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CSP Inc. REPORTS FISCAL FOURTH QUARTER AND FISCAL YEAR 2020 RESULTS
Continues to Generate Enthusiasm for Award-Winning Cyber Security Solutions; Enters Fiscal Year 2021 with Record New Business Pipeline and Solid Cash Position
LOWELL, Mass., December 28, 2020 – CSP Inc. (NASDAQ: CSPI), an award-winning provider of security and packet capture products, managed IT and professional services and technology solutions, reported financial and operating results for the 2020 fiscal fourth quarter and fiscal year ended September 30, 2020 and provided a business update.
Fourth Quarter Key Achievements
|●||Gross margin improved by 8 percentage points compared to the year-ago fiscal fourth quarter, as higher margin offerings gain market acceptance|
|●||Managed Services Practice remains strong as new and existing customers continue to generate meaningful momentum|
|●||Ended fiscal year 2020 with a robust cash balance to fund growth objectives|
“Our fiscal fourth quarter financial performance, as well as the full fiscal year, was impacted by the challenging business environment created by the COVID-19 pandemic. While the challenges remain, we have made numerous adjustments to our operations and have made progress that positions CSPi for greater accomplishments in 2021 and beyond,” commented Victor Dellovo, Chief Executive Officer. “The expansion of our gross margin by 8 percentage points is encouraging and demonstrates our commitment to building our profitability. Further, we prudently managed our cash throughout the year and, despite the unprecedented landscape, we have sufficient resources to navigate the near-term uncertainty to grow and prosper. For example, we are generating strong momentum in our Managed Services Practice, including our UCaaS offering. We are pursuing a number of larger transactions with this offering that could contribute nicely to fiscal year 2021 and drive higher margin improvement. Our fiscal 2021 looks promising and I believe growth drivers in the coming year, including ARIA and a full resumption of our cruise line business, will allow us to significantly exceed the revenue, gross margin and bottom line results we reported in fiscal year 2020”.
Fiscal Year 2020 Fourth Quarter Results
Revenue for the fiscal fourth quarter was $14.3 million, compared to $22.2 million in the year-ago fiscal fourth quarter. Gross profit for the fiscal fourth quarter was $4.4 million, or 31% of sales, compared to $5.1 million, or 23% of sales, in the year-ago fiscal fourth quarter, reflecting improved product gross margin percentage plus a mix of higher margin services and product business. The Company reported a net profit of $36,000 for the fourth fiscal quarter, or $0.01 per share, compared with a net loss of $(334,000), or $(0.08) per share, for the fourth quarter of fiscal year 2019. Loss before income tax was $(689,000) for the fiscal fourth quarter, compared to net income before income tax of $61,000 for the same quarter of the prior fiscal year. The Company’s income tax benefit for the fiscal fourth quarter was $725,000. The tax benefit was due to a partial valuation allowance against US deferred tax assets that are more likely to be partially realized, offset by current year federal research & development credits and the benefit resulting from the carryback of federal net operating losses.
At September 30, 2020, the Company had cash and cash equivalents of $19.3 million.
Fiscal 2020 Full Year Results
Revenue for the full fiscal year ended September 30, 2020 was $61.8 million compared to revenue of $79.1 million in the prior full year period. Gross profit for the twelve months ended September 30, 2020 was $17.2 million, or 27.8% of sales, compared with $18.0 million, or 22.8% of sales, in the twelve months ended September 30, 2019. Net loss for the full year ended September 30, 2020 was $(1.4) million, or $(0.36) per share, compared with net loss of $(371,000), or $(0.09) per share for the fiscal 2019.
Conference Call Details
The following information was filed by Csp Inc (CSPI) on Monday, December 28, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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