Frequency Electronics, Inc. · NASDAQ:FEIM
Frequency Electronics — Needham Growth Conference 2021
22 slides from Frequency Electronics's conference presentation, Jan 12, 2021
Slide 1: Frequency Electronics, Inc.
Frequency Electronics, Inc. NASDAQ: FEIM Providing High-Precision Timing & Frequency Generation and RF/Microwave Technology for Space and Terrestrial Applications Stanton Sloane President & CEO Steven Bernstein CFO Needham Growth Conference 1/12/2021
Slide 2: Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The Statements in this presentation regarding the future constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1933 or th
Slide 3: Who We Are
Who We Are • FEIM is a world leader in high-precision time and frequency technology for space and terrestrial markets – one of few companies in the world capable of producing atomic clocks from the raw materials to finished products – complete control of quality, performance and production for key t
Slide 4: Company History
Company History • 2020 is our 58th year in operations • Over 5000 systems in space (some systems in continuous operations for 40 years…and counting) • Frequency’s systems have: • visited all of our sun’s known planets • landed on the moon • aided in viewing the far reaches of our universe, providing
Slide 5: Investment Highlights
Investment Highlights - Technology: Robust R&D investments to target new market opportunities, both space and non-space. - Operations: Consolidating manufacturing and streamlining operations to further reduce costs. - Financial Strength: Continued cash generation producing balance sheet strength wit
Slide 6: FEI Global Customers
FEI Global Customers U.S. Gov’t/DOD Direct to Government…Fortune 25…A&D Primes disclaimer: images are for illustration purposes only 6
Slide 7: Frequency Electronics - Primary Business Sources
Frequency Electronics - Primary Business Sources FY20 Revenues by End Market - $41.5M ~51% non-Space Related 20.6% 10% Other Commercial and 41% Industrial $4.2M Satellite Payloads $20.4M U.S. Government/DOD $16.9M 24.1% 49% ~49% Space-Related
Slide 8: Key Building Blocks From Raw Materials to Final Products
Key Building Blocks From Raw Materials to Final Products Controlling Product Flow Reduces Cycle Time & Enhances Performance Raw Materials Engineered Components Finished Products Applications Quartz Quartz Quartz Bar Resonator Timing System Rubidium Aging of Lamps, Filter Cells Rubidium Atomic Clock:
Slide 9: FEIM Product Portfolio Addresses Mission Critical Precision Time & Frequency Requirements
FEIM Product Portfolio Addresses Mission Critical Precision Time & Frequency Requirements Non-SPACE Example Platforms Products AMRAAM Airborne, Sea, and Rugged low-G Qz Oscillators AEGIS Ground Secure Rugged Rb Oscillators THAAD Communications, RF/µW Broadband Fast-Switching IBCS Signa
Slide 10: Iridium NEXT Constellation -- Master Frequency Generation Unit and L-Band Frequency Converter Assembly
Iridium NEXT Constellation -- Master Frequency Generation Unit and L-Band Frequency Converter Assembly • 81 Flight Master Frequency 2011-current Generation Units • 168 L-Band Frequency Converter Assemblies Iridium NEXT Program Demonstrates Frequency’s Ability to Deliver High-Production-Volumes of Hi
Slide 11: WGS Triple Redundant
WGS DOD Triple WGS Redundant Constellation Master -- Triple Oscillator, Redundant Master Master Clock Oscillator, Master and Reference Clock Generators and Reference (10 (10 Generators Ship sets) Shipsets) Triple Redundant Master OCXO 1 Dual Redundant 6 Dual Redundant Master Clock (CRO) Ref Gen (DRO
Slide 12: DOD AEHF Constellation -- Triple Redundant Rb Master Timing System
DOD AEHF Constellation -- Triple Redundant Rb Master Timing System (6 Ship sets) AEHF Master Oscillator Group (MOG) - 3 Redundant Rb Master Oscillators MILSTAR Predecessor FEI Rb Clocks Have Been in Continuous Operation 12 in Orbit Since 1995 12
Slide 13: FEIM & Voyager Space Exploration
FEIM & Voyager Space Exploration • Launched in 1977, Voyager 1 and 2 are still in good health • Voyager 1 is ~13 billion miles (~21 billion km) from Earth; Voyager 2 is ~11 billion miles (~17.7 billion km) from Earth • Both are operating as part of the Voyager Interstellar Mission Courtesy of JPL Vo
Slide 14: US Government Opportunities are Robust
US Government Opportunities are Robust • Space now recognized as a warfighting domain • Vulnerability of GPS to jamming/spoofing makes alternative precision timing more important • Investment trends in key space systems are favorable…GPS-IIIF, OPIR, WGS, Classified • Technology that will position us
Slide 15: Secure Communications & Command and Control Market- Air/Ground/Maritime
Secure Communications & Command and Control Market- Air/Ground/Maritime • The DoD budget environment is favorable. • C4ISR is getting increased focus, driven by: – Global geopolitics – Terrorism – Increasing vulnerability of critical systems (e.g. GPS) – Advancing (commercial) technology – Increasin
Slide 16: Financial Information
Financial Information 17
Slide 17: Financial Highlights
Financial Highlights • Continuing to invest in R&D, ensuring our products are cutting edge and available as future opportunities mature. • Frequency has a strong balance sheet and is expecting to see significant financial improvement in the next fiscal year. • The number and value of new business op
Slide 18: Strong Balance Sheet
Strong Balance Sheet • Total Assets $ 90M • Net Working Capital $ 40M • Cash and ST Investments $ 14M • Long Term Debt $ 3M • Shareholders Equity $ 55M As of October 31, 2020 (end of FEIM 2nd quarter FY21) 18 19
Slide 19: Statement of Operations
Statement of Operations FY19 FY20 FY21 (in thousands) April 30, 2019 April 30, 2020 6 months October 31, 2020 Revenue $ 49,509 $ 41,507 $ 26,940 Operating Loss $ (2,817) $ (10,922) $ (119) Net Income Loss $ (2,529) $ (10,026) $ 67 Cash Flow Provided $ 3,175 $ 1,407 $ 1,981 (Used) by Operations Opera
Slide 20: Backlog
Backlog FY19 FY20 FY21 April 30, 2019 April 30, 2020 6 months October 31, 2020 $37M $36M $42M Growing backlog will convert to increasing revenue and improved bottom line performance. Backlog does not include unfunded portions of contracts or value for unexercised production options. 20 21
Slide 21: FEI Selected Near-Term Opportunities
FEI Selected Near-Term Opportunities Potential Value GPS IIIF + Related PNT Satellites: S Rubidium clocks, quartz Oscillators (satellite+programmatic costs) $180-$200M P A C Other Space programs: E Ultra-Stable Very-Low Phase-Noise Clocks, Frequency Synthesizers, $35-$80M Frequency Generators for Co
Slide 22: Frequency Electronics
Frequency Electronics Building for the Future From a 58 Year Legacy of Excellence 23
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