Innovative Solutions & Support, Inc. Announces Third Quarter Fiscal 2022 Revenues and Earnings

·6 min read

EXTON, Pa., August 10, 2022--(BUSINESS WIRE)--Innovative Solutions & Support, Inc. ("IS&S" or the "Company") (NASDAQ: ISSC) today announced its financial results for the third quarter and first nine months of fiscal year 2022, ending June 30, 2022.

For the third quarter of fiscal 2022, the Company reported net sales of $6.9 million, up from 12% from $6.2 million reported for the third quarter of fiscal 2021. Net income for the third quarter of fiscal 2022 was $1.4 million, or $0.08 per share, compared to $2.7 million, or $0.16 per share, in the same quarter a year ago. Third quarter fiscal 2021 results include a $1.5 million, or $0.09 per share, tax benefit from the release of a deferred tax valuation allowance. The Company reported a 41% increase in operating income, rising to $1.7 million from $1.2 million a year ago.

Shahram Askarpour, Chief Executive Officer, said, "I am pleased to report another quarter of strong growth in revenue, operating income and cash flow.

Mr. Askarpour added, "I am also pleased to welcome two experienced aviation industry professionals to our Board, Ms. Parizad Olver (Parchi) and Mr. Stephen L. Belland. Both individuals strengthen our Board with their extensive experience in aviation finance and aerospace and defense, respectively. In addition, I want to also welcome Michael Linacre as Chief Financial Officer. Mike has an accomplished track record of successful financial management and driving financial results. He has recently joined IS&S as CFO upon the retirement of Relland Winand. I believe we have a leadership team that will continue to drive growth and create value for our shareholders."

Cash Flow, New Orders and Backlog

The Company’s cash on hand increased to $14.5 million at June 30, 2022, from $8.3 million at the end the latest fiscal year end. Net cash provided by operating activities was $6.4 million for the first nine months of the year.

New orders in the third quarter of fiscal 2022 were approximately $12.0 million and backlog as of June 30, 2022, was $12.6 million, up from $7.5 million at March 31, 2022. Only purchase orders in hand from the Pilatus PC-24, Textron King Air and the KC-46A long-term programs are included in the backlog total. The Company expects these programs to remain in production for approximately a decade and believes that they will continue to add to production sales already included in the backlog.

Nine Months Results

Total sales for the nine months ended June 30, 2022 were $20.5 million, up 26.6% compared to $16.2 million for the nine months ended June 30, 2021. For the nine months ended June 30, 2022, the company reported net income of $3.9 million, or $0.23 per share, up from $3.5 million, or $0.21 per share for the first nine months of fiscal 2021. The company’s operating income of $4.9 million is up 138% from $2.0 million for the nine months a year ago

Conference Call

The Company will be hosting a conference call on Thursday, August 11, 2022, at 10:00 a.m. ET to discuss these results and the Company’s business outlook and product development. Please use the following dial in number to register your name and company affiliation for the conference call: 1-844-739-3798 and ask to be joined into the Innovative Solutions & Support call. The call will also be carried live on the Investor Relations page of the Company web site at www.innovative-ss.com.

About Innovative Solutions & Support, Inc.

Headquartered in Exton, Pa., Innovative Solutions & Support, Inc. (www.innovative-ss.com) is a systems integrator that designs and manufactures flight guidance and cockpit display systems for Original Equipment Manufacturers (OEMs) and retrofit applications. The company supplies integrated Flight Management Systems (FMS), Auto-Throttle Systems and advanced GPS receivers for precision low carbon footprint navigation.

Certain matters contained herein that are not descriptions of historical facts are "forward-looking" (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, those discussed in filings made by the Company with the Securities and Exchange Commission. Many of the factors that will determine the Company’s future results are beyond the ability of management to control or predict. Readers should not place undue reliance on forward-looking statements, which reflects management’s views only as of the date hereof. The Company undertakes no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

Innovative Solutions & Support, Inc.

Condensed Consolidated Statements of Operations

Three Months Ended June 30,

Nine Months Ended June 30,

2022

2021

2022

2021

Net Sales:

Product

$

6,935,976

$

5,981,462

$

20,279,371

$

15,886,967

Engineering development contracts

-

198,721

198,203

284,713

Total net sales

6,935,976

6,180,183

20,477,574

16,171,680

Cost of sales:

Product

2,879,462

2,764,765

8,253,981

7,270,708

Engineering development contracts

-

60,916

16,748

77,656

Total cost of sales

2,879,462

2,825,681

8,270,729

7,348,364

Gross profit

4,056,514

3,354,502

12,206,845

8,823,316

Operating expenses:

Research and development

676,381

646,795

2,062,937

1,936,747

Selling, general and administrative

1,694,233

1,512,138

5,226,015

4,847,410

Total operating expenses

2,370,614

2,158,933

7,288,952

6,784,157

Operating income

1,685,900

1,195,569

4,917,893

2,039,159

Interest income

10,429

107

10,871

1,138

Other income

21,608

17,231

49,401

50,994

Income before income taxes

1,717,937

1,212,907

4,978,165

2,091,291

Income tax expense

358,763

(1,473,014

)

1,056,363

(1,443,352

)

Net income

$

1,359,174

$

2,685,921

$

3,921,802

$

3,534,643

Net income per common share:

Basic

$

0.08

$

0.16

$

0.23

$

0.21

Diluted

$

0.08

$

0.16

$

0.23

$

0.21

Weighted average shares outstanding:

Basic

17,261,349

17,230,387

17,253,822

17,222,312

Diluted

17,265,798

17,231,438

17,255,305

17,223,908

Innovative Solutions and Support, Inc.

Condensed Consolidated Balance Sheets

June 30,

September 30,

2022

2021

(Unaudited)

ASSETS

Current assets

Cash and cash equivalents

$

14,541,901

$

8,265,606

Accounts receivable

3,003,362

4,046,337

Inventories

4,905,034

4,545,392

Prepaid expenses and other current assets

778,850

833,076

Assets held for sale

1,558,475

-

Total current assets

24,787,622

17,690,411

Property and equipment, net

6,381,461

8,143,483

Deferred income taxes

278,085

1,063,822

Other assets

168,900

188,284

Total assets

$

31,616,068

$

27,086,000

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities

Accounts payable

$

752,479

$

623,620

Accrued expenses

1,683,430

1,431,115

Contract liability

329,116

417,504

Total current liabilities

2,765,025

2,472,239

Other liabilities

18,407

28,680

Total liabilities

2,783,432

2,500,919

Commitments and contingencies (See Note 6)

Shareholders' equity

Preferred stock, 10,000,000 shares authorized, $.001 par value, of which

200,000 shares are authorized as Class A Convertible stock. No shares

issued and outstanding at June 30, 2022 and September 30, 2021

-

-

Common stock, $.001 par value: 75,000,000 shares authorized,

19,372,664 and 19,342,823 issued at June 30, 2022 and September 30, 2021

19,373

19,343

Additional paid-in capital

52,142,818

51,817,095

(Accumulated deficit)

(1,961,018

)

(5,882,820

)

Treasury stock, at cost, 2,096,451 shares at June 30, 2021

and September 30, 2021

(21,368,537

)

(21,368,537

)

Total shareholders' equity

28,832,636

24,585,081

Total liabilities and shareholders' equity

$

31,616,068

$

27,086,000

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Contacts

Mike Linacre – CFO
610-646-9800 X550