- Preliminary fourth quarter revenue was $116 million, and preliminary bookings were $177 million, for a book-to-bill of 1.5
- Preliminary 2021 revenue was $445 million, and preliminary bookings were $577 million, for a book-to-bill of 1.3
- Total cash proceeds of over $50 million associated with AMJP grant, earnout agreement, tax refund and facility sale; $29 million received to date with the remainder expected in early 2022
Astronics Corporation (Nasdaq: ATRO), a leading provider of advanced technologies for global aerospace, defense and other mission critical industries, today announced preliminary revenue and bookings while providing an update on liquidity events and a ruling on an intellectual property dispute in the U.K.
Preliminary Fourth Quarter Revenue of $116 Million; Book:Bill Ratio of 1.5x
Astronics’ unaudited preliminary revenue in the fourth quarter of 2021 was approximately $116 million of which approximately $99 million was from the Aerospace segment and $17 million was from the Test segment. For the full year, sales were approximately $445 million.
Preliminary bookings in the fourth quarter of 2021 were $177 million, which included $30 million from the Company’s Test segment. Bookings for the Aerospace segment were approximately $147 million, nearly double the $74 million in bookings realized in the fourth quarter of 2020.
Total bookings for 2021 were approximately $577 million, a 35% increase over total bookings received in 2020. Aerospace segment bookings for 2021 were approximately $509 million, up 53% over $333 million in bookings in 2020.
Backlog at year end was an estimated $416 million, a new record for the Company.
Increasing Liquidity and Strengthening Balance Sheet
At December 31, 2021, the Company had approximately $163 million in long term debt, down $20 million from October 2, 2021. Cash and equivalents at year end were $30 million, relatively unchanged from the end of the third quarter. Included in the year end cash balances were approximately $18 million in cash received related to a facility sale, the Aviation Manufacturing Jobs Protection Program (“AMJP”) and tax refunds. The Company expects to receive an additional $35 million in early 2022 which includes approximately $21 million in earnout from the sale of its semiconductor business, of which half has already been received, $9 million in tax refunds and an additional $5 million related to the AMJP. In addition, the Company expects to receive the final $2 million installment from the AMJP later in 2022. In total, the Company’s cash proceeds from these items are expected to be approximately $55 million.
Earnout payments for 2020 and 2021 related to 2019 sale of semiconductor test business
In late December, the Company reached an agreement with the buyer of its former semiconductor test business, which was sold in 2019, related to earnout payments. For its calendar 2020 earnout payment, the Company agreed to an earnout amount of $10.7 million, which was recorded in the fourth quarter of 2021 as other income and was paid to the Company in early January.
For its calendar 2021 earnout, the Company expects to receive an earnout payment of similar size, which it expects to recognize and receive in the first quarter of 2022, after an earnout calculation is received and reviewed by the Company.
The Company is eligible for a final earnout based on 2022 sales, which will be due in early 2023.
The Company is recognizing the AMJP grant as an offset to cost of products sold over a six-month period beginning in late September 2021 when the grant agreement commenced. Approximately $1 million of the grant was recognized in the third quarter of 2021, $7 million in the fourth quarter and $6 million is expected to be recognized in the first quarter of 2022.
Ruling in U.K. on Intellectual Property Dispute
The Company has been notified of an adverse ruling in its long-running intellectual property dispute with Lufthansa Technik, which has been in litigation since 2010 in the United States, France, Germany and the United Kingdom.
Most recently, the U.K. Court has ruled that the subject Lufthansa Technik patent is valid and that the Company has been infringing the expired patent. Based on the information currently available, the Company expects to make an accrual relating to the U.K. suit of approximately $8 million to $10 million in its fourth quarter 2021 financial results, although the actual amount of damages will not be known until the damages trial is completed, which is expected to occur sometime in 2023.
This ruling is contrary to conclusions reached by earlier courts in the US and France, where the patent was invalidated, and also in Germany, where the broadest claims of the patent were overturned. Lufthansa is appealing the French Court’s decision, and both sides are working on appeals in Germany regarding the calculation of damages. The US dispute is concluded.
The Company believes that the proceedings in the U.K., France and Germany are likely to conclude in 2023.
About Astronics Corporation
Astronics Corporation (Nasdaq: ATRO) serves the world’s aerospace, defense, and other mission critical industries with proven, innovative technology solutions. Astronics works side-by-side with customers, integrating its array of power, connectivity, lighting, structures, interiors, and test technologies to solve complex challenges. For over 50 years, Astronics has delivered creative, customer-focused solutions with exceptional responsiveness. Today, global airframe manufacturers, airlines, militaries, completion centers and Fortune 500 companies rely on the collaborative spirit and innovation of Astronics. The Company’s strategy is to increase its value by developing technologies and capabilities that provide innovative solutions to its targeted markets.
For more information on Astronics and its solutions, visit Astronics.com.
Safe Harbor Statement
This news release contains forward-looking statements as defined by the Securities Exchange Act of 1934. One can identify these forward-looking statements by the use of the words “expect,” “anticipate,” “plan,” “may,” “will,” “estimate” or other similar expressions and include all statements with the demand in business jet connectivity services, customer response to the connectivity service, and the performance of the Company’s connectivity hardware. Because such statements apply to future events, they are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated by the statements. Important factors that could cause actual results to differ materially from what may be stated here include the impact of a global pandemic and governmental and other actions taken in response, trend in growth with passenger power and connectivity on airplanes, the state of the aerospace and defense industries, the market acceptance of newly developed products, internal production capabilities, the timing of orders received, the status of customer certification processes and delivery schedules, the demand for and market acceptance of new or existing aircraft which contain the Company’s products, the need for new and advanced test and simulation equipment, customer preferences and relationships, and other factors which are described in filings by Astronics with the Securities and Exchange Commission. The Company assumes no obligation to update forward-looking information in this news release whether to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial conditions or prospects, or otherwise.