Full Press Release Details
Richard L. Van Kirk, Chief Executive Officer
INC. ANNOUNCES FISCAL 2024 SECOND QUARTER
CA, February 8, 2024 - PRO-DEX, INC. (NasdaqCM: PDEX) today
announced financial results for its fiscal 2024 second quarter ended December 31, 2023. The Company also filed its Quarterly Report
on Form 10-Q for the second quarter of fiscal year 2024 with the Securities and Exchange Commission today.
Ended December 31, 2023
sales for the three months ended December 31, 2023, increased $1.3 million, or 12%, to $12.6 million from $11.3 million for the three
months ended December 31, 2022,
due primarily to an increase in repair revenue related to the orthopedic surgical handpiece that we sell to our largest customer. As
previously disclosed, we began an enhanced repair program in the prior fiscal year to upgrade our customer's handpieces to the
most current revision.
profit for the three months ended December 31, 2023, increased $179,000, or 7%, to $2.8 million from $2.6 million for the same period
in fiscal 2023. The improvement in gross margin is primarily because we have seen a reduction in the requirement for us to supply components
to our suppliers for our printed circuit board assemblies.
expenses (which include selling, general and administrative, and research and development expenses) for the quarter ended December 31,
2023 increased $539,000, or 36%, to $2.0 million compared to $1.5 million in the prior fiscal year's corresponding quarter, reflecting
in part the reduced number of billable engineering projects in the current fiscal quarter compared to the same period in the prior fiscal
year and increased general and administrative expenses mostly due to higher professional fees related to audit and valuation services.
operating income for the quarter ended December 31, 2023, decreased $360,000, or 32%, to $777,000 compared to $1.1 million for the prior
fiscal year's corresponding quarter. Although sales and gross profit have increased, as described above, our operating expenses
have increased at a higher rate.
income for the quarter ended December 31, 2023, was $500,000 or $0.14 per diluted share, compared to $2.8 million, or $0.75 per diluted
share, for the corresponding quarter in fiscal 2023. Our net income for the three months ended December 31, 2023, contains unrealized
losses on our marketable equity investments of $40,000 while our net income for the three months ended December 31,2022 contains unrealized
gains on our marketable equity investments of $2.7 million. All of our investments are recorded at estimated fair value, and the valuation
can be highly volatile.
Months Ended December 31, 2023
sales for the six months ended December 31, 2023, increased $2.2 million, or 10%, to $24.5 million from $22.4 million for the six
ended December 31, 2022, due primarily to increased repair revenue from the orthopedic surgical handpiece that we sell to our largest
customer as well as the launch of our second thoracic driver, offset by decreased non-recurring engineering and proto-type revenue.
profit for the six months ended December 31, 2023, increased $882,000, or 16%, compared to the same period in fiscal 2023 due to a decline
in the requirement for us to source components at elevated prices on behalf of our suppliers in order to meet delivery requirements of
our customers, which we believe was a temporary COVID related disruption that impacted our business.
expenses (which include selling, general and administrative, and research and development expenses) for the six months ended December
31, 2023, increased $359,000, or 10%, to $3.9 million compared to $3.5 million in the prior fiscal year's corresponding period.
The increase is related to increased research and development costs due to fewer billable projects in the current fiscal year than the
prior fiscal year as well as higher general and administrative expenses mostly due to higher professional fees mostly related to audit
and valuation services.
operating income for six months ended December 31, 2023, increased $523,000, or 25%, to $2.6 million compared to $2.1 million for the
corresponding period of the prior fiscal year. The increase in operating income is attributable to higher sales and gross profit offset
by the higher operating expenses described above.
loss for the six months ended December 31, 2023, was $115,000 or $0.03 per diluted share, compared to net income of $4.0 million, or
$1.08 per diluted share for the six months ended December 31, 2022. Our net income for the six months ended December 31, 2023, contains
unrealized losses on our marketable equity investments of $2.6 million and our net income for the six months ended December 31, 2022,
contains unrealized gains on our marketable equity investments of $3.2 million. All of our investments are recorded at estimated fair
value, and the valuation can be highly volatile.
are pleased with our second quarter and year-to-date results." said Richard L. ("Rick") Van Kirk, the Company's
President and Chief Executive Officer. "We would also like to share that we have implemented a new stock buy-back program and have
begun to decrease our inventory levels." Mr. Van Kirk continued, "We are excited about our continued sales growth as well
as our prospects for continued future growth, as we are increasing our investment in our sales channels."
Inc. specializes in the design, development, and manufacture of autoclavable, battery-powered and electric, multi-function surgical drivers
and shavers used primarily in the orthopedic, thoracic, and maxocranial facial markets. We have patented adoptive torque-limiting
software and proprietary sealing solutions which appeal to our customers, primarily medical device distributors. Pro-Dex, Inc. also sells
rotary air motors to a wide range of industries. Pro-Dex's products are found in hospitals and medical engineering labs around the world.
For more information, visit the Company's website at www.pro-dex.com.
herein concerning the Company's plans, growth, and strategies may include 'forward-looking statements' within the context of the federal
securities laws. Statements regarding the Company's future events, developments, and future performance, as well as management's expectations,
beliefs, plans, estimates, or projections relating to the future, are forward-looking statements within the meaning of these laws. The
Company's actual results may differ materially from those suggested as a result of various factors. Interested parties should refer to
the disclosure concerning the operational and business concerns of the Company set forth in the Company's filings with the Securities
and Exchange Commission.
PRO-DEX, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
| December 31, 2023 | June 30, 2023 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 1,289 | $ | 2,936 | ||||
| Investments | 5,803 | 1,134 | ||||||
| Accounts receivable, net of allowance for expected credit losses of $0 at December 31, 2023 and at June 30, 2023, respectively | 13,169 | 9,952 | ||||||
| Deferred costs | 412 | 494 | ||||||
| Inventory | 15,026 | 16,167 | ||||||
| Prepaid expenses and other current assets | 901 | 296 | ||||||
| Total current assets | 36,600 | 30,979 | ||||||
| Land and building, net | 6,202 | 6,249 | ||||||
| Equipment and leasehold improvements, net | 5,331 | 5,079 | ||||||
| Right-of-use asset, net | 1,675 | 1,872 | ||||||
| Intangibles, net | 68 | 81 | ||||||
| Investments | 1,509 | 7,521 | ||||||
| Other assets | 42 | 42 | ||||||
| Total assets | $ | 51,427 | $ | 51,823 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 2,909 | $ | 2,261 | ||||
| Accrued liabilities | 2,846 | 3,135 | ||||||
| Income taxes payable | 389 | 453 | ||||||
| Notes payable | 3,846 | 3,827 | ||||||
| Total current liabilities | 9,990 | 9,676 | ||||||
| Lease liability, net of current portion | 1,415 | 1,638 | ||||||
| Deferred income taxes, net | 8 | 8 | ||||||
| Notes payable, net of current portion | 8,228 | 8,911 | ||||||
| Total non-current liabilities | 9,651 | 10,557 | ||||||
| Total liabilities | 19,641 | 20,233 | ||||||
| Shareholders' equity: | ||||||||
| Common stock; no par value; 50,000,000 shares authorized; 3,541,045 and 3,545,309 shares issued and outstanding at December 31, 2023 and June 30, 2023, respectively | 7,078 | 6,767 | ||||||
| Retained earnings | 24,708 | 24,823 | ||||||
| Total shareholders' equity | 31,786 | 31,590 | ||||||
| Total liabilities and shareholders' equity | $ | 51,427 | $ | 51,823 |
PRO-DEX, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
| Three Months Ended December 31, | Six Months Ended December 31, | |||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||
| (restated) | (restated) | |||||||||||||||
| Net sales | $ | 12,588 | $ | 11,282 | $ | 24,526 | $ | 22,369 | ||||||||
| Cost of sales | 9,786 | 8,659 | 18,066 | 16,791 | ||||||||||||
| Gross profit | 2,802 | 2,623 | 6,460 | 5,578 | ||||||||||||
| Operating expenses: Selling expenses | 37 | 68 | 63 | 122 | ||||||||||||
| General and administrative expenses | 1,200 | 951 | 2,195 | 1,975 | ||||||||||||
| Research and development costs | 788 | 467 | 1,593 | 1,395 | ||||||||||||
| Total operating expenses | 2,025 | 1,486 | 3,851 | 3,492 | ||||||||||||
| Operating income | 777 | 1,137 | 2,609 | 2,086 | ||||||||||||
| Interest expense | (139 | ) | (128 | ) | (271 | ) | (258 | ) | ||||||||
| Unrealized gain (loss) on marketable equity investments | (40 | ) | 2,740 | (2,593 | ) | 3,165 | ||||||||||
| Interest and other income | 22 | 7 | 46 | 225 | ||||||||||||
| Gain on sale of investments | - | - | - | 7 | ||||||||||||
| Income (loss) before income taxes | 620 | 3,756 | (209 | ) | 5,225 | |||||||||||
| Income tax benefit (expense) | (120 | ) | (1,004 | ) | 94 | (1,270 | ) | |||||||||
| Net income (loss) | $ | 500 | $ | 2,752 | $ | (115 | ) | $ | 3,955 | |||||||
| Basic net income (loss) per share: | ||||||||||||||||
| Net income (loss) | $ | 0.14 | $ | 0.77 | $ | (0.03 | ) | $ | 1.10 | |||||||
| Diluted net income (loss) per share: | ||||||||||||||||
| Net income (loss) | $ | 0.14 | $ | 0.75 | $ | (0.03 | ) | $ | 1.08 | |||||||
| Weighted-average common shares outstanding: | ||||||||||||||||
| Basic | 3,547 | 3,574 | 3,547 | 3,595 | ||||||||||||
| Diluted | 3,612 | 3,652 | 3,547 | 3,672 | ||||||||||||
| Common shares outstanding | 3,541 | 3,554 | 3,541 | 3,554 |