Optex Systems Holdings, Inc. Announces Financial Highlights for the Year Ended September 29, 2024

RICHARDSON, TX / ACCESSWIRE / December 19, 2024 / Optex Systems Holdings, Inc. (Nasdaq:OPXS), a leading manufacturer of precision optical sighting systems for domestic and worldwide military and commercial applications, announced financial results for the year ended September 29, 2024.

Danny Schoening, CEO of Optex Systems Holdings, Inc., commented, "To build on last year's comments, this was again, another strong year for Optex. This was accomplished with multi-year wins on every major platform that we support. Laser Protected Periscopes, Laser Filter Units, Laser Interference Filters, M22 Binoculars, and other optical assemblies have filled our backlog and driven favorable factory leverage at both of our facilities. In addition, our suppliers have stepped up to the delivery challenges and we've selectively increased various internal bottlenecks to fuel the output. I would like to thank all of our employees, customers, and shareholders for their continued support in 2024 as we anticipate these trends to continue in 2025."

Backlog as of September 29, 2024 was $44.2 million. This compares to a backlog of $41.8 million as of October 1, 2023, representing an increase of $2.4 million, or 5.7%.

For the year ended September 29, 2024, our total revenues increased by $8.3 million, or 32.5%, compared to the prior year. The increase in revenue reflects increases at both the Optex Richardson segment of $6.1 million and the Applied Optics Center segment of $2.2 million. The increase in revenue was driven by increased customer demand for military products across both operating segments partially offset by lower customer demand in optical assemblies at the Applied Optics Center.

Gross profit increased $2.9 million, or 44.0%, and the gross margin percentage increased by 2.2 points from 25.8% in the 2023 fiscal year to 28.0% in the 2024 fiscal year. Optex Systems gross profit increased by $1.4 million and the gross margin percentage increased to 20.7% as compared to 19.7% in the prior year. Applied Optics Center gross profit increased by $1.5 million and the gross margin percentage increased to 34.1% as compared to 29.3% in the prior year. The increase in each segment and consolidated gross profit is primarily attributable to higher revenue and increased absorption of fixed cost.

Consolidated operating income increased by $2.0 million, or 73.0%, in the year ended September 29, 2024 to $4.8 million as compared to the prior year operating income of $2.8 million. Both operating segments realized an increase in operating income which is primarily attributable to higher revenue and gross profit, partially offset by increases in general and administrative costs.

As of September 29, 2024, Optex Systems Holdings had working capital of $15.1 million, as compared to $13.5 million as of October 1, 2023. During the twelve months ended September 29, 2024, we generated operating cash of $1.8 million, primarily driven by increased revenue and net income. For the twelve months ended September 29, 2024, there was no net change against the outstanding credit facility balance of $1.0 million.

At September 29, 2024, the Company had approximately $1.0 million in cash and an outstanding payable balance of $1.0 against its $3.0 million line of credit. As of September 29, 2024, our outstanding accounts receivable balance was $3.8 million, which has been collected during the first quarter of fiscal 2025. During the first quarter of 2025, we paid down our credit facility to zero.

Our key performance measures for year ended September 29, 2024 and October 1, 2023 are summarized below.

During the twelve months ended September 29, 2024, the Company booked $36.4 million in new orders, representing a 5.2% increase from the prior year period orders of $34.6 million. The orders for the most recently completed twelve months consist of $23.5 million for our Optex Richardson segment and $12.9 million attributable to the Applied Optics Center segment.

The table below summarizes our twelve-month operating results for the periods ended September 29, 2024 and October 1, 2023, in terms of both the GAAP net income measure and the non-GAAP Adjusted EBITDA measure. We believe that including both measures allows the reader better to evaluate our overall performance.

Adjusted EBITDA has limitations and should not be considered in isolation or a substitute for performance measures calculated under GAAP. This non-GAAP measure excludes certain cash expenses that we are obligated to make. In addition, other companies in our industry may calculate Adjusted EBITDA differently than we do or may not calculate it at all, which limits the usefulness of Adjusted EBITDA as a comparative measure.

During the year ended September 29, 2024, we recorded net income of $3.8 million as compared to net income of $2.3 million during the year ended October 1, 2023. The increase of net income of $1.5 million is primarily attributable to increased operating income of $2.0 million, offset by increased federal income taxes of ($0.5) million. Our Adjusted EBITDA increased by $2.3 million to $5.7 million during the twelve months ended September 29, 2024 as compared to $3.4 million during the twelve months ended October 1, 2023. The increase in EBITDA is primarily driven by increased net income, offset by increased taxes, depreciation and amortization, and stock compensation.

Highlights of the Consolidated and Segment Results of Operations have been prepared in accordance with GAAP. These financial highlights do not include all information and disclosures required in the consolidated financial statements and footnotes and should be read in conjunction with our Annual Report on Form 10-K for the twelve months ended September 29, 2024 filed with the SEC on December 19, 2024.

Optex Systems Holdings, Inc.
Consolidated Balance Sheets