Mechanical Technology Announces 2014 Results
March 5, 2015 | By Business Wire News
ALBANY, N.Y.
Mechanical Technology, Incorporated (MTI or the Company), (OTCQB:MKTY), a company engaged, through its subsidiary MTI Instruments, Inc. (MTI Instruments), in the design, manufacture and sale of test and measurement instruments and systems that provide solutions for precision linear displacement, vibration measurement and system balancing and precision tensile measurement systems for markets that require the exacting measurement and control of products and processes in the development and implementation of automated manufacturing, assembly, and consistent operation of complex machinery, announces its 2014 results and business update.
- Operating income increased by 56.5% as compared to the prior year as a direct result of increased sales and improved margins.
- Product revenue increased by 5.1% in 2014 compared to 2013 due to increases in both instruments for automated manufacturing with new customers and engine vibration and balancing system activity under government contracts.
- Gross profit, as a percentage of product revenue, increased to 62.6% in 2014 compared to 61.0% in 2013 due to an improved product sales mix and reduced product costs achieved with our lean manufacturing approach.
- Year-end backlog improved over the prior year by approximately $500 thousand due to strong sales efforts in precision sensor instrumentations and systems.
- Average monthly inventory balances decreased 7% over the prior year due to ongoing inventory management and our “lean” approach in operations.
- Net income increased when compared to the previous year after excluding the significant, one-time, non-cash gain recorded during 2013 from the deconsolidation of MTI Micro operations on December 31, 2013, as we have previously discussed.
- Working capital increased to $2.8 million at December 31, 2014 from $1.8 million at December 31, 2013 through improved earnings and ongoing financial management.
“This past year proved to be very successful as we have demonstrated improvements in all of our business areas” commented Kevin Lynch, Chairman and Chief Executive Officer of MTI. “We have remained committed to the execution of our plan, and thanks to the ongoing support of our Board of Directors, the MTI team has successfully carried out new product developments and launches, expanded market coverage, commercialized major new accounts, demonstrated production flexibility and capacity increases and implemented operational and quality improvements, all while achieving overall cost reductions.”
“As seen in 2014, with our current size, quarter to quarter sales and earnings results were uneven, but the full year outcome was very positive. The result of our efforts has translated into both a stronger income statement and balance sheet for the Company. This provides us with a solid financial foundation and strong outlook for future growth. We will continue to invest in product and market development efforts to position MTI with the best available technology to drive increased sales in support of our key markets and customers that require exacting measurement and control. Once more, this may have an impact on our performance in the short term, but we believe it will serve us well for our overall performance in 2015 as we again target to provide improved and sustainable results.”
About MTI
MTI is engaged in the design, manufacture, and sale of test and measurement instruments and systems through its subsidiary MTI Instruments, Inc. MTI Instrument’s products use a comprehensive array of technologies to solve complex, real world applications in numerous industries including manufacturing, electronics, semiconductor, solar, commercial and military aviation, automotive and data storage. For more information about the Company, please visit www.mechtech.com.
Statements in this press release which are not historical fact, including: “This provides us with a … strong outlook for future growth,” “we will continue to invest in product and market development efforts to position MTI with the best available technology to drive increased sales,” and “we believe it will serve us well for our overall performance in 2015 as we again target to provide improved and sustainable results,” constitute forward-looking statements within the meaning of federal securities laws. All forward-looking statements are made as of today, and MTI disclaims any duty to update such statements. It is important to note that the Company’s actual results could differ materially from those projected in forward-looking statements. Factors that could cause the anticipated results not to occur include: variability of customer requirements resulting in cancellations, reductions, or delays; a reduction in defense department spending; our inability to build and maintain relationships with our customers; significant periodic fluctuations in our results of operations and the other risk factors listed from time to time in the Company’s SEC reports, including, but not limited to, our annual report on Form 10-K for the year ended December 31, 2014, and our quarterly reports on Form 10-Q.
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MECHANICAL TECHNOLOGY, INCORPORATED AND SUBSIDIARIES |
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| (Dollars in thousands, except share related information) | December 31, | |||||||||
| 2014 | 2013 | |||||||||
| Assets | ||||||||||
| Current Assets: | ||||||||||
| Cash | $ | 1,923 | $ | 1,211 | ||||||
| Accounts receivable | 1,196 | 824 | ||||||||
| Notes receivable – related party, net | 20 | — | ||||||||
| Inventories | 773 | 742 | ||||||||
| Deferred income taxes, net | 20 | 25 | ||||||||
| Prepaid expenses and other current assets | 92 | 111 | ||||||||
| Total Current Assets | 4,024 | 2,913 | ||||||||
| Deferred income taxes, net | 1,315 | 1,475 | ||||||||
| Property, plant and equipment, net | 140 | 146 | ||||||||
| Total Assets | $ | 5,479 | $ | 4,534 | ||||||
| Liabilities and Equity | ||||||||||
| Current Liabilities: | ||||||||||
| Accounts payable | $ | 216 | $ | 149 | ||||||
| Accrued liabilities | 1,045 | 993 | ||||||||
| Total Current Liabilities | 1,261 | 1,142 | ||||||||
| Commitments and Contingencies | ||||||||||
| Equity: | ||||||||||
| Common stock, par value $0.01 per share, authorized 75,000,000; | ||||||||||
| 75,000,000; 6,263,975 and 6,261,975 issued in | ||||||||||
| 2014 and 2013, respectively | 63 | 63 | ||||||||
| Additional paid-in-capital | 135,698 | 135,612 | ||||||||
| Accumulated deficit | (117,789 | ) | (118,529 | ) | ||||||
| Common stock in treasury, at cost, 1,005,092 shares | ||||||||||
| in both 2014 and 2013 | (13,754 | ) | (13,754 | ) | ||||||
| Total Stockholders’ Equity | 4,218 | 3,392 | ||||||||
| Total Liabilities and Equity | $ | 5,479 | $ | 4,534 | ||||||
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MECHANICAL TECHNOLOGY, INCORPORATED AND SUBSIDIARIES |
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| (Dollars in thousands, except per share) |
Year Ended |
Year Ended |
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| Product revenue | $ | 8,781 | $ | 8,352 | ||||||
| Operating costs and expenses: | ||||||||||
| Cost of product revenue | 3,284 | 3,254 | ||||||||
| Unfunded research and product development expenses | 1,346 | 1,320 | ||||||||
| Selling, general and administrative expenses | 3,586 | 3,417 | ||||||||
| Operating income | 565 | 361 | ||||||||
| Gain on variable interest entity deconsolidation | — | 3,619 | ||||||||
| Other income (expense), net | 135 | (366 | ) | |||||||
| Income before income taxes and non-controlling interest | 700 | 3,614 | ||||||||
| Income tax benefit (expense) | 40 | (35 | ) | |||||||
| Net income | 740 | 3,579 | ||||||||
| Plus: Net loss attributed to non-controlling interest | — | 75 | ||||||||
| Net income attributed to MTI | $ | 740 | $ | 3,654 | ||||||
| Income per share attributable to MTI (Basic) | $ | 0.14 | $ | 0.70 | ||||||
| Income per share attributable to MTI (Diluted) | $ | 0.14 | $ | 0.69 | ||||||
| Weighted average shares outstanding (Basic) | 5,257,360 | 5,256,883 | ||||||||
| Weighted average shares outstanding (Diluted) | 5,464,003 | 5,308,498 | ||||||||
Mechanical Technology, Incorporated
Lisa Brennan, 518-218-2500
lbrennan@mtiinstruments.com
