ulbi20210428_8k.htm
false 0000875657 0000875657 2021-04-29 2021-04-29
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
FORM 8-K
 
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
 
April 29, 2021
Date of Report (Date of Earliest Event Reported)
 
 
ULTRALIFE CORPORATION
(Exact name of registrant as specified in its charter)
 
Delaware
000-20852
16-1387013
(State of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
 
2000 Technology Parkway, Newark, New York 14513
(Address of principal executive offices) (Zip Code)
 
(315) 332-7100
(Registrant’s telephone number, including area code)
 
 
Securities registered pursuant to Section 12(b) of the Act:
 
Common Stock, $0.10 par value per share
ULBI
NASDAQ
(Title of each class)
(Trading Symbol)
(Name of each exchange on which registered)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
 Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934. Emerging Growth Company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
 
 

 
 
Item 2.02 Results of Operations and Financial Condition
 
On April 29, 2021, Ultralife Corporation issued a press release regarding the financial results for its first quarter ended March 31, 2021. A copy of this press release is attached hereto as Exhibit 99.1 and is incorporated herein by this reference.
 
The information set forth in this Form 8-K and the attached exhibit is being furnished to and not filed with the Securities and Exchange Commission and shall not be deemed as incorporated by reference in any filing under the Securities Exchange Act of 1934, as amended, or the Securities Act of 1933, as amended, except to the extent specifically provided in any such filing.
 
 
Item 9.01 Financial Statements, Pro Forma Financials and Exhibits
 
(d) Exhibits.
 
Exhibit
Number
 
Exhibit Description
 
99.1
   
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)
 
 
 

 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
Date: April 29, 2021
 
ULTRALIFE CORPORATION
     
     
 
By:
/s/ Philip A. Fain
   
Philip A. Fain
   
Chief Financial Officer and Treasurer
 
 
 
ex_244515.htm

Exhibit 99.1

https://cdn.kscope.io/ef73cbec5da4bd3b2354004d769b89b4-logo.jpg

 

 

Ultralife Corporation Reports First Quarter Results

 

 

NEWARK, N.Y. – April 29, 2021 -- Ultralife Corporation (NASDAQ: ULBI) reported operating income of $1.0 million on revenue of $26.0 million for the first quarter ended March 31, 2021 compared to operating income of $1.5 million on revenue of $25.8 million for the first quarter of 2020.

 

“Ultralife increased year-over-year revenue for the first quarter on the strength of Battery & Energy Products as medical sales were up 32% and government/defense sales were up 30%. Similar to the trends experienced since the onset of the pandemic, these gains were for the most part offset by continued sluggishness in the oil & gas market, as well as lower Communications Systems sales. Profitability for the quarter reflected our continuing start-up costs to transition several new products to high volume manufacturing and investments in engineering and sales resources for new product development and market launches to support organic growth initiatives. As we continue to work on completing new products and identify new targets in emerging markets, we are steadily expanding our long-term opportunities to scale the business and realize the operating leverage inherent in our profitable business model,” said Michael D. Popielec, President and Chief Executive Officer.

 

 

First Quarter 2021 Financial Results

 

Revenue was $26.0 million, an increase of $0.2 million, or 0.6%, compared to $25.8 million for the first quarter of 2020, as a 19.4% increase in core battery sales across diversified end markets was partially offset by lower oil & gas market and Communications Systems sales. Battery & Energy Products revenues increased 6.5% to $22.1 million, compared to $20.8 million last year, as a 32.2% increase in medical device battery sales and a 30.3% increase in government/defense sales, were partially offset by a 30.0% decline in oil & gas market sales. Communications Systems sales decreased 23.6% to $3.9 million compared to $5.1 million for the same period last year, primarily reflecting 2020 shipments of vehicle amplifier-adaptor systems to support the U.S. Army’s Network Modernization initiatives under the delivery orders announced in October 2018. These orders were completed in the second quarter of 2020. The net adverse impact of COVID-19 on revenues for the 2021 first quarter was approximately $2.0 million as an increase in demand for medical batteries was more than offset primarily by weakened demand in the oil & gas and international industrial markets and some delays with government/defense orders.

 

Gross profit was $7.0 million, or 26.9% of revenue, compared to $7.3 million, or 28.4% of revenue, for the same quarter a year ago. Battery & Energy Products’ gross margin was 24.6%, compared to 25.6% last year, primarily reflecting incremental costs in 2021 associated with the transition of a multitude of new products to higher volume production as well as higher freight costs on incoming materials. Communications Systems gross margin was 39.9%, the same as last year.

 

 

 

Operating expenses were $6.0 million compared to $5.8 million last year, an increase of 3.0%, primarily relating to our continued investment in engineering and sales resources for new product development and market launches. Operating expenses were 23.2% of revenue compared to 22.7% of revenue for the year-earlier period.

 

Operating income was $1.0 million compared to $1.5 million last year, and operating margin was 3.7% compared to 5.7% last year. The net adverse impact of COVID-19 on operating income for the 2021 first quarter was approximately $0.9 million.

 

Net income was $0.7 million or $0.04 per diluted share using the U.S. statutory tax rate, compared to net income of $1.1 million, or $0.07 per diluted share for the first quarter of 2020. Adjusted EPS was $0.05 on a diluted basis for the first quarter of 2021, compared to $0.08 for the 2020 period. Adjusted EPS excludes the provision for deferred income taxes of $0.2 million which primarily represents non-cash charges for U.S. taxes which we expect will be fully offset by net operating loss carryforwards and other tax credits for the foreseeable future. The net adverse impact of COVID-19 on Adjusted EPS for the 2021 first quarter was approximately $0.06.

 

Adjusted EBITDA, defined as EBITDA including non-cash, stock-based compensation expense, for the first quarter of 2021 was $2.0 million or 7.8% of sales, compared to $2.5 million or 9.8% for the year earlier period. For the trailing twelve-month period, Adjusted EBITDA was $9.2 million or 8.5% of revenues.

 

During the first quarter of 2021, our cash-on-hand increased by 28% to $13.7 million and our debt was reduced by 27% to $1.1 million (gross of unamortized debt issuance costs).

 

See the “Non-GAAP Financial Measures” section of this release for a reconciliation of Adjusted EPS to EPS and Adjusted EBITDA to Net Income Attributable to Ultralife Corporation.

 

 

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.ultralifecorporation.com.

 

 

 

Conference Call Information

 

Ultralife will hold its first quarter earnings conference call today at 8:30 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 the impact of COVID-19, potential reductions in revenues from key customers, acceptance of our new products on a global basis and uncertain global economic conditions. 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)

 

   

March 31,

2021

   

December 31,

2020

 
ASSETS                

Current Assets:

               

Cash

  $ 13,662     $ 10,653  

Trade Accounts Receivable, Net

    19,156       21,054  

Inventories, Net

    27,856       28,193  

Prepaid Expenses and Other Current Assets

    2,846       4,596  

Total Current Assets

    63,520       64,496  
                 

Property, Plant and Equipment, Net

    22,946       22,850  

Goodwill

    27,061       27,018  

Other Intangible Assets, Net

    9,077       9,209  

Deferred Income Taxes, Net

    11,652       11,836  

Other Non-Current Assets

    2,134       2,292  

Total Assets

  $ 136,390     $ 137,701  
                 
LIABILITIES AND SHAREHOLDERS' EQUITY                

Current Liabilities:

               

Accounts Payable

  $ 10,141     $ 10,839  

Current Portion of Long-Term Debt, Net

    993       1,361  

Accrued Compensation and Related Benefits

    1,404       1,748  

Accrued Expenses and Other Current Liabilities

    4,097       4,758  

Total Current Liabilities

    16,635       18,706  

Deferred Income Taxes

    504       515  

Other Non-Current Liabilities

    1,390       1,557  

Total Liabilities

    18,529       20,778  
                 

Shareholders' Equity:

               

Common Stock

    2,042       2,037  

Capital in Excess of Par Value

    185,674       185,464  

Accumulated Deficit

    (46,927 )     (47,598 )

Accumulated Other Comprehensive Loss

    (1,679 )     (1,782 )

Treasury Stock

    (21,380 )     (21,321 )

Total Ultralife Equity

    117,730       116,800  

Non-Controlling Interest

    131       123  

Total Shareholders’ Equity

    117,861       116,923  
                 

Total Liabilities and Shareholders' Equity

  $ 136,390     $ 137,701  

 

 

 

ULTRALIFE CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

 (In Thousands Except Per Share Amounts)

(Unaudited)

 

   

Three-Month Period Ended

 
   

March 31,

   

March 31,

 
   

2021

   

2020

 

Revenues:

               

Battery & Energy Products

  $ 22,111     $ 20,761  

Communications Systems

    3,862       5,053  

Total Revenues

    25,973       25,814  
                 

Cost of Products Sold:

               

Battery & Energy Products

    16,675       15,445  

Communications Systems

    2,320       3,035  

Total Cost of Products Sold

    18,995       18,480  
                 

Gross Profit

    6,978       7,334  
                 

Operating Expenses:

               

Research and Development

    1,647       1,548  

Selling, General and Administrative

    4,379       4,301  

Total Operating Expenses

    6,026       5,849  
                 

Operating Income

    952       1,485  
                 

Other Expense

    (56 )     (92 )

Income Before Income Tax Provision

    896       1,393  
                 

Income Tax Provision

    (217 )     (319 )
                 

Net Income

    679       1,074  
                 

Net Income Attributable to Non-Controlling Interest

    (8 )     (15 )
                 

Net Income Attributable to Ultralife Corporation

  $ 671     $ 1,059  
                 

Net Income Per Share Attributable to Ultralife Common Shareholders Basic

  $ 0.04     $ 0.07  
                 

Net Income Per Share Attributable to Ultralife Common Shareholders Diluted

  $ 0.04     $ 0.07  
                 

Weighted Average Shares Outstanding – Basic

    15,973       15,875  
                 

Weighted Average Shares Outstanding – Diluted

    16,152       16,087  

 

 

 

Non-GAAP Financial Measures:

 

Adjusted Earnings Per Share

 

In evaluating our business, we consider and use Adjusted EPS, a non-GAAP financial measure, as a supplemental measure of our business performance in addition to GAAP financial measures. We define Adjusted EPS as net income attributable to Ultralife Corporation excluding the provision for deferred taxes divided by our weighted average shares outstanding on both a basic and diluted basis. We believe that this information is useful in providing period-to-period comparisons of our results by reflecting the portion of our tax provision that we expect will be offset by our U.S. net operating loss carryforwards and other tax credits for the foreseeable future. We reconcile Adjusted EPS to EPS, the most comparable financial measure under GAAP. Neither current nor potential investors in our securities should rely on Adjusted EPS as a substitute for any GAAP measures and we encourage investors to review the following reconciliation of Adjusted EPS to EPS and net income attributable to Ultralife Corporation.

 

 

ULTRALIFE CORPORATION AND SUBSIDIARIES

CALCULATION OF ADJUSTED EPS

(In Thousands Except Per Share Amounts)

(Unaudited)

 

 

   

Three-Month Period Ended

 
   

March 31, 2021

   

March 31, 2020

 
   

Amount

   

Per

Basic

Share

   

Per

Diluted

Share

   

Amount

   

Per

Basic

Share

   

Per

Diluted

Share

 

Net Income Attributable to Ultralife Corporation

  $ 671     $ .04     $ .04     $ 1,059     $ 0.07     $ 0.07  

Deferred Tax Provision

    168       .01       .01       242       .01       .01  

Adjusted Net Income

  $ 839     $ .05     $ .05     $ 1,301     $ .08     $ .08  
                                                 

Weighted Average Shares Outstanding

            15,973       16,152               15,875       16,087  

 

 

 

Adjusted EBITDA

 

In evaluating our business, we consider and use Adjusted EBITDA, a non-GAAP financial measure, as a supplemental measure of our operating performance in addition to GAAP financial measures. We define Adjusted EBITDA as net income attributable to Ultralife Corporation before net interest expense, provision (benefit) for income taxes, depreciation and amortization, and stock-based compensation expense, plus/minus expense/income that we do not consider reflective of our ongoing continuing operations. We reconcile Adjusted EBITDA to net income attributable to Ultralife Corporation, the most comparable financial measure under GAAP. Neither current nor potential investors in our securities should rely on Adjusted EBITDA as a substitute for any GAAP measures and we encourage investors to review the following reconciliation of Adjusted EBITDA to net income attributable to Ultralife Corporation.

 

 

ULTRALIFE CORPORATION AND SUBSIDIARIES

CALCULATION OF ADJUSTED EBITDA

(Dollars in Thousands)

(Unaudited)

 

   

Three-Month Period Ended

 
   

March 31,

2021

   

March 31,

2020

 
                 

Net Income Attributable to Ultralife Corporation

  $ 671     $ 1,059  

Adjustments:

               

Interest Expense

    56       174  

Income Tax Provision

    217       319  

Depreciation Expense

    730       579  

Amortization of Intangible Assets

    154       161  

Stock-Based Compensation Expense

    184       230  

Adjusted EBITDA

  $ 2,012     $ 2,522  

 

 

 

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