Ultralife Corporation
Feb 9, 2017

Ultralife Corporation Reports Fourth Quarter Results

NEWARK, N.Y., Feb. 09, 2017 (GLOBE NEWSWIRE) -- Ultralife Corporation (NASDAQ:ULBI) reported operating income of $1.6 million on revenue of $21.6 million for the fourth quarter ended December 31, 2016 compared to operating income of $.5 million on revenue of $19.3 million for the fourth quarter of 2015.  For total year 2016, Ultralife produced operating income of $3.8 million on revenue of $82.5 million compared to operating income of $3.3 million on revenue of $76.4 million for 2015. 

"Strong operating leverage on 12% year-over-year revenue growth for the fourth quarter produced EPS of $0.11, our highest quarterly result this year and a more than three-fold increase over last year.  Revenue growth for the quarter reflects gains from our Accutronics acquisition and Communications Systems business even though we experienced lower U.S. government/defense battery sales.  For the year, we achieved our stated goal of generating profitable growth, posting 13% operating income growth on an 8% revenue increase," said Michael D. Popielec, President and Chief Executive Officer.   "As we look ahead to 2017, an improving backlog and disciplined execution of our business model while continuing to invest in market and sales reach expansion and new product development, positions us well to further diversify beyond our core U.S. government/defense business and achieve another year of profitable growth."

Fourth Quarter 2016 Financial Results

Revenue was $21.6 million, an increase of $2.4 million, or 12.3%, compared to $19.3 million for the fourth quarter of 2015 reflecting higher medical sales, the addition of Accutronics and higher Communications Systems sales partially offset by lower government/defense Battery & Energy sales.  Battery & Energy Products sales increased $1.0 million to $17.6 million, or 5.9%, compared to $16.6 million last year due primarily to higher medical sales and the contribution of Accutronics, partially offset by lower government/defense and 9-Volt sales.  Communications Systems sales grew 53.4% to $4.0 million compared to $2.6 million for the same period last year reflecting shipments of Vehicle Installed Power Enhanced Riflemen Appliqué ("VIPER") units to fulfill an additional order received for the fourth quarter.

Gross profit was $6.8 million, or 31.5% of revenue, compared to $5.6 million, or 28.8% of revenue, for the same quarter a year ago.  Battery & Energy Products' gross margin was 29.4%, compared to 27.6% last year, an increase of 180 basis points reflecting higher volume and favorable product mix including the contribution of Accutronics.  Communications Systems' gross margin was 40.6%, compared to 36.4% last year, an increase of 420 basis points primarily due to sales mix.       

Operating expenses were $5.2 million compared to $5.0 million last year reflecting the addition of Accutronics, partially offset by the 2015 write down of a Communications Systems trademark and continued tight control over discretionary spending.  Operating expenses were 23.9% of revenue compared to 26.1% of revenue for the year earlier period.  

Operating income was $1.6 million compared to $.5 million last year for an operating margin of 7.6% compared to 2.7% last year. 

Net income was $1.7 million, or $0.11 per share, compared to net income of $0.5 million, or $0.03 per share, for the fourth quarter of 2015.

About Ultralife Corporation

Ultralife Corporation serves its markets with products and services ranging from power solutions to communications and electronics systems. Through its engineering and collaborative approach to problem solving, Ultralife serves government, defense and commercial customers across the globe.

Headquartered in Newark, New York, the Company's business segments include Battery & Energy Products and Communications Systems. Ultralife has operations in North America, Europe and Asia. For more information, visit www.ultralifecorp.com.

Conference Call Information

Ultralife will hold its fourth quarter earnings conference call today at 10:00 AM ET. To participate in the live call, please dial (800) 915-4836 at least ten minutes before the scheduled start time, identify yourself and ask for the Ultralife call. A live webcast of the conference call will be available to investors in the Events & Presentations section of the Company's website at http://investor.ultralifecorporation.com. For those who cannot listen to the live broadcast, a replay of the webcast will be available shortly after the call at the same location.

This press release may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include:  potential reductions in U.S. military spending, uncertain global economic conditions and acceptance of our new products on a global basis. The Company cautions investors not to place undue reliance on forward-looking statements, which reflect the Company's analysis only as of today's date. The Company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances.  Further information on these factors and other factors that could affect Ultralife's financial results is included in Ultralife's Securities and Exchange Commission (SEC) filings, including the latest Annual Report on Form 10-K. 

 
ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
 
 ASSETS
 December 31, December 31, 
  2016   2015  
Current Assets:    
Cash$10,706  $14,533  
Trade Accounts Receivable, Net 13,179   11,430  
Inventories 23,456   23,814  
Prepaid Expenses and Other Current Assets 2,173   2,169  
Total Current Assets 49,514   51,946  
     
Property, Equipment and Improvements, Net 7,999   9,038  
Goodwill, Intangibles and Other Assets 27,231   20,538  
Total Assets$84,744  $81,522  
     
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:   
Accounts Payable$7,292  $6,494  
Accrued Compensation and Related Benefits 1,258   2,377  
Accrued Expenses and Other Current Liabilities 2,778   1,976  
Current Portion of Debt -   -  
Total Current Liabilities 11,328   10,847  
Deferred Income Taxes and Other Non-Current Liabilities 5,556   4,659  
Total Liabilities 16,884   15,506  
     
Shareholders' Equity:    
Common Stock 1,932   1,918  
Capital in Excess of Par Value 178,163   177,007  
Accumulated Deficit (90,542)   (94,051)  
Accumulated Other Comprehensive Loss (3,080)   (907)  
Treasury Stock (18,443)   (17,808)  
Total Ultralife Equity 68,030   66,159  
Non-Controlling Interest (170)   (143)  
Total Shareholders' Equity 67,860   66,016  
     
Total Liabilities and Shareholders' Equity$84,744  $81,522  


 
ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
(Unaudited)
        
 Three Month Periods Ended Year Ended
 December 31, December 31, December 31, December 31,
  2016   2015   2016   2015 
Revenues:       
Battery & Energy Products$17,611  $16,634  $64,753  $65,272 
Communication Systems 4,014   2,617   17,707   11,155 
Total Revenues 21,625   19,251   82,460   76,427 
        
Cost of Products Sold:       
Battery & Energy Products 12,436   12,036   45,173   46,574 
Communication Systems 2,384   1,665   12,179   6,537 
Total Cost of Products Sold 14,820   13,701   57,352   53,111 
        
Gross Profit 6,805   5,550   25,108   23,316 
        
Operating Expenses:       
Research and Development 1,508   1,686   5,946   5,603 
Selling, General and Administrative 3,653   3,196   15,399
   14,233
 
Intangible Asset Impairment -   150   -   150 
Total Operating Expenses 5,161   5,032   21,345   19,986 
        
Operating Income  1,644   518   3,763   3,330 
        
Other Expense (16)   (24)   (183)   (180) 
Income Before Income Taxes 1,628   494   3,580   3,150
 
        
Income Tax Provision (Benefit) (115)   (2)   98   310 
        
Net Income  1,743   496   3,482   2,840 
        
Net Loss Attributable to Non-Controlling Interest 2   6   27   29 
        
Net Income Attributable to Ultralife Corporation$1,745  $502  $3,509  $2,869 
        
        
Other Comprehensive Income:       
Foreign Currency Translation Adjustments (858)   (157)   (2,173)   (440) 
Comprehensive Income Attributable to Ultralife$887  $345  $1,336  $2,429 
        
        
Net Income Per Share Attributable to Ultralife Common Shareholders — Basic$.11 $.03 $.23 $.18
        
Net Income Per Share Attributable to Ultralife Common Shareholders — Diluted$.11 $.03 $.23 $.17
        
Weighted Average Shares Outstanding — Basic 15,259   15,271   15,261   16,182 
        
Weighted Average Shares Outstanding — Diluted 15,360   15,757   15,405   16,458 
Company Contact:
Ultralife Corporation
Philip A. Fain
(315) 210-6110
pfain@ulbi.com

Investor Relations Contact:
LHA
Jody Burfening
(212) 838-3777
jburfening@lhai.com