8-K
Cps Technologies Corp/De/ (CPSH)
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
Date of Report (Date of earliest event reported): October 27, 2021
CPS TECHNOLOGIES CORP.
(Exact Name of Registrant as Specified in its Charter)
| Delaware | 0-16088 | 04-2832509 |
|---|---|---|
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
| 111 South Worcester Street, Norton, Massachusetts | 02766 | |
| (Address of principal executive offices) | (Zip Code) | |
| Registrant’s telephone number, including area code | 508-222-0614 | |
| (Former name or former address, if changed since last report.) |
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 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
☐ 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. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.01 par value | CPSH | Nasdaq Capital Market |
Item 2.02 Results of Operations and Financial Condition
On October 27, 2021, the Company issued a press release announcing its financial results for the fiscal quarter ended September 25, 2021. A copy of the press release is attached hereto as Exhibit 99 and is incorporated herein in its entirety by reference.
The information in this Item 2.02, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (The “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
Cautionary Note Regarding Forward-Looking Statements.
Except for historical information contained in the press release attached as an exhibit hereto, the press release contains forward-looking statements which involve certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these statements. Please refer to the cautionary note in the press release regarding these forward-looking statements.
Item 8.01 Other Events
Exhibit 99.2 is incorporated herein in its entirety by reference.
Item 9.01 Financial Statements and Exhibits
| EXHIBIT<br><br> <br>NUMBER | DESCRIPTION |
|---|---|
| 99.1 | Press release dated Oc6ober 27, 2021 of CPS Technologies Corp. announcing its Financial results for the fiscal quarter ended September 25, 2021 |
| 99.2 | Financial results for the fiscal quarter ended September 25, 2021 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| CPS Technologies Corp.<br> (Registrant) | |
|---|---|
| Date: October 29, 2021 | /s/ Charles K. Griffith, Jr.<br> Charles K. Griffith Jr.<br> Chief Financial Officer |
EXHIBIT INDEX
| EXHIBIT<br><br> <br>NUMBER | DESCRIPTION |
|---|---|
| 99.1 | Press release dated October 27, 2021 of CPS Technologies Corp. announcing its financial results for the fiscal quarter ended September 25, 2021 |
| 99.2 | Financial results for the fiscal quarter ended September 25, 2021 |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
ex_298887.htm
Exhibit 99.1
CPS Technologies Corporation
Chuck Griffith, Chief Financial Officer
111 South Worcester Street
Norton, MA 02766
Telephone: (508) 222-0614
Web Site: www.alsic.com
CPS TECHNOLOGIES CORPORATION ANNOUNCES THIRD QUARTER 2021 RESULTS
Norton, Massachusetts, October 27, 2021. CPS Technologies Corporation (NASDAQ:CPSH) today announced revenues of $5.5 million and an operating loss of $88 thousand for the quarter ended September 25, 2021. This compares with revenues of $4.5 million and an operating profit of $253 thousand for the quarter ended September 26, 2020.
Michael McCormack, President and CEO, said: “Revenues in the third quarter 2021 showed significant improvement over revenues in the third quarter of 2020, reflecting the lessening impact of the Covid-19 pandemic on our business. Revenues in the third quarter 2021 were 24% higher than the third quarter 2020, and our 2021 bookings are 158% of shipments, reflecting our current and expected future growth.
Unfortunately, we are showing a loss for the third quarter, but it is not without explanation. As a result of the mandate from the Board of Directors to grow both the top and bottom line, several steps were taken in the quarter to further streamline the business. These steps resulted in $327 thousand of non-recurring restructuring costs incurred during the quarter. As a reminder, GAAP requires that these types of expenses be recognized when the liability is incurred. Although some of these charges will not be paid immediately, the entire expense is being charged in this quarter. Without these expenses CPS would have been solidly profitable in the third quarter. In addition, our new sales and technical hires made in 2021 are now showing positive results as evidenced by our book to bill ratio mentioned above.
I would also like to point out that although our net after tax profit for the quarter is $2.8 million, it does not relate to Q3 activities or results. This is the result of the reversal of our deferred tax valuation allowance. In 2018, due to recurring losses, it was judged “more likely than not” that CPS would be unable to use its deferred tax asset. As such, a reserve was set up against that asset and an additional loss of $3.0 million was incurred. After further evaluation, based on the Company’s profitability and the expected growth of CPS over the next several years, we have now judged that it is “more likely than not” that CPS will be able to use the deferred tax asset and the remaining reserve of $2.8 million has been reversed.
As part of the Defense Industrial Base, CPS has been open and operating throughout the Covid-19 pandemic. To date all of our major customers remain open and operational. Although some have been negatively affected by the pandemic, others continue to grow. These observations do not mean that CPS will be unaffected by the pandemic going forward, but we continue to see demand increasing rather than declining. We remain very optimistic about our 2021 performance, and the future long-term growth opportunities across all lines of business into Fiscal Year 2022.
Beyond Fiscal Year 2022, we are cautiously optimistic that our collective growth initiatives, specifically in longer-term new product development investments, will expand the current product line pipelines both in terms of revenues and earnings. In addition, we will make additional measured investments to increase the capacity of our current high volume manufacturing capacity.”
The Company will be hosting its first quarter conference call with investors at 4:45pm on Wednesday, October 27. Those interested in participating in the conference call should dial:
Call in Number: 1-833-953-1394
Conference ID: 8251606
We encourage those who wish to participate, to call in 10 minutes before the scheduled start time to ensure the operator can connect you prior to the start of the call.
About CPS
CPS is a technology and manufacturing leader in producing high-performance energy management components that facilitate the electrification of the economy. Our products and intellectual property include critical pieces of the technology puzzle for electric trains and subway cars, wind turbines, hybrid vehicles, electric vehicles, the smart electric grid, 5G infrastructure and others. CPS hermetic packages can be found in many Aerospace and Satellite applications. CPS armor products provide exceptional ballistic protection and environmental durability at very light weight. CPS is committed to innovation and to supporting our customers in building solutions to this planet's problems.
Safe Harbor
Statements made in this document that are not historical facts or which apply prospectively, including those relating to 2021 financial results, are forward-looking statements that involve risks and uncertainties. These forward-looking statements are identified by the use of terms and phrases such as "will," "intends," "believes," "expects," "plans," "anticipates" and similar expressions. Investors should not rely on forward looking statements because they are subject to a variety of risks and uncertainties and other factors that could cause actual results to differ materially from the company's expectation. Additional information concerning risk factors is contained from time to time in the company's SEC filings, including its Annual Report on Form 10-K and other periodic reports filed with the SEC. Forward-looking statements contained in this press release speak only as of the date of this release. Subsequent events or circumstances occurring after such date may render these statements incomplete or out of date. The company expressly disclaims any obligation to update the information contained in this release.
CPS TECHNOLOGIES CORPORATION
Statements of Operations (Unaudited)
| Three Months Ended | Nine Months Ended | |||||||
|---|---|---|---|---|---|---|---|---|
| September 25, | September 26, | September 25, | September 26, | |||||
| 2021 | 2020 | 2021 | 2020 | |||||
| Revenues: | ||||||||
| Product sales | $ | 5,514,872 | $ | 4,452,387 | $ | 16,242,762 | $ | 16,721,973 |
| Total revenues | 5,514,872 | 4,452,387 | 16,242,762 | 16,721,973 | ||||
| Cost of product sales | 4,375,676 | 3,514,813 | 12,807,844 | 13,050,860 | ||||
| Gross Margin | 1,139,196 | 937,574 | 3,434,918 | 3,671,113 | ||||
| Selling, general, and administrative expense | 1,227,258 | 684,836 | 3,234,344 | 2,466,196 | ||||
| Income from operations | (88,062) | 252,738 | 200,573 | 1,204,915 | ||||
| Interest/Other income (expense) | 16,032 | (21,266) | (2,047) | (72,558) | ||||
| Net income before income tax | (72,030) | 231,472 | 198,526 | 1,132,357 | ||||
| Income tax provision (benefit) | (2,840,951) | 456 | (2,840,951) | 456 | ||||
| Net income | $ | 2,768,921 | $ | 231,016 | $ | 3,039,021 | $ | 1,131,901 |
| Net income per basic common share | $ | 0.19 | $ | 0.02 | $ | 0.22 | $ | 0.09 |
| CPS TECHNOLOGIES CORPORATION | ||||
|---|---|---|---|---|
| BALANCE SHEET (UNAUDITED) | ||||
| September 25, | December 26, | |||
| --- | --- | --- | --- | --- |
| 2021 | 2020 | |||
| ASSETS | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 3,837,737 | $ | 195,203 |
| Accounts receivable-trade, net | 5,032,187 | 2,914,800 | ||
| Inventories, net | 3,773,228 | 3,709,471 | ||
| Prepaid expenses and other current assets | 132,315 | 71,506 | ||
| Total current assets | 12,775,467 | 6,890,980 | ||
| Net property and equipment | 1,175,244 | 1,287,947 | ||
| Right-of-use lease asset | 613,000 | 25,000 | ||
| Deferred taxes, net | 2,958,407 | 117,000 | ||
| Total Assets | $ | 17,522,118 | $ | 8,320,927 |
| LIABILITIES AND STOCKHOLDERS’EQUITY | ||||
| Current liabilities: | ||||
| Note payable, current portion | 44,821 | $ | 58,134 | |
| Accounts payable | 1,699,154 | 909,291 | ||
| Accrued expenses | 911,387 | 804,091 | ||
| Deferred revenue | 1,150,797 | 12,177 | ||
| Lease liability, current portion | 153,000 | 25,000 | ||
| Total current liabilities | 3,959,159 | 1,808,693 | ||
| Note payable less current portion | 124,566 | 154,570 | ||
| Long term lease liability | 460,000 | -- | ||
| Total liabilities | 4,543,725 | 1,963,263 | ||
| Total stockholders’ equity | 12,978,393 | 6,357,664 | ||
| Total liabilities and stockholders’ equity | $ | 17,522,118 | $ | 8,320,927 |
ex_298888.htm
Exhibit 99.2
CPS TECHNOLOGIES CORPORATION
Statements of Operations (Unaudited)
| Three Months Ended | Nine Months Ended | |||||||
|---|---|---|---|---|---|---|---|---|
| September 25, | September 26, | September 25, | September 26, | |||||
| 2021 | 2020 | 2021 | 2020 | |||||
| Revenues: | ||||||||
| Product sales | $ | 5,514,872 | $ | 4,452,387 | $ | 16,242,762 | $ | 16,721,973 |
| Total revenues | 5,514,872 | 4,452,387 | 16,242,762 | 16,721,973 | ||||
| Cost of product sales | 4,375,676 | 3,514,813 | 12,807,844 | 13,050,860 | ||||
| Gross Margin | 1,139,196 | 937,574 | 3,434,918 | 3,671,113 | ||||
| Selling, general, and administrative expense | 1,227,258 | 684,836 | 3,234,344 | 2,466,196 | ||||
| Income from operations | (88,062) | 252,738 | 200,573 | 1,204,915 | ||||
| Interest/Other income (expense) | 16,032 | (21,266) | (2,047) | (72,558) | ||||
| Net income before income tax | (72,030) | 231,472 | 198,526 | 1,132,357 | ||||
| Income tax provision (benefit) | (2,840,951) | 456 | (2,840,951) | 456 | ||||
| Net income | $ | 2,768,921 | $ | 231,016 | $ | 3,039,021 | $ | 1,131,901 |
| Net income per basic common share | $ | 0.19 | $ | 0.02 | $ | 0.22 | $ | 0.09 |
| CPS TECHNOLOGIES CORPORATION | ||||
|---|---|---|---|---|
| BALANCE SHEET (UNAUDITED) | ||||
| September 25, | December 26, | |||
| --- | --- | --- | --- | --- |
| 2021 | 2020 | |||
| ASSETS | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 3,837,737 | $ | 195,203 |
| Accounts receivable-trade, net | 5,032,187 | 2,914,800 | ||
| Inventories, net | 3,773,228 | 3,709,471 | ||
| Prepaid expenses and other current assets | 132,315 | 71,506 | ||
| Total current assets | 12,775,467 | 6,890,980 | ||
| Net property and equipment | 1,175,244 | 1,287,947 | ||
| Right-of-use lease asset | 613,000 | 25,000 | ||
| Deferred taxes, net | 2,958,407 | 117,000 | ||
| Total Assets | $ | 17,522,118 | $ | 8,320,927 |
| LIABILITIES AND STOCKHOLDERS’EQUITY | ||||
| Current liabilities: | ||||
| Note payable, current portion | 44,821 | $ | 58,134 | |
| Accounts payable | 1,699,154 | 909,291 | ||
| Accrued expenses | 911,387 | 804,091 | ||
| Deferred revenue | 1,150,797 | 12,177 | ||
| Lease liability, current portion | 153,000 | 25,000 | ||
| Total current liabilities | 3,959,159 | 1,808,693 | ||
| Note payable less current portion | 124,566 | 154,570 | ||
| Long term lease liability | 460,000 | -- | ||
| Total liabilities | 4,543,725 | 1,963,263 | ||
| Total stockholders’ equity | 12,978,393 | 6,357,664 | ||
| Total liabilities and stockholders’ equity | $ | 17,522,118 | $ | 8,320,927 |