 |
EARNINGS REPORT |
NVE Corporation Reports Third Quarter
Results and Announces Quarterly Dividend
EDEN PRAIRIE, Minn.—January 23, 2019—NVE
Corporation (Nasdaq: NVEC) announced today financial results for the quarter and
nine months ended December 31, 2018.
Total revenue for the third quarter of fiscal 2019 decreased 15% to $6.27 million
from $7.36 million in the prior-year quarter. The decrease was due to a 7%
decrease in product sales and a 69% decrease in contract research and development
revenue. Net income for the third quarter of fiscal 2019 decreased 4% to $3.42 million,
or $0.71 per diluted share, compared to $3.57 million, or $0.74 per
share, for the prior-year quarter.
For the first nine months of fiscal 2019, total revenue decreased 5% to $20.9 million
from $22.0 million for the first nine months of the prior year. The decrease
was primarily due to a 57% decrease in contract research and development revenue.
Net income increased 16% to $11.6 million, or $2.40 per diluted share,
for the first nine months of fiscal 2019 compared to $10.0 million, or $2.07
per share, for the first nine months of fiscal 2018.
The company also announced a quarterly cash dividend to shareholders of $1.00 per
share of common stock, payable February 28, 2019 to shareholders of record
as of February 4, 2019.
“We are pleased to report strong earnings for the quarter despite a large increase
in research and development expense for new product development including smart sensors,”
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. NVE
has also licensed its spintronic magnetoresistive random access memory technology,
commonly known as MRAM.
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, risks and uncertainties
related to future sales and revenue, uncertainties related to the impact of Federal
tax reform, risks related to changes in tariffs and other trade barriers, 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, 2018 and
other reports filed with the SEC.
###
NVE CORPORATION
STATEMENTS OF INCOME
QUARTERS AND NINE MONTHS ENDED DECEMBER 31, 2018 AND 2017 (Unaudited)
|
|
Quarter Ended Dec. 31 |
| 2018 |
|
2017 |
| Revenue |
|
Product sales
|
$ |
5,991,241 |
|
|
$ |
6,448,831 |
|
|
Contract research and development
|
278,164 |
|
|
911,958 |
|
| Total revenue |
|
6,269,405 |
|
|
|
7,360,789 |
|
| Cost of sales |
1,169,406 |
|
|
1,657,700 |
|
| Gross profit |
|
5,099,999 |
|
|
|
5,703,089 |
|
| Expenses |
|
Research and development
|
|
1,126,975 |
|
|
|
852,739 |
|
|
Selling, general, and administrative
|
268,905
|
|
|
313,033 |
|
| Total expenses |
1,395,880 |
|
|
1,165,772 |
|
| Income from operations |
|
3,704,119 |
|
|
|
4,537,317 |
|
| Interest income |
457,204 |
|
|
404,665 |
|
| Income before taxes |
|
4,161,323 |
|
|
|
4,941,982 |
|
| Provision for income taxes |
739,918 |
|
|
1,370,380 |
|
| Net income |
$ |
3,421,405 |
|
|
$ |
3,571,602 |
|
| Net income per share – basic |
$ |
0.71 |
|
|
$ |
0.74 |
|
| Net income per share – diluted |
$ |
0.71 |
|
|
$ |
0.74 |
|
| Cash dividends declared per common share |
$ |
1.00 |
|
|
$ |
1.00 |
|
| Weighted average shares outstanding |
|
Basic
|
|
4,845,010 |
|
|
|
4,841,369 |
|
|
Diluted
|
|
4,850,507 |
|
|
|
4,847,290 |
|
|
Nine Months Ended Dec. 31 |
| 2018 |
|
2017 |
| Revenue |
|
Product sales
|
$ |
19,916,864 |
|
|
$ |
19,718,584 |
|
|
Contract research and development
|
966,522 |
|
|
2,246,105 |
|
| Total revenue |
|
20,883,386 |
|
|
|
21,964,689 |
|
| Cost of sales |
3,918,256 |
|
|
4,809,235 |
|
| Gross profit |
|
16,965,130 |
|
|
|
17,155,454 |
|
| Expenses |
|
Research and development
|
|
3,087,964
|
|
|
|
2,788,968 |
|
|
Selling, general, and administrative
|
975,114 |
|
|
1,060,757 |
|
| Total expenses |
4,063,078 |
|
|
3,849,725 |
|
| Income from operations |
|
12,902,052 |
|
|
|
13,305,729 |
|
| Interest income |
1,325,299 |
|
|
1,154,303 |
|
| Income before taxes |
|
14,227,351 |
|
|
|
14,460,032 |
|
| Provision for income taxes |
2,578,287 |
|
|
4,429,780 |
|
| Net income |
$ |
11,649,064 |
|
|
$ |
10,030,252 |
|
| Net income per share – basic |
$ |
2.41 |
|
|
$ |
2.07 |
|
| Net income per share – diluted |
$ |
2.40 |
|
|
$ |
2.07 |
|
| Cash dividends declared per common share |
$ |
3.00 |
|
|
$ |
3.00 |
|
| Weighted average shares outstanding |
|
Basic
|
|
4,843,355 |
|
|
|
4,841,130 |
|
|
Diluted
|
|
4,850,120 |
|
|
|
4,846,036 |
|
NVE
CORPORATION
BALANCE SHEETS
DECEMBER 31 AND MARCH 31, 2018
|
|
(Unaudited)
Dec. 31, 2018 |
|
March
31, 2018 |
| ASSETS |
| Current assets |
|
Cash and cash equivalents
|
$ |
6,206,549 |
|
|
$ |
4,755,082 |
|
|
Marketable securities, short-term
|
|
17,445,586 |
|
|
|
20,765,809 |
|
|
Accounts receivable, net of allowance for uncollectible
accounts of $15,000
|
|
2,717,728 |
|
|
|
2,888,779 |
|
|
Inventories
|
|
4,141,481 |
|
|
|
3,650,439 |
|
|
Prepaid expenses and other assets
|
755,806 |
|
|
635,160 |
|
| Total current assets |
|
31,267,150 |
|
|
|
32,695,269 |
|
| Fixed assets |
|
Machinery and equipment
|
|
9,426,267 |
|
|
|
9,395,987 |
|
|
Leasehold improvements
|
1,787,269 |
|
|
1,749,284 |
|
| |
|
11,213,536
|
|
|
|
11,145,271 |
|
|
Less accumulated depreciation and amortization
|
10,192,504 |
|
|
9,819,888 |
|
| Net fixed assets |
|
1,021,032 |
|
|
|
1,325,383 |
|
| Deferred tax assets |
590,391 |
|
|
572,655 |
|
| Marketable securities, long-term |
51,907,552 |
|
|
52,838,158 |
|
| Total assets |
$ |
84,786,125 |
|
|
$ |
87,431,465 |
|
| |
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
| Current liabilities |
|
Accounts payable
|
$ |
313,116
|
|
|
$ |
414,970 |
|
|
Accrued payroll and other
|
552,834 |
|
|
574,755 |
|
| Total current liabilities |
|
865,950 |
|
|
|
989,725 |
|
| |
| Shareholders’ equity |
Common stock
|
|
48,460 |
|
|
|
48,420 |
|
|
Additional paid-in capital
|
|
19,910,558 |
|
|
|
19,599,298 |
|
|
Accumulated other comprehensive loss
|
|
(929,899 |
) |
|
|
(915,635 |
) |
|
Retained earnings
|
64,891,056 |
|
|
67,709,657 |
|
| Total shareholders’ equity |
83,920,175 |
|
|
86,441,740 |
|
| Total liabilities and shareholders’ equity |
$ |
84,786,125 |
|
|
$ |
87,431,465 |
|
|
