NEWARK, N.Y., July 28, 2022 (GLOBE NEWSWIRE) -- Ultralife Corporation (NASDAQ: ULBI) reported operating income of $0.8 million and Adjusted EBITDA of $2.2 million on revenue of $32.1 million for the second quarter ended June 30, 2022. For the second quarter of 2021, the Company reported operating income of $1.1 million and Adjusted EBITDA of $2.2 million on revenue of $26.8 million.

“Driven by the Excell acquisition and strong shipments to core commercial end-markets, for the second quarter we delivered a 20% year-over-year sales increase and returned to total Company profitability. Persistent supply chain constraints continued to delay shipments against government/defense orders in both of our business segments, while operationally, we continued to contend with inflationary cost pressures and manufacturing inefficiencies associated with supply chain disruptions, which pressured gross margins,” said Michael D. Popielec, President and Chief Executive Officer. “While we anticipate continuing to battle these challenges in the second half of the year, we remain steadfast in our commitment to advancing our new product development initiatives, transitioning new products to production, and generating profitable growth for the year.”

Second Quarter 2022 Financial Results

Revenue was $32.1 million, an increase of $5.4 million, or 20.0%, compared to $26.8 million for the second quarter of 2021. Overall, commercial sales increased 54.1% and government/defense sales decreased 30.8% from the 2021 period. Battery & Energy Products sales increased 31.8% to $30.1 million, compared to $22.9 million last year, reflecting the contribution of $6.6 million of Excell sales coupled with increases of 16.3% in medical battery sales, 14.6% in industrial market sales, and 6.9% in oil & gas market sales, partially offset by a 20.5% decrease in government/defense sales.   Net organic sales for this segment increased 3.0%. Communications Systems sales decreased 49.0% to $2.0 million compared to $3.9 million for the same period last year, primarily due to lingering supply chain disruptions resulting in delays in our shipments to future periods.
     
Gross profit was $7.6 million, or 23.8% of revenue, compared to $7.3 million, or 27.1% of revenue, for the same quarter a year ago. Battery & Energy Products’ gross margin was 23.7%, compared to 26.3% last year, primarily due to supply chain disruptions including higher material and logistics costs, and continued investments in the transition of new products to high volume production. Communications Systems gross margin was 24.9% compared to 32.1% last year, primarily due to lower factory volume resulting from delays in component deliveries and the timing of orders.

Operating expenses were $6.9 million compared to $6.2 million last year, an increase of 11.0%, reflecting $1.1 million for Excell. Operating expenses were 21.3% of revenue compared to 23.1% of revenue for the year-earlier period.

Operating income was $0.8 million compared to income of $1.1 million last year.

Net income was $0.5 million or $0.03 per diluted share on a GAAP basis, compared to net income of $0.8 million or $0.05 per diluted share for the second quarter of 2021.

Adjusted EBITDA, defined as EBITDA including non-cash, stock-based compensation expense, was $2.2 million for the second quarter of 2022 or 6.8% of sales, compared to $2.2 million or 8.2% of sales for the year earlier period.

See the “Non-GAAP Financial Measure” section of this release for a reconciliation of 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 second 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 and related supply chain disruptions, 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.

Non-GAAP Financial Measure:

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.