Micropac Industries Reports Significant Financial Improvements in Q3 and Nine Months Ended August 24, 2024

Micropac Industries, Inc. reported significant financial improvements for the three and nine months ended August 24, 2024, compared to the same periods in the previous fiscal year. Net sales surged to $12.6 million for the third quarter, a 95% increase from $6.5 million in the prior year. For the nine months, sales rose to $26.8 million, up from $20.1 million, marking a 33.4% increase. The sales distribution shifted notably, with military sales comprising 70% of total sales in 2024, compared to 61% in 2023, while commercial sales decreased from 18% to 11%.

Operating income for the third quarter reached $3.6 million, a substantial turnaround from an operating loss of $589,000 in the same quarter of 2023. For the nine-month period, operating income was $4.1 million, compared to a loss of $571,000 in the previous year. Net income for the third quarter was $3.0 million, compared to a net loss of $530,000 in 2023, and for the nine months, net income totaled $4.0 million, a significant increase from a loss of $371,000.

The company’s cost of goods sold (COGS) improved markedly, accounting for 43.9% of net sales in the third quarter of 2024, down from 70.8% in the same quarter of 2023. Year-to-date COGS also decreased as a percentage of sales, from 65.2% to 52.3%. Research and development expenses increased slightly, reflecting ongoing investment in product development.

Micropac's cash position improved, with cash and cash equivalents rising to $11.2 million as of August 24, 2024, compared to $10.3 million at the end of November 2023. This increase was driven by $1.2 million from operations and $706,000 from the sale of a building, despite cash outflows for dividends and equipment purchases.

The company also reported a backlog of $29.5 million as of August 24, 2024, down from $42.7 million a year earlier, attributed to a decrease in new orders, which totaled $19.2 million year-to-date, compared to $29.3 million in 2023.

Micropac continues to focus on its core business of designing and manufacturing microelectronic circuits for key markets, including military and space applications, and maintains certifications from the Defense Logistics Agency and ISO standards. The company has 2,578,315 shares of common stock outstanding as of October 8, 2024.