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

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

MITCHEL FIELD, N.Y., March 13, 2013 (GLOBE NEWSWIRE) -- Frequency Electronics,
Inc. (Nasdaq:FEIM) reported revenues for the third quarter of fiscal 2013,
which ended January 31, 2013, of $17.1 million, an 11% increase over the $15.4
million recorded in the third quarter of fiscal 2012. Revenues for the first
nine months of fiscal 2013 also increased by 11% to $51.4 million compared to
$46.4 million in the same period of the prior year.

The Company recorded operating profit of $1.8 million for the quarter ended
January 31, 2013, compared to $1.9 million in the third quarter of the prior
year. Operating profit for the first nine months of fiscal year 2013 was $4.8
million compared to $5.5 million for the same period of fiscal year 2012. Net
income for the third quarter of fiscal 2013 was $1.5 million or $0.18 per
diluted share compared to $1.1 million or $0.13 per diluted share for the
third quarter of the prior year. For the year to date, net income was $3.7
million or $0.43 per diluted share compared to the prior year's $3.2 million
or $0.37 per diluted share.

Commenting on results of the past quarter, Chairman of the Board General
Joseph Franklin said: "Based on our results through the third quarter, our
present backlog and our expectations for the balance of the year, we continue
to anticipate year-over-year growth in revenues, operating profits and EBITDA
for full fiscal year 2013. FEI-Elcom's recently announced additional order for
ultra fast switching synthesizers will contribute to their profitability in
our 4^th quarter of this fiscal year.Also, we are making excellent progress
in the development of our expanded product line of Ka and Ku band
receivers/down converters for space. We expect to have prototypes available
for customer evaluation and qualification this year."

Selected Fiscal 2013 Financial Metrics and Other Items

  *For the nine months ended January 31, 2013, satellite payload revenues
    increased by more than $2 million over the same period of the prior year
    and accounted for approximately half of consolidated revenues. Satellite
    payloads account for more than three-fourths of the Company's consolidated
    backlog of over $60 million.
  *Total sales for U.S. Government/DOD end-use, including revenues on U.S.
    Government satellite programs, rose in the third quarter and for the nine
    months accounted for 60% 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 third quarter, revenues at FEI-Elcom increased by approximately
    25% over the preceding quarter of this fiscal year.The additional
    revenues enabled this recently acquired subsidiary to record a modest
    operating profit from operations partially offsetting the $900,000
    operating loss included in consolidated results reported for the first
    quarter of fiscal year 2013.
  *Spending on internal research and development (IR&D) for the nine months
    ended January 31, 2013, increased by approximately $800,000 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/converters. IR&D is expected to continue at a rate of less than
    10% of revenues for fiscal 2013.
  *Reported segment revenues (in thousands):

                          3 months ended  9 months ended
                           January 31,     January 31,
                          2013    2012    2013     2012
FEI-NY                     $14,076 $11,075 $38,211  $33,050
Gillam-FEI                 1,913   3,370   6,431    7,039
FEI-Zyfer                  2,054   2,001   8,742    8,588
less intersegment revenues (906)  (998)  (1,993) (2,235)
Consolidated revenues      $17,137 $15,448 $51,391  $46,442

Investor Conference Call

As previously announced, the Company will hold a conference call to discuss
these results on Wednesday, March 13, 2013, at 2:30 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 April 15, 2013.The
archived call may also be retrieved at 1-877-660-6853 (domestic) or
1-201-612-7415 (international) using Conference ID #: 410788.

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
                                                      
                          Quarter Months ended Nine Months Ended
                           January 31,          January 31,
                          2013       2012      2013      2012
                          (unaudited)
                          (in thousands except per share data)
                                                      
Net Revenues               $17,137    $15,448   $51,391   $46,442
Cost of Revenues           10,387     9,233     31,928    27,970
Gross Margin               6,750      6,215     19,463    18,472
Selling and Administrative 3,887      3,390     10,883    10,017
Research and Development   1,113      882       3,731     2,954
Operating Profit           1,750      1,943     4,849     5,501
Interest and Other, Net    70        (369)    280      (537)
Income before Income Taxes 1,820      1,574     5,129     4,964
Income Tax Provision       300        500       1,400     1,770
Net Income                 $1,520     $1,074    $3,729    $3,194
                                                      
Net Income per Share:                                  
Basic                      $0.18      $0.13     $0.44     $0.38
Diluted                    $0.18      $0.13     $0.43     $0.37
Average Shares Outstanding                             
Basic                      8,424,162  8,323,912 8,401,348 8,319,740
Diluted                    8,603,774  8,508,297 8,583,616 8,537,591



Frequency Electronics, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
                                               
                                               
                                   January 31, April 30,
                                     2013        2012
                                    (in thousands)
ASSETS                                          
Cash & Marketable Securities         $21,631     $22,440
Accounts Receivable                  8,357       10,866
Costs and Estimated Earnings                   
in Excess of Billings, net          8,617       7,207
Inventories                          37,756      34,299
Other Current Assets                 4,357       4,550
Property, Plant & Equipment          8,391       8,374
Other Assets                         19,171      18,491
                                    $108,280    $106,227
                                               
LIABILITIES AND STOCKHOLDERS' EQUITY            
Current Liabilities                  $14,701     $16,109
Long-term Obligations and Other      11,133      10,986
Stockholders' Equity                 82,446      79,132
                                    $108,280    $106,227

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