Revenues Grew 70.5% and Operating Income Increased 200% Year-Over-Year
WEST MELBOURNE, Florida — March 1, 2017 — RELM Wireless Corporation (NYSE MKT: RWC) today announced financial and operating results for the quarter and year ended December 31, 2016.
For the year ended December 31, 2016, revenues increased 70.5% to approximately $50.7 million, compared with approximately $29.7 million for 2015. Operating income for the year increased 199.7% to approximately $4.3 million, compared with approximately $1.4 million last year, while net income increased 158.3% to approximately $2.7 million, or $0.19 per diluted share, compared with approximately $1.0 million, or $0.08 per diluted share, for the prior year.
Gross profit margin for 2016 was 33.7% of sales, versus 41.3% of sales in the previous year. Selling, general and administrative expenses totaled approximately $12.8 million (25.2% of sales) in 2016, compared with approximately $10.9 million (36.5% of sales) in 2015.
For the fourth quarter ended December 31, 2016, revenues increased 4.0% to approximately $7.2 million, compared with approximately $7.0 million for the fourth quarter of 2015. Operating income for the quarter increased 21.2% to approximately $343,000, compared with $283,000 for the same quarter last year. Net income for the quarter ended December 31, 2016 was approximately $92,000, or $0.01 per diluted share, compared with approximately $213,000 or $0.02 per diluted share for the same quarter in 2015.
Gross profit margin for the fourth quarter 2016 was 41.9% of sales, compared with 39.3% of sales for the fourth quarter 2015. Selling, general and administrative expenses totaled approximately $2.7 million (37.1% of sales) for the fourth quarter 2016, compared with approximately $2.4 million (35.2% of sales) for the fourth quarter 2015.
The Company had approximately $23.4 million in working capital as of December 31, 2016, of which $14.4 million was comprised of cash and trade receivables. This compares with working capital of approximately $23.9 million as of December 31, 2015, of which $8.8 million was comprised of cash and trade receivables. As of December 31, 2016 the Company had no borrowings outstanding under its revolving credit facility.
RELM President Tim Vitou commented, “With sales exceeding $50 million, 2016 was a record year for RELM. Our contract with the U.S. Transportation Security Administration (TSA) was a significant contributor to a year-over-year growth rate exceeding 70%. With over 19,000 radios deployed to 406 airports, the TSA program demonstrates our ability to successfully handle large projects, which should enhance our reputation and brand recognition, and foster confidence with potential new customers.”
Mr Vitou continued, “Beyond the TSA, sales in 2016 to other customers, both domestic and international, also increased from the previous year. Moving forward we are very excited about the future of our core business the prospects for expanding our reach beyond RELM’s historical niche in the land mobile radio market.”
Conference Call and Webcast
The Company will host a conference call and webcast for investors at 9:00 a.m. Eastern Time, Thursday, March 2, 2017. Shareholders and other interested parties may participate in the conference call by dialing 877-407-8031 (international/local participants dial 201-689-8031) and asking to be connected to the “RELM Wireless Corporation Conference Call” a few minutes before 9:00 a.m. Eastern Time on March 2, 2017. The call will also be webcast at http://www.relm.com. Please allow extra time prior to the call to visit the site and download any necessary software to listen to the Internet webcast. An online archive of the webcast will be available on the Company’s website for 30 days following the call at http://www.relm.com.
A replay of the conference call will be available one hour after the completion of the call until March 10, 2017, by dialing 877-481-4010 (international/local participants dial 919-882-2331) and entering the conference replay ID# 13654405.