Frequency Electronics, Inc. Announces Second Quarter Fiscal Year 2013 Results

Frequency Electronics, Inc. Announces Second Quarter Fiscal Year 2013 Results

MITCHEL FIELD, N.Y., Dec. 12, 2012 (GLOBE NEWSWIRE) -- Frequency Electronics,
Inc. (Nasdaq:FEIM) reported revenues for the second quarter of fiscal 2013,
which ended October 31, 2012, of $17.6 million, a 17% increase over the $15.1
million recorded in the first quarter of fiscal 2012. Revenues for the first
six months of fiscal 2013 were $34.3 million compared to $31 million recorded
in the same period of the prior year.

The Company recorded operating profit of $2.0 million for the quarter ended
October 31, 2012, up from $1.1 million in the preceding quarter compared to
$1.8 million in the second quarter of the prior year. Operating profit for the
first six months of fiscal year 2013 was $3.1 million compared to $3.6 million
in the first half of fiscal year 2012. Net income for the second quarter of
fiscal 2013 was $1.4 million or $0.17 per diluted share, up from $768,000 or
$0.09 per diluted share in the preceding quarter and compared to $776,000 or
$0.09 per diluted share for the second quarter of the prior year. For the year
to date, net income was $2.2 million or $0.26 per diluted share compared to
the prior year's $2.1 million or $0.25 per diluted share.

Commenting on results of the past quarter, Chairman of the Board General
Joseph Franklin said: "In the second quarter just completed, our
year-over-year growth in revenues and operating profits were in line with
expectations to achieve higher revenues, operating profits and EBITDA for
fiscal year 2013 and beyond. Bookings continued strong during this past
quarter and included additions to long-term legacy programs, hosted payloads
and new starts. FEI's world-leading technologies in precision timing, low
phase-noise microwave frequency sources, and ultra-fast synthesizers are
crucial for achieving better performance at lower costs in many critical
commercial and U.S. Government/DOD systems, 'Doing More With Less.'"

Selected Fiscal 2013 Financial Metrics and Other Items

  *Reported segment revenues (in thousands):

                            6 months ended  3 months ended
                             October 31,     October 31,
                            2012    2011    2012    2011
  FEI-NY                     $24,135 $21,975 $12,287 $11,361
  Gillam-FEI                 4,518   3,669   2,610   1,680
  FEI-Zyfer                  6,688   6,587   3,331   2,814
  less intersegment revenues (1,087) (1,237) (659)   (800)
  Consolidated revenues      $34,254 $30,994 $17,569 $15,055

  *For the six months ended October 31, 2012, satellite payload revenues
    increased by $1.5 million over the same period of the prior year and
    accounted for nearly half of consolidated revenues. Satellite payloads
    account for three-fourths of the Company's consolidated backlog.
  *Total sales for U.S. Government/DOD end-use, including revenues on U.S.
    Government satellite programs, rose in the second quarter and for the six
    months accounted for 54% of consolidated revenues.With increasing sales
    from FEI-Elcom, revenues for U.S. Government/DOD end-use will continue to
    grow in this current fiscal year.
  *For the second quarter, revenues at FEI-Elcom increased by more than $1.0
    million over the preceding quarter of this fiscal year.The additional
    revenues gave rise to a nominal operating profit from operations compared
    to a $900,000 operating loss in the first quarter of fiscal year 2013.
  *Spending on internal research and development (IR&D) for the six months
    ended October 31, 2012, increased by approximately $550,000 compared to
    the same period of the prior year.These expenditures include increased
    efforts on the Company's expanded product line of satellite microwave
    receivers and up/down converters. IR&D is expected to continue at a rate
    of less than 10% of revenues for fiscal 2013.

Investor Conference Call

As previously announced, the Company will hold a conference call to discuss
these results on Wednesday, December 12, 2012, at 2:00 PM Eastern
Time.Investors and analysts may access the call by dialing
1-877-407-9205.International callers may dial 1-201-689-8054.Ask for the
Frequency Electronics conference call.

The call will be archived on the Company's website through January 11,
2013.The archived call may also be retrieved at 1-877-660-6853 (domestic) or
1-201-612-7415 (international) using Postcodes (both are required for
playback): Account: 286, Conference ID #: 405559.

About Frequency Electronics

Frequency Electronics, Inc. is a world leader in the design, development and
manufacture of high precision timing, frequency control and synchronization
products for space and terrestrial applications. Frequency's products are used
in commercial, government and military systems, including satellite payloads,
C4ISR markets, missiles, UAVs, aircraft, GPS, secure radios, energy
exploration and wireline and wireless communication networks. Frequency has
received over 100 awards of excellence for achievements in providing high
performance electronic assemblies for over 150 space and DOD programs. The
Company invests significant resources in research and development and
strategic acquisitions world-wide to expand its capabilities and markets. 

Frequency's Mission Statement: "Our mission is to provide precision time and
low phase noise frequency generation systems from 1 Hz to 42 GHz, for space
and other challenging environments."

Subsidiaries and Affiliates: Gillam-FEI provides expertise in wireline network
synchronization and SCADA; FEI-Zyfer provides GPS and secure timing ("SAASM")
capabilities for critical military and commercial applications; FEI-Asia
provides cost effective manufacturing and distribution capabilities; FEI-Elcom
Tech provides added resources for state-of-the-art RF microwave
products.Frequency's Morion affiliate supplies high-quality, cost effective
quartz oscillators and components. Additional information is available on the
Company's website: www.frequencyelectronics.com

Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995:

The Statements in this press release regarding the future constitute
"forward-looking" statements pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995.Forward-looking statements
inherently involve risks and uncertainties that could cause actual results to
differ materially from the forward-looking statements.Factors that would
cause or contribute to such differences include, but are not limited to,
inability to integrate operations and personnel, actions by significant
customers or competitors, general domestic and international economic
conditions, consumer spending trends, reliance on key customers, continued
acceptance of the Company's products in the marketplace, competitive factors,
new products and technological changes, product prices and raw material costs,
dependence upon third-party vendors, competitive developments, changes in
manufacturing and transportation costs, the availability of capital, and other
risks detailed in the Company's periodic report filings with the Securities
and Exchange Commission.By making these forward-looking statements, the
Company undertakes no obligation to update these statements for revisions or
changes after the date of this release.

                                                     
Frequency Electronics, Inc. and Subsidiaries
Condensed Consolidated Statement of Operations
                                                     
                          Six Months ended    Quarter Ended
                           October 31,         October 31,
                          2012      2011      2012      2011
                          (unaudited)
                          (in thousands except per share data)
                                                     
Net Revenues               $34,254   $30,994   $17,569   $15,055
Cost of Revenues           21,541    18,738    10,837    8,943
Gross Margin               12,713    12,256    6,732     6,112
Selling and Administrative 6,996     6,626     3,511     3,464
Research and Development   2,618     2,071     1,203     873
Operating Profit           3,099     3,559     2,018     1,775
Interest and Other, Net    210       (169)     93        (369)
Income before Income Taxes 3,309     3,390     2,111     1,406
Income Tax Provision       1,100     1,270     670       630
Net Income                 $2,209    $2,120    $1,441    $776
                                                     
Net Income per Share:                                 
Basic                      $0.26     $0.26     $0.17     $0.09
Diluted                    $0.26     $0.25     $0.17     $0.09
Average Shares Outstanding                            
Basic                      8,389,942 8,311,679 8,401,636 8,318,874
Diluted                    8,573,536 8,540,065 8,603,021 8,540,902

                                                                  

Frequency Electronics, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
                                                                  
                                                       October 31, April 30,
                                                        2012        2012
                                                       (in thousands)
ASSETS                                                             
Cash & Marketable Securities                            $23,909     $22,440
Accounts Receivable                                     9,918       10,866
Costs and Estimated Earnings in Excess of Billings, net 10,587      7,207
Inventories                                             35,347      34,299
Other Current Assets                                    4,140       4,550
Property, Plant & Equipment                             7,893       8,374
Other Assets                                            18,924      18,491
                                                       $110,718    $106,227
                                                                  
LIABILITIES AND STOCKHOLDERS' EQUITY                               
Current Liabilities                                     $17,417     $16,109
Long-term Obligations and Other                         11,173      10,986
Stockholders' Equity                                    82,128      79,132
                                                       $110,718    $106,227
                                                                  

CONTACT: Alan Miller, CFO, or General Joseph P. Franklin, Chairman:
         TELEPHONE: (516) 794-4500
         WEBSITE: www.frequencyelectronics.com