Air Industries Group Announces Improved Operating Results for Second Quarter Ended June 30, 2023 and Provides Comments on Business Outlook
08 Agosto 2023 - 2:30PM
Business Wire
Conference Call Scheduled for August 9,
2023
Air Industries Group (NYSE American: AIRI), an integrated
Tier 1 manufacturer of precision assemblies and components for
mission-critical aerospace and defense applications, and a prime
contractor to the U.S. Department of Defense, today announced its
financial results for the quarter ended June 30, 2023.
Commenting on the recent results, Lou Melluzzo, CEO of Air
Industries Group, said, “I am pleased that we delivered both
top-line and bottom-line improved performance during the second
quarter of 2023. Our gross profit margin for Q2 has risen
impressively to 16.4% of sales, an increase from the 2023 first
quarter’s 15.0%. Moreover, we successfully transitioned from
operating losses in the past two quarters to achieving operating
income in the most recent period.”
Mr. Melluzzo also commented on the Company’s business outlook,
stating, “As we look ahead, I am extremely encouraged by the
positive feedback emanating from both our longstanding and new
customers. The substantial investments we made over multiple years
in new equipment, refined delivery processes, and elevated customer
service are undeniably yielding fruitful results. I am confident
that we are witnessing the commencement of a sustained period of
improved order-flow trajectory, which bodes well for the future for
our Company.”
Second Quarter 2023 Results
- Consolidated net sales for the second quarter ended June 30,
2023 were $13.2 million, representing an increase of $656,000 or
5.0% from $12.5 million reported for the first quarter of 2023.
Second quarter 2023 net sales were lower by $803,000 or (5.7%)
compared with sales of $14.0 million reported for the second
quarter of 2022.
- Consolidated gross profit for the second quarter of 2023 was
$2.2 million, an increase of $289,000 or 13.3% from $1.9 million in
the 2023 first quarter. Second quarter 2023 gross profit was lower
by $253,000 or (10.5%) compared with $2.4 million in the second
quarter of 2022.
- Gross profit margin was 16.4% of sales for the second quarter
of 2023, 15.0% for the first quarter of 2023, and 17.3% for the
second quarter of 2022.
- Operating expenses for the second quarter of 2023 were $2.1
million, slightly higher than $2.0 million in the first quarter of
2023, and lower than $2.2 million in the 2022 second quarter.
- The Company achieved operating income of $90,000 in the second
quarter of 2023 compared with an operating loss of $158,000 in the
first quarter of 2023 and operating income of $250,000 in the
second quarter of 2022.
- Interest and financing costs for the three months ended June
30, 2023 were $500,000 compared with $476,000 in the first quarter
of 2023, and $289,000 for the three months ended June 30, 2022. The
increases in interest expense resulted from increases in the prime
rate and from higher loan balances.
- Net loss for the second quarter of 2023 was reduced to $395,000
versus a net loss of $618,000 in the first quarter of 2023. The net
loss in the second quarter of 2022 was $7,000.
Six-Month 2023 Results
- Consolidated net sales for the six months ended June 30, 2023
were $25.8 million compared with $26.1 million in the same period
of 2022, a slight decrease of $316,000 or (1.2.%).
- Consolidated gross profit for the six months ended June 30,
2023 was $4.0 million versus $4.5 million in the 2022 period, a
decrease of $451,000 or (10.0%). Gross profit margin was 15.7% of
sales for the six months ended June 30, 2023 compared with 17.3%
for the first six months of 2022.
- Operating expenses for the six months ended June 30, 2023 were
$4.1 million, increasing $53,000 from $4.0 million in the 2022
period.
- The operating loss for the six months ended June 30, 2023 was
$47,000 compared with operating income of $457,000 reported for the
2022 period.
- Interest and financing costs for the six months ended June 30,
2023 were $996,000 compared with $612,000 in the 2022 period, an
increase of $384,000 or 62.7%, mainly due to the effect of
increases in the prime rate and from higher loan balances.
- Net loss for the six months ended June 30, 2023 was $1.0
million, compared with a net loss of $35,000 in the 2022
period.
- Adjusted EBITDA for the six months ended June 30, 2023 was $1.6
million.
Reconciliation of Net (Loss) to Adjusted EBITDA (in
thousands)
For the Six Months Ended June 30, 2023 Net Loss
$
(1,013
)
Add-backs to EBITDA Interest
956
Taxes
-
Depreciation & Amortization
1,273
EBITDA
1,216
Add-backs to Adjusted EBITDA Goodwill
163
Stock Compensation
232
Adjusted EBITDA
$
1,611
Additional information about the Company can be found in its
filings with the SEC and by visiting the website at
www.airindustriesgroup.com.
Investor Conference Call
Management will host a conference call on
Wednesday, August 9, 2023 at 4:15 PM Eastern Time
Conference Toll-Free Number
877-524-8416
AIR INDUSTRIES GROUP is an integrated Tier 1 manufacturer
of precision assemblies and components for mission-critical
aerospace and defense applications, and a prime contractor to the
U.S. Department of Defense.
Forward Looking Statements
Certain matters discussed in this press release are
'forward-looking statements' intended to qualify for the safe
harbor from liability established by the Private Securities
Litigation Reform Act of 1995. In particular, the Company's
statements regarding trends in the marketplace, future revenues,
earnings and Adjusted EBITDA, the ability to realize firm backlog
and projected backlog, cost cutting measures, potential future
results and acquisitions, are examples of such forward-looking
statements. The forward-looking statements are subject to numerous
risks and uncertainties, including, but not limited to, the timing
of projects due to variability in size, scope and duration, the
inherent discrepancy in actual results from estimates, projections
and forecasts made by management, regulatory delays, changes in
government funding and budgets, and other factors, including
general economic conditions, not within the Company's control. The
factors discussed herein and expressed from time to time in the
Company's filings with the Securities and Exchange Commission could
cause actual results and developments to be materially different
from those expressed in or implied by such statements. The
forward-looking statements are made only as of the date of this
press release and the Company undertakes no obligation to publicly
update such forward-looking statements to reflect subsequent events
or circumstances.
Adjusted EBITDA
The Company uses Adjusted EBITDA, a Non-GAAP financial measure
as defined by the SEC, as a supplemental profitability measure
because management finds it useful to understand and evaluate
results, excluding the impact of non-cash depreciation and
amortization charges, stock based compensation expenses, and
nonrecurring expenses and outlays, prior to consideration of the
impact of other potential sources and uses of cash, such as working
capital items. This calculation may differ in method of calculation
from similarly titled measures used by other companies and may be
different than the EBITDA calculation used by our lenders for
purposes of determining compliance with our financial covenants.
This Non-GAAP measure may have limitations when understanding
performance as it excludes the financial impact of transactions
such as interest expense necessary to conduct the Company’s
business and therefore are not intended to be an alternative to
financial measure prepared in accordance with GAAP. The Company has
not quantitatively reconciled its forward looking Adjusted EBITDA
target to the most directly comparable GAAP measure because such
items such as amortization of stock-based compensation and interest
expense, which are specific items that impact these measures, have
not yet occurred, are out of the Company’s control, or cannot be
predicted. For example, quantification of stock-based compensation
is not possible as it requires inputs such as future grants and
stock prices which are not currently ascertainable.
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Air Industries Group Investor Relations 631.328.7078
ir@airindustriesgroup.com
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