STERLING, VA--(Marketwired - Aug 13, 2013) - Sutron Corporation (NASDAQ: STRN) today announced results for the second quarter and six months ended June 30, 2013.
Second Quarter 2013 Highlights
Revenue of $6.3 million, down 2% from Q1 2013
Backlog of $14.6 million, up 11% from Q1 2013
Cash of $7.1 million, up 42% from Q1 2013
First Half 2013 Highlights
Record Revenue of $12.8 million, up 21% from prior year period
Backlog of $14.6 million as of mid-year, up 11% from prior year period
Sutron reported revenue of $6.3 million for the second quarter of 2013, down 7% from $6.8 million in the second quarter of 2012. This decrease was primarily driven by decreased international project activity. The net loss for the second quarter of fiscal year 2013 was $53,170 compared to net income of $551,670 in the second quarter of fiscal year 2012. This result was primarily due to the impact of the decline in revenue and to increased research and development investments. The Company reported a second quarter loss of $0.01 per basic and diluted share as compared to earnings of $0.12 per basic share and $0.11 per diluted share in the second quarter of 2012.
For the first six months of calendar year 2013, Sutron recorded record revenue of $12.8 million, a 21% increase compared to $10.5 million during the first six months of 2012. Sutron reported a net loss of $22,968 for the first six months of 2013 compared to $475,561 of net income for the same period of 2012. The first six months loss results in $0.00 per basic and diluted share as compared to earning $0.10 per basic share and $0.09 per diluted share in the first six months of 2012.
The Company's backlog as of June 30, 2013 was approximately $14.6 million, up 11% from the backlog as of June 30, 2012.
Balance Sheet and Liquidity
Sutron ended the second quarter of 2013 with $7.1 million in cash and cash equivalents, up from $5 million at March 31, 2013. Cash generated by operating activities during the first six months of 2013 was $167,222 as compared to cash generated by operating activities through the first six months of 2012 of $394,908. Capital expenditures were $164,747 for the first six months of 2013 compared to $30,264 for the first six months of 2012. As a consequence, Free Cash Flow for the first six months of 2013 was $2,475 compared to Free Cash Flow of $364,644 for the first six months of 2012. Sutron defines Free Cash Flow as net cash provided or used by operating activities less cash used in the purchase of property and equipment.
Management Commentary
Raul McQuivey, Chairman and Chief Executive Officer, said, "We have been affected this year by a perceptible slowdown in international project tender activity as well as the cancellation of some tenders prior to anticipated awards. While our second quarter results were largely impacted by these developments, we are encouraged by our record first six month's revenue of $12.8 million and our backlog of $14.6 million. After funding our recent acquisitions of Sabio and MeteoStar with cash, we have been able to build back to a strong cash balance of $7.1 million. We also continue to invest in new product development in these new divisions and, while this has increased our expenses in the near term, we anticipate that these investments will contribute to increased profitability in the upcoming quarters. As evidenced by this quarter's results, our business remains highly project driven through competitive tender and, thus, we expect periodic fluctuations in bookings and revenue due to the uncertain timing of governmental approval and funding processes."
About Sutron
Sutron Corporation, headquartered in Sterling, Virginia, is a project driven business. We provide hydrological, meteorological, oceanic and aviation real-time data collection products, systems, software and services to a diversified customer base of federal, state, local and foreign governments, engineering companies, universities, hydropower companies and other commercial entities. Our quarterly results may fluctuate substantially based upon contract awards that are difficult to project in terms of timing and may be delayed due to differing time frames in securing government approvals and funding.
Safe Harbor Statement
The statements in this press release that relate to future plans, events or performance are "forward-looking statements" within the meaning of the Private Securities Litigation Act of 1995. Forward-looking statements include without limitation any statements regarding our expected future financial position, results of operations, cash flows, EBITDA, financing plans, business strategy, bookings, products and services, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "should" and other similar expressions are forward-looking statements. All forward-looking statements involve risks, uncertainties and contingencies which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. We are under no obligation to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.
SUTRON CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
Three Months Ended June 30,
2013
2012
Revenue
$
6,343,240
$
6,804,168
Cost of goods sold
3,987,068
4,027,666
Gross profit
2,356,172
2,776,502
Operating expenses:
Selling, general and administrative expenses
1,467,134
1,347,544
Research and development expenses
976,254
627,633
Total operating expenses
2,443,388
1,975,177
Operating income (loss)
(87,216
)
801,325
Financing income, net
6,046
15,345
Income (loss) before income taxes
(81,170
)
816,670
Income tax expense (benefit)
(28,000
)
265,000
Net income (loss)
$
(53,170
)
$
551,670
Net income (loss) per share:
Basic income (loss) per share
$
(0.01
)
$
0.12
Diluted income (loss) per share
$
(0.01
)
$
0.11
SUTRON CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
Six Months Ended June 30,
2013
2012
Revenue
$
12,798,350
$
10,541,349
Cost of goods sold
7,796,037
6,338,255
Gross profit
5,002,313
4,203,094
Operating expenses:
Selling, general and administrative expenses
3,101,137
2,352,360
Research and development expenses
1,946,393
1,180,901
Total operating expenses
5,047,530
3,533,261
Operating income (loss)
(45,217
)
669,833
Financing income, net
9,249
26,728
Income (loss) before income taxes
(35,968
)
696,561
Income tax expense (benefit)
(13,000
)
221,000
Net income (loss)
$
(22,968
)
$
475,561
Net income per share:
Basic income per share
$
0.00
$
0.10
Diluted income per share
$
0.00
$
0.09
SUTRON CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Audited)
June 30,
December 31,
2013
2012
ASSETS
Current Assets:
Cash and cash equivalents
$
6,322,489
$
7,576,374
Restricted cash and cash equivalents
818,453
810,396
Accounts receivable, net
5,597,267
5,771,013
Inventory
4,893,888
4,291,505
Prepaid items and other assets
310,445
248,546
Income taxes receivable
1,277,154
1,202,709
Deferred income taxes
745,000
666,000
Total Current Assets
19,964,696
20,566,543
Property and Equipment, Net
1,679,802
1,698,218
Other Assets
Goodwill
4,754,152
3,768,435
Intangibles, net of amortization
714,463
781,633
Other Assets
90,799
95,217
Total Assets
$
27,203,912
$
26,910,046
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable
$
1,149,407
$
1,300,917
Accrued payroll
349,524
464,942
Deferred revenue
556,979
531,397
Other accrued expenses
1,431,795
1,134,279
Billings in excess of costs and estimated earnings
539,344
306,148
Total Current Liabilities
4,027,049
3,737,683
Long-Term Liabilities
Deferred rent
886,672
1,006,893
Deferred income taxes
145,000
39,000
Total Long-term Liabilities
1,031,672
1,045,893
Total Liabilities
5,058,721
4,783,576
Stockholders' Equity
Common stock, 12,000,000 shares authorized; 5,069,009 and 5,039,632 issued and outstanding
50,469
50,397
Additional paid-in capital
5,283,259
5,185,325
Retained earnings
17,050,383
17,073,351
Accumulated other comprehensive loss
(238,920
)
(182,603
)
Total Stockholders' Equity
22,145,191
22,126,470
Total Liabilities and Stockholders' Equity
$
27,203,912
$
26,910,046
SUTRON CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended June 30,
2013
2012
Cash Flows from Operating Activities:
Net income (loss)
$
(22,968
)
$
475,561
Noncash items included in net income:
Depreciation and amortization
259,850
143,365
Deferred income taxes
36,000
(32,134
)
Stock based compensation
80,080
44,364
Tax benefit from stock options exercised
(12,996
)
(9,873
)
Change in current assets and liabilities:
Accounts receivable
256,599
323,534
Inventory
(435,285
)
(639,217
)
Prepaid items and other assets
(58,632
)
(153,153
)
Income taxes receivable
(61,449
)
67,636
Accounts payable
(151,510
)
(55,571
)
Accrued expenses
138,976
(124,933
)
Deferred revenues
25,582
174,860
Billings in excess of costs and estimated earnings
233,196
282,572
Deferred rent
(120,221
)
(102,103
)
Net Cash Provided by Operating Activities
167,222
394,908
Cash Flows from Investing Activities:
Restricted cash and cash equivalents
(8,057
)
(131,551
)
Purchase of property and equipment
(164,747
)
(30,264
)
Certificate of deposit
-
(1,933
)
Other assets
4,418
5,093
Business Acquisition
(1,214,330
)
(4,241,914
)
Net Cash Used by Investing Activities
(1,382,716
)
(4,400,569
)
Cash Flows from Financing Activities:
Tax benefit from stock options exercised
12,996
9,873
Proceeds from stock options exercised
4,930
89,000
Net Cash Provided by Financing Activities
17,926
98,873
Effect of exchange rate changes on cash and cash equivalents
(56,317
)
(17,601
)
Net increase (decrease) in cash and cash equivalents
