BK Technologies Announces Second Quarter 2023 Results

BK Technologies Corporation (NYSE American: BKTI) (the “Company,” “BK Technologies”) announced financial and operating results for the second quarter and six months ended June 30, 2023. 

Second Quarter 2023 Financial and Operational Update

• 57% increase in second quarter revenue to $19.0 million driven by increased shipments and strong demand for the BKR 5000 radio and improved shipment volumes
• Gross margin improved to 27%, continuing the sequential quarter over quarter margin improvement trend that began in the third quarter of 2022
• Order backlog of $24.0 million at June 30, 2023
• Launched the BKR 9000 Multiband RadioDelivered first shipment of BKR 9000 radios to the U.S. Army in the continental United States
• Field tests completed over 11 major P25 trunked systems, include several statewide P25 systems

“During second quarter 2023, our strong order and shipment volumes continued the momentum built during the first quarter, resulting in substantial revenue growth and improved margin performance as compared to the second quarter of 2022. An important development in the quarter was the receipt of final FCC approval and our first shipment of the BKR 9000 radios in early June,” stated John Suzuki, CEO of BK Technologies. “With its enhanced multiband capabilities, the BKR 9000 is a next generation portable communication product at a cost-effective price point that we are confident will heighten our exposure to new addressable markets and customers.

“Additionally, we continue to see strong interest and robust order activity around our BKR 5000, and we announced several large purchase orders during the quarter, including two orders from the USDA for a total of more than 5,100 BKR 5000 radios. BK radios enjoy a solid reputation as durable and reliable portable communications solutions, and we remain focused on growing that recognition and expanding our customer base of federal, state and local public safety and first responder agencies.

“Our first half 2023 results speak to our enhanced ability to move our solid backlog from orders to deliveries, resulting in revenue growth and improved margins. As we move through the balance of 2023, we’re focused on building upon our first half momentum and facilitating our product cost improvement programs.”

Second Quarter 2023 Financial Review
Revenue increased 57% to $19.0 million, compared with $12.1 million for the second quarter of last year driven by increased radio shipments and demand for the BKR 5000 radio. Gross profit margin was 27% compared to 14% for the same quarter of last year, reflecting improved product costs related to raw material, components and freight costs.

Selling, General & Administrative expenses totaled $6.0 million, compared with $5.4 million for the second quarter of last year.

Operating loss totaled ($784,000) compared with operating loss of ($3.7 million) for the second quarter of last year.

BK Technologies recorded a net loss of ($1.3 million) or ($0.39) per basic and diluted share, compared with a net loss of ($4.3 million) or ($1.28) per basic and diluted share, for the second quarter of last year.

First Six Months 2023 Financial Review
Revenue increased 101% to $37.7 million, compared with $18.7 million for the first six months of last year. Gross profit margin was 27% compared to 17% for the first six months of last year, reflecting improved costs associated with material and freight during the first half of 2023.

Selling, General & Administrative expenses totaled $11.9 million, compared with $10.3 million for the first half of 2022.

Operating loss totaled ($1.8 million) compared with operating loss of ($7.1 million) for the first six months of last year.

BK Technologies recorded a net loss of ($2.6 million) or ($0.77) per basic and diluted share, compared with a net loss of ($8.3 million) or ($2.45) per basic and diluted share for the first half of last year. In the first six months of 2023, the Company recognized a loss of ($489,000) on its investment in FG Financial Holdings, LLC, compared to a loss on that investment of ($1.1) million in the first six months of last year.

Working capital totaled approximately $12.4 million, of which approximately $11.9 million was comprised of cash, cash equivalents, and trade receivables. This compares with the working capital at year-end of 2022 of approximately $13.2 million, of which $12.5 million was comprised of cash, cash equivalents, and trade receivables.