8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  April 29, 2009

INNOVATIVE SOLUTIONS AND SUPPORT, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania	0-31157	23-2507402
(State or other jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

720 Pennsylvania Drive

Exton, Pennsylvania 19341

(Address of principal executive offices)  (Zip Code)

(610) 646-9800

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02               Results of Operations and Financial Condition.

On April 29, 2009, Innovative Solutions and Support, Inc. issued a press release announcing its financial results for its second quarter ended March 31, 2009.  A copy of that press release and the attached financial schedules are attached as Exhibit 99.1 to this report and incorporated herein by reference.

The information in this report (including Exhibit 99.1) is being furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	INNOVATIVE SOLUTIONS AND SUPPORT, INC.
Date: April 29, 2009	By:	/s/ John C. Long
		John C. Long
		Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated April 29, 2009 announcing financial results for the second quarter ended March 31, 2009.

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EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Contact:	John Long, Chief Financial Officer
	Innovative Solutions & Support, Inc.
	610-646-0350

Innovative Solutions & Support, Inc. Announces Fiscal 2009 Second Quarter Financial Results

Revenues Up 53% from Year Ago Quarter, Operating Margin of 13.0% and Earnings Per Share of $0.08 in Second Quarter

Exton, PA.  — April 29, 2009 — Innovative Solutions & Support, Inc. (NASDAQ: ISSC) today announced its financial results for the second quarter of fiscal 2009 ending March 31, 2009.

Net revenues for the second quarter of fiscal 2009 were $10.5 million, up 53% from $6.8 million in the second quarter fiscal 2008.  The Company reported fiscal 2009 second quarter net income of $1.3 million, or $0.08 per fully diluted share, compared to a fiscal second quarter 2008 net loss of ($7.1 million), or ($0.42) per fully diluted share.  Cash flow was also strong in the quarter, reversing the working capital changes that reduced cash flow growth in the first quarter of fiscal 2009.

“We are again reporting results consistent with our expectations,” said Geoffrey Hedrick, Chairman and Chief Executive Officer of Innovative Solutions & Support, Inc.  “We have retooled and reorganized operations to improve productivity and reduce fixed overhead burden so we can effectively leverage our growth into more

significant bottom line improvement.  Both gross margin and operating margin performance are clearly demonstrating that the decisive actions taken this year are having the intended effect.”

Compared to the year ago period, the improvement in operating margins this quarter are in part due to the reduction in legal expenses, which amounted to over $1.3 million last year during the vigorous pursuit of the successful prosecution of a trade secret matter.  The case was settled in the fourth fiscal quarter of 2008.

Mr. Hedrick added, “As new aircraft build slows, operators are budgeting to improve the safety and performance of their existing fleets as well as to extend their life.  Economic uncertainty has severely impacted both the commercial airline transport and business jet industry.  In these difficult and uncertain economic times, our unequaled  performance/price strengthens demand for ISS products.

Several OEM’s have recently contacted us for retro-fit solutions in their existing fleets.  It is in the OEM’s interest to support the existing operators during this difficult economic time with a low-cost solution for their existing aircraft.  These upgrades, while providing significant improvement in operation and situational awareness, make the resale of these aircraft far more attractive when the user decides to upgrade to a new aircraft in the future.  While the general economic malaise has impacted our sales, we have been able to grow the company by an estimated 25% this year.

Six Month Results

Revenues for the six months ended March 31, 2009 were $21.0 million, up 82% over revenues for the six months ended March 31, 2008 of $11.6 million. For the six months ended March 31, 2009, net income was $3.2 million or $0.19 per diluted share compared to a net loss of ($11.2 million) or ($0.66) per fully diluted share for the six months ended March 31, 2008.    Legal expenses associated with the successful prosecution of the trade secret matter were $4.9 million in the six months ended March 31, 2008.  For the six months ended March 31, 2009, gross margin was 50% and our cash and cash equivalents increased by $2.5 million.

Roman Ptakowski, President, added, “Relative to our current operations, we have a healthy order book, including a substantive and growing intra-quarter book-and-ship business.  Over $4 million of recent orders and early indications by the military for further awards are indicative of our increasing success penetrating that very large market.  With flight testing nearly completed, the Cessna Flat Panel Display will be more widely available in the very near future.  We are also optimistic about the growth opportunities for our extremely versatile new Vantage Flat Panel Display System.  Also, by leveraging our technology into new applications such as our mission displays and marketing our legacy retrofit expertise, there are numerous opportunities available to expand our presence throughout the entire aircraft industry.”

Business Outlook

For the fiscal year 2009, based upon existing backlog, current production schedules and improving operating efficiency, the Company expects net revenues $37.0 - $39.0 million; and positive operating cash flow.  This outlook represents a 25% increase in

revenue over the prior fiscal year. We will provide additional details related to our outlook during the conference call.

The Company will be hosting a conference call Thursday, April 30, 2009 at 10:00 a.m. EDT time to discuss these results and its business outlook.  Please use the following dial in number to register your name and company affiliation for the conference call: 888-562-3654. The conference ID# is 95611570. The call will also be carried live on the Investor Relations page of the Company web site at www.innovative-ss.com.

About Innovative Solutions & Support, Inc.

Headquartered in Exton, PA. Innovative Solutions & Support, Inc. (www.innovative-ss.com) is a systems integrator engaged in the design, manufacture and marketing of Flat Panel Display Systems, Air Data equipment, Flight Information Computers, Engine and Fuel Measurement and Control Computers, and advanced monitoring systems that measure and display critical flight information. This includes data relative to aircraft separation, airspeed and altitude as well as fuel and critical engine parameters.

Certain matters contained herein that are not descriptions of historical facts are “forward-looking” (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, those discussed in filings made by the Company with the Securities and Exchange Commission. Many of the factors that will determine the Company’s future results are beyond the ability of management to control or predict. Readers should not place undue reliance on forward-looking statements, which reflects management’s views only as of the date hereof. The Company undertakes no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

Innovative Solutions and Support, Inc.

Consolidated Balance Sheets

(unaudited)

	March 31, 2009			September 30, 2008
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	37,518,990		$	35,031,932
Accounts receivable, net	5,764,620			4,218,443
Inventories	5,945,812			9,361,257
Deferred income taxes	301,841			414,636
Prepaid expenses and other current assets	1,277,542			1,406,260
Total current assets	50,808,805			50,432,528
Property and equipment, net	8,681,807			8,958,346
Other assets	503,114			505,840
TOTAL ASSETS	$	59,993,726		$	59,896,714
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Current portion of capitalized lease obligations	$	9,908		$	9,908
Accounts payable	1,638,298			2,349,981
Accrued expenses	2,805,843			5,130,463
Deferred revenue	241,509			450,923
Total current liabilities	4,695,558			7,941,275
Note payable	4,335,000			4,335,000
Long-term portion of capitalized lease obligations	32,403			37,633
Deferred revenue	86,844			114,075
Deferred income taxes	301,841			414,636
Other liabilities	294,428			249,969
Total liabilities	9,746,074			13,092,588
Commitments and contingencies				—
SHAREHOLDERS’ EQUITY:
Common stock	18,189			18,177
Additional paid-in capital	46,148,808			45,767,960
Retained earnings	23,323,531			20,152,615
Treasury stock	(19,242,876		)	(19,134,626		)
Total shareholders’ equity	50,247,652			46,804,126
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	59,993,726		$	59,896,714

Innovative Solutions and Support, Inc.

Consolidated Statement of Operations

(unaudited)

	Three months ended March 31,						Six months ended March 31,
	2009			2008			2009			2008
Sales	10,465,726			6,824,360			21,041,072			11,560,007
Cost of sales	5,217,613			3,790,661			10,472,786			7,449,720
Gross profit	5,248,113			3,033,699			10,568,286			4,110,287
Operating expenses:
Research and development	1,610,687			2,776,576			2,891,188			4,517,244
Selling, general and administrative	2,272,080			4,734,446			4,631,387			10,670,352
Total operating expenses	3,882,767			7,511,022			7,522,575			15,187,596
Operating income (loss)	1,365,346			(4,477,323		)	3,045,711			(11,077,309		)
Interest income	97,227			441,779			298,313			1,031,140
Interest expense	(19,241		)	(38,580		)	(54,715		)	(89,119		)
Other income	—			300,000			50,073			300,000
Income (loss) before income taxes	1,443,332			(3,774,124		)	3,339,382			(9,835,288		)
Income taxes expense	95,802			3,286,033			168,466			1,346,810
Net income (loss)	$	1,347,530		$	(7,060,157	)	$	3,170,916		$	(11,182,098	)
Net income (loss) per common share:
Basic	$	0.08		$	(0.42	)	$	0.19		$	(0.66	)
Diluted	$	0.08		$	(0.42	)	$	0.19		$	(0.66	)
Weighted average shares outstanding:
Basic	16,718,209			16,890,942			16,718,209			16,895,720
Diluted	16,718,215			16,890,942			16,735,645			16,895,720