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Pro Dex Inc (PDEX) SEC Filing 10-Q Quarterly Report for the period ending Thursday, March 31, 2022

Pro Dex Inc

CIK: 788920 Ticker: PDEX

 

 

EXHIBIT 99.1

ProDexLogoAndTag_High Res

 

 

 

Contact: Richard L. Van Kirk, Chief Executive Officer

(949) 769-3200

 

For Immediate Release

 

PRO-DEX, INC. ANNOUNCES FISCAL 2022 THIRD QUARTER

AND NINE-MONTH RESULTS

 

IRVINE, CA, May 5, 2022 - PRO-DEX, INC. (NasdaqCM: PDEX) today announced financial results for its fiscal 2022 third quarter ended March 31, 2022. The Company also filed its Quarterly Report on Form 10-Q for the third quarter of fiscal year 2022 with the Securities and Exchange Commission today.

 

Quarter Ended March 31, 2022

 

Net sales for the three months ended March 31, 2022, decreased $2.5 million, or 21%, to $9.3 million from $11.7 million for the three months ended March 31, 2021, due primarily to decreased sales of $2.8 million of our thoracic driver, which is as expected after a significant launch and fulfillment of our customer’s distribution network. While we expect future sales of this product, the revenue may not follow a consistent trajectory.

 

Gross profit for the three months ended March 31, 2022, decreased $1.5 million, or 35%, to $2.9 million from $4.4 million for the same period in fiscal 2021. The gross profit decrease is related in part to procurement of long-lead time components for many of our printed circuit board assemblies at higher prices given the world-wide shortages of these parts. These components were necessary to support customer requirements. As an example, a component normally costing $5 each was available at only $70 each due to these shortages. Total non-standard component costs were approximately $340,000 for the third quarter. While this remains an issue, we are hopeful that the most challenging cost issues are behind us.

 

Operating expenses (which include selling, general and administrative, and research and development expenses) for the quarter ended March 31, 2022, decreased $683,000, or 27%, compared to the same period in fiscal 2021 mostly due to reduced spending on internal product development projects as our engineering team focused more on billable customer projects.

 

Net income for the quarter ended March 31, 2022, was $462,000, or $0.12 per diluted share, compared to $2.1 million, or $0.54 per diluted share, for the corresponding quarter in fiscal 2021. Net income for the quarter ended March 31, 2021, included $919,000 of combined realized and unrealized gains on our investment portfolio, while the quarter ended March 31, 2022, included unrealized losses of $275,000.

 

Nine Months Ended March 31, 2022

 

Net sales for the nine months ended March 31, 2022, increased $832,000, or 3%, to $29.4 million from $28.6 million for the nine months ended March 31, 2021, due to increased billable non-recurring engineering projects and despite the above mentioned component challenges.

 

Gross profit for the nine months ended March 31, 2022, decreased $767,000, or 7%, compared to the same period in fiscal 2021. The gross profit decline for the nine months ended March 31, 2022, is similarly due to the supply chain issues mentioned above.

 

Operating expenses (which include selling, general and administrative, and research and development expenses) for the nine months ended March 31, 2022, decreased 12% to $5.7 million from $6.5 million in the prior fiscal year’s corresponding period, mostly due to reduced spending on internal product development projects and reduced selling expenses offset by increased general and administrative expenses due to non-cash stock based compensation expense.

 

 

 
 

 

Net income for the nine months ended March 31, 2022 was $2.5 million, or $0.65, per diluted share, compared to $5.0 million, or $1.26 per diluted share, for the corresponding period in fiscal 2021. Net income for the nine months ended March 31, 2021, included $2.2 million of combined realized and unrealized gains on our investment portfolio, while the nine months ended March 31, 2022, included unrealized losses of $427,000.

 

CEO Comments

 

“As disclosed in our second quarter earnings release, we knew that we were facing supply chain challenges related to component shortages and we are pleased that while this quarter did not set any records, we were able to meet our customers’ expectations and report profitable results during this challenging period,” said the Company’s President and Chief Executive Officer Richard L. (“Rick”) Van Kirk. “While we are still sourcing parts that have proven difficult and costly to obtain, we have successfully navigated these sourcing challenges. We are looking forward to a good fourth quarter and we are tracking toward record sales for the fiscal year from a revenue perspective as we have a healthy backlog and have secured the components we need. We also have absorbed much of the additional component costs in our third quarter. We remain optimistic going forward as we have a healthy pipeline and the additional capacity our new building provides.

 

About Pro-Dex, Inc.:

 

Pro-Dex, 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 also manufactures and 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.

 

Statements 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, (including, but not limited to, future sale of products and the ability to navigate future supply chain challenges), 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.

 

(tables follow)

 

 

 

 

 

 
 

 

PRO-DEX, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except share amounts)

 

 

    March 31,
2022
   

June 30,

2021

 
ASSETS                
Current Assets:                
Cash and cash equivalents   $ 4,761     $ 3,721  
Investments     1,129       1,295  
Accounts receivable, net of allowance for doubtful accounts of $0 and $2 at March 31, 2022 and at June 30, 2021, respectively     8,680       10,933  
Deferred costs     341       193  
Inventory     11,866       8,437  
Prepaid expenses and other current assets     1,322       434  
Total current assets     28,099       25,013  
Land and building, net     6,366       6,437  
Equipment and leasehold improvements, net     4,635       3,845  
Right of use asset, net     2,339       2,605  
Intangibles, net     162       186  
Deferred income taxes, net     463       463  
Investments     1,778       1,704  
Other assets     42       67  
Total assets   $ 43,884     $ 40,320  
                 
LIABILITIES AND SHAREHOLDERS’ EQUITY                
Current Liabilities:                
Accounts payable   $ 3,533     $ 2,288  
Accrued expenses     1,652       2,198  
Deferred revenue     896       150  
Note payable     1,642       1,236  
Total current liabilities     7,723       5,872  
Lease liability, net of current portion     2,151       2,432  
Income taxes payable     1,164       397  
Notes payable, net of current portion     10,575       11,535  
Total non-current liabilities     13,890       14,364  
Total liabilities     21,613       20,236  
Shareholders’ equity:                
Common shares; no par value; 50,000,000 shares authorized; 3,618,663 and 3,645,660 shares issued and outstanding at March 31, 2022 and June 30, 2021, respectively     7,690       7,953  
Retained earnings     14,581       12,131  
Total shareholders’ equity     22,271       20,084  
Total liabilities and shareholders’ equity   $ 43,884     $ 40,320  
                 

 

 

 
 

 

PRO-DEX, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except per share amounts)

 

 

    Three Months Ended
March 31,
    Nine Months Ended
March 31,
 
    2022     2021     2022     2021  
                         
Net sales   $ 9,265     $ 11,739     $ 29,426     $ 28,594  
Cost of sales     6,407       7,354       19,737       18,138  
Gross profit     2,858       4,385       9,689       10,456  
                                 
Operating expenses:                                
Selling expenses     20       136       79       415  
General and administrative expenses     1,145       1,280       3,402       2,922  
Loss on disposal of equipment     14             14        
Research and development costs     658       1,104       2,254       3,184  
Total operating expenses     1,837       2,520       5,749       6,521  
                                 
Operating income     1,021       1,865       3,940       3,935  
Interest expense     (112 )     (102 )     (349 )     (231 )
Unrealized gain (loss) on marketable equity investments     (275 )     136       (427 )     1,442  
Interest and other income           41       50       102  
Gain on sale of investments           783             795  
Income before income taxes     634       2,723       3,214       6,043  
Income tax expense     (172 )     (592 )     (764 )     (1,004 )
Net income   $ 462     $ 2,131     $ 2,450     $ 5,039  
                                 
Basic net income per share:                                
Net income   $ 0.13     $ 0.56     $ 0.67     $ 1.31  
Diluted net income per share:                                
Net income   $ 0.12     $ 0.54     $ 0.65     $ 1.26  
                                 
                                 
Weighted average common shares outstanding:                                
Basic     3,626       3,817       3,645       3,843  
Diluted     3,749       3,966       3,774       3,998  
Common shares outstanding     3,618       3,701       3,618       3,701  

 

 

 


The following information was filed by Pro Dex Inc (PDEX) on Thursday, May 5, 2022 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-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Pro Dex Inc's 10-Q Quarterly Report:

Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Cover
Condensed Consolidated Balance Sheets (Unaudited)
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical)
Condensed Consolidated Income Statements (Unaudited)
Condensed Consolidated Statements Of Cash Flows (Unaudited)
Condensed Consolidated Statements Of Shareholders' Equity (Unaudited)
Basis Of Presentation
Basis Of Presentation (Policies)
Commitments And Contingencies
Common Stock
Common Stock (Details Narrative)
Composition Of Certain Financial Statement Items
Composition Of Certain Financial Statement Items (Details Narrative)
Composition Of Certain Financial Statement Items (Intangible Assets) (Details)
Composition Of Certain Financial Statement Items (Inventory) (Details)
Composition Of Certain Financial Statement Items (Land And Building ) (Details)
Composition Of Certain Financial Statement Items (Marketable Equity Securities) (Details)
Composition Of Certain Financial Statement Items (Tables)
Description Of Business
Income Taxes
Income Taxes (Details Narrative)
Leases
Leases (Details Narrative)
Leases (Schedule Of Future Minimum Base Rental Payment) (Details)
Leases (Tables)
Major Customers And Suppliers
Major Customers And Suppliers (Accountsreceivablepayable) (Details1)
Major Customers And Suppliers (Details Narrative)
Major Customers And Suppliers (Sales) (Details)
Major Customers And Suppliers (Tables)
Net Income Per Share
Net Income Per Share (Details)
Net Income Per Share (Tables)
Net Sales
Net Sales (Details Narrative)
Net Sales (Details)
Net Sales (Tables)
Notes Payable And Financing Transactions
Notes Payable And Financing Transactions (Details Narrative)
Revision Of Previously Issued Financial Statements For Correction Of Immaterial Errors
Revision Of Previously Issued Financial Statements For Correction Of Immaterial Errors (Details Narrative)
Share-Based Compensation
Share-Based Compensation (Details Narrative)
Share-Based Compensation (Details)
Share-Based Compensation (Tables)
Subsequent Events
Warranty
Warranty (Details Narrative)
Warranty (Details)
Warranty (Tables)
Ticker: PDEX
CIK: 788920
Form Type: 10-Q Quarterly Report
Accession Number: 0001553350-22-000397
Submitted to the SEC: Thu May 05 2022 4:01:34 PM EST
Accepted by the SEC: Thu May 05 2022
Period: Thursday, March 31, 2022
Industry: Surgical And Medical Instruments And Apparatus

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