freqelec20211031

freqelec20211031_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)

☒QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period ended October 31, 2021

☐TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File No. 1-8061

FREQUENCY ELECTRONICS, INC.

(Exact name of Registrant as specified in its charter)

Delaware	11-1986657
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

55 CHARLES LINDBERGH BLVD., MITCHEL FIELD, N.Y.	11553
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: 516-794-4500

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock (par value $1.00 per share)	FEIM	NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller Reporting Company ☒
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

APPLICABLE ONLY TO CORPORATE ISSUERS:

The number of shares outstanding of registrant’s Common Stock, par value $1.00 per share, as of December 6, 2021 – 9,264,590

FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

TABLE OF CONTENTS

	Page No.
Part I. Financial Information:

Item 1 - Financial Statements:

Condensed Consolidated Balance Sheets – October 31, 2021 (unaudited) and April 30, 2021	3

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) Three and Six Months Ended October 31, 2021 and 2020 (unaudited)	4

Condensed Consolidated Statements of Cash Flows Six Months Ended October 31, 2021 and 2020 (unaudited)	5

Condensed Consolidated Statements of Changes in Stockholders’ Equity Three and Six Months Ended October 31, 2021 (unaudited)	6

Condensed Consolidated Statements of Changes in Stockholders’ Equity Three and Six Months Ended October 31, 2020 (unaudited)	7

Notes to Condensed Consolidated Financial Statements (unaudited)	8-17

Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations	18-24

Item 3 - Quantitative and Qualitative Disclosures About Market Risk	25

Item 4 - Controls and Procedures	25

Part II. Other Information:

Item 1 – Legal Proceedings	26

Item 6 - Exhibits	26

Signatures	27

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Condensed Consolidated Balance Sheets

(In thousands except par value)

(Unaudited)

	October 31,			April 30,
	2021			2021

ASSETS:
Current assets:
Cash and cash equivalents	$	10,623		$	9,807
Marketable securities		9,955			10,313
Accounts receivable, net of allowance for doubtful accounts of $111 at October 31, 2021 and April 30, 2021		8,743			5,515
Costs and estimated earnings in excess of billings, net		-			1,948
Inventories, net		19,477			19,661
Prepaid income taxes		453			444
Prepaid expenses and other		1,226			991
Total current assets		50,477			48,679
Property, plant and equipment, at cost, net of accumulated depreciation and amortization		9,403			9,612
Goodwill		617			617
Cash surrender value of life insurance		9,990			15,396
Other assets		1,804			1,939
Right-of-Use assets – operating leases		9,087			9,773
Total assets	$	81,378		$	86,016

LIABILITIES AND STOCKHOLDERS’ EQUITY:
Current liabilities:
Accounts payable – trade	$	970		$	1,080
Accrued liabilities		3,710			5,245
Loss provision accrual		72			57
Operating lease liability		1,779			1,715
Billings in excess of costs and estimated earnings, net		3,479			-
Total current liabilities		10,010			8,097
Deferred compensation		9,007			14,017
Deferred taxes		8			8
Operating lease liability – non-current		7,605			8,366
Other liabilities		119			119
Total liabilities		26,749			30,607
Commitments and contingencies
Stockholders’ equity:
Preferred stock - $1.00 par value; authorized 600 shares, no shares issued		-			-
Common stock - $1.00 par value; authorized 20,000 shares, 9,264 shares issued and 9,263 shares outstanding at October 31, 2021; 9,226 shares issued and 9,225 shares outstanding at April 30, 2021		9,264			9,226
Additional paid-in capital		57,693			57,355
Accumulated deficit		(12,535	)		(11,457	)
Common stock reacquired and held in treasury - at cost (1 share at October 31, 2021 and 1 share at April 30, 2021)		(6	)		(6	)
Accumulated other comprehensive income		213			291
Total stockholders’ equity		54,629			55,409
Total liabilities and stockholders’ equity	$	81,378		$	86,016

See accompanying notes to condensed consolidated financial statements.

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FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(In thousands except per share data)

(Unaudited)

	Three Months Ended October 31,						Six Months Ended October 31,
	2021			2020			2021			2020
Condensed Consolidated Statements of Operations
Revenues	$	12,936		$	13,990		$	25,890		$	26,940
Cost of revenues		8,845			8,668			17,738			17,530
Gross margin		4,091			5,322			8,152			9,410
Selling and administrative expenses		2,411			4,124			6,805			7,352
Research and development expenses		1,377			979			2,732			2,177
Operating income (loss)		303			219			(1,385	)		(119	)

Other income (expense):
Investment income		98			50			191			157
Interest expense		(20	)		(36	)		(40	)		(75	)
Other income (expense), net		118			113			158			129
Income (loss) before provision for income taxes		499			346			(1,076	)		92
Provision for income taxes		2			17			2			25
Net income (loss)	$	497		$	329		$	(1,078	)	$	67

Net income (loss) per common share:
Basic and diluted income (loss) per share	$	0.05		$	0.04		$	(0.12	)	$	0.01

Weighted average shares outstanding:
Basic		9,256			9,170			9,246			9,154
Diluted		9,302			9,236			9,246			9,206


Condensed Consolidated Statements of Comprehensive Income (Loss)
Net income (loss)	$	497		$	329		$	(1,078	)	$	67

Unrealized (loss) gain on marketable securities:
Change in market value of marketable securities before reclassification, net of tax		(157	)		(176	)		(72	)		5
Reclassification adjustment for realized gains included in net income, net of tax		-			-			(6	)		(10	)
Total unrealized (loss) gain on marketable securities, net of tax		(157	)		(176	)		(78	)		(5	)

Comprehensive income (loss)	$	340		$	153		$	(1,156	)	$	62

See accompanying notes to condensed consolidated financial statements.

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FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

	Six Months Ended October 31,
	2021			2020
Cash flows from operating activities:
Net (loss) income	$	(1,078	)	$	67
Non-cash charges to earnings		1,765			2,580
Net changes in operating assets and liabilities		974			(667	)
Net cash provided by operating activities		1,661			1,980

Cash flows from investing activities:
Proceeds on redemption of marketable securities		1,427			1,521
Purchase of marketable securities		(1,164	)		(909	)
Purchase of property, plant, and equipment, and other assets		(1,108	)		(781	)
Net cash used in investing activities		(845	)		(169	)

Net cash used in financing activities:
Repayment of PPP Loan		-			(4,965	)
Proceeds from UBS line of credit		-			3,000
Net cash used in financing activities		-			(1,965	)

Net increase (decrease) in cash and cash equivalents		816			(154	)

Cash and cash equivalents at beginning of period		9,807			3,808

Cash and cash equivalents at end of period	$	10,623		$	3,654


Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	40		$	46
Income Taxes	$	15			-

Cash refunded during the period for:
Income Taxes	$	-		$	477

See accompanying notes to condensed consolidated financial statements.

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FREQUENCY ELECTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Three and Six Months Ended October 31, 2021

(In thousands except share data)

(Unaudited)

					Additional						Treasury stock					Accumulated other
	Common Stock				paid in			Accumulated			(at cost)					comprehensive
	Shares		Amount		capital			Deficit			Shares		Amount			Income (loss)			Total
Balance at April 30, 2021		9,226,268	$	9,226	$	57,355		$	(11,457	)		1,376	$	(6	)	$	291		$	55,409
Contribution of stock to 401(k) plan		13,251		13		117			-			-		-			-			130
Stock-based compensation expense		7,500		8		61			-			-		-			-			69
Exercise of stock options and stock appreciation rights - net of shares tendered for exercise price		-		-		-			-			-		-			-			-
Other comprehensive income, net of tax		-		-		-			-			-		-			79			79
Net loss		-		-		-			(1,575	)		-		-			-			(1,575	)
Balance at July 31, 2021		9,247,019	$	9,247	$	57,533		$	(13,032	)		1,376	$	(6	)	$	370		$	54,112
Contribution of stock to 401(k) plan		10,779		11		100			-			-		-			-			111
Stock-based compensation expense		250		-		66			-			-		-			-			66
Exercise of stock options and stock appreciation rights - net of shares tendered for exercise price		6,278		6		(6	)		-			-		-			-			-
Other comprehensive loss, net of tax		-		-		-			-			-		-			(157	)		(157	)
Net income		-		-		-			497			-		-			-			497
Balance at October 31, 2021		9,264,326	$	9,264	$	57,693		$	(12,535	)		1,376	$	(6	)	$	213		$	54,629

See accompanying notes to condensed consolidated financial statements.

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FREQUENCY ELECTRONICS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Three and Six Months Ended October 31, 2020

(In thousands except share data)

(Unaudited)

					Additional						Treasury stock						Accumulated other
	Common Stock				paid in			Accumulated			(at cost)						comprehensive
	Shares		Amount		capital			Deficit			Shares			Amount			Income (loss)			Total
Balance at April 30, 2020		9,163,940	$	9,164	$	56,914		$	(12,137	)		42,696		$	(195	)	$	490		$	54,236
Contribution of stock to 401(k) plan		-		-		68			-			(14,926	)		68			-			136
Stock-based compensation expense		-		-		54			-			-			-			-			54
Exercise of stock options and stock appreciation rights - net of shares tendered for exercise price		-		-		(109	)		-			(23,808	)		109			-			-
Other comprehensive income, net of tax		-		-		-			-			-			-			171			171
Net loss		-		-		-			(262	)					-			-			(262	)
Balance at July 31, 2020		9,163,940	$	9,164	$	56,927		$	(12,399	)		3,962		$	(18	)	$	661		$	54,335
Contribution of stock to 401(k) plan		9,496		9		86			-			-			-			-			95
Stock-based compensation expense		-		-		73			-			-			-			-			73
Exercise of stock options and stock appreciation rights - net of shares tendered for exercise price		2,654		3		(15	)		-			(2,586	)		12			-			(0	)
Other comprehensive loss, net of tax		-		-		-			-			-			-			(176	)		(176	)
Net income		-		-		-			329			-			-			-			329
Balance at October 31, 2020		9,176,090	$	9,176	$	57,071		$	(12,070	)		1,376		$	(6	)	$	485		$	54,656

See accompanying notes to condensed consolidated financial statements.

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FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

NOTE A – CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In the opinion of management of Frequency Electronics, Inc. (the “Company”), the accompanying unaudited condensed consolidated interim financial statements reflect all adjustments (which include only normal recurring adjustments) necessary to present fairly, in all material respects, the consolidated financial position of the Company as of October 31, 2021 and the results of its operations, changes in stockholders’ equity for the three and six months ended October 31, 2021 and 2020, and cash flows for the six months ended October 31, 2021 and 2020. The April 30, 2021 condensed consolidated balance sheet was derived from audited financial statements. These financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP’). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the annual consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended April 30, 2021, filed on June 30, 2021 with the Securities and Exchange Commission. The results of operations for such interim periods are not necessarily indicative of the operating results for the full fiscal year.

COVID-19 Pandemic

The full impact of the COVID-19 pandemic continues to evolve as of the date of this report. The current resurgence of COVID-19 variants may have additional, unforeseen, impacts. As such, it is uncertain as to the full magnitude that the pandemic may have on the Company’s financial condition, liquidity, and future results of operations. For the six months ended October 31, 2021, the Company was impacted by employee absenteeism related to direct or indirect effects of the COVID-19 pandemic and delays in the receipt of anticipated new contracts from customers due to COVID-19 related administrative delays. Management has taken steps to minimize COVID-19 related impacts to our workforce. Given the changing dynamics of the pandemic, it is not possible for the Company to estimate potential future adverse effects on its operations, financial condition, or liquidity for fiscal year 2022. As of July 31, 2021, the Company had returned to normal operations, and the Company will continue to follow CDC and state guidelines with an emphasis on employee safety.

The Company faces various future COVID-19 related risks, including the possibility of impact from the Omicron variant and other future mutations. The Company is dependent on its workforce to design and manufacture its products. If significant portions of the Company’s workforce are unable to work effectively, or if the U.S. Government, state and/or other customers or supplier operations are curtailed due to illness, quarantines, government actions, facility closures, or other restrictions, the Company’s operations may be impacted. If so, the Company may be unable to perform fully on its contracts and costs may increase. These cost increases may not be fully recoverable or adequately covered by insurance. In the latter part of fiscal year 2021, the Company did experience some disruption due to the need to vacate certain areas of its facilities for cleaning and disinfecting as a result of employees potentially being exposed to COVID-19 or following positive COVID-19 test results. Also, certain of the Company’s vendors have been unable to deliver materials on time due to COVID-19 related impacts to their workforces or their supply chains. These delays impacted the Company’s production costs and schedules. Vendor delivery performance is being closely monitored and alternate sources of supply are generally available and, in some cases, are being established.

NOTE B – EARNINGS (LOSS) PER SHARE

Reconciliation of the weighted average shares outstanding for basic and diluted earnings (loss) per share for the three and six months ended October 31, 2021 and 2020, respectively, were as follows:

	Periods ended October 31,
	Three months				Six months
	2021		2020		2021		2020
Weighted average shares outstanding:
Basic EPS Shares outstanding (weighted average)		9,256,255		9,169,758		9,246,240		9,154,434
Effect of Dilutive Securities		45,273		66,019		**		51,389
Diluted EPS Shares outstanding		9,301,528		9,235,777		9,246,240		9,205,823

** For the six-months ended October 31, 2021 dilutive securities are excluded from the calculation of earnings per share since the inclusion of such shares would be antidilutive due to the net loss for that period. The exercisable shares excluded for the three- and six-months ended October 31, 2021 was 198,000 and 223,000 options, respectively. The exercisable shares excluded for the three- and six-month periods ended October 31, 2020 was 303,000 and 436,000 options, respectively.

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FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

NOTE C – COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS, NET

At October 31, 2021 and April 30, 2021, billings in excess of costs and estimated earnings and costs and estimated earnings in excess of billings, net, respectively, consisted of the following:

	October 31, 2021			April 30, 2021
	(In thousands)
Costs and estimated earnings in excess of billings	$	9,882		$	12,640
Billings in excess of costs and estimated earnings		(13,361	)		(10,692	)
Net (liability) asset	$	(3,479	)	$	1,948

Such amounts represent revenue recognized on long-term contracts that had not been billed at the balance sheet dates or represent a liability for amounts billed in excess of the revenue earned. Amounts are billed to customers pursuant to contract terms. In general, the recorded amounts will be billed and collected and revenue recognized within twelve months of the balance sheet date. Revenue on these long-term contracts is accounted for on the percentage of completion (“POC”) basis. During the three and six months ended October 31, 2021, revenue recognized under POC contracts was approximately $12.2 million and $24.6 million, respectively. During the three and six months ended October 31, 2020, revenue recognized under POC contracts was approximately $12.9 million and $24.6 million, respectively. Anticipated contract losses, if any, are accrued for in the period such determination is made. Contract losses of approximately $31,000 and $47,000 were recorded for the three and six months ended October 31, 2021, respectively. Contract losses of approximately $121,000 and $731,000 were recorded for the three and six months ended October 31, 2020, respectively.

NOTE D –STOCK TRANSACTIONS

During the three and six-month periods ended October 31, 2021, the Company made contributions of 10,779 and 24,030 shares of its common stock, respectively, to the Company’s profit-sharing plan and trust under Section 401(k) of the Internal Revenue Code. Such contributions are in accordance with the Company’s discretionary match of employee voluntary contributions to this plan.

NOTE E – INVENTORIES, NET

Inventories, which are reported at the lower of cost and net realizable value, consisted of the following:

	October 31, 2021		April 30, 2021
	(In thousands)
Raw Materials and Component Parts	$	12,288	$	12,386
Work in Progress		6,689		6,259
Finished Goods		500		1,016
	$	19,477	$	19,661

The amounts above are net of reserves of $7.0 million and $7.3 million as of October 31, 2021 and April 30, 2021, respectively.

NOTE F – RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

The Company’s leases primarily represent offices, warehouses, vehicles, and manufacturing and research and development facilities which expire at various times through 2029 and are operating leases. Contractual arrangements are evaluated at inception to determine if the agreement contains a lease. Certain lease agreements contain renewal options, rent abatement, and escalation clauses that are factored into our determination of lease payments when appropriate. Right-of-use (“ROU”) assets and lease liabilities are recorded based on the present value of future lease payments which factor in certain qualifying initial direct costs incurred as well as any lease incentives that may have been received. Lease expenses for operating lease payments are recognized on a straight-line basis over the lease term. Lease terms may factor in options to extend or terminate the lease.

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FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The Company elected the practical expedient for short-term leases which allows leases with terms of twelve months or less to be recorded on a straight-line basis over the lease term without being recognized on the balance sheet.

The table below presents ROU assets and liabilities recorded on the respective consolidated balance sheets as follows:

	Classification	October 31, 2021		April 30, 2021
		(in thousands)
Assets
Operating lease ROU assets	Right-of-Use assets leases	$	9,087	$	9,773

Liabilities
Operating lease liabilities (short-term)	Lease liability, current		1,779		1,715
Operating lease liabilities (long-term)	Lease liability, non-current		7,605		8,366
Total lease liabilities		$	9,384	$	10,081

Total operating lease expense was $500,000 and $1.0 million for the three and six months ended October 31, 2021, respectively, the majority of which is included in cost of revenues and the remaining amount in selling and administrative expenses in the condensed consolidated statements of operations. Total operating lease expense was $500,000 and $1.2 million for the three and six months ended October 31, 2020, respectively, the majority of which is included in cost of revenues and the remaining amount in selling and administrative expenses in the condensed consolidated statements of operations.

The table below reconciles the undiscounted cash flows for each of the first five fiscal years and total of the remaining fiscal years to the operating lease liabilities recorded on the unaudited condensed consolidated balance sheet as of October 31, 2021:

Fiscal Year Ending April 30,
(in thousands)

Remainder of 2022	$	766
2023		1,837
2024		1,849
2025		1,723
2026		1,317
Thereafter		4,174
Total lease payments		11,666
Less imputed interest		(2,282	)
Present value of future lease payments		9,384
Less current obligations under leases		(1,779	)
Long-term lease obligations		7,605

As of October 31, 2021, the weighted-average remaining lease term for all operating leases was 7.0 years. The Company does not generally have access to the rate implicit in the leases and therefore utilized the Company’s borrowing rate as the discount rate. The weighted average discount rate for operating leases as of October 31, 2021 was 6.22%.

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FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

NOTE G – SEGMENT INFORMATION

The Company operates under two reportable segments based on the geographic locations of its subsidiaries:

(1)

FEI-NY – operates out of New York and its operations consist principally of precision time and frequency control products used in three principal markets: satellites (both commercial and U.S. Government-funded); terrestrial cellular telephone or other ground-based telecommunication stations; and other components and systems for the U.S. military.

The FEI-NY segment also includes the operations of the Company’s wholly-owned subsidiary, FEI-Elcom. FEI-Elcom, in addition to its own product line, provides design and technical support for the FEI-NY segment’s satellite business.

(2)

FEI-Zyfer – operates out of California and its products incorporate Global Positioning System (GPS) technologies into systems and subsystems for secure communications, both government and commercial, and other locator applications. FEI-Zyfer’s products also incorporate precision time references for terrestrial secure communications and command and control, and frequency products that incorporate GPS. FEI-Zyfer’s GPS capability complements the Company’s existing technologies and permits the combined entities to provide a broader range of embedded systems for a variety of timing functions and anti-spoofing (“SAASM”) applications.

The Company measures segment performance based on total revenues and profits generated by each geographic location rather than on the specific types of customers or end-users. Consequently, the Company determined that the segments indicated above most appropriately reflect the way the Company’s management views the business.

The accounting policies of the two segments are the same as those described in the “Summary of Significant Accounting Policies” in the fiscal year-end financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended April 30, 2021, filed on June 30, 2021 with the Securities and Exchange Commission. The Company evaluates the performance of its segments and allocates resources to them based on operating profit which is defined as income before investment income, interest expense and taxes. All acquired assets, including intangible assets, are included in the assets of both reporting segments.

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FREQUENCY ELECTRONICS, INC. and SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(Unaudited)

The tables below present information about reported segments with reconciliation of segment amounts to consolidated amounts as reported in the condensed consolidated statements of operations or the condensed consolidated balance sheets for each of the periods (in thousands):

	Periods ended October 31,
	Three months						Six months
	2021			2020			2021			2020
Revenues:
FEI-NY	$	10,381		$	11,156		$	20,543		$	20,996
FEI-Zyfer		2,648			3,430			5,783			7,353
less intersegment revenues		(93	)		(596	)		(436	)		(1,409	)
Consolidated revenues	$	12,936		$	13,990		$	25,890		$	26,940

Operating income (loss):
FEI-NY	$	(64	)	$	41		$	(1,075	)	$	(582	)
FEI-Zyfer		(132	)		306			(99	)		667
less intersegment revenues		-						(20	)
Corporate		499			(128	)		(191	)		(204	)
Consolidated operating income (loss)	$	303		$	219		$	(1,385	)	$	(119	)

SEC Form 10-Q filed by Frequency Electronics, Inc.