AmpliTech Reports FY 2023 Results; Core Business Sales Increased YoY, 5G ORAN Radio Products And Over 100 New SKU’s Released During FY2023, All Available For Sale Now
- Gross margin increased to nearly 47% in FY2023.
- Net loss of $2.4M in FY2023 due to R&D expenses and compliance costs.
- Introduction of over 100 new products in FY2023, including flagship 5G products.
- Total yearly revenues of $15.6M in FY2023.
- Strong liquidity with Total Current Assets of $17.1M and Total Current Liabilities of $1.5M.
- Targeted top-line sales of $35M - $40M in FY 2024.
- Focus on high-margin products to increase bottom-line revenue.
- Strategic partnerships with major 5G players for product development and testing.
- Net loss of $2.4M in FY2023, despite gross margin expansion.
- Decline in semiconductor materials distribution business sales.
- Dependency on funding opportunities for emerging technologies.
- Challenges in various industries to achieve connectivity speeds.
Insights
The expansion of AmpliTech Group's gross margin from 46.0% to nearly 47% is a positive indicator of the company's ability to manage costs and enhance profitability. Despite a net loss of $2.4M, which was largely attributed to R&D and compliance costs, the underlying health of the business appears robust, with a strong liquidity position evidenced by $17.1M in total current assets against $1.5M in total current liabilities. This financial health is critical for supporting strategic growth initiatives.
Investors might consider the company's significant investment in R&D as a commitment to innovation, which could yield long-term benefits despite the short-term impact on net profitability. The introduction of over 100 new SKUs, including potential flagship products like the 5G CAT B ORAN radios and Private NIB 5G suite, suggests a strategic pivot towards high-demand areas in telecommunications, which may enhance future revenue streams.
However, the decline in sales from the distribution business due to reduced demand from Asian customers raises concerns about market volatility and reliance on global economic conditions. The projected growth in semiconductor demand and the company's diversification into the LNB market may mitigate some of these risks, but investors should remain cognizant of the potential for fluctuating demand patterns.
AmpliTech's strategic move into the LNB market and the release of new product lines, such as the 5G ORAN Massive MIMO radios, align with industry trends towards increased data consumption and the need for advanced telecommunications infrastructure. The company's collaboration with Northeastern University for O-RAN 5G interoperability testing places it at the forefront of industry standards, potentially increasing its appeal to Mobile Network Operators seeking cutting-edge technology.
Furthermore, the company's focus on proprietary low noise technology within its LNB offerings could differentiate it from competitors and capture a share of the X and Ka Band markets. The anticipation of these new products matching the revenue size of the LNA business by 2024 provides a positive outlook for revenue diversification and growth.
While the company's forward-looking sales target of $35M - $40M for FY 2024 is ambitious, it is backed by a substantial CRM funnel and strategic partnerships, including a distribution agreement with CDI. This suggests a proactive approach to market penetration and sales strategy, which may bolster investor confidence in the company's capacity to achieve these targets.
The semiconductor industry's growth prospects, with an expected annual growth rate of 20%, could benefit AmpliTech's distribution business in the long run. The company's readiness to capitalize on this growth through its new product offerings and strategic alliances indicates a forward-thinking approach to leveraging market trends.
However, the reliance on economic recovery and the adoption of semiconductor technologies in various sectors, such as AI, could introduce uncertainty. Global economic conditions and supply chain disruptions, as seen with the decreased demand from Asian customers, can significantly impact sales trajectories. This underscores the importance for AmpliTech to maintain agility in its business model and the ability to adapt to changing market conditions.
The company's working capital and current ratio suggest a strong financial position to withstand short-term market fluctuations and continue funding its strategic initiatives. The presence of valuable intangible assets and goodwill also speaks to the company's established brand reputation and intellectual property, which can be important in securing a competitive edge in the market.
Gross Margin Expands to nearly
HAUPPAUGE, NY / ACCESSWIRE / April 1, 2024 / AmpliTech Group, Inc (Nasdaq:AMPG), a designer, developer, and manufacturer of state-of-the-art signal-processing components for satellite, 5G, and other communications networks, including the design of complete 5G/6G systems, and a global distributor of packages and lids for integrated circuit assembly, today announced financial results for year ended December 31, 2023.
Full Year 2023 Highlights
- Total Yearly Revenues of
$15.6M - Despite lower sales from our distribution business, FY23 gross profit margins grew to nearly
47% (from46% in FY22). Core low noise amplifier business sales grew while semiconductor materials distribution business had a notable decrease in sales this fiscal year. - FY23 net loss was
$2.4M which includes$2.3M of Research and Development expenses and nearly$800 K in compliance costs required for being a public company. It is important to note that without these costs, the Company would've been profitable. - FY23 was a record-breaking year for new products introduction at AmpliTech Group, with over 100 new SKUs (Stock Keeping Units) released to the market in the latter portion of the fiscal year. Among these products, two major new product lines were introduced, which the company believes will be the flagship products and major revenue sources for the organization. These products are the 5G CAT B ORAN (Open Radio Access Network) Massive MIMO (Multiple Input-Multiple Output) 64T64R radios along with the Private NIB 5G suite solution (Network in a Box). These products are being marketed through our AGTGSS Division. For the core AmpliTech Inc Division, in addition to a major release of a passive product line (over 60 new SKU's), the company has made an incursion into the profitable LNB (Low Noise Block Converter) market, the company has now product offerings in the X and Ka Bands which the company expects, at the very least, to match the revenue size of the LNA business in 2024. The company keeps on leveraging on its proprietary low noise technology with these LNB releases, as each LNB has AmpliTech Inc's leading low noise technology amplifiers in them.
- As of December 31, 2023, Total Current Assets totaled
$17.1M while Total Current Liabilities totaled$1.5M indicating strong liquidity and sound ability to meet short-term obligations. - Working capital is
$15.7M which is sufficient capital for AmpliTech to continue to fund all of its strategic growth initiatives. - Valuable Intangible Assets and Goodwill: The presence of significant intangible assets and goodwill totaling nearly
$8M reflects the company's valuable brand reputation, intellectual property, and strategic acquisitions, which combined with the newly released product lines, demonstrates the company's ability and fulfillment of growth strategies, positioning the company to start achieving profitable results in our next fiscal year while contributing to future earnings and competitive advantage for the years to come. - The decline in sales of our distribution business (approx.
$4.2M ) was fully attributable to lack of demand from Asian customers, due to their increased inventories as result of the logistics and transportation issues experienced globally, in addition to the COVID pandemic, which triggered unprecedented demand to have inventory on hand of semiconductor materials products during 2021 and 2022. - The demand for semiconductor products is influenced by various sectors such as consumer electronics, automotive, telecommunications, and industrial applications. Economists believe global economic conditions continue to improve and industries will increase their adoption of semiconductor technologies for innovation and expansion, mostly in AI (Artificial Intelligence) technologies, therefore predicting an annual growth rate of
20% , representing a bounce in demand for 2024.
Forward-Looking Update
- The company has set and will continue to develop pivotal business relationships with major 5G players. Our CAT B, ORAN Massive MIMO 64T64R radio has already been completed and passed all of the required laboratory testing clocking in speeds of over 1 Gigabits per second Download and Upload! While our radios are ready to start taking pre-orders, the company is moving forward with a live testing endeavor IOT (Inter Operability Testing) and has contracted and partnered with Northeastern University's and its Open6G OTIC facility to Perform O-RAN 5G Interoperability Testing and End-to-End Demonstration and Certification of AmpliTech's O-RAN CAT B 64T64R MIMO Radio. The tests also involve performance evaluation of the radios to meet the necessary capacity and throughput requirements sought by MNOs (Mobile Network Operators). Notably, The Open6G Open Testing and Integration Center (OTIC) at the Institute for the Wireless Internet of Things (WIoT) at Northeastern University, also partners with AT&T and Verizon as a neutral testing facility in the Acceleration of Compatibility and Commercialization for Open RAN Deployments Consortium (ACCoRD) framework.
- With the major product releases pushed out late in 2023, Top line sales for FY 2024 are targeted to come in between
$35M -$40M based on CRM funnel of$120M , including 5G products, the updated cryogenic products which were already validated by a third party lab, the newly released LNB products and the Distribution Agreement signed with CDI (A global distributor) to spur MMIC related products which soon will include offerings of not just raw MMIC's but also packaged parts. Management expects our stronger quarters in sales will be Q3 and Q4 with notable bookings and strategic business alliances to be announced during Q2.
Management Commentary
Fawad Maqbool, Founder and CEO of AmpliTech, commented, "Although our sales were lower during our Fiscal year 2023, our gross margins increased. We continue to have a solid balance sheet and as recently released, we have introduced over 100 new products including our new flagship products for our AGTGSS and AmpliTech Inc divisions, which based on the business development activity we are generating, they will be leading our company sales in fiscal 2024. We will continue to pursue funding opportunities for our emerging technologies with the NTIA, Chips Program and USTDA which we believe we are perfectly lined up with to be approved for grant funding. Our Research and Development costs continue to demonstrate our unwavering commitment to innovation, growth and provide our valued shareholders with a solid foundation for incrementing our overall value. We continue our strategy to focus on increasing top-line revenue with high-margin products, which will eventually lead to increased bottom-line revenue later this year. "
Further more Mr. Maqbool added, "At AmpliTech, our mission is to empower companies to build the communications infrastructure that will fuel the future of technology - from AR/VR platforms and high-performance Quantum computing to 5G/6G networks providing satellite internet and beyond.
Although there is still much work to be done across various industries, including satcom, telecom (5G), high-performance computing, defense, and aerospace, to achieve the connectivity speeds required by emerging technologies, we recognize the immense potential for innovation and are dedicated to developing solutions that address these challenges, enabling faster and more efficient communication systems. By continuously pushing the boundaries of communications technology, we aim to play a pivotal role in shaping the future of these industries and facilitating the realization of their full potential," concluded Mr. Maqbool.
About AmpliTech Group
AmpliTech Group, Inc. designs, develops, manufactures, and distributes state-of-the-art radio frequency (RF) microwave components for global satellite communications, telecom (5G & IoT), space, defense, and quantum computing markets as well as systems and component design consulting services. In December 2021, AmpliTech completed the purchase of the assets and operations of Spectrum Semiconductor Materials Inc. a global specialty distributor of semiconductor components based in San Jose, CA. AmpliTech has a 21+ year track record of developing high performance, custom solutions to meet the unique needs of some of the largest companies in the global industries we serve. We are proud of our focused team's unique skills, experience and dedication, which enables us to deliver superior solutions, faster time to market, competitive pricing, excellent customer satisfaction and repeat business. For more information, visit: www.amplitechgroup.com.
Safe Harbor Statement
This release contains statements that constitute forward-looking statements. These statements appear in several places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company's ability to execute its business plan as anticipated; (ii) trends affecting the Company's financial condition or results of operations; (iii) the Company's growth strategy and operating strategy. The words "may" "would" "will" "expect" "estimate" "anticipate" "believe" "intend" and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements because of various factors. Other risks are identified and described in more detail in the "Risk Factors" section of the Company's filings with the SEC, which are available on our website. We undertake no obligation to update, and we do not have a policy of updating or revising these forward-looking statements, except as required by applicable law.
Contacts:
Corporate Social Media
Twitter: @AmpliTechAMPG
Instagram: @AmpliTechAMPG
Facebook: AmpliTechInc
Linked In: Amplitech Group Inc
Investor Social Media
Twitter: @AMPG_IR
StockTwits: @AMPG_IR
Company Contact:
Jorge Flores
Tel: (631)-521-7831
Investors@amplitechgroup.com
-Tables Follow-
| AmpliTech Group, Inc. Consolidated Balance Sheet For the Year Ended December 31, 2023 | ||||
| December 31, 2023 | ||||
Assets | ||||
Current Assets | ||||
Cash and cash equivalents | $ | 6,726,013 | ||
Accounts receivable | $ | 2,542,710 | ||
Inventories, net | $ | 6,537,578 | ||
Prepaid expenses | $ | 1,342,335 | ||
Total Current Assets | $ | 17,148,636 | ||
Property and equipment, net | $ | 2,599,448 | ||
Operating lease right of use assets | $ | 3,538,798 | ||
Intangible assets, net | $ | 2,984,133 | ||
Goodwill | $ | 4,696,883 | ||
Cost method investment | $ | 348,250 | ||
Security deposits | $ | 91,481 | ||
Total Assets | $ | 31,407,629 | ||
Liabilities and Stockholders' Equity | ||||
Current Liabilities | ||||
Accounts payable and accrued expenses | $ | 846,179 | ||
Customer deposits | $ | 14,239 | ||
Current portion of financing lease obligations | $ | 16,799 | ||
Current portion of operating lease obligations | $ | 541,324 | ||
Current portion of notes payable | $ | 80,841 | ||
Total Current Liabilities | $ | 1,499,382 | ||
Long-term Liabilities | ||||
Financing lease obligations, net of current portion | $ | 32,537 | ||
Operating lease obligations, net of current portion | $ | 3,171,979 | ||
Deferred tax liability | $ | 24,000 | ||
Total Liabilities | $ | 4,727,898 | ||
Commitments and Contingencies | - | |||
Stockholders' Equity | ||||
Common stock, par value | ||||
500,000,000 shares authorized, 9,714,613 and 9,634,613 | ||||
shares issued and outstanding, respectively | $ | 9,715 | ||
Additional paid-in capital | $ | 36,439,739 | ||
Accumulated deficit | $ | (9,769,723 | ) | |
Total Stockholders' Equity | $ | 26,679,731 | ||
Total Liabilities and Stockholders' Equity | $ | 31,407,629 | ||
| AmpliTech Group, Inc. Consolidated Statement of Operations For the Year Ended December 31, 2023 | ||||
| 2023 | ||||
Revenues | $ | 15,584,577 | ||
Cost of Goods Sold | $ | 8,308,949 | ||
Gross Profit | $ | 7,275,628 | ||
Operating Expenses | ||||
Selling, general and administrative | $ | 7,511,319 | ||
Research and development | $ | 2,341,845 | ||
Total Operating Expenses | $ | 9,853,164 | ||
Income (Loss) From Operations | $ | (2,577,536 | ) | |
Other Income (Expenses) | ||||
Loss on disposal of property and equipment | $ | (16,403 | ) | |
Unrealized gain on investments | $ | 1,697 | ||
Realized gain on investments | $ | 131,522 | ||
Interest Income (expense), net | $ | 19,281 | ||
Total Other Income (Expenses) | $ | 136,097 | ||
Net Loss Before Income Taxes | $ | (2,441,439 | ) | |
Provision For Income Taxes | $ | 24,000 | ||
Net Loss | $ | (2,465,439 | ) | |
Net Loss Per Share; | ||||
Basic and diluted | $ | (0.26 | ) | |
Weighted Average Shares Outstanding; | ||||
Basic and diluted | 9,659,421 | |||
SOURCE: AmpliTech Group, Inc.
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