
higher future profitability.
We are
pleased that during the quarter the company qualified five
additional JAN (Joint Army Navy) products. That brings our current
JAN qualified products to eight. Additional JAN products are
currently being developed and qualified. For those unfamiliar with
the industry, qualification involves various testing including life
testing.
Bookings
are seasonal, but it is encouraging to see an increase from the
prior year period. Our sales team continues to do an excellent job.
As noted in our fiscal 2018 press release, a customer who typically
books in the fiscal fourth quarter placed a split order with the
second half expected to be awarded toward the end of the second
quarter of fiscal 2019. Due to the nature of government contracts,
the award may slip into the early part of the third quarter.
Management is still forecasting an increase in bookings for fiscal
2019 versus the $8.3 million received in fiscal 2018, although it
should be noted that our largest order tends to be received right
near the end of the fiscal year so it is possible that timing
differences could impact our forecast.
The investigation pertaining to certain matters relating to the
Company’s historical inventory reserves has concluded. The
Company incurred approximately $500,000 of costs in the quarter
related to the investigation and audit. Management continues to
work with its independent registered public
accounting firm to complete the
audit.
These
preliminary, unaudited results for the first fiscal quarter ended
2019 and 2018 are based on management's review of operations for
those periods and the information available to the Company as of
the date of this press release and remain subject to the completion
of the Company's review procedures and the audit of the
Company’s annual financial statements by an independent
registered public accounting firm to be retained by the Company.
Final adjustments and other material developments may arise between
the date of this press release and the date the Company files with
the Securities and Exchange Commission (“SEC”) its
Quarterly Reports on Form 10-Q for the quarter ended May 31, 2018.
Our current independent registered public accounting firm has not
reviewed or performed any procedures with respect to the
preliminary financial information presented for the fiscal periods
ended May 31, 2018, May 31, 2017, and fiscal year ended February
28, 2018, nor has it completed the audit for the fiscal year ended
February 28, 2017.
The
information presented in this press release should not be
considered a substitute for the financial information to be filed
with the SEC in the Company's Quarterly Reports on Form 10-Q for
the quarter ended May 31, 2018 once it becomes available. The
Company has no intention or obligation to update the preliminary
estimated unaudited financial results in this release prior to
filing its Quarterly Reports on Form 10-Q for the quarter ended May
31, 2018.
About Solitron Devices, Inc.
Solitron Devices, Inc., a Delaware corporation, designs, develops,
manufactures and markets solid state semiconductor components and
related devices primarily for the military and aerospace markets.
The Company manufactures a large variety of bipolar and metal oxide
semiconductor (“MOS”) power transistors, power and
control hybrids, junction and power MOS field effect transistors
(“Power MOSFETS”), and other related products. Most of
the Company's products are custom made pursuant to contracts with
customers whose end products are sold to the United States
government. Other products, such as Joint Army/Navy
(“JAN”) transistors, diodes and Standard Military
Drawings voltage regulators, are sold as standard or catalog items.
The Company was incorporated under the laws of the State of New
York in March 1959 and reincorporated under the laws of the State
of Delaware in August 1987.
Forward-Looking Statements
This press release contains forward-looking statements regarding
future events and the future performance of Solitron Devices, Inc.
that involve risks and uncertainties that could materially affect
actual results, including statements regarding the Company’s
preliminary first quarter results. Factors that could cause actual
results to vary from current expectations and forward-looking
statements contained in this press release include, but are not
limited to: (1) expected bookings for fiscal year 2019; (2) the
results of the investigation and the impact of the results on the
Company’s previously issued financial statements and the
Company’s inventory policies and assessments; (3) our ability
to properly account for inventory in the future, (4) our ability to
protect the Company’s net operating losses and tax benefits,
(5) changes in our stock price, corporate or other market
conditions; (6) the loss of, or reduction of business from,
substantial clients; (7) our dependence on government contracts,
which are subject to termination, price renegotiations and
regulatory compliance; (8) changes in government policy or economic
conditions; (9) increased competition; (10) the uncertainty of
current economic conditions, domestically and globally; and (11)
other factors contained in the Company’s Securities and
Exchange Commission filings, including its Form 10-K, 10-Q and 8-K
reports.