FREQUENCY ELECTRONICS, INC.
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(Exact Name of Registrant as Specified in Charter)
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Delaware
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1-8061
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11-1986657
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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55 Charles Lindbergh Blvd.,
Mitchel Field, NY
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11553
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(Address of Principal Executive Offices)
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(Zip Code)
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(516) 794-4500
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(Registrant’s telephone number, including area code)
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Not applicable
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(Former name or former address, if changed since last report)
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-
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For the year ended April 30, 2016, revenues from satellite payloads were approximately 55% of consolidated revenues compared to 60% for the prior year.
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-
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Total sales for U.S. Government/DOD end-use, including revenues on U.S. Government satellite programs, were approximately 60% of consolidated revenues in fiscal 2016 compared to 47% in fiscal year 2015.
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-
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Revenues from non-space U.S. Government/DOD customers were approximately 25% of consolidated revenues in fiscal 2016 compared to 20% in fiscal 2015.
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-
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For fiscal 2016, the Company’s NY-segment included operating losses of approximately $2 million at FEI-Elcom and $470,000 at FEI-Asia. The Gilliam-FEI segment recorded an operating loss of approximately $1.3 million. The FEI-Zyfer segment recorded an operating profit of approximately $2 million. In the current year we anticipate improvements in operating results and will address resource allocations at the segments which recorded losses during the past fiscal year.
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-
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The gross margin rate for the year ended April 30, 2016 increased to 34%, despite lower revenues, compared to 31% in the prior fiscal year. The company maintained full capacity scalability for increased production throughput. The company can achieve significantly higher gross margin rates on increased throughput.
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-
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Backlog at April 30, 2016 was $32 million compared to $37 million at the end of the prior fiscal year and up from $22 million at the end of the previous quarter.
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-
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For the year ended April 30, 2016, the Company generated positive operating cash flow of $3 million. The Company expects to continue to generate positive cash flow in subsequent fiscal quarters.
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-
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General Joseph P. Franklin has stepped down as Chairman of the Board of Directors of the Company and Mr. Joel Girsky a director of the company has been elected Chairman of the Board of Directors. General Franklin has been appointed Chairman Emeritus and will continue to serve as a director of the company.
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-
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On July 5, 2016, the Company received a letter from Privet Fund LP, a stockholder of the Company (“Privet Fund”), seeking to nominate four individuals for election to the Board of Directors at the Company’s 2016 annual meeting of stockholders. The Board of Directors believes that Privet Fund is engaged in an effort to acquire control of the Company without paying a premium to the Company’s stockholders. Accordingly, the Board does not believe that electing Privet Fund’s nominees would be in the best interests of the Company’s stockholders. The Board has been considering and will continue to consider candidates for election at the Company’s 2016 annual meeting, and will make an appropriate recommendation. Our recommendation will be contained in the proxy statement that we will file with the Securities and Exchange Commission to solicit proxies to elect our director nominees at Frequency’s 2016 annual meeting. When completed and available, our definitive proxy statement and WHITE proxy card will be mailed to Frequency shareholders.
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Quarter Ended
April 30,
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Year Ended
April 30,
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|||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||
(unaudited) | (unaudited) | (audited) | ||||||||||||||
(in thousands except per share data) | ||||||||||||||||
Revenues
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$
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14,212
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$
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19,200
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$
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60,394
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$
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76,564
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||||||||
Cost of Revenues
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9,499
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13,887
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39,958
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53,016
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||||||||||||
Gross Margin
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4,713
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5,313
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20,436
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23,548
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||||||||||||
Selling and Administrative
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3,138
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3,659
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13,205
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14,207
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||||||||||||
Research and Development
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1,534
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1,701
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5,929
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5,666
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||||||||||||
Operating Profit(Loss)
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41
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(47
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)
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1,302
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3,675
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|||||||||||
Interest and Other, Net
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30
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248
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773
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861
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||||||||||||
Income before Income Taxes
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71
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201
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2,075
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4,536
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||||||||||||
Income Tax Provision
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170
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260
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1,070
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1,710
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||||||||||||
Net Income (Loss)
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$
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(99
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)
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$
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(59
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)
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$
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1,005
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$
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2,826
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||||||
Net Income per Share:
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||||||||||||||||
Basic
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$
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(0.01
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)
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$
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(0.01
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)
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$
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0.12
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$
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0.33
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||||||
Diluted
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$
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(0.01
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)
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$
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(0.01
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)
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$
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0.11
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$
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0.32
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||||||
Average Shares Outstanding
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||||||||||||||||
Basic
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8,744
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8,643
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8,728
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8,611
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||||||||||||
Diluted
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8,744
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8,643
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8,937
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8,910
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April 30,
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April 30,
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|||||||
2016
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2015
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|||||||
(unaudited)
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(audited)
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|||||||
(in thousands)
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||||||||
ASSETS
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||||||||
Cash & Marketable Securities
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$
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17,193
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$
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18,408
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||||
Accounts Receivable
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10,244
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9,689
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||||||
Costs and Estimated Earnings in Excess of Billings, net
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11,133
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12,929
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||||||
Inventories
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41,278
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38,239
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||||||
Other Current Assets
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4,463
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4,334
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||||||
Property, Plant & Equipment
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13,072
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12,686
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||||||
Other Assets
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22,831
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21,540
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||||||
$
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120,214
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$
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117,825
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|||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
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||||||||
Current Liabilities
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$
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8,758
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$
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8,350
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||||
Long-term Debt
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6,000
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6,000
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||||||
Other Long-term Obligations
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12,104
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11,665
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||||||
Stockholders’ Equity
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93,352
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91,810
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||||||
$
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120,214
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$
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117,825
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