Innovative Solutions & Support, Inc. Announces Second Quarter Fiscal 2024 Financial Results
For the second quarter of fiscal 2024,
Sales and earnings in the second quarter of 2024 continued to benefit from the product lines acquired from Honeywell International, Inc. (“Honeywell”) pursuant to an exclusive license and asset acquisition that closed in the third quarter of 2023. Costs for the quarter included approximately
Over the first half of fiscal 2024, the Company generated
New orders in the second quarter of fiscal 2024 were approximately
Conference Call
The Company will be hosting a conference call on
About
Headquartered in
FORWARD LOOKING STATEMENT DISCLAIMER
In addition to the historical information contained herein, this press release contains “forward-looking statements” within the meaning of, and intended to be covered by, the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In this press release, the words “anticipates,” “believes,” “may,” “will,” “estimates,” “continues,” “anticipates,” “intends,” “forecasts,” “expects,” “plans,” “could,” “should,” “would,” “is likely”, “projected”, “might”, “potential”, “preliminary”, “provisionally” and similar expressions, as they relate to the business or to its management, are intended to identify forward-looking statements, but they are not exclusive means of identifying them. All forward-looking statements are based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company including, without limitation; statements about: future revenue; financial performance and profitability; future business opportunities; the integration of the Honeywell product lines, including statements regarding the ongoing integration; expectations that our new CFO
will be a key contributor to our long-term planning and strategy; our plans to grow organically through new product development and related market expansion, as well as via acquisitions; and the timing of our long-term programs remaining in production and continuing to generate future sales. Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made. Because forward-looking statements are subject to assumptions, risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, the Company’s ability to efficiently integrate acquired and licensed product lines, including the Honeywell product lines, into its operations; a reduction in anticipated orders; an economic downturn; changes in the competitive marketplace and/or customer requirements; an inability to perform customer contracts at anticipated cost levels; and other factors that generally affect the economic and business environments in which the Company operates. Such factors are detailed in the Company's Annual Report on Form 10-K for the fiscal year ended
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
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2024 |
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2023 |
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ASSETS |
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Current assets |
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Cash and cash equivalents |
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$ |
574,079 |
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$ |
3,097,193 |
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Accounts receivable |
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|
6,061,185 |
|
|
|
9,743,714 |
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Contract assets |
|
|
1,230,607 |
|
|
|
487,139 |
|
Inventories |
|
|
9,120,870 |
|
|
|
6,139,713 |
|
Prepaid inventory |
|
|
6,775,822 |
|
|
|
12,069,114 |
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Prepaid expenses and other current assets |
|
|
711,772 |
|
|
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1,073,012 |
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Assets held for sale |
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— |
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2,063,818 |
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Total current assets |
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24,474,335 |
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34,673,703 |
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3,557,886 |
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3,557,886 |
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Intangible assets, net |
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15,648,321 |
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16,185,321 |
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Property and equipment, net |
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12,450,425 |
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7,892,427 |
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Deferred income taxes |
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1,173,227 |
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456,392 |
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Other assets |
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319,704 |
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191,722 |
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Total assets |
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$ |
57,623,898 |
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$ |
62,957,451 |
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LIABILITIES AND SHAREHOLDERS’ EQUITY |
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Current liabilities |
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Current portion of long-term debt |
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$ |
10,642,885 |
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$ |
2,000,000 |
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Accounts payable |
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2,647,123 |
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1,337,275 |
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Accrued expenses |
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2,415,095 |
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2,918,325 |
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Contract liability |
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96,650 |
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143,359 |
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Total current liabilities |
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15,801,753 |
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6,398,959 |
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Long-term debt |
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— |
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17,500,000 |
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Other liabilities |
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444,440 |
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421,508 |
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Total liabilities |
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16,246,193 |
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24,320,467 |
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Commitments and contingencies (See Note 6) |
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Shareholders’ equity |
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Preferred stock, 10,000,000 shares authorized, |
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— |
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— |
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Common stock, |
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19,556 |
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19,543 |
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Additional paid-in capital |
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54,792,307 |
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54,317,265 |
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Retained earnings |
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7,934,379 |
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|
|
5,668,713 |
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(21,368,537 |
) |
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(21,368,537 |
) |
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Total shareholders’ equity |
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41,377,705 |
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38,636,984 |
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Total liabilities and shareholders’ equity |
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$ |
57,623,898 |
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$ |
62,957,451 |
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
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Three Months Ended |
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Six Months Ended |
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2024 |
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2023 |
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2024 |
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2023 |
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Product |
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$ |
4,895,589 |
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$ |
5,945,151 |
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$ |
9,319,697 |
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$ |
11,035,358 |
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Customer service |
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5,098,222 |
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1,395,303 |
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|
9,325,469 |
|
|
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2,454,452 |
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Engineering development contracts |
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745,705 |
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— |
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1,402,413 |
|
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366,899 |
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Total net sales |
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10,739,516 |
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7,340,454 |
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20,047,579 |
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13,856,709 |
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Cost of sales: |
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Product |
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2,347,695 |
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2,202,750 |
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4,129,040 |
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4,618,694 |
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Customer service |
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2,462,260 |
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|
397,553 |
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4,189,221 |
|
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|
716,655 |
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Engineering development contracts |
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347,199 |
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— |
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623,794 |
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|
57,406 |
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Total cost of sales |
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5,157,154 |
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2,600,303 |
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8,942,055 |
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5,392,755 |
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Gross profit |
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5,582,362 |
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4,740,151 |
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11,105,524 |
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8,463,954 |
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Operating expenses: |
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Research and development |
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1,031,119 |
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866,198 |
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1,932,263 |
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1,536,643 |
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Selling, general and administrative |
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2,908,193 |
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2,446,635 |
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5,915,012 |
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4,708,498 |
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Total operating expenses |
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3,939,312 |
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3,312,833 |
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7,847,275 |
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6,245,141 |
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Operating income |
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1,643,050 |
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1,427,318 |
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3,258,249 |
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2,218,813 |
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Interest expense |
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(171,470 |
) |
|
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— |
|
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(531,483 |
) |
|
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— |
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Interest income |
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36,200 |
|
|
|
130,951 |
|
|
115,679 |
|
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|
246,843 |
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Other income |
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26,472 |
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23,258 |
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44,171 |
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|
41,455 |
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Income before income taxes |
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|
1,534,252 |
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|
1,581,527 |
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|
2,886,616 |
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|
2,507,111 |
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Income tax expense |
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325,936 |
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|
310,424 |
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620,950 |
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|
537,357 |
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Net income |
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$ |
1,208,316 |
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$ |
1,271,103 |
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$ |
2,265,666 |
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$ |
1,969,754 |
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Net income per common share: |
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Basic |
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$ |
0.07 |
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$ |
0.07 |
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$ |
0.13 |
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$ |
0.11 |
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Diluted |
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$ |
0.07 |
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$ |
0.07 |
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$ |
0.13 |
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$ |
0.11 |
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Weighted average shares outstanding: |
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Basic |
|
|
17,456,120 |
|
|
|
17,352,340 |
|
|
17,453,741 |
|
|
|
17,334,553 |
|
Diluted |
|
|
17,487,527 |
|
|
|
17,354,030 |
|
|
17,481,217 |
|
|
|
17,340,104 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240513484660/en/
610-646-9800 X550
Source: