NVE Corporation EARNINGS REPORT

NVE Corporation Reports Third Quarter Results and Announces Quarterly Dividend

EDEN PRAIRIE, Minn.—January 20, 2021—NVE Corporation (Nasdaq: NVEC) announced today financial results for the quarter and nine months ended December 31, 2020.

Total revenue for the third quarter of fiscal 2021 increased 1% to $6.53 million from $6.46 million for the the prior-year quarter. The increase was due to a 3% increase in product sales, partially offset by a 34% decrease in contract research and development revenue. Net income for the third quarter of fiscal 2021 increased 5% to $3.93 million, or $0.81 per diluted share, compared to $3.73 million, or $0.77 per share, for the prior-year quarter.

For the first nine months of fiscal 2021, total revenue decreased 20% to $15.5 million from $19.3 million for the first nine months of the prior year. The decrease was due to a 19% decrease in product sales and a 21% decrease in contract research and development revenue. Net income decreased 23% to $8.56 million, or $1.77 per diluted share, compared to $11.2 million, or $2.30 per share, for the first nine months of fiscal 2020.

The company also announced a quarterly cash dividend to shareholders of $1.00 per share of common stock, payable February 26, 2021 to shareholders of record as of February 1, 2021.

“We are pleased to report growth in product sales, total revenue, and net income despite the impact of the COVID-19 pandemic,” said NVE President and Chief Executive Officer Daniel A. Baker, Ph.D.

NVE is a leader in the practical commercialization of spintronics, a nanotechnology that relies on electron spin rather than electron charge to acquire, store and transmit information. The company manufactures high-performance spintronic products including sensors and couplers that are used to acquire and transmit data.

Statements used in this press release that relate to future plans, events, financial results or performance are forward-looking statements that are subject to certain risks and uncertainties including, among others, such factors as risks and uncertainties related to future sales and revenues and risks related to the COVID-19 pandemic, as well as the risk factors listed from time to time in our filings with the SEC, including our Annual Report on Form 10-K for the fiscal year ended March 31, 2020 as updated in our Quarterly Reports on Form 10-Q for the quarters ended June 30, September 30, December 31, 2020 and other reports filed with the SEC.
 
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NVE CORPORATION
STATEMENTS OF INCOME
QUARTERS AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019 (Unaudited)
 
Quarter Ended Dec. 31
2020   2019
Revenue
Product sales
 $ 6,332,349 $ 6,160,967  
Contract research and development
 201,013   303,629  
Total revenue   6,533,362   6,464,596
Cost of sales 1,075,048   1,263,806  
Gross profit   5,458,314 5,200,790
Expenses
Research and development
   702,216 771,468
Selling, general, and administrative
 311,356   327,989  
Total expenses 1,013,572   1,099,457  
Income from operations   4,444,742 4,101,333
Interest income 365,498   443,478  
Income before taxes   4,810,240   4,544,811
Provision for income taxes 884,531   814,147  
Net income $ 3,925,709     $ 3,730,664  
Net income per share – basic $ 0.81     $ 0.77  
Net income per share – diluted $ 0.81     $ 0.77  
Cash dividends declared per common share $ 1.00     $ 1.00  
Weighted average shares outstanding
Basic
 4,833,232 4,846,010
Diluted
   4,833,261 4,847,436
 
 
Nine Months Ended Dec. 31
2020 2019
Revenue
Product sales
 $ 14,850,157 $ 18,434,039  
Contract research and development
 653,252   827,198  
Total revenue   15,503,409   19,261,237  
Cost of sales 2,852,757   3,701,941  
Gross profit   12,650,652     15,559,296  
Expenses
Research and development
  

2,399,164

   2,671,131
Selling, general, and administrative

1,024,549

   1,026,448  
Total expenses 3,423,713   3,697,579  
Income from operations  

9,226,939

   11,861,717
Interest income 1,166,102   1,358,826  
Income before taxes  

10,393,041

   13,220,543
Provision for income taxes 1,833,127   2,060,398  
Net income $

8,559,914

   $ 11,160,145  
Net income per share – basic $ 1.77   $ 2.30  
Net income per share – diluted $ 1.77   $ 2.30  
Cash dividends declared per common share $ 3.00   $ 3.00  
Weighted average shares outstanding
Basic
 4,834,324 4,846,010
Diluted
 4,834,411 4,848,506
 
 
NVE CORPORATION
BALANCE SHEETS
DECEMBER 31 AND MARCH 31, 2020
  (Unaudited)
Dec. 31, 2020		   March 31, 2020
ASSETS
Current assets
Cash and cash equivalents
 $ 13,988,308     $ 8,065,594
Marketable securities, short-term
 11,115,094       19,084,814
Accounts receivable, net of allowance for uncollectible accounts of $15,000
   3,161,308       2,694,018
Inventories
   3,842,477       3,884,450
Prepaid expenses and other assets
 570,018     655,835  
Total current assets   32,677,205     34,384,711  
Fixed assets
Machinery and equipment 
   9,280,062     9,280,062
Leasehold improvements
 1,810,872     1,797,245  
  11,090,934       11,077,307
Less accumulated depreciation and amortization 
 10,724,866     10,494,840  
Net fixed assets   366,068       582,467
Deferred tax assets -   108,119  
Marketable securities, long-term 40,656,967   43,606,495
Right-of-use asset – operating lease 720,618     816,358  
Total assets $ 74,420,858     $ 79,498,150  
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable
 $ 136,673     $ 186,993
Accrued payroll and other
 505,428     482,074
Operating lease
 106,843     127,134
Total current liabilities   748,944       796,201
Deferred tax liabilities   89,420   -
Operating lease 613,775     706,600  
Total liabilities 1,452,139 1,502,801
 
Shareholders’ equity
Common stock
   48,332 48,350
Additional paid-in capital
   19,333,852 19,383,956
Accumulated other comprehensive income
   1,483,409   516,523  
Retained earnings
 52,103,126   58,046,520  
Total shareholders’ equity 72,968,719   77,995,349  
Total liabilities and shareholders’ equity $ 74,420,858   $ 79,498,150