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Elecsys Corp. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: December 11, 2012 03:06PM

Elecsys Corp. (ESYS) filed Quarterly Report for the period ended 2012-10-31. Elecsys Corporation has a market cap of $11.7 million; its shares were traded at around $3.83 with a P/E ratio of 13.6 and P/S ratio of 0.5.



Highlight of Business Operations:

Sales of our wireless remote monitoring solutions were approximately $1,897,000 for the three-month period ended October 31, 2012, which was an increase of $254,000, or 15.5%, from $1,643,000 during the three-month period ended October 31, 2011. The increase in sales of remote monitoring equipment and services was driven by an increase in customer orders received and shipped during the period. We continue to focus on sales, marketing, and new product development and have seen increases in our recurring data management services. Data management services revenue continues to grow as a function of the growing population of monitoring units deployed in the field. Overall, data management services revenue totaled approximately $246,000, an increase of $45,000, or 22.4%, from data management services revenue of $201,000 reported in the comparable period of the prior fiscal year. We anticipate that over the next few quarters, revenues from our wireless remote monitoring solutions will continue to grow from the current period as a result of new products and our expansion into new industrial markets. Although some of our targeted markets and potential new customers remain cautious regarding their capital investments, we expect that our continued investment in sales, marketing, and new product development will produce additional revenues over the next few fiscal quarters and into the next fiscal year.

Sales of our mobile data acquisition solutions, including our Radix handheld computer hardware, peripherals, maintenance contract revenues, and our eXtremeTAG RFID solutions, were approximately $847,000 for the three-month period ended October 31, 2012. Total sales increased approximately $417,000, or 97.0%, as compared to the prior year period reported revenues of approximately $430,000. The increase in revenues was primarily driven by an increase in shipments of the Radix FW950 and peripherals to our largest international partner and some domestic projects. The increase in Radix sales was partially offset by decreases in shipments of our eXtremeTAG RFID tags. These sales were sluggish as we focused on specific projects within certain international markets in order to establish a market presence. We believe that improving international economic conditions in specific markets and increased domestic sales of Radix products will provide an overall increase in sales in this area over the next few quarters. Recurring maintenance contract revenues posted an increase for the three-month period ended October 31, 2012 of approximately $14,000, or 6.5%, as a result of customers continuing their maintenance plans after their initial warranty periods expired.

Selling and marketing expenses were $582,000 for the three-month period ended October 31, 2012 and $526,000 for the three-month period ended October 31, 2011. The increase of $56,000 was the result of changes in sales personnel from the previous year period. During the third quarter of last fiscal year, we eliminated a sales management position and reallocated those resources to add additional sales people. The result of this reallocation and investment was a slight increase in overall personnel expenses of approximately $26,000 which we believe will help increase both EMS and Proprietary product revenues over the long term. We also experienced increases in travel costs of $29,000 and customer support expenses of $15,000 as compared to the previous year period.

Sales of our wireless remote monitoring solutions were approximately $2,851,000 for the six-month period ended October 31, 2012, which was a decrease of $407,000, or 12.5%, from $3,258,000 during the six-month period ended October 31, 2011. The overall decrease in sales of remote monitoring equipment and services was driven by a reduction in customer orders received and shipped during the first fiscal quarter. Sales increased during the second quarter, but not enough to overtake the shortfall from the first quarter. We continue to focus on sales, marketing, and new product development and have seen increases in our recurring data management services. Data management services revenue continues to grow as a function of the growing population of monitoring units deployed in the field. Overall, data management services revenue totaled approximately $482,000, an increase of $88,000, or 22.3%, from data management services revenue of $394,000 reported in the comparable period of the prior fiscal year. We anticipate that over the next few quarters, revenues from our wireless remote monitoring solutions will continue to grow steadily from the current period as a result of new products and our expansion into new industrial markets. Although some of our targeted markets and potential new customers remain cautious regarding their capital investments, we expect that our continued investment in both sales and marketing and new product development will produce additional revenues over the next few fiscal quarters and into the next fiscal year.

Selling, general and administrative (“SG&A”) expenses totaled approximately $3,329,000 for the six-month period ended October 31, 2012. This was an increase of $99,000, or 3.1%, from the total SG&A expenses of $3,230,000 for the six-month period ended October 31, 2011. SG&A expenses were 32.0% of sales for the six-month period ended October 31, 2012 as compared to 27.4% of sales for the comparable period for fiscal 2012.

Read the The complete Report



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