8-K
Innovative Solutions & Support Inc (ISSC)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
currentreport****Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest eventreported): February 10, 2021
INNOVATIVE SOLUTIONS AND SUPPORT, INC.
(Exact name of registrant as specified in its charter)
| Pennsylvania | 0-31157 | 23-2507402 |
|---|---|---|
| (State or other jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
720 Pennsylvania Drive
Exton, Pennsylvania 19341
(Address of principal executive offices) (Zip Code)
(610) 646-9800
(Registrant’s telephone number, including area code)
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:
¨ 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))
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, par value $0.001 per share | ISSC | Nasdaq Stock Market LLC |
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. ¨
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On February 10, 2021, Innovative Solutions and Support, Inc. issued a press release announcing its financial results for its fiscal first quarter ended December 31, 2020. A copy of that press release and the attached financial schedules are attached as Exhibit 99.1 to this report and incorporated herein by reference.
The information in this report (including Exhibit 99.1) is being furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
(d) Exhibits.
| Exhibit Number | Description |
|---|---|
| 99.1 | Press Release, dated February 10, 2021, announcing financial results for the first fiscal quarter ended December 31, 2020. |
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.
| INNOVATIVE SOLUTIONS AND SUPPORT,<br> INC. | ||
|---|---|---|
| Date: February 10, 2021 | By: | /s/ Relland M. Winand |
| Relland M. Winand | ||
| Chief Financial Officer |
Exhibit 99.1
InnovativeSolutions & Support, Inc. Announces First Quarter Fiscal 2021 Financial Results
Exton,PA. – February 10, 2021– Innovative Solutions & Support, Inc. (“IS&S” or the “Company”) (NASDAQ: ISSC) today announced its financial results for the first quarter of fiscal 2021, ended December 31, 2020.
For the first quarter of fiscal 2021, the Company reported net sales of $4.9 million, up from net sales of $4.5 million in the first quarter a year ago. The Company reported operating income of $232,000 and net income of $240,000, or $0.01 per share, in the first quarter of fiscal 2021, compared to operating income of $232,000 buoyed by interest income to a net income of $328,000, or $0.02 per share, in the first quarter of fiscal 2020.
Geoffrey Hedrick, Chairman and Chief Executive Officer of IS&S, said, “The results for the first quarter of fiscal 2021 reflect revenue growth, and positive cash flow compared to the year ago quarter. I am very pleased with the continued success we are experiencing growing our portfolio of production contracts for both retrofit and new production aircraft in spite of the Pandemic’s impact on our anticipated exponential market demand. However, continued demand is providing a solid base of recurring revenue on which to build. We are also experiencing healthy demand for our Boeing 757 and 767 Flat Panel Upgrade system and Eclipse software upgrade. Innovative Solutions and Support remains focused on creating value for our shareholders through the continued development of the industry’s leading price-for-performance technology in the Commercial Air Transport, Military and General Aviation markets.”
“We’ve achieved these results while remaining committed to implementing precautions against COVID-19 that seek to ensure the safety of our employees, suppliers and customers. Reflecting our continued confidence, in December we declared a special, $0.50 per share dividend to provide tangible returns to our shareholders. Together with the $0.65 dividend declared in September, over the last six months of calendar 2020 we returned nearly $20 million of cash to our shareholders. Even after these distributions, we remain in excellent financial condition with significant liquidity and no debt.”
At December 31, 2020, the Company had $5.6 million of cash on hand. Net cash flows from operating activities were $1.7 million in the quarter.
New orders in the first quarter of fiscal 2021 were $5.4 million, and backlog as of December 31, 2020, was $4.2 million. Backlog excludes potential future sole-source production orders from the Pilatus PC-24, the KC-46A and the Textron King Air 360 and King Air 260 ThrustSense® Autothrottle programs, all of which the Company expects to remain in production for a decade. The Company expects that these contracts will add to production sales already in backlog.
Conference Call
The Company will be hosting a conference call on Thursday, February 11, 2021, at 10:00 a.m. ET to discuss these results, its business outlook and product development. Please use the following dial in number to register your name and company affiliation for the conference call: 844-739-3798. No conference ID is required. The call will also be carried live on the Investor Relations page of the Company web site at www.innovative-ss.com.
About Innovative Solutions & Support, Inc.
Headquartered in Exton, Pa., Innovative Solutions & Support, Inc. (www.innovative-ss.com) is a systems integrator that designs and manufactures flight guidance and cockpit display systems for Original Equipment Manufacturers (OEMs) and retrofit applications. The company supplies integrated Flight Management Systems (FMS), Autothrottle Systems and advanced GPS receivers for precision low carbon footprint navigation.
Certain matters containedherein that are not descriptions of historical facts are “forward-looking” (as such term is defined in the PrivateSecurities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differmaterially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materiallyfrom those expressed or implied by such forward-looking statements include, but are not limited to, those discussed in filingsmade by the Company with the Securities and Exchange Commission. Many of the factors that will determine the Company’s futureresults are beyond the ability of management to control or predict. Readers should not place undue reliance on forward-lookingstatements, which reflect management’s views only as of the date hereof. The Company undertakes no obligation to reviseor update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information,future events or otherwise.
Innovative Solutions and Support, Inc.
Consolidated Balance Sheets
| September 30, | |||||
|---|---|---|---|---|---|
| 2020 | |||||
| ASSETS | |||||
| Current assets | |||||
| Cash and cash equivalents | 5,608,255 | $ | 12,603,967 | ||
| Restricted cash | - | $ | 11,180,900 | ||
| Accounts receivable | 2,544,529 | 4,369,111 | |||
| Inventories | 4,180,743 | 4,291,335 | |||
| Prepaid expenses and other current assets | 850,861 | 675,109 | |||
| Total current assets | 13,184,388 | 33,120,422 | |||
| Property and equipment, net | 8,155,667 | 8,175,872 | |||
| Other assets | 208,093 | 249,543 | |||
| Total assets | 21,548,148 | $ | 41,545,837 | ||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||
| Current liabilities | |||||
| Accounts payable | 727,593 | $ | 790,892 | ||
| Dividends payable | - | $ | 11,180,900 | ||
| Accrued expenses | 1,121,818 | 1,361,960 | |||
| Contract liability | 121,473 | 313,365 | |||
| Total current liabilities | 1,970,884 | 13,647,117 | |||
| Non-current deferred income taxes | 129,689 | 129,689 | |||
| Total liabilities | 2,100,573 | 13,776,806 | |||
| Commitments and contingencies | |||||
| Shareholders' equity | |||||
| Preferred stock, 10,000,000 shares authorized, .001 par value, of which 200,000 shares are authorized as Class A Convertible stock. No shares issued and outstanding at December 31, 2019 and September 30, 2019 | - | $ | - | ||
| Common stock, .001 par value: 75,000,000 shares authorized, 19,310,835 issued at December 31, 2020 and September 30, 2020 | 19,311 | 19,311 | |||
| Additional paid-in capital | 51,504,378 | 51,458,787 | |||
| (Accumulated deficit) | (10,707,577 | ) | (2,340,530 | ) | |
| Treasury stock, at cost, 2,096,451 shares at December 31, 2020 and September 30, 2020 | (21,368,537 | ) | (21,368,537 | ) | |
| Total shareholders' equity | 19,447,575 | 27,769,031 | |||
| Total liabilities and shareholders' equity | 21,548,148 | $ | 41,545,837 |
All values are in US Dollars.
Innovative Solutions and Support, Inc.
Consolidated Statements of Operations
(unaudited)
| Three months ended | ||||
|---|---|---|---|---|
| December 31, | ||||
| 2020 | 2019 | |||
| Net sales | $ | 4,869,652 | $ | 4,511,428 |
| Cost of sales | 2,303,829 | 1,909,781 | ||
| Gross profit | 2,565,823 | 2,601,647 | ||
| Operating expenses: | ||||
| Research and development | 600,298 | 666,615 | ||
| Selling, general and administrative | 1,733,154 | 1,703,274 | ||
| Total operating expenses | 2,333,452 | 2,369,889 | ||
| Operating income | 232,371 | 231,758 | ||
| Interest income | 879 | 78,870 | ||
| Other income | 16,392 | 17,280 | ||
| Income before income taxes | 249,642 | 327,908 | ||
| Income tax expense | 9,497 | - | ||
| Net income | $ | 240,145 | $ | 327,908 |
| Net income per common share: | ||||
| Basic | $ | 0.01 | $ | 0.02 |
| Diluted | $ | 0.01 | $ | 0.02 |
| Weighted average shares outstanding: | ||||
| Basic | 17,214,384 | 16,909,036 | ||
| Diluted | 17,216,287 | 17,081,578 |