CPI Aerostructures Reports Third Quarter and Nine Month 2023 Results

CPI Aerostructures, Inc.

Third Quarter 2023 vs. Third Quarter 2022

• Revenue of $20.4 million compared to $20.2 million;

• Gross profit of $3.7 million compared to $5.3 million;

• Gross margin of 18.2% compared to 26.4%;

• Net income of $0.3 million compared to $1.9 million;

• Earnings per diluted share of $0.02 compared to $0.15;

• Cash flow from operations of $0.0 million compared to $2.9 million.

Nine Months 2023 vs. Nine Months 2022

• Revenue of $63.0 million compared to $59.3 million;

• Gross profit of $13.0 million compared to $12.4 million;

• Gross margin of 20.6% compared to 21.0%;

• Net income of $2.4 million compared to $2.3 million ($3.1 million excluding first quarter severance accrual of $0.8 million);

• Earnings per diluted share of $0.19 compared to $0.19 ($0.25 excluding first quarter severance accrual of $0.06);

• Cash flow from operations of $0.8 million compared to $0.8 million;

• Debt as of September 30, 2023 of $20.9 million compared to $23.7 million at September 30, 2022.
  

EDGEWOOD, N.Y., Nov. 14, 2023 (GLOBE NEWSWIRE) -- CPI Aerostructures, Inc. (“CPI Aero” or the “Company”) (NYSE American: CVU) today announced financial results for the three and nine month periods ended September 30, 2023.

“During the third quarter, we continued to execute on our plan to strengthen our balance sheet and build shareholder value. However, supply chain technical challenges negatively impacted our throughput and gross profit during the quarter. In addition, our year-over-year comparison was difficult given that the prior year’s third quarter benefited from a favorable mix. Nevertheless, our nine month revenue was up 6.3% and gross profit up 4.4% over prior year,” said Dorith Hakim, President and CEO.

“We continued to use cash flow from operations and paid off our term loan in full, reducing total debt by $2.8 million over prior year. We remain confident in our long-term outlook based on the corrective actions implemented in our supply chain, the increase in our funded backlog and our total backlog of $503 million as of September 30, 2023.”

About CPI Aero

CPI Aero is a U.S. manufacturer of structural assemblies for fixed wing aircraft, helicopters and airborne Intelligence Surveillance and Reconnaissance pod systems in both the commercial aerospace and national security markets. Within the global aerostructure supply chain, CPI Aero is either a Tier 1 supplier to aircraft OEMs or a Tier 2 subcontractor to major Tier 1 manufacturers. CPI also is a prime contractor to the U.S. Department of Defense, primarily the Air Force. In conjunction with its assembly operations, CPI Aero provides engineering, program management, supply chain management, and MRO services.

Forward-looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included or incorporated in this press release are forward-looking statements. The word “outlook,” and similar expressions are intended to identify these forward-looking statements. The Company does not guarantee that it will actually achieve the plans, intentions or expectations disclosed in its forward-looking statements and you should not place undue reliance on the Company’s forward-looking statements.

Forward-looking statements involve risks and uncertainties, and actual results could vary materially from these forward-looking statements. There are a number of important factors that could cause the Company’s actual results to differ materially from those indicated or implied by its forward-looking statements, including those important factors set forth under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K for the period ended December 31, 2022 filed with the Securities and Exchange Commission. Although the Company may elect to do so at some point in the future, the Company does not assume any obligation to update any forward-looking statements and it disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

CPI Aero® is a registered trademark of CPI Aerostructures, Inc. For more information, visit www.cpiaero.com, and follow us on Twitter @CPIAERO.

Contacts:
Investor Relations Counsel LHA Investor Relations Jody Burfening (212) 838-3777 cpiaero@lhai.com		CPI Aerostructures, Inc. Andrew L. Davis Chief Financial Officer (631) 586-5200 adavis@cpiaero.com www.cpiaero.com

CPI AEROSTRUCTURES, INC. AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS

	September 30, 2023 (Unaudited)				December 31, 2022
ASSETS
Current Assets:
Cash	$	2,609,693			$	3,847,225
Accounts receivable, net		9,124,187				4,857,772
Insurance recovery receivable		—				3,600,000
Contract assets		31,030,568				27,384,540
Inventory		1,650,873				2,493,069
Refundable income taxes		40,000				40,000
Prepaid expenses and other current assets		670,304				975,830
Total Current Assets		45,125,625				43,198,436
Operating lease right-of-use assets		5,196,418				6,526,627
Property and equipment, net		866,536				1,124,556
Deferred tax asset		6,074,243				6,574,463
Goodwill		1,784,254				1,784,254
Other assets		212,054				238,744
Total Assets	$	59,259,130			$	59,447,080
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	13,058,857			$	8,029,996
Accrued expenses		5,409,080				7,344,590
Litigation settlement obligation		—				3,600,000
Contract liabilities		6,669,341				6,001,726
Loss reserve		371,633				576,549
Current portion of line of credit		2,400,000				1,200,000
Current portion of long-term debt		66,311				1,719,766
Operating lease liabilities, current		1,961,070				1,817,811
Income tax payable		16,874				11,396
Total Current Liabilities		29,953,166				30,301,834
Line of credit, net of current portion		18,360,000				19,800,000
Long-term operating lease liabilities		3,613,270				5,077,235
Long-term debt, net of current portion		34,064				70,981
Total Liabilities		51,960,500				55,250,050
Shareholders’ Equity:
Common stock - $.001 par value; authorized 50,000,000 shares, 12,760,331 and 12,506,795 shares, respectively, issued and outstanding		12,761				12,507
Additional paid-in capital		73,849,050				73,189,449
Accumulated deficit		(66,563,181	)			(69,004,926	)
Total Shareholders’ Equity		7,298,630				4,197,030
Total Liabilities and Shareholders’ Equity	$	59,259,130			$	59,447,080

CPI AEROSTRUCTURES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

	For the Three Months Ended September 30,								For the Nine Months Ended September 30,
	2023				2022				2023				2022
Revenue	$	20,399,369			$	20,196,913			$	62,963,592			$	59,257,416
Cost of sales		16,693,279				14,869,100				49,990,986				46,835,304
Gross profit		3,706,090				5,327,813				12,972,606				12,422,112
Selling, general and administrative expenses		2,535,065				2,744,265				8,210,603				8,579,314
Income from operations		1,171,025				2,583,548				4,762,003				3,842,798
Interest expense		(663,857	)			(721,046	)			(1,816,408	)			(1,488,091	)
Income before provision for income taxes		507,168				1,862,502				2,945,595				2,354,707
Provision for income taxes		205,804				3,750				503,850				11,250
Net income	$	301,364			$	1,858,752			$	2,441,745			$	2,343,457
Income per common share, basic:
Income per common share-unrestricted shares	$	0.02			$	0.15			$	0.19			$	0.19
Income per common share-restricted shares	$	0.02			$	0.15			$	0.19			$	0.19
Income per common share, diluted	$	0.02			$	0.15			$	0.19			$	0.19
Shares used in computing income per common share, basic:
Unrestricted shares		12,431,727				12,208,340				12,418,693				12,274,246
Restricted shares		328,244				93,412				195,206				88,714
Total shares		12,759,971				12,301,752				12,613,899				12,362,960
Shares used in computing income per common share, diluted		12,793,133				12,349,283				12,647,061				12,410,491