Acquisition of Electrochem Completed and Integration Has Commenced

NEWARK, N.Y., April 01, 2025 (GLOBE NEWSWIRE) -- Ultralife Corporation (NASDAQ: ULBI) reported operating results for the fourth quarter and full year ended December 31, 2024 as follows:

Fourth Quarter:

Sales of $43.9 million compared to $44.5 million for the 2023 fourth quarter, including a 11.7% increase in Battery & Energy Products sales and a 55.1% decrease in Communications Systems sales
Gross profit of $10.6 million, or 24.2% of revenue, compared to $11.4 million, or 25.6% of revenue, for the 2023 fourth quarter
Operating income of $1.5 million, including one-time costs and GAAP adjustments of $1.1 million directly related to the acquisition of Electrochem Solutions, Inc. ("Electrochem") on October 31, 2024, compared to $3.6 million for the 2023 fourth quarter
GAAP EPS of $0.01 compared to $0.17 for the 2023 fourth quarter
Adjusted EBITDA of $3.9 compared to $4.8 million for the 2023 fourth quarter
Backlog and high confidence orders of $102.2 million exiting 2024 compared to $78.0 exiting the third quarter

Fiscal Year 2024:

Sales of $164.5 million represent a 3.7% year-over-year increase; essentially flat with 2023 when excluding Electrochem
Operating income of $10.0 million including one-time costs and GAAP adjustments of $1.4 million directly related to the acquisition of Electrochem on October 31, 2024, versus $9.5 million for 2023
GAAP EPS of $0.38 compared to $0.44 for 2023 which included approximately $0.08 for recognition of the ERC filed under the Coronavirus Aid, Relief and Economic Act
Adjusted EBITDA of $16.5 million compared to $15.7 million for 2023

"For the fourth quarter the contribution of Electrochem compensated for delays in the timing of expected larger orders for our Communications Systems segment and customer requests to push orders into 2025 for our Battery & Energy Products segment. These fulfillment delays illustrate how fluctuations in order timing can impact our financial results on a short-term basis even as demand for our products remains strong. In addition, after acquiring Electrochem on October 31^st, we began implementing our integration playbook commencing the necessary groundwork to realize the benefits of our investment," said Mike Manna, President and Chief Executive Officer.

"We entered 2025 with a healthy backlog and a schedule of new products to launch representing a broadened opportunity set in high-growth markets that position us to more fully realize the operating leverage of our business model through scale, and a strengthened sales and marketing leadership team to expedite organic growth and further leverage our global brand and resources. We are also on track to complete the acquisition integration and realize resulting manufacturing cost efficiencies and U.S.-based vertical integration savings. As a result, we are confident in our ability to deliver profitable growth and incremental cash flow enabling us to reduce debt and support strategic capital expenditures," concluded Mr. Manna.

Fourth Quarter 2024 Financial Results

Revenue was $43.9 million, including $6.1 million relating to our acquisition of Electrochem, compared to revenue of $44.5 million for the fourth quarter of 2023. Battery & Energy Products sales increased 11.7% to $39.9 million compared to $35.7 million last year reflecting the inclusion of Electrochem. Organic sales for this segment declined 5.3% as a 48.1% increase in government/defenses sales and a 1.6% increase in oil & gas market sales were offset by a 47.2% decrease in medical battery sales and a 4.4% decline in other industrial market sales. Communications Systems sales decreased by 55.1% to $4.0 million compared to $8.8 million for the same period last year, primarily attributable to shipments in the prior year of vehicle-amplifier adaptors to a global defense contractor for the U.S. Army and of integrated systems of amplifiers and radio vehicle mounts to a major international defense contractor. Our total backlog and high confidence orders exiting the fourth quarter was $102.2 million compared to $78.0 million reported for the third quarter.

Gross profit was $10.6 million, or 24.2% of revenue, compared to $11.4 million, or 25.6% of revenue, for the same quarter a year ago. Battery & Energy Products gross margin was 23.4%, compared to 25.2% last year, primarily due to product mix and lower factory cost absorption. Communications Systems gross margin was 31.9% compared to 27.2% last year, primarily due to product mix and price realization despite lower factory volume.

Operating expenses were $9.1 million, compared to $7.8 million for the 2023 fourth quarter, reflecting $1.8 million for the inclusion of Electrochem and the one-time costs associated with the acquisition. Operating expenses were 20.8% of revenue compared to 17.4% of revenue for the year-earlier period.

Operating income was $1.5 million compared to $3.6 million last year. Driven by the 55.1% decline in Communications Systems sales and one-time acquisition costs, operating margin decreased to 3.4% compared to 8.2% last year.

Net income attributable to Ultralife Corporation was $0.2 million or $0.01 per diluted share on a GAAP basis, compared to $2.9 million or $0.17 per diluted share for the fourth quarter of 2023. Adjusted EPS was also $0.01 on a diluted basis for the fourth quarter of 2024, compared to $0.18 for the 2023 period. Adjusted EPS excludes the provision for deferred taxes which primarily represents non-cash charges for U.S. taxes which we expect will be fully offset by net operating loss carryforwards and other tax credits for the foreseeable future.

Adjusted EBITDA, defined as EBITDA including non-cash, stock-based compensation expense and one-time acquisition costs and non-cash purchase accounting adjustments, was $3.9 million for the fourth quarter of 2024, or 8.9% of sales, compared to $4.8 million, or 10.7% of sales, for the year-earlier period.

See the "Non-GAAP Financial Measures" section of this release for a reconciliation of adjusted EPS to EPS and adjusted EBITDA to net income attributable to Ultralife Corporation.

About Ultralife Corporation

Ultralife Corporation serves its markets with products and services ranging from power solutions to communications and electronics systems. Through its engineering and collaborative approach to problem solving, Ultralife serves government/defense and commercial customers across the globe.

Headquartered in Newark, New York, the Company's business segments include Battery & Energy Products and Communications Systems. Ultralife has operations in North America, Europe and Asia. For more information, visit www.ultralifecorporation.com.

Conference Call Information

Ultralife will hold its fourth quarter earnings conference call on today at 8:30 AM ET.

To ensure a fast and reliable connection to our investor conference call, we require participants dialing in by phone to pre-register using this link prior to the call: https://register-conf.media-server.com/register/BI1a1f31c093654241b376ab0dfc2c088b. This will eliminate the need to speak with an operator. Once registered, dial-in information will be provided along with a personal identification number. Should you register early and misplace your details, you can simply click back on this same link at any time to register and view this information again. A live webcast of the conference call will be available to investors in the Events & Presentations Section of the Company's website at http://investor.ultralifecorporation.com. For those who cannot listen to the live broadcast, a replay of the webcast will be available shortly after the call at the same location.

This press release may contain forward-looking statements based on current expectations that involve a number of risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include uncertain global economic conditions, reductions in revenues from key customers, delays or reductions in U.S. and foreign military spending, acceptance of our new products on a global basis, and disruptions or delays in our supply of raw materials and components due to business conditions, global conflicts, weather or other factors not under our control. The Company cautions investors not to place undue reliance on forward-looking statements, which reflect the Company's analysis only as of today's date. The Company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances. Further information on these factors and other factors that could affect Ultralife's financial results is included in Ultralife's Securities and Exchange Commission (SEC) filings, including the latest Annual Report on Form 10-K.

ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Dollars in Thousands)
(Unaudited)

ASSETS

	December 31, 2024			December 31, 2023
Current Assets:
Cash	$	6,854		$	10,278
Trade Accounts Receivable, Net		29,370			31,761
Inventories, Net		51,363			42,215
Prepaid Expenses and Other Current Assets		9,573			5,949
Total Current Assets		97,160			90,203

Property, Plant and Equipment, Net		40,485			21,117
Goodwill		45,006			37,571
Other Intangible Assets, Net		24,557			15,107
Deferred Income Taxes, Net		8,413			10,567
Other Non-Current Assets		4,830			3,711
Total Assets	$	220,451		$	178,276

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts Payable	$	14,160		$	11,336
Current Portion of Long-Term Debt		2,750			2,000
Accrued Compensation and Related Benefits		2,911			3,115
Accrued Expenses and Other Current Liabilities		9,470			7,279
Total Current Liabilities		29,291			23,730
Long-Term Debt, Net		51,502			23,624
Deferred Income Taxes		1,443			1,714
Other Non-Current Liabilities		4,028			3,781
Total Liabilities		86,264			52,849

Shareholders' Equity:
Common Stock		2,107			2,078
Capital in Excess of Par Value		191,828			189,160
Accumulated Deficit		(34,442	)		(40,754	)
Accumulated Other Comprehensive Loss		(4,006	)		(3,660	)
Treasury Stock		(21,492	)		(21,492	)
Total Ultralife Corporation Equity		133,995			125,332
Non-Controlling Interest		192			95
Total Shareholders' Equity		134,187			125,427

Total Liabilities and Shareholders' Equity	$	220,451		$	178,276

ULTRALIFE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Amounts)
(Unaudited)

	Three-Month Period Ended					Year Ended
	December 31,		December 31,			December 31,		December 31,
	2024		2023			2024		2023
Revenues:
Battery & Energy Products	$	39,880	$	35,703		$	144,081	$	129,953
Communications Systems		3,972		8,845			20,375		28,691
Total Revenues		43,852		44,548			164,456		158,644

Cost of Products Sold:
Battery & Energy Products		30,549		26,711			107,764		99,178
Communications Systems		2,704		6,435			14,378		20,266
Total Cost of Products Sold		33,253		33,146			122,142		119,444

Gross Profit		10,599		11,402			42,314		39,200

Operating Expenses:
Research and Development		2,415		1,852			8,268		7,531
Selling, General and Administrative		6,710		5,901			24,081		22,194
Total Operating Expenses		9,125		7,753			32,349		29,725

Operating Income		1,474		3,649			9,965		9,475

Other Expense		979		536			1,664		358
Income Before Income Taxes		495		3,113			8,301		9,117

Income Tax Provision		262		263			1,892		1,951

Net Income		233		2,850			6,409		7,166

Net Income (Loss) Attributable to Non-Controlling Interest		39		(23	)		97		(31	)

Net Income Attributable to Ultralife Corporation	$	194	$	2,873		$	6,312	$	7,197


Net Income Per Share Attributable to Ultralife Common Shareholders – Basic	$	.01	$	.18		$	.38	$	.44

Net Income Per Share Attributable to Ultralife Common Shareholders – Diluted	$	.01	$	.17		$	.38	$	.44

Weighted Average Shares Outstanding – Basic		16,629		16,338			16,555		16,214

Weighted Average Shares Outstanding – Diluted		16,762		16,479			16,767		16,226

Non-GAAP Financial Measures

Adjusted EBITDA

In evaluating our business, we consider and use adjusted EBITDA, a non-GAAP financial measure, as a supplemental measure of our operating performance in addition to U.S. Generally Accepted Accounting Principles ("GAAP") financial measures. We define adjusted EBITDA as net income attributable to Ultralife Corporation before net interest expense, provision for income taxes, depreciation and amortization, and stock-based compensation expense, plus/minus expense/income that we do not consider reflective of our ongoing continuing operations. We reconcile adjusted EBITDA to net income attributable to Ultralife Corporation, the most comparable financial measure under GAAP. Neither current nor potential investors in our securities should rely on adjusted EBITDA as a substitute for any GAAP measures and we encourage investors to review the following reconciliation of adjusted EBITDA to net income attributable to Ultralife Corporation.

ULTRALIFE CORPORATION AND SUBSIDIARIES
CALCULATION OF ADJUSTED EBITDA
(Dollars in Thousands)
(Unaudited)

	Three-Month Period Ended				Year Ended
	December 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023

Net Income Attributable to Ultralife Corporation	$	194	$	2,873	$	6,312	$	7,197
Adjustments:
Interest Expense, Net		829		566		1,940		2,016
Income Tax Provision		262		263		1,892		1,951
Depreciation Expense		831		740		3,125		3,022
Amortization Expense		348		226		1,032		889
Stock-Based Compensation Expense		208		104		698		528
Cyber-Insurance Policy Deductible		-		-		-		100
Non-Recurring Acquisition Costs		1,111		-		1,361		-
Non-Cash Purchase Accounting Adjustment		120		-		120		-
Adjusted EBITDA	$	3,903	$	4,772	$	16,480	$	15,703

Adjusted Earnings Per Share

In evaluating our business, we consider and use adjusted EPS, a non-GAAP financial measure, as a supplemental measure of our business performance. We define adjusted EPS as net income attributable to Ultralife Corporation excluding the provision (benefit) for deferred income taxes divided by our weighted average shares outstanding on both a basic and diluted basis. We believe that this information is useful in providing period-to-period comparisons of our results by reflecting the portion of our tax provision that we expect will be predominantly offset by our U.S. net operating loss carryforwards and other tax credits for the foreseeable future. We reconcile adjusted EPS to EPS, the most comparable financial measure under GAAP. Neither current nor potential investors in our securities should rely on adjusted EPS as a substitute for any GAAP measures and we encourage investors to review the following reconciliation of adjusted EPS to EPS and net income attributable to Ultralife Corporation.

ULTRALIFE CORPORATION AND SUBSIDIARIES
CALCULATION OF ADJUSTED EPS
(In Thousands Except Per Share Amounts)
(Unaudited)

	Three-Month Period Ended
	December 31, 2024							December 31, 2023
	Amount				Per Basic Share		Per Diluted Share	Amount			Per Basic Share		Per Diluted Share
Net Income Attributable to Ultralife Corporation	$	194		$	.01	$	.01	$	2,873	$	.18	$	.17
Deferred Tax Provision (Benefit)		(63	)		-		-		56		-		.01
Adjusted Net Income	$	131		$	.01	$	.01	$	2,929	$	.18	$	.18

Weighted Average Shares Outstanding					16,629		16,762				16,338		16,479

	Year Ended
	December 31, 2024						December 31, 2023
	Amount			Per Basic Share		Per Diluted Share	Amount			Per Basic Share		Per Diluted Share
Net Income Attributable to Ultralife Corporation	$	6,312	$	.38	$	.38	$	7,197	$	.44	$	.44
Deferred Tax Provision		1,232		.08		.07		1,301		.08		.08
Adjusted Net Income	$	7,544	$	.46	$	.45	$	8,498	$	.52	$	.52

Weighted Average Shares Outstanding				16,555		16,767				16,214		16,226

Company Contact:		Investor Relations Contact:
Ultralife Corporation		Alliance Advisors IR
Philip A. Fain		Jody Burfening/Alex Villalta
(315) 210-6110		(212) 838-3777
pfain@ulbi.com		avillalta@allianceadvisors.com

Ultralife Corporation Reports Fourth Quarter Results