Relm Wireless Reports First-Quarter Financial Results
Wednesday, May 10, 2017 | Comments

Relm Wireless announced its financial and operating results for the first quarter ended March 31.

For the first quarter, sales totaled about $7.4 million, compared with $12.1 million for the first quarter of 2016. Sales for the first quarter last year included sales under the company's contract with the Transportation Security Administration (TSA). Sales for the base year and first option year were completed in 2016 and not replicated during the first quarter of 2017. The financial results for the first quarter of 2017 include certain nonrecurring items that had an unfavorable impact. These items included about $400,000 related to severance arrangements, $200,000 related to the discontinuation of a development project and $300,000 for product enhancements.

Net loss for the first quarter of 2017 was about $1.3 million compared with net income of approximately $513,000 for the same quarter last year. Gross profit margin for the first quarter 2017 was 30.3 percent of sales, compared with 31.7 percent of sales for the same quarter last year.

“Over the last few months, we redirected product development efforts, assigning the highest priority to initiatives that are critical to our future success while discontinuing others,” said Relm President Tim Vitou. “Some of the changes adversely impacted our financial and operating results in the first quarter. Ultimately, however, we believe these actions will provide meaningful benefits moving forward in the form of cost savings, and available resources to more effectively address the best opportunities for growth and enhanced shareholder value."

The company had about $20.8 million in working capital as of March 31, of which approximately $11.6 million was comprised of cash, cash equivalents and trade receivables. This compares with working capital of about $23.4 million as of Dec. 31, 2016, of which about $14.4 million was comprised of cash, cash equivalents and trade receivables. As of March 31, the firm had no borrowings outstanding under its revolving credit facility.

"During the first quarter, our board was reconfigured with five new members, each of whom brings a new perspective and a unique and valuable skillset to the company,” said Relm Chairman Kyle Cerminara. “We also named Tim Vitou as Relm’s president during the first quarter. Tim assumed the president role after nine years as the company's senior vice president of sales where he was a significant contributor to the key sales of the company."

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