MIND TECHNOLOGY, INC. REPORTS FISCAL 2022 FOURTH QUARTER AND YEAR-END RESULTS

THE WOODLANDS, Texas, April 20, 2022 /PRNewswire/ — MIND Technology, Inc. (NASDAQ: MIND) (“MIND” or the “Company”) today announced financial results for its fiscal 2022 fourth quarter and year ended January 31, 2022.

Total revenues from continuing operations for fiscal 2022 were $23.1 million compared to $21.2 million in fiscal 2021. Revenues from Marine Technology Products sales for the fourth quarter of fiscal 2022 were $3.8 million compared to $8.3 million in the third quarter of fiscal 2022 and $6.4 million in the fourth quarter of fiscal 2021.

On an annual basis, the Company reported a net loss of $18.0 million attributable to common stockholders in fiscal 2022, or $(1.20) per share, compared to a net loss of $22.6 million attributable to common stockholders in fiscal 2021, or $(1.30) per share. The Company reported a net loss from continuing operations for the fourth quarter of fiscal 2022 of approximately $5.1 million compared to a loss of $2.1 million in the third quarter of fiscal 2022 and a loss of $3.3 million in the fourth quarter of fiscal 2021.  Fourth quarter of fiscal 2022 net loss from continuing operations attributable to common shareholders was $(0.43) per share compared to the third quarter of fiscal 2022 net loss per share of $(0.20) and a net loss of $(0.29) per share in the fourth quarter of fiscal 2021.

For the full year, Adjusted EBITDA from continuing operations was a loss of $10.6 million compared to a loss of $7.3 million in fiscal 2021. Adjusted EBITDA from continuing operations for the fourth quarter of fiscal 2022 was a loss of approximately $4.5 million compared to a loss of $1.3 million in the third quarter of fiscal 2022 and a loss of $1.8 million in the fourth quarter of fiscal 2021. Adjusted EBITDA from continuing operations, which is a non-GAAP measure, is defined and reconciled to reported net loss from continuing operations and cash provided by operating activities in the accompanying financial tables. These are the most directly comparable financial measures calculated and presented in accordance with United States generally accepted accounting principles.

Backlog of Marine Technology Products as of January 31, 2022, was approximately $13.1 million compared to $10.0 million at October 31, 2021 and $14.2 million at January 31, 2021.  

Rob Capps, MIND’s President and Chief Executive Officer, stated, “Despite the challenges we have continued to face, including global supply chain disruptions, order delays and delivery challenges, we accomplished a great deal in fiscal 2022 and continue to see increased levels of customer interest. While our fourth quarter revenues were disappointing due to the mentioned supply chain bottlenecks and delivery delays, we saw sales grow 9% year-over-year.

“Inquiry and bidding activity remain robust. As we announced last week, we have recently received significant new orders and have other pending orders that we are highly confident in receiving.  Coupled with our backlog of approximately $13.1 million as of January 31, we believe our current book of business is in excess of $23 million. This is significantly higher than we have seen historically and of course does not include numerous other prospects that we are actively pursuing. Based on these factors, we expect revenues from continuing operations in fiscal 2023 to exceed those of fiscal 2022 and we think that improvement will be seen beginning in the first quarter.

“Our balance sheet remains strong with zero debt, and our cost structure is flexible. We have taken steps recently to streamline our organization and thereby reduce our overhead structure, including eliminating two of the three highest paid positions in the Company.

“Our long-term outlook remains positive as we progress with our strategic initiatives to expand our product offerings to meet the increasing needs of the maritime market, which will underpin our future growth,” continued Capps.  “However, we are very much focused on near-term opportunities. The disruptions in the global supply chain obviously introduce risk and uncertainty. As always, we will proactively work to mitigate these risks as much as possible, but we do believe these issues are temporary and will be resolved in time.

“As we move into fiscal 2023, we continue to believe the positive trend for order flow will continue. Additionally, we believe the underlying market fundamentals are positive and those have contributed to the increase in order activity. The current geopolitical situation has highlighted the need for maritime security and other defense applications. Some of our recent order and bid activity is, we believe, a direct result of the European security situation. The pricing environment in the energy market is positive for our customers in that space.  The trend towards renewable energy, such as wind farms, is a positive development for our marine survey customers. We plan to continue executing on our long-term strategic initiatives and position the Company to become a leading provider of innovative marine technology and products,” concluded Capps. 

NOTE: As has been previously disclosed, the Company is exiting the land leasing business.  Accordingly, the Equipment Leasing segment has been treated as a discontinued operation, and the associated results are excluded from the Company’s results from continuing operations for all periods presented.  Assets and liabilities associated with the Equipment Leasing segment have been reclassified as “held for sale” in the accompanying consolidated condensed balance sheet.

CONFERENCE CALL

Management has scheduled a conference call for Thursday, April 21, 2022 at 9:00 a.m. Eastern Time (8:00 a.m. Central Time) to discuss the Company’s fiscal 2022 fourth quarter and year-end results.  To access the call, please dial (412) 902-0030 and ask for the MIND Technology call at least 10 minutes prior to the start time.  Investors may also listen to the conference live on the MIND Technology website,  http://mind-technology.com, by logging onto the site and clicking “Investor Relations.”  A telephonic replay of the conference call will be available through April 28, 2022 and may be accessed by calling (201) 612-7415 and using passcode 13728499#.  A webcast archive will also be available at http://mind-technology.com shortly after the call and will be accessible for approximately 90 days.  For more information, please contact Dennard Lascar Investor Relations by email at [email protected].

ABOUT MIND TECHNOLOGY

MIND Technology, Inc. provides technology to the oceanographic, hydrographic, defense, seismic and security industries.  Headquartered in The Woodlands, Texas, MIND has a global presence with key operating locations in the United States, Singapore, Malaysia, and the United Kingdom.  Its Seamap and Klein units, design, manufacture and sell specialized, high performance, marine sonar and seismic equipment. 

Forward-looking Statements

Certain statements and information in this press release concerning results for the quarter and fiscal year ended January 31, 2022 may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “believe,” “expect,” “anticipate,” “plan,” “intend,” “should,” “would,” “could” or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature.  These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us.  While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate.  All comments concerning our expectations for future revenues and operating results are based on our forecasts of our existing operations and do not include the potential impact of any future acquisitions or dispositions.  Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, without limitation, reductions in our customers’ capital budgets, our own capital budget, limitations on the availability of capital or higher costs of capital, volatility in commodity prices for oil and natural gas and the extent of disruptions caused by the COVID-19 outbreak.

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof.  We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, unless required by law, whether as a result of new information, future events or otherwise. All forward-looking statements included in this press release are expressly qualified in their entirety by the cautionary statements contained or referred to herein.

Non-GAAP Financial Measures

Certain statements and information in this press release contain non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles, or GAAP.  Company management believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. Company management also believes that these non-GAAP financial measures enhance the ability of investors to analyze the Company’s business trends and to understand the Company’s performance. In addition, the Company may utilize non-GAAP financial measures as guides in its forecasting, budgeting, and long-term planning processes and to measure operating performance for some management compensation purposes. Any analysis of non-GAAP financial measures should be used only in conjunction with results presented in accordance with GAAP.  Reconciliation of Backlog, which is a non-GAAP financial measure, is not included in this press release due to the inherent difficulty and impracticality of quantifying certain amounts that would be required to calculate the most directly comparable GAAP financial measures.

Contacts:

Rob Capps, President & CEO


MIND Technology, Inc.


281-353-4475




Ken Dennard / Zach Vaughan


Dennard Lascar Investor Relations


713-529-6600


[email protected] 

 

MIND TECHNOLOGY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(unaudited)




January 31,




2022



2021


ASSETS


Current assets:









     Cash and cash equivalents


$

5,114



$

4,611


     Accounts receivable, net of allowance for doubtful accounts of $484 and $948 at January

     31, 2022 and 2021, respectively



8,126




4,747


     Inventories, net



14,006




11,453


     Prepaid expenses and other current assets



1,840




1,659


     Assets held for sale



159




4,321


          Total current assets



29,245




26,791


Property and equipment, net



4,272




4,751


Operating lease right-of-use assets



1,835




1,471


Intangible assets, net



6,018




6,750


     Other assets



650





          Total assets


$

42,020



$

39,763


LIABILITIES AND STOCKHOLDERS’ EQUITY


Current liabilities:









     Accounts payable


$

2,046



$

1,704


     Deferred revenue



232




208


     Accrued expenses and other current liabilities



5,762




2,912


     Income taxes payable



837




562


     Operating lease liabilities – current



869




1,008


     Liabilities held for sale



953




1,442


           Total current liabilities



10,699




7,836


Operating lease liabilities – non-current



966




463


Notes payable






850


Deferred tax liability



92




198


          Total liabilities



11,757




9,347


Stockholders’ equity:









     Preferred stock, $1.00 par value; 2,000 shares authorized; 1,683 and 1,038 shares

     issued and outstanding at January 31, 2022, and 2021, respectively



37,779




23,104


     Common stock $0.01 par value; 40,000 shares authorized; 15,705 and 15,681 shares

     issued at January 31, 2022 and 2021, respectively



157




157


Additional paid-in capital



128,926




128,241


Treasury stock, at cost (1,931 and 1,929 shares at January 31, 2022 and 2021,

respectively)



(16,862)




(16,860)


Accumulated deficit



(117,856)




(99,870)


Accumulated other comprehensive loss



(1,881)




(4,356)


     Total stockholders’ equity



30,263




30,416


          Total liabilities and stockholders’ equity


$

42,020



$

39,763


 

MIND TECHNOLOGY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)




For the Three Months

Ended January 31,



For the Twelve Months

Ended January 31,




2022



2021



2022



2021


Revenues:

















     Sale of marine technology products


$

3,759



$

6,401



$

23,107



$

21,215


          Total revenues



3,759




6,401




23,107




21,215


Cost of sales:

















     Sale of marine technology products



3,674




3,867




17,085




13,906


          Total cost of sales



3,674




3,867




17,085




13,906


               Gross profit



85




2,534




6,022




7,309


Operating expenses:

















     Selling, general and administrative



3,663




3,733




14,761




12,648


     Research and development



1,029




926




3,596




3,003


     Provision for doubtful accounts






659







659


     Impairment of intangible assets












2,531


     Depreciation and amortization



492




704




2,209




2,796


          Total operating expenses



5,184




6,022




20,566




21,637


Operating loss



(5,099)




(3,488)




(14,544)




(14,328)


Other income:

















     Other income, net



(111)




794




926




862


          Total other income



(111)




794




926




862


Loss from continuing operations before income taxes



(5,210)




(2,694)




(13,618)




(13,466)


Benefit (provision) for income taxes



150




(615)




39




(536)


Loss from continuing operations



(5,060)




(3,309)




(13,579)




(14,002)


Loss from discontinued operations, net of income taxes



(803)




(161)




(1,506)




(6,304)


Net loss


$

(5,863)



$

(3,470)



$

(15,085)



$

(20,306)


Preferred stock dividends



(947)




(577)




(2,901)




(2,254)


Net loss attributable to common stockholders


$

(6,810)



$

(4,047)



$

(17,986)



$

(22,560)


Net loss per common share – Basic

















     Continuing operations


$

(0.43)



$

(0.29)



$

(1.20)



$

(1.30)


     Discontinued operations


$

(0.06)



$

(0.01)



$

(0.11)



$

(0.50)


Net loss


$

(0.49)



$

(0.30)



$

(1.31)



$

(1.80)


Net loss per common share – Diluted

















     Continuing operations


$

(0.43)



$

(0.29)



$

(1.20)



$

(1.30)


     Discontinued operations


$

(0.06)



$

(0.01)



$

(0.11)



$

(0.50)


          Net loss


$

(0.49)



$

(0.30)



$

(1.31)



$

(1.80)


Shares used in computing loss per common share:

















     Basic



13,774




13,313




13,771




12,519


     Diluted



13,774




13,313




13,771




12,519


 

MIND TECHNOLOGY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)




Year Ended January 31,




2022



2021


Cash flows from operating activities:









Net loss


$

(15,085)



$

(20,306)


     Adjustments to reconcile net loss to net cash used in operating activities:









          PPP loan forgiveness



(850)




(757)


          Depreciation and amortization



2,214




4,627


          Stock-based compensation



643




708


          Impairment of intangible assets






2,531


          Loss on disposal of discontinued operations






1,859


          (Recovery) provision for doubtful accounts, net of charge offs



(453)




1,129


          Provision for inventory obsolescence



921




321


          Gross profit from sale of lease pool equipment






(1,326)


          Gross profit from sale of other equipment



(155)




(357)


          Deferred tax expense



(106)




32


     Changes in:









          Accounts receivable



(3,195)




4,632


          Unbilled revenue



(57)




72


          Inventories



(3,074)




1,178


          Income taxes receivable and payable



37




767


          Accounts payable, accrued expenses and other current liabilities



713




(2,510)


          Prepaid expenses and other current and long-term assets



(565)




581


          Deferred revenue



1,878




459


               Net cash used in operating activities



(17,134)




(6,360)


Cash flows from investing activities:









     Purchases of seismic equipment held for lease






(110)


     Purchase of technology






(366)


     Purchases of property and equipment



(834)




(90)


     Sale of used lease pool equipment






2,010


     Sale of assets held for sale



5,437




1,506


     Sale of business, net of cash sold



761




257


               Net cash provided by investing activities



5,364




3,207


Cash flows from financing activities:









     Net proceeds from preferred stock offering



14,676




1,000


     Net proceeds from common stock offering



43




3,584


     Repurchase of common stock



(2)





     Preferred stock dividends



(2,530)




(1,677)


     Proceeds from PPP loans






1,607


               Net cash provided by financing activities



12,187




4,514


Effect of changes in foreign exchange rates on cash, cash equivalents and restricted cash



86




16


Net increase in cash, cash equivalents and restricted cash



503




1,377


Cash, cash equivalents and restricted cash, beginning of period



4,611




3,234


Cash, cash equivalents and restricted cash, end of period


$

5,114



$

4,611


 

MIND TECHNOLOGY, INC.

Reconciliation of Net Loss From Continuing Operations and Net Cash Used in Operating Activities to EBITDA and

Adjusted EBITDA From Continuing Operations

(in thousands)

(unaudited)




For the Three Months

Ended January 31,



For the Twelve Months

Ended January 31,




2022



2021



2022



2021




(in thousands)



(in thousands)


Reconciliation of Net loss from continuing operations to EBITDA

and Adjusted EBITDA

















Net loss from continuing operations


$

(5,060)



$

(3,309)



$

(13,579)



$

(14,002)


Depreciation and amortization



492




704




2,209




2,796


(Benefit) provision for income taxes



(150)




615




(39)




536


EBITDA from continuing operations (1)



(4,718)




(1,990)




(11,409)




(10,670)


Non-cash foreign exchange losses



39




31




163




110


Stock-based compensation



224




146




643




708


Impairment of intangible assets












2,531


Adjusted EBITDA from continuing operations (1)


$

(4,455)



$

(1,813)



$

(10,603)



$

(7,321)


Reconciliation of Net Cash Used In Operating Activities to EBITDA

















Net cash used in operating activities


$

(5,905)



$

(1,557)



$

(17,134)



$

(6,360)


PPP loan forgiveness






757




850




757


Stock-based compensation



(224)




(146)




(643)




(708)


Provision for doubtful accounts






(659)







(659)


Provision for inventory obsolescence



(533)




(65)




(616)




(132)


Changes in accounts receivable (current and long-term)



(567)




(899)




4,316




(3,077)


Interest paid






6







40


Taxes paid, net of refunds



206




117




355




336


Loss on sale of subsidiaries






54








Loss on sale of other equipment









155




357


Changes in inventory



2,992




(236)




3,122




(998)


Changes in accounts payable, accrued expenses and other current

liabilities and deferred revenue



(873)




(218)




(2,673)




1,223


Impairment of intangible assets












(2,531)


Changes in prepaid expenses and other current and long-term assets



64




477




606




(154)


Other



122




379




253




1,236


EBITDA from continuing operations (1)


$

(4,718)



$

(1,990)



$

(11,409)



$

(10,670)


 


1.

EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA is defined as net income before (a) interest income and interest expense, (b) provision for (or benefit from) income taxes and (c) depreciation and amortization. Adjusted EBITDA excludes non-cash foreign exchange gains and losses, stock-based compensation, impairment of intangible assets, other non-cash tax related items and non-cash costs of lease pool equipment sales. We consider EBITDA and Adjusted EBITDA to be important indicators for the performance of our business, but not measures of performance or liquidity calculated in accordance with GAAP. We have included these non-GAAP financial measures because management utilizes this information for assessing our performance and liquidity, and as indicators of our ability to make capital expenditures, service debt and finance working capital requirements and we believe that EBITDA and Adjusted EBITDA are measurements that are commonly used by analysts and some investors in evaluating the performance and liquidity of companies such as us. In particular, we believe that it is useful to our analysts and investors to understand this relationship because it excludes transactions not related to our core cash operating activities. We believe that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations. EBITDA and Adjusted EBITDA are not measures of financial performance or liquidity under GAAP and should not be considered in isolation or as alternatives to cash flow from operating activities or as alternatives to net income as indicators of operating performance or any other measures of performance derived in accordance with GAAP. In evaluating our performance as measured by EBITDA, management recognizes and considers the limitations of this measurement. EBITDA and Adjusted EBITDA do not reflect our obligations for the payment of income taxes, interest expense or other obligations such as capital expenditures. Accordingly, EBITDA and Adjusted EBITDA are only two of the measurements that management utilizes. Other companies in our industry may calculate EBITDA or Adjusted EBITDA differently than we do and EBITDA and Adjusted EBITDA may not be comparable with similarly titled measures reported by other companies.

 

Cision View original content:https://www.prnewswire.com/news-releases/mind-technology-inc-reports-fiscal-2022-fourth-quarter-and-year-end-results-301529562.html

SOURCE MIND Technology, Inc.

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