Ultralife Corporation Reports Fourth Quarter Results

Acquisition of Electrochem Completed and Integration Has Commenced

NEWARK, N.Y., April 01, 2025 (GLOBE NEWSWIRE) -- Ultralife Corporation (NASDAQ: ULBI) reported operating results for the fourth quarter and full year ended December 31, 2024 as follows:

Fourth Quarter:

• Sales of $43.9 million compared to $44.5 million for the 2023 fourth quarter, including a 11.7% increase in Battery & Energy Products sales and a 55.1% decrease in Communications Systems sales
• Gross profit of $10.6 million, or 24.2% of revenue, compared to $11.4 million, or 25.6% of revenue, for the 2023 fourth quarter
• Operating income of $1.5 million, including one-time costs and GAAP adjustments of $1.1 million directly related to the acquisition of Electrochem Solutions, Inc. ("Electrochem") on October 31, 2024, compared to $3.6 million for the 2023 fourth quarter
• GAAP EPS of $0.01 compared to $0.17 for the 2023 fourth quarter
• Adjusted EBITDA of $3.9 compared to $4.8 million for the 2023 fourth quarter
• Backlog and high confidence orders of $102.2 million exiting 2024 compared to $78.0 exiting the third quarter

Fiscal Year 2024:

• Sales of $164.5 million represent a 3.7% year-over-year increase; essentially flat with 2023 when excluding Electrochem
• Operating income of $10.0 million including one-time costs and GAAP adjustments of $1.4 million directly related to the acquisition of Electrochem on October 31, 2024, versus $9.5 million for 2023
• GAAP EPS of $0.38 compared to $0.44 for 2023 which included approximately $0.08 for recognition of the ERC filed under the Coronavirus Aid, Relief and Economic Act
• Adjusted EBITDA of $16.5 million compared to $15.7 million for 2023

"For the fourth quarter the contribution of Electrochem compensated for delays in the timing of expected larger orders for our Communications Systems segment and customer requests to push orders into 2025 for our Battery & Energy Products segment. These fulfillment delays illustrate how fluctuations in order timing can impact our financial results on a short-term basis even as demand for our products remains strong. In addition, after acquiring Electrochem on October 31^st, we began implementing our integration playbook commencing the necessary groundwork to realize the benefits of our investment," said Mike Manna, President and Chief Executive Officer.

"We entered 2025 with a healthy backlog and a schedule of new products to launch representing a broadened opportunity set in high-growth markets that position us to more fully realize the operating leverage of our business model through scale, and a strengthened sales and marketing leadership team to expedite organic growth and further leverage our global brand and resources. We are also on track to complete the acquisition integration and realize resulting manufacturing cost efficiencies and U.S.-based vertical integration savings. As a result, we are confident in our ability to deliver profitable growth and incremental cash flow enabling us to reduce debt and support strategic capital expenditures," concluded Mr. Manna.

Fourth Quarter 2024 Financial Results

Revenue was $43.9 million, including $6.1 million relating to our acquisition of Electrochem, compared to revenue of $44.5 million for the fourth quarter of 2023. Battery & Energy Products sales increased 11.7% to $39.9 million compared to $35.7 million last year reflecting the inclusion of Electrochem. Organic sales for this segment declined 5.3% as a 48.1% increase in government/defenses sales and a 1.6% increase in oil & gas market sales were offset by a 47.2% decrease in medical battery sales and a 4.4% decline in other industrial market sales. Communications Systems sales decreased by 55.1% to $4.0 million compared to $8.8 million for the same period last year, primarily attributable to shipments in the prior year of vehicle-amplifier adaptors to a global defense contractor for the U.S. Army and of integrated systems of amplifiers and radio vehicle mounts to a major international defense contractor. Our total backlog and high confidence orders exiting the fourth quarter was $102.2 million compared to $78.0 million reported for the third quarter.

Gross profit was $10.6 million, or 24.2% of revenue, compared to $11.4 million, or 25.6% of revenue, for the same quarter a year ago. Battery & Energy Products gross margin was 23.4%, compared to 25.2% last year, primarily due to product mix and lower factory cost absorption. Communications Systems gross margin was 31.9% compared to 27.2% last year, primarily due to product mix and price realization despite lower factory volume.

Operating expenses were $9.1 million, compared to $7.8 million for the 2023 fourth quarter, reflecting $1.8 million for the inclusion of Electrochem and the one-time costs associated with the acquisition. Operating expenses were 20.8% of revenue compared to 17.4% of revenue for the year-earlier period.

Operating income was $1.5 million compared to $3.6 million last year. Driven by the 55.1% decline in Communications Systems sales and one-time acquisition costs, operating margin decreased to 3.4% compared to 8.2% last year.

Net income attributable to Ultralife Corporation was $0.2 million or $0.01 per diluted share on a GAAP basis, compared to $2.9 million or $0.17 per diluted share for the fourth quarter of 2023. Adjusted EPS was also $0.01 on a diluted basis for the fourth quarter of 2024, compared to $0.18 for the 2023 period. Adjusted EPS excludes the provision for deferred taxes which primarily represents non-cash charges for U.S. taxes which we expect will be fully offset by net operating loss carryforwards and other tax credits for the foreseeable future.

Adjusted EBITDA, defined as EBITDA including non-cash, stock-based compensation expense and one-time acquisition costs and non-cash purchase accounting adjustments, was $3.9 million for the fourth quarter of 2024, or 8.9% of sales, compared to $4.8 million, or 10.7% of sales, for the year-earlier period.

See the "Non-GAAP Financial Measures" section of this release for a reconciliation of adjusted EPS to EPS and adjusted EBITDA to net income attributable to Ultralife Corporation.

About Ultralife Corporation

Ultralife Corporation serves its markets with products and services ranging from power solutions to communications and electronics systems. Through its engineering and collaborative approach to problem solving, Ultralife serves government/defense and commercial customers across the globe.

Headquartered in Newark, New York, the Company's business segments include Battery & Energy Products and Communications Systems. Ultralife has operations in North America, Europe and Asia. For more information, visit www.ultralifecorporation.com.

Conference Call Information

Ultralife will hold its fourth quarter earnings conference call on today at 8:30 AM ET.

To ensure a fast and reliable connection to our investor conference call, we require participants dialing in by phone to pre-register using this link prior to the call: https://register-conf.media-server.com/register/BI1a1f31c093654241b376ab0dfc2c088b. This will eliminate the need to speak with an operator. Once registered, dial-in information will be provided along with a personal identification number. Should you register early and misplace your details, you can simply click back on this same link at any time to register and view this information again. A live webcast of the conference call will be available to investors in the Events & Presentations Section of the Company's website at http://investor.ultralifecorporation.com. For those who cannot listen to the live broadcast, a replay of the webcast will be available shortly after the call at the same location.

This press release may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include uncertain global economic conditions, reductions in revenues from key customers, delays or reductions in U.S. and foreign military spending, acceptance of our new products on a global basis, and disruptions or delays in our supply of raw materials and components due to business conditions, global conflicts, weather or other factors not under our control. The Company cautions investors not to place undue reliance on forward-looking statements, which reflect the Company's analysis only as of today's date. The Company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances. Further information on these factors and other factors that could affect Ultralife's financial results is included in Ultralife's Securities and Exchange Commission (SEC) filings, including the latest Annual Report on Form 10-K.

ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Dollars in Thousands)
(Unaudited)
ASSETS
		December 31, 2024							December 31, 2023
Current Assets:
Cash		$	6,854						$	10,278
Trade Accounts Receivable, Net			29,370							31,761
Inventories, Net			51,363							42,215
Prepaid Expenses and Other Current Assets			9,573							5,949
Total Current Assets			97,160							90,203
Property, Plant and Equipment, Net			40,485							21,117
Goodwill			45,006							37,571
Other Intangible Assets, Net			24,557							15,107
Deferred Income Taxes, Net			8,413							10,567
Other Non-Current Assets			4,830							3,711
Total Assets		$	220,451						$	178,276
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts Payable		$	14,160						$	11,336
Current Portion of Long-Term Debt			2,750							2,000
Accrued Compensation and Related Benefits			2,911							3,115
Accrued Expenses and Other Current Liabilities			9,470							7,279
Total Current Liabilities			29,291							23,730
Long-Term Debt, Net			51,502							23,624
Deferred Income Taxes			1,443							1,714
Other Non-Current Liabilities			4,028							3,781
Total Liabilities			86,264							52,849
Shareholders' Equity:
Common Stock			2,107							2,078
Capital in Excess of Par Value			191,828							189,160
Accumulated Deficit			(34,442				)			(40,754			)
Accumulated Other Comprehensive Loss			(4,006				)			(3,660			)
Treasury Stock			(21,492				)			(21,492			)
Total Ultralife Corporation Equity			133,995							125,332
Non-Controlling Interest			192							95
Total Shareholders' Equity			134,187							125,427
Total Liabilities and Shareholders' Equity		$	220,451						$	178,276

ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
(Unaudited)
	Three-Month Period Ended							Year Ended
	December 31,			December 31,				December 31,			December 31,
	2024			2023				2024			2023
Revenues:
Battery & Energy Products	$	39,880		$	35,703			$	144,081		$	129,953
Communications Systems		3,972			8,845				20,375			28,691
Total Revenues		43,852			44,548				164,456			158,644
Cost of Products Sold:
Battery & Energy Products		30,549			26,711				107,764			99,178
Communications Systems		2,704			6,435				14,378			20,266
Total Cost of Products Sold		33,253			33,146				122,142			119,444
Gross Profit		10,599			11,402				42,314			39,200
Operating Expenses:
Research and Development		2,415			1,852				8,268			7,531
Selling, General and Administrative		6,710			5,901				24,081			22,194
Total Operating Expenses		9,125			7,753				32,349			29,725
Operating Income		1,474			3,649				9,965			9,475
Other Expense		979			536				1,664			358
Income Before Income Taxes		495			3,113				8,301			9,117
Income Tax Provision		262			263				1,892			1,951
Net Income		233			2,850				6,409			7,166
Net Income (Loss) Attributable to Non-Controlling Interest		39			(23	)			97			(31	)
Net Income Attributable to Ultralife Corporation	$	194		$	2,873			$	6,312		$	7,197
Net Income Per Share Attributable to Ultralife Common Shareholders - Basic	$	.01		$	.18			$	.38		$	.44
Net Income Per Share Attributable to Ultralife Common Shareholders - Diluted	$	.01		$	.17			$	.38		$	.44
Weighted Average Shares Outstanding - Basic		16,629			16,338				16,555			16,214
Weighted Average Shares Outstanding - Diluted		16,762			16,479				16,767			16,226

Non-GAAP Financial Measures

Adjusted EBITDA

In evaluating our business, we consider and use adjusted EBITDA, a non-GAAP financial measure, as a supplemental measure of our operating performance in addition to U.S. Generally Accepted Accounting Principles ("GAAP") financial measures. We define adjusted EBITDA as net income attributable to Ultralife Corporation before net interest expense, provision for income taxes, depreciation and amortization, and stock-based compensation expense, plus/minus expense/income that we do not consider reflective of our ongoing continuing operations. We reconcile adjusted EBITDA to net income attributable to Ultralife Corporation, the most comparable financial measure under GAAP. Neither current nor potential investors in our securities should rely on adjusted EBITDA as a substitute for any GAAP measures and we encourage investors to review the following reconciliation of adjusted EBITDA to net income attributable to Ultralife Corporation.

ULTRALIFE CORPORATION AND SUBSIDIARIES
CALCULATION OF ADJUSTED EBITDA
(Dollars in Thousands)
(Unaudited)
	Three-Month Period Ended						Year Ended
	December 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
Net Income Attributable to Ultralife Corporation	$	194		$	2,873		$	6,312		$	7,197
Adjustments:
Interest Expense, Net		829			566			1,940			2,016
Income Tax Provision		262			263			1,892			1,951
Depreciation Expense		831			740			3,125			3,022
Amortization Expense		348			226			1,032			889
Stock-Based Compensation Expense		208			104			698			528
Cyber-Insurance Policy Deductible		-			-			-			100
Non-Recurring Acquisition Costs		1,111			-			1,361			-
Non-Cash Purchase Accounting Adjustment		120			-			120			-
Adjusted EBITDA	$	3,903		$	4,772		$	16,480		$	15,703

Adjusted Earnings Per Share

In evaluating our business, we consider and use adjusted EPS, a non-GAAP financial measure, as a supplemental measure of our business performance. We define adjusted EPS as net income attributable to Ultralife Corporation excluding the provision (benefit) for deferred income taxes divided by our weighted average shares outstanding on both a basic and diluted basis. We believe that this information is useful in providing period-to-period comparisons of our results by reflecting the portion of our tax provision that we expect will be predominantly offset by our U.S. net operating loss carryforwards and other tax credits for the foreseeable future. We reconcile adjusted EPS to EPS, the most comparable financial measure under GAAP. Neither current nor potential investors in our securities should rely on adjusted EPS as a substitute for any GAAP measures and we encourage investors to review the following reconciliation of adjusted EPS to EPS and net income attributable to Ultralife Corporation.

ULTRALIFE CORPORATION AND SUBSIDIARIES
CALCULATION OF ADJUSTED EPS
(In Thousands Except Per Share Amounts)
(Unaudited)
	Three-Month Period Ended
	December 31, 2024										December 31, 2023
	Amount					Per Basic Share			Per Diluted Share		Amount				Per Basic Share			Per Diluted Share
Net Income Attributable to Ultralife Corporation	$	194			$	.01		$	.01		$	2,873		$	.18		$	.17
Deferred Tax Provision (Benefit)		(63	)			-			-			56			-			.01
Adjusted Net Income	$	131			$	.01		$	.01		$	2,929		$	.18		$	.18
Weighted Average Shares Outstanding						16,629			16,762						16,338			16,479

	Year Ended
	December 31, 2024									December 31, 2023
	Amount				Per Basic Share			Per Diluted Share		Amount				Per Basic Share			Per Diluted Share
Net Income Attributable to Ultralife Corporation	$	6,312		$	.38		$	.38		$	7,197		$	.44		$	.44
Deferred Tax Provision		1,232			.08			.07			1,301			.08			.08
Adjusted Net Income	$	7,544		$	.46		$	.45		$	8,498		$	.52		$	.52
Weighted Average Shares Outstanding					16,555			16,767						16,214			16,226

Company Contact:		Investor Relations Contact:
Ultralife Corporation		Alliance Advisors IR
Philip A. Fain		Jody Burfening/Alex Villalta
[phone]		[phone]
[e-mail]		[e-mail]