Market Overview

Mikros Systems Announces Third Quarter Results

PRINCETON, N.J., Nov. 14, 2012 (GLOBE NEWSWIRE) -- Mikros Systems Corporation (OTCQB:MKRS) today announced results for the three and nine months ended September 30, 2012.

Highlights

  • Mikros posted revenue of $1.1 million for the third quarter of 2012, consistent with $1.1 million of revenue in the comparable period of 2011
     
  • Gross profit margin remained stable at 41.0% in the current quarter compared to 41.6% in the third quarter of 2011.
     
  • Gross profit margin for the nine months ended September 30, 2012 increased 13.4% to 52.6% as compared to 46.4% for the comparable period of 2011.
     
  • Net income for the third quarter increased to approximately $118,000 as compared to approximately $1,000 in the third quarter of 2011.
     
  • Mikros received $3.2 million of additional ADEPT orders from the U.S. Navy during the third quarter of 2012.

Third Quarter Results

Revenue for the three months ended September 30, 2012 was $1.1 million as compared to $1.1 million during the three months ended September 30, 2011, reflecting timing of contract awards related to the Company's ADEPT products in August and September of 2012. Gross profit also remained stable at $0.5 million, or 41.0% of revenue, during the three months ended September 30, 2012, as compared to $0.6 million, or 41.6% of revenue, in the prior-year period.  The Company posted net income of approximately $118,000, or $0.00 per diluted share, as compared to net income of approximately $1,000, or $0.00 per diluted share, in the third quarter of 2011. 

Nine Months Results

Revenue for the nine months ended September 30, 2012 was approximately $2.4 million, as compared to approximately $3.1 million during the prior year period, reflecting timing of contract awards related to the Company's ADEPT products.  Mikros realized gross profit of approximately $1.2 million, or 52.6% of revenue, during the nine months ended September 30, 2012, as compared to approximately $1.4 million, or 46.4% of revenue, in the prior-year period.  The Company posted net income of $13,000, or $0.00 per diluted share, during the nine months ended September 30, 2012 as compared to net income of $17,000, or $0.00 per diluted share, in the prior-year period. 

In commenting on the quarter, Chief Executive Officer Tom Meaney stated, "Although top line revenue in 2012 has not been what we expected, we are operating with increased margins, have maintained profitability, and continue to deliver mission critical equipment to U.S. Navy AEGIS cruisers and destroyers. Based on the combination of strong current orders, increased backlog, and multiple opportunities in the pipeline, we expect a profitable 2012 and strong start to 2013."

Additional information regarding the Company's financial results may be found in the Company's Quarterly Report on Form 10-Q for the nine months ended September 30, 2012 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

Mikros Systems Corporation is an advanced technology company specializing in the research and development of electronic systems technology, primarily for military 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, combat/command, control, communications, computers and intelligence systems engineering, and communications engineering. Mikros' primary business is to pursue and obtain contracts from the Department of Homeland Security, U.S. Navy, and other governmental authorities. For more information on Mikros visit: www.mikrossystems.com

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 the 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, the failure of Congress to approve a budget or a continuing resolution, 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, 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, 2011 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. 

Mikros Systems Corporation
Condensed Statements of Operations
 (Unaudited) 
         
  Three Months Ended, Nine Months Ended,
  September 30, September 30, September 30, September 30,
  2012 2011 2012 2011
         
 Contract Revenues  $ 1,124,211  $ 1,098,430  $ 2,362,703  $ 3,057,406
         
 Cost of sales 662,812 641,865 1,119,994 1,639,322
         
 Gross margin 461,399 456,565 1,242,709 1,418,084
         
Expenses:        
 Engineering 174,203 211,977 480,956 621,220
 General and administrative 251,712 247,796 854,100 778,875
         
 Total expenses 425,915 459,773 1,335,056 1,400,095
         
(Loss) income from operations 35,484 (3,208) (92,347) 17,989
         
Other income:        
Interest 0  --  98 816
         
Net income (loss) before income taxes 35,484 (3,208) (92,249) 18,805
         
Income tax (benefit) expense (83,000) (4,100) (105,000) 1,400
         
Net income (loss)  $ 118,484  $ 892  $ 12,751  $ 17,405
         
(Loss) income per common share - basic and diluted  $ --   $ --   $ --   $ -- 
         
Basic weighted average number of shares outstanding  31,782,786  31,766,753  31,772,136  31,766,753
         
Diluted weighted average number of shares outstanding  35,345,085  35,329,052  35,334,435  35,329,052
 Mikros Systems Corporation 
 Condensed Balance Sheets 
 (unaudited)    
  September 30, December 31,
  2012 2011
     
Assets    
Current assets:    
 Cash and cash equivalents  $ 871,878  $ 963,556
 Receivables on government contracts  784,055  1,478,103
 Prepaid expenses and other current assets  85,062  30,846
Total current assets  1,740,995  2,472,505
Property and equipment    
Equipment  38,172  37,070
Furniture & fixtures  9,264  9,264
Less: accumulated depreciation  (40,640)  (35,167)
Property and equipment, net  6,796  11,167
Patents and trademarks  1,383  5,383
Less: accumulated amortization  (862)  (1,775)
Intangible assets, net  521  3,608
Deferred tax assets  102,000  21,000
Total assets  $ 1,850,312  $ 2,508,280
Liabilities and shareholders' equity    
Current liabilities:    
 Accrued payroll and payroll taxes  $ 125,783  $ 364,148
 Accounts payable and accrued expenses  479,298  904,217
 Accrued warranty expense  52,338  86,400
Total current liabilities  657,419  1,354,765
Long-term liabilities  15,877  16,708
Total liabilities  673,296  1,371,473
     
Redeemable series C preferred stock     
par value $.01 per share, authorized 150,000 shares, issued    
and outstanding 5,000 shares (involuntary liquidation value  
-- $80,450)  80,450  80,450 
Shareholders' equity:    
Preferred stock, series B convertible, par value $.01 per share,    
 authorized 1,200,000 shares, issued and outstanding 1,102,433    
 shares (involuntary liquidation value -- $1,102,433)  11,024  11,024 
 Preferred stock, convertible, par value $.01 per share, authorized     
 2,000,000 shares, issued and outstanding 255,000 shares (involuntary     
 liquidation value -- $255,000)  2,550  2,550 
Preferred stock, series D, par value $.01 per share, 690,000 shares     
 authorized, issued and outstanding (involuntary liquidation value     
 -- $1,518,000)  6,900  6,900 
 Common stock, par value $.01 per share, authorized 60,000,000 shares,    
 issued and outstanding 32,016,753 shares  320,168  320,168 
 Capital in excess of par value  11,602,894  11,575,436
 Accumulated deficit (10,846,970)  (10,859,721)
Total shareholders' equity  1,096,566  1,056,357
Total liabilities and shareholders' equity  $ 1,850,312  $ 2,508,280
CONTACT: Thomas J. Meaney, 609-987-1513
 

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