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CPS Technologies Corporation Announces Second Quarter 2016 Results

/EIN News/ -- NORTON, Mass., Aug. 03, 2016 (GLOBE NEWSWIRE) -- CPS Technologies Corporation (NASDAQ:CPSH) today announced revenues of $3.9 million and a net loss of $259 thousand for the quarter ended July 2, 2016.  This compares with revenues of $5.6 million and net income of $114 thousand for the quarter ended June 27, 2015.

Revenues for the six months ended July 2, 2016 were $9.2 million compared with revenues of $10.9 million for the corresponding period a year ago, a decline of 16%.  The net loss for the six- month period in 2016 totaled $62 thousand compared with net income of $188 thousand for the corresponding period a year ago.

Grant Bennett, President and CEO, commented, “Although this revenue decline is consistent with comments offered during our conference call in May, the results are disappointing.  Early in Q2 demand for baseplates for power modules used in trains and wind turbines declined unexpectedly, surprising both us and our customers.  We experienced similar unexpected demand volatility in 2012; demand returned after several quarters. At that time economic uncertainty in Europe was the primary reason for the decline; there are some indications this is at least one factor today.  In Q2 demand in most other product families also declined slightly, but within the range of expected quarter-to-quarter volatility.  The underlying markets remain long-term growth markets and we view these declines as short-term.  However, we have moved quickly to reduce manufacturing personnel to align with current volumes, institute salary adjustments, and sharply curtail discretionary spending.  These actions will minimize the effects of depressed revenues on cash flow while at the same time allowing us to maintain our sales and technical resources essential for growth,”

Mr. Bennett continued, “We are pressing forward with our strategy to strengthen our sales and marketing reach and focus.  Our search for a Senior Vice-President for Business Development and Strategy is progressing well.  We have been pleased with the quality of the candidates, have begun interviewing and are targeting a decision by Labor Day.  We are confident our unique technologies have multiple applications globally and see this individual as key to focusing our resources on the most attractive opportunities.  One final note-in July we completed a major redo of our website (www.alsic.com) and have received positive feedback from both prospective customers and investors.”

The Company will be hosting its second quarter conference call with investors at 4:30 pm on Wednesday, August 3.  Those interested in participating in the conference call should dial:

Call in Number: 855-863-0441
Conference ID: 56390707

About CPS
CPS Technologies Corporation is a global leader in producing metal-matrix composite components used to improve the reliability and performance of various electrical systems.  CPS products are used in motor controllers for hybrid and electric vehicles, high-speed trains, subway cars and wind turbines.  They are also used as heatspreaders in internet switches, routers and high-performance microprocessors.  CPS also develops and produces metal-matrix composite armor.

Safe Harbor
Statements made in this document that are not historical facts or which apply prospectively, including those relating to 2016 financial results, are forward-looking statements that involve risks and uncertainties. These forward-looking statements are identified by the use of terms and phrases such as "will," "intends," "believes," "expects," "plans," "anticipates" and similar expressions. Investors should not rely on forward looking statements because they are subject to a variety of risks and uncertainties and other factors that could cause actual results to differ materially from the company's expectation. Additional information concerning risk factors is contained from time to time in the company's SEC filings, including its Annual Report on Form 10-K and other periodic reports filed with the SEC. Forward-looking statements contained in this press release speak only as of the date of this release. Subsequent events or circumstances occurring after such date may render these statements incomplete or out of date. The company expressly disclaims any obligation to update the information contained in this release.

CPS TECHNOLOGIES CORPORATION        
STATEMENT OF OPERATIONS (Unaudited)        
       
  ---Quarter Ended---   -- Six Months Ended--
  July 2, June 27,   July 2, June 27,
    2016     2015       2016     2015  
  ----------- -----------   ----------- -----------
           
Total Revenues $ 3,934,995   $ 5,635,889     $ 9,150,612   $ 10,926,155  
Cost of Sales   3,374,078     4,336,853       7,458,138     8,491,754  
  ----------- -----------   ----------- -----------
Gross Margin   560,917     1,299,036       1,692,474     2,434,401  
Operating Expenses   892,477     1,112,295       1,800,646     2,125,133  
  ----------- -----------   ----------- -----------
Operating income  (loss)   (331,560 )   186,741       (108,172 )   309,268  
Interest income   2,722     851       6,462     851  
  ----------- -----------   ----------- -----------
Income (loss) before income taxes   (328,838 )   187,592       (101,710 )   310,119  
Income tax expense (benefit)   (70,100 )   73,760       (40,100 )   122,500  
  ----------- -----------   ----------- -----------
Net income  (loss)   (258,938 )   113,832       (61,610 )   187,619  
  ======== ========   ========= =========
Net income (loss) per diluted share ($ 0.02 ) $ 0.01     $ 0.00   $ 0.01  
Shares outstanding, diluted   13,200,269     13,627,346       13,199,210     13,679,355  


CPS TECHNOLOGIES CORPORATION
BALANCE SHEET (Unaudited)
             
    July 2,     Dec. 26,  
      2016     2015  
    --------------     --------------  
Assets            
             
Current assets:            
Cash and cash equivalents   $ 3,574,227   $ 3,412,649  
Accounts receivable, net     2,499,056     3,572,479  
Inventories, net     2,414,875     2,632,444  
Prepaid expenses and other current assets     134,641     104,761  
Deferred taxes, current     510,288     467,374  
    ---------------     ---------------  
Total current assets     9,133,087     10,189,707  
             
Property and equipment, net     1,874,320     1,688,553  
Deferred taxes, non-current     1,683,375     1,683,375  
    ---------------     ---------------  
Total assets   $ 12,690,782   $ 13,561,635  
    =========     =========  
             
Liabilities and Stockholders' Equity            
             
Current liabilities:            
Accounts payable   $ 913,644   $ 1,622,564  
Accrued expenses     710,859     931,916  
    -----------     -----------  
Total current liabilities     1,624,503     2,554,480  
             
Stockholders' equity     11,066,279     11,007,155  
    ---------------     ---------------  
Total liabilities and stockholders' equity   $ 12,690,782   $ 13,561,635  
    =========     =========  
             
CPS Technologies Corporation                                          
                    Ralph Norwood, Chief Financial Officer
                    111 South Worcester Street
                    Norton, MA 02766
                    Telephone: (508) 222-0614                                                                 
                    Web Site:  www.alsic.com

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