LOWELL, Mass., Dec. 10, 2019 (GLOBE NEWSWIRE) -- CSP Inc. (NASDAQ: CSPI), a provider of security and packet capture products, managed IT and professional services and technology solutions, reported revenue growth of 12.8% and 8.4% for the fiscal fourth quarter and fiscal 2019 full year ended September 30, 2019, respectively.
The Company also announced that its board of directors has voted to pay a quarterly dividend of $0.15 per share to shareholders of record on December 31, 2019, payable on January 15, 2020.
“We had a solid year end and I believe our goal to transform CSPi to a cybersecurity and wireless managed services company is coming to fruition and we are well-positioned to achieve our near and long-term objectives,” commented Victor Dellovo, Chief Executive Officer. “I am pleased with the initial roll-out of our ARIA™ Software-defined Security (SDS) solution and we are highly encouraged by the customer feedback. Their positive experience validates CSPi’s vision and our efforts to increase the direct sales capabilities for ARIA will allow us to maintain this momentum. Additionally, I believe the recent acknowledgement from CyberDefense Magazine, the premier source of IT security information, will create new revenue opportunities as in-bound requests have increased. We entered fiscal 2020 with a strong tailwind and this success gives me greater confidence that we will continue to execute our goals to further develop applications and enhance the performance of ARIA to drive customer adoption. I also believe we are in a much stronger position today to deliver significant revenue growth and increased profitability, not only this year, but in the years to come.”
Fiscal 2019 Fourth Quarter Results
Revenue for the fiscal fourth quarter increased to $22.2 million from $19.6 million a year ago. Gross profit for the fiscal fourth quarter of 2019 was $5.1 million, or 23% of sales, compared with $4.8 million, or 24.7% of sales in the year-ago fiscal fourth quarter. Net loss for the fourth quarter of fiscal 2019 was $334 thousand, or $0.08 per diluted share, compared with net income of $16.2 million, or $3.95 per diluted share for the fourth quarter of fiscal 2018. The year-ago net income included a gain on sale of discontinued operations, related to the Germany sale, of $16.8 million. Excluding the gain, the Company’s continuing operations would have reported a net loss of $0.7 million, or $0.18 per share.
Fiscal 2019 Full Year Results
Revenue for the fiscal year ended September 30, 2019 increased 8.4% to $79.1 million compared to revenue of $72.9 million in fiscal year 2018. Gross profit for fiscal year 2019 was $18 million, or 22.8% of sales, compared with $18.4 million, or 25.2% of sales in 2018. Net loss for the twelve months ended September 30, 2019 was $371 thousand, or $0.09 per share, compared with net income of $14.4 million, or $3.55 per diluted share for fiscal 2018, which includes the gain on sale of the Company’s German operations. Excluding the gain, the Company’s continuing operations would have reported a net loss of $2 million, or $0.52 per share.
At September 30, 2019, the Company had cash and cash equivalents of $18.1 million.
Conference Call Details
CSPi Chief Executive Officer Victor Dellovo and Chief Financial Officer Gary W. Levine will host a conference call at 10:00 a.m. (ET) on December 10, 2019 to review CSPi’s financial results and provide a business update. To listen to a live webcast of the call, please visit the “Investor Relations” section of the Company’s website at www.cspi.com. Individuals may also listen to the call via telephone, by dialing 866-342-8591 or 203-518-9713. For interested parties unable to participate in the live call, an archived version of the webcast will be available for approximately one year on CSPi’s website.
About CSPi
CSPi (NASDAQ: CSPI) operates two divisions, each with unique expertise in designing and implementing technology solutions to help their customers use technology as a means to success. The High Performance Product division, including ARIA Cybersecurity Solutions, originated from supporting initiatives for the Department of Defense and Western intelligence agencies related to network monitoring, data protection, and intelligence initiatives. This focused mindset now results in foolproof data protection, enterprise-wide. Our ARIA Software Defined Security solutions set provides enhanced network security, as well as accelerating incident response capabilities, while our Myricom nVoy Series appliances provide automated breach identification and notification, enabled by the 10G dropless packet capture inherent in our Myricom intelligent adapters. CSPi’s Technology Solutions division helps clients achieve their business goals and accelerate time to market through innovative IT solutions and professional services by partnering with best-in-class technology providers. For organizations that want the benefits of an IT department without the cost, we offer a robust catalog of Managed IT Services providing 24×365 proactive support. Our team of engineers have expertise across major industries supporting five key technology areas: Advanced Security; Communication and Collaboration; Data Center; Networking; and Wireless & Mobility.
Safe Harbor
The Company wishes to take advantage of the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995 with respect to statements that may be deemed to be forward-looking under the Act. Such forward-looking statements may include, but are not limited to: “We entered fiscal 2020 with a strong tailwind and this success gives me greater confidence that we will continue to execute our goals to further develop applications and enhance the performance of ARIA to drive customer adoption. I also believe we are in a much stronger position today to deliver significant revenue growth and increased profitability, not only this year, but in the years to come.” The Company cautions that numerous factors could cause actual results to differ materially from forward-looking statements made by the Company. Such risks include general economic conditions, market factors, competitive factors and pricing pressures, and others described in the Company's filings with the Securities and Exchange Commission (“SEC”). Please refer to the section on forward-looking statements included in the Company's filings with the SEC.
Contact:
Gary Levine
Chief Financial Officer
CSPi
Tel: 978.954.5040
Fax: 978.616.9065
CSP INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
| September 30, | September 30, | ||||
| 2019 | 2018 | ||||
| Assets | |||||
| Current assets: | |||||
| Cash and short-term investments | $ | 18,099 | $ | 25,107 | |
| Accounts receivable, net | 15,114 | 13,146 | |||
| Inventories | 7,818 | 7,558 | |||
| Other current assets | 5,503 | 2,604 | |||
| Total current assets | 46,534 | 48,415 | |||
| Property, equipment and improvements, net | 1,273 | 847 | |||
| Other assets | 11,562 | 6,013 | |||
| Total assets | $ | 59,369 | $ | 55,275 | |
| Liabilities and Shareholders' Equity | |||||
| Current liabilities | $ | 20,027 | $ | 14,061 | |
| Pension and retirement plans | 6,904 | 6,168 | |||
| Non-current liabilities | 2,010 | 1,244 | |||
| Shareholders' equity | 30,428 | 33,802 | |||
| Total liabilities and shareholders' equity | $ | 59,369 | $ | 55,275 | |
CSP INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)
| /-----Three Months Ended-----/ | /-----Twelve Months Ended-----/ | ||||||||||||||
| September 30, | September 30, | September 30, | September 30, | ||||||||||||
| 2019 | 2018 | 2019 | 2018 | ||||||||||||
| Sales: | |||||||||||||||
| Product | $ | 18,627 | $ | 15,863 | $ | 66,017 | $ | 59,661 | |||||||
| Service | 3,534 | 3,775 | 13,044 | 13,255 | |||||||||||
| Total sales | 22,161 | 19,638 | 79,061 | 72,916 | |||||||||||
| Cost of sales: | |||||||||||||||
| Product | 15,846 | 13,527 | 55,836 | 50,000 | |||||||||||
| Service | 1,223 | 1,270 | 5,199 | 4,517 | |||||||||||
| Total cost of sales | 17,069 | 14,797 | 61,035 | 54,517 | |||||||||||
| Gross Profit | 5,092 | 4,841 | 18,026 | 18,399 | |||||||||||
| Operating expenses: | |||||||||||||||
| Engineering and development | 691 | 925 | 2,800 | 3,277 | |||||||||||
| Selling, general & administrative | 4,616 | 5,041 | 16,052 | 16,723 | |||||||||||
| Total operating expenses | 5,307 | 5,966 | 18,852 | 20,000 | |||||||||||
| Operating loss | (215 | ) | (1,125 | ) | (826 | ) | (1,601 | ) | |||||||
| Other income (expense), net | 276 | 82 | 384 | 495 | |||||||||||
| Net income (loss) before income taxes and discontinued operations | 61 | (1,043 | ) | (442 | ) | (1,106 | ) | ||||||||
| Income taxes expense (benefit) | 395 | (343 | ) | (71 | ) | 882 | |||||||||
| Net loss from continuing operations | $ | (334 | ) | $ | (700 | ) | $ | (371 | ) | $ | (1,988 | ) | |||
| Discontinued operations: | |||||||||||||||
| Gain from sale of discontinued operations | - | 16,838 | - | 16,838 | |||||||||||
| Income (loss) from discontinued operations | - | 93 | - | (410 | ) | ||||||||||
| Net income from discontinued operations | - | 16,931 | - | 16,428 | |||||||||||
| Net income (loss) | $ | (334 | ) | $ | 16,231 | $ | (371 | ) | $ | 14,440 | |||||
| Net income (loss) attributable to common stockholders | $ | (334 | ) | $ | 15,596 | $ | (371 | ) | $ | 13,842 | |||||
| Net loss from continuing operations per share - basic | $ | (0.08 | ) | $ | (0.18 | ) | $ | (0.09 | ) | $ | (0.52 | ) | |||
| Net income from discontinued operations per share - basic | $ | 0.00 | $ | 4.39 | $ | 0.00 | $ | 4.30 | |||||||
| Net income (loss) per share -basic | $ | (0.08 | ) | $ | 4.04 | $ | (0.09 | ) | $ | 3.62 | |||||
| Weighted average shares outstanding - basic | 4,063 | 3,857 | 3,924 | 3,822 | |||||||||||
| Net loss from continuing operations per share - diluted | $ | (0.08 | ) | $ | (0.18 | ) | $ | (0.09 | ) | $ | (0.52 | ) | |||
| Net income from discontinued operations per share - diluted | $ | 0.00 | $ | 4.29 | $ | 0.00 | $ | 4.21 | |||||||
| Net income (loss) per share -diluted | $ | (0.08 | ) | $ | 3.95 | $ | (0.09 | ) | $ | 3.55 | |||||
| Weighted average shares outstanding - diluted | 4,063 | 3,944 | 3,924 | 3,901 | |||||||||||