PRINCETON, N.J., April 03, 2017 (GLOBE NEWSWIRE) -- Mikros Systems Corporation (OTCQB:MKRS) today announced financial results for 2016.
Revenues for 2016 were $5,067,365 compared to $7,360,204 in 2015, a decrease of $2,292,839, or 31%. The decrease was due primarily to the completion of the production contracts for 64 ADEPT units in 2015 and significant delays in the award of several Navy contracts.
Costs of sales were $2,047,002 in 2016 compared to $3,585,127 in 2015, a decrease of $1,538,125, or 43%. The decrease was due primarily to the timely completion of production contracts in 2015 for 64 ADEPT units. As a percentage of revenue, cost of sales decreased to 40% of revenues for 2016 as compared to 49% of revenues for 2015, due primarily to a change in the mix of costs incurred in 2016 and significant decreases in material purchases due to delays in receiving production orders.
The Company reported net income of $82,490 in 2016 as compared to $461,536 in 2015. The decreases in profits and revenue were largely the result of significant delays in the award of several Navy contracts in 2016.
Tom Meaney, Mikros President and CEO, commented, “After our biggest year ever in 2015, we used 2016 to position Mikros for continued growth by strengthening our engineering, contracting and quality departments, and investing R&D funds into developing commercial applications of our military product lines. In 2016, we also completed a recapitalization transaction in which we eliminated $2,955,433 of aggregate liquidation preferences applicable to our previously outstanding shares of preferred stock while limiting dilution to our existing shareholders to approximately 9.5%. This simplified our balance sheet and our common stock can now reflect the full equity value of the Company.
Mr. Meaney continued, “We solidified the foundation for future growth by generating multiple new contract awards from the United States Navy. In September, we received the largest contract in Company history when the Naval Surface Warfare Center in Port Hueneme, California awarded us a five year, $48,000,000 IDIQ contract for our ADSSS® system. We followed this up in February when we received a second five year IDIQ contract in the amount of $35,000,000 for our ADEPT® product line. Since then, we have received in excess of $14,000,000 of delivery orders under these IDIQ contracts, driving backlog to record levels. For 2017, we expect additional delivery orders under these IDIQ contracts, multiple new contract awards, as well as growth in our commercial business. The combination of two substantial long-term contracts, renewed emphasis on national defense, and the availability of condition based maintenance systems for complex distributed systems which both government and commercial customers are demanding, positions us well to have a very successful year in 2017.”
Additional information regarding the Company’s financial data may be found in the Company's Annual Report on Form 10-K for fiscal year 2016 filed with the U.S. Securities and Exchange Commission. The Form 10-K may be accessed at www.sec.gov or at the Company's website at www.mikrossystems.com.
About Mikros
Mikros Systems Corporation is an advanced technology company specializing in the research and development of electronic systems technology primarily for military applications. Classified by the U.S. Department of Defense as a small business, its capabilities include technology management, electronic systems engineering and integration, radar systems engineering, command, control, communications, computers and intelligence systems engineering, and communications engineering. Mikros’ primary business is to pursue and obtain contracts from the Department of Homeland Security, U.S. Navy, and other governmental authorities. For more information on Mikros, please visit: www.mikrossystems.com.
Important Information about Forward-Looking Statements
All statements in this news release other than statements of historical facts are forward-looking statements which contain our current expectations about our future results. Forward-looking statements involve numerous risks and uncertainties. We have attempted to identify any forward-looking statements by using words such as "anticipates," "believes," "could," "expects," "intends," "may," "should" and other similar expressions. Although we believe that the expectations reflected in all of our forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Such statements are not guarantees of future performance or events and are subject to known and unknown risks and uncertainties that could cause the Company's actual results, events or financial positions to differ materially from those included within or implied by such forward-looking statements. Such factors include, but are not limited to, changes in business conditions, a decline or redirection of the U.S. Defense budget, significant delays or reductions in appropriations for our projects, the termination of any contracts with the U.S. Government, changes in our sales strategy and product development plans, changes in the marketplace, continued services of our executive management team, our limited marketing experience, competition between us and other companies seeking SBIR grants, competitive pricing pressures, market acceptance of our products under development, delays in the development of products, our ability to adequately integrate our new software offerings into our business model, statements of assumption underlying any of the foregoing, and other factors disclosed in our annual report on Form 10-K for the year ended December 31, 2016 and other filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. Except as required by law, we undertake no obligation to disclose any revision to these forward-looking statements.