Item 2.02 Results of Operations and Financial Condition
NEWARK, N.Y. - July 31, 2014 -- Ultralife Corporation (NASDAQ: ULBI) reported an
operating loss from continuing operations of $1.3 million on revenue of $15.2
million for the quarter ended June 29, 2014. For the second quarter of 2013, the
company reported an operating loss from continuing operations of $1.9 million on
revenue of $17.3 million.
Discontinued operations for the second quarter of 2013 included the final
adjustments relating to the sale of RedBlack. All revenue, gross margin and
operating expense amounts presented below represent results from continuing
Revenue was $15.2 million, compared to $17.3 million for the second quarter of
2013, a 12% decline, reflecting a decrease of $2.5 million in Battery & Energy
Products sales partially offset by a $0.4 million increase in Communications
Systems sales. Battery & Energy Products sales were $12.2 million, compared to
$14.7 million last year, a 17% decrease, reflecting a 19% increase in commercial
sales more than offset by a 53% decline in Government/Defense sales.
Communications Systems sales were $3.0 million, compared to $2.6 million for the
same period last year, an increase of 16%, driven by the fulfillment of a $1.9
million order for the recently introduced Universal Vehicle Adaptors.
Gross profit was $4.2 million, or 27.7% of revenue, compared to $4.5 million, or
26.2% of revenue, for the same quarter a year ago. The 150 basis point
improvement reflects a higher mix of higher margin Communications Systems sales.
Communications Systems' gross margin was 44.0%, compared to 39.3%, an increase
of 470 basis points reflecting higher volumes and favorable product mix. Battery
& Energy Products' gross margin was 23.6%, compared to 23.8% last year,
Operating expenses decreased by 13% to $5.5 million, compared to $6.4 million a
year ago, primarily reflecting reductions in general and administrative
expenses. Operating expenses were 36.4% of revenue, compared to 37.0% for the
year earlier period.
With the reduction in operating expenses and the improvement in gross margin
offsetting the decline in volume, the operating loss was narrowed to $1.3
million for the quarter from $1.9 million last year.
As a result, the company reported a net loss from continuing operations of $1.4
million, or $0.08 per share, compared to a net loss of $2.0 million, or $0.11
per share, for the second quarter of 2013. Net income from discontinued
operations was $0.0 million, or $0.00 per share, compared to a net loss of $0.1
million, or $0.01 per share, for the second quarter of 2013.
Despite the company's commercial sales momentum, management now expects revenue
for the year to be approximately 10% below last year given the reductions in
global government and defense spending to date that are likely to persist. As a
result of the revised outlook for revenue, management now expects a slight
operating loss for the year in the range of 2 - 3% of sales.
Management cautions that the timing of orders and shipments may cause
variability in quarterly results.
The information set forth in this Form 8-K and the attached exhibit is being
furnished to and not filed with the Securities and Exchange Commission and shall
not be deemed to be incorporated by reference in any filing under the Securities
Exchange Act of 1934, as amended, or the Securities Act of 1933, as amended,
except to the extent specifically provided in any such filing.
Item 9.01 Financial Statements, Pro Forma Financials and Exhibits.
99.1 Press Release of Ultralife Corporation dated July 31, 2014