Technical Communications Corporation Reports Results for the Three and Six Months Ended March 29, 2014

  Technical Communications Corporation Reports Results for the Three and Six
  Months Ended March 29, 2014

Business Wire

CONCORD, Mass. -- May 13, 2014

Technical Communications Corporation (NasdaqCM: TCCO) today announced its
results for the three and six months ended March 29, 2014. For the second
quarter of the Company’s 2014 fiscal year, the Company reported a net loss of
($1,467,000), or ($0.80) per share, on revenue of $1,293,000, compared to a
net loss of ($328,000), or ($0.18) per share, on revenue of $546,000 for the
quarter ended March 30, 2013. For the six months ended March 29, 2014, the
Company reported a net loss of ($1,282,000), or ($0.70) per share, on revenue
of $3,802,000, compared to a net loss of ($638,000), or ($0.35) per share, on
revenue of $2,142,000 for the six months ended March 30, 2013.

The higher than expected loss for the second quarter of fiscal 2014 was
primarily attributable to a tax provision in the amount of $821,000, a result
of cumulative losses over the previous 10 quarters leading to the
establishment of a valuation allowance against deferred tax assets during the
quarter ended March 29, 2014. This compares to a tax benefit in the amount of
$656,000 for the quarter ended March 30, 2013.

Carl H. Guild, Jr., President and CEO of TCC, commented, “Delays in the
receipt of certain foreign and domestic contracts negatively impacted our
profitability for the quarter. We believe that these delays, coupled with
customer and production delivery requirements, will result in lower than
expected revenue for the remainder of fiscal 2014.”

“Despite these setbacks, we ended the second quarter of fiscal 2014 with a $1
million backlog and a healthy pipeline of potential contracts. We have also
continued marketing our new voice and data network encryption systems, and
remain optimistic about expanded market opportunities for long-term growth,”
concluded Guild.

Activity highlights during the quarter included shipping the balance of orders
from a domestic radio manufacturer for our DSP 9000 secure radio system for
deployment to Afghanistan. TCC also continued the delivery of secure radio
systems and training orders to a domestic prime contractor supporting a
government customer in North Africa.

About Technical Communications Corporation

For over 50 years, TCC has specialized in superior-grade secure communications
systems and customized solutions, supporting our CipherONE^®best-in-class
criteria, to protect highly sensitive voice, data and video transmitted over a
wide range of networks. Government entities, military agencies and corporate
enterprises in 115 countries have selected TCC's proven security to protect
their communications. Learn more:www.tccsecure.com.

Statements made in this press release or as may otherwise be incorporated by
reference herein constitute “forward-looking statements” within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-looking
statements include but are not limited to statements regarding anticipated
operating results, future earnings, and the ability to achieve growth and
profitability. Such forward-looking statements involve known and unknown
risks, uncertainties and other factors, including but not limited to the
effect of foreign political unrest; domestic and foreign government policies
and economic conditions; future changes in export laws or regulations; changes
in technology; the ability to hire, retain and motivate technical, management
and sales personnel; the risks associated with the technical feasibility and
market acceptance of new products; changes in telecommunications protocols;
the effects of changing costs, exchange rates and interest rates; and the
Company's ability to secure adequate capital resources. Such risks,
uncertainties and other factors could cause the actual results, performance or
achievements of the Company, or industry results, to be materially different
from any future results, performance or achievements expressed or implied by
such forward-looking statements. For a more detailed discussion of the risks
facing the Company, see the Company’s filings with the Securities and Exchange
Commission, including its Quarterly Report on Form 10-Q for the quarter ended
December 28, 2013, and its Annual Report on Form 10-K for the fiscal year
ended September 28, 2013 and the “Risk Factors” section included therein.


Technical Communications Corporation

Condensed consolidated income statements

                                 Quarter Ended
                                   (Unaudited)
                                03/29/2014    03/30/2013
Net sales                        $ 1,293,000   $ 546,000
Gross profit                     956,000       489,000
S, G & A expense                 842,000       693,000
Product development costs        766,000       789,000
Operating loss                   (652,000)     (993,000)
Income tax provision (benefit)   821,000       (656,000)
Net loss                         (1,467,000)   (328,000)
Net loss per share:                           
Basic                            $ (0.80)      $ (0.18)
Diluted                          $ (0.80)      $ (0.18)
                                                
                                   Six Months Ended
                                   (Unaudited)
                                03/29/2014    03/30/2013
Net sales                        $ 3,802,000   $ 2,142,000
Gross profit                     2,676,000     1,591,000
S, G & A expense                 1,549,000     1,471,000
Product development costs        1,528,000     1,645,000
Operating loss                   (401,000)     (1,524,000)
Income tax provision (benefit)   894,000       (870,000)
Net loss                         (1,282,000)   (638,000)
Net loss per share:                           
Basic                            $ (0.70)      $ (0.35)
Diluted                          $ (0.70)      $ (0.35)


Condensed consolidated balance sheets
                                      03/29/2014     9/28/2013
                                     (Unaudited)    (derived from audited
                                                         financial statements)
Cash and marketable securities        $ 5,938,000    $ 4,581,000
Accounts receivable, net              251,000        1,376,000
Inventory                             2,129,000      2,619,000
Deferred & refundable income taxes    729,000        1,618,000
Other current assets                  234,000        225,000
Total current assets                  9,281,000      10,419,000
Marketable securities                 1,335,000      1,463,000
Property and equipment, net           474,000        469,000
                                                   
Total assets                          $ 11,090,000   $ 12,351,000
                                                   
Accounts payable                      159,000        262,000
Accrued expenses and other current    658,000        667,000
liabilities
Total current liabilities             817,000        929,000
Total stockholders’ equity            10,273,000     11,422,000
Total liabilities and stockholders’   $ 11,090,000   $ 12,351,000
equity

Contact:

Technical Communications Corporation
Michael P. Malone, 978-287-5100
Chief Financial Officer
www.tccsecure.com
 
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