THE WOODLANDS, Texas, June 13, 2023 /PRNewswire/ -- MIND Technology, Inc. (NASDAQ:MIND) ("MIND" or the "Company") today announced financial results for its fiscal 2024 first quarter ended April 30, 2023.

Revenues from Marine Technology Products sales for the first quarter of fiscal 2024 were $12.6 million compared to $12.4 million in the fourth quarter of fiscal 2023 and $9.1 million in the first quarter of fiscal 2023.

The Company reported operating income of $289,000 for the first quarter of fiscal 2024 compared to losses of $221,000 in the fourth quarter of fiscal 2023 and approximately $2.5 million in the first quarter of fiscal 2023. The net loss (after income taxes) for the first quarter of fiscal 2024 was $240,000 compared to net income of $666,000 million in the fourth quarter of fiscal 2023 and a net loss of approximately $2.4 million in the first quarter of fiscal 2023. First quarter of fiscal 2024 net loss attributable to common shareholders was $0.09 per share compared to $0.02 in the fourth quarter of fiscal 2023 and $0.24 in the first quarter of fiscal 2023.

Adjusted EBITDA from continuing operations for the first quarter of fiscal 2024 was approximately $913,000 compared to $1.4 million in the fourth quarter of fiscal 2023 and a loss of $1.9 million in the first quarter of fiscal 2023. Adjusted EBITDA from continuing operations, which is a non-GAAP measure, is defined and reconciled to reported net income (loss) from continuing operations and cash used in operating activities in the accompanying financial tables. These are the most directly comparable financial measures calculated and presented in accordance with United States generally accepted accounting principles.

The backlog of Marine Technology Products as of April 30, 2023, was approximately $22.6 million compared to $20.7 million at January 31, 2023 and $13.4 million at April 30, 2022.

Rob Capps, MIND's President and Chief Executive Officer, stated, "We are pleased to report positive results for the second quarter in a row, having produced positive operating income and Adjusted EBITDA with significantly improved revenues year-over-year. Our first quarter revenues from continuing operations increased 39% year-over-year, with our Seamap segment making up a meaningful portion of that growth. I think it's noteworthy that we saw sequential improvement at the operating level. The sequential improvement in operating income was partially driven by an increase in gross margin to approximately 43% in the current quarter versus 36% in the prior quarter. Our backlog of $22.6 million was up over 68% from the $13.4 million we reported during the first quarter of fiscal 2023 and improved on a sequential basis, demonstrating the strong demand growth we continue to see in our key markets. Inquiry and bidding activity remain robust as we work to further expand our backlog. Our backlog reflects the continued positive momentum that we are experiencing in various markets, and we believe that our differentiated marine technology products are uniquely positioned to benefit from favorable market trends.

"As we progress throughout fiscal 2024, we continue to believe the positive trend for order flow will continue. Additionally, we believe the underlying market fundamentals are positive and those have contributed to the increase in order activity. The current geopolitical situation emphasizes the need for maritime security and other defense applications. The constructive pricing environment in the energy market is positive for our customers in that space. The trend towards renewable energy, such as wind farms, is a positive development for our marine survey customers. We plan to continue to execute our long-term strategic initiatives and position the Company to become a leading provider of innovative marine technology and products," concluded Capps.

CONFERENCE CALL

Management has scheduled a conference call for Wednesday, June 14, 2023 at 9:00 a.m. Eastern Time (8:00 a.m. Central Time) to discuss the Company's fiscal 2024 first quarter results. To access the call, please dial (412) 902-0030 and ask for the MIND Technology call at least 10 minutes prior to the start time. Investors may also listen to the conference live on the MIND Technology website, http://mind-technology.com, by logging onto the site and clicking "Investor Relations." A telephonic replay of the conference call will be available through June 21, 2023 and may be accessed by calling (201) 612-7415 and using passcode 13739231#. A webcast archive will also be available at http://mind-technology.com shortly after the call and will be accessible for approximately 90 days. For more information, please contact Dennard Lascar Investor Relations by email at MIND@dennardlascar.com.

ABOUT MIND TECHNOLOGY

MIND Technology, Inc. provides technology to the oceanographic, hydrographic, defense, seismic and security industries. Headquartered in The Woodlands, Texas, MIND has a global presence with key operating locations in the United States, Singapore, Malaysia, and the United Kingdom. Its Seamap and Klein units, design, manufacture and sell specialized, high performance, marine sonar and seismic equipment.

Forward-looking Statements

Certain statements and information in this press release concerning results for the quarter ended April 30, 2023 may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical fact, including statements regarding our future results of operations and financial position, our business strategy and plans, and our objectives for future operations, are forward-looking statements. The words "believe," "expect," "anticipate," "plan," "intend," "should," "would," "could" or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. All comments concerning our expectations for future revenues and operating results are based on our forecasts of our existing operations and do not include the potential impact of any future acquisitions or dispositions. Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, without limitation, reductions in our customers' capital budgets, our own capital budget, limitations on the availability of capital or higher costs of capital, volatility in commodity prices for oil and natural gas and the extent of disruptions caused by the COVID-19 outbreak.

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, unless required by law, whether as a result of new information, future events or otherwise. All forward-looking statements included in this press release are expressly qualified in their entirety by the cautionary statements contained or referred to herein.

Non-GAAP Financial Measures

Certain statements and information in this press release contain non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles, or GAAP. Company management believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. Company management also believes that these non-GAAP financial measures enhance the ability of investors to analyze the Company's business trends and to understand the Company's performance. In addition, the Company may utilize non-GAAP financial measures as guides in its forecasting, budgeting, and long-term planning processes and to measure operating performance for some management compensation purposes. Any analysis of non-GAAP financial measures should be used only in conjunction with results presented in accordance with GAAP. Reconciliation of Backlog, which is a non-GAAP financial measure, is not included in this press release due to the inherent difficulty and impracticality of quantifying certain amounts that would be required to calculate the most directly comparable GAAP financial measures.

-Tables to Follow-

MIND TECHNOLOGY, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (unaudited)

	April 30, 2023		January 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	815	$	778
Accounts receivable, net of allowance for doubtful accounts of $504 at each of April 30, 2023 and January 31, 2023		7,390		3,993
Inventories, net		14,339		15,318
Prepaid expenses and other current assets		1,088		2,144
Total current assets		23,632		22,233
Property and equipment, net		3,787		3,945
Operating lease right-of-use assets		1,762		1,749
Intangible assets, net		4,664		4,931
Total assets	$	33,845	$	32,858
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	1,206	$	4,101
Deferred revenue		486		164
Accrued expenses and other current liabilities		2,638		2,247
Income taxes payable		1,723		1,516
Operating lease liabilities - current		753		903
Note payable, net		3,139		—
Total current liabilities		9,945		8,931
Operating lease liabilities - non-current		1,009		846
Deferred tax liability		29		29
Total liabilities		10,983		9,806
Stockholders' equity:
Preferred stock, $1.00 par value; 2,000 shares authorized; 1,683 shares issued and outstanding at each of April 30, 2023 and January 31, 2023		37,779		37,779
Common stock, $0.01 par value; 40,000 shares authorized; 15,721 shares issued at each of April 30, 2023 and January 31, 2023		157		157
Additional paid-in capital		129,630		129,580
Treasury stock, at cost (1,933 shares at each of April 30, 2023 and January 31, 2023)		(16,863)		(16,863)
Accumulated deficit		(127,875)		(127,635)
Accumulated other comprehensive gain		34		34
Total stockholders' equity		22,862		23,052
Total liabilities and stockholders' equity	$	33,845	$	32,858

MIND TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (unaudited)

	For the Three Months Ended April 30,
	2023		2022
Revenues:
Sale of marine technology products	$	12,586	$	9,087
Total revenues		12,586		9,087
Cost of sales:
Sale of marine technology products		7,169		5,798
Total cost of sales		7,169		5,798
Gross profit		5,417		3,289
Operating expenses:
Selling, general and administrative		3,874		4,272
Research and development		773		1,014
Depreciation and amortization		481		479
Total operating expenses		5,128		5,765
Operating income (loss)		289		(2,476)
Other expense:
Other, net		(111)		(118)
Total other expense		(111)		(118)
Income (loss) from continuing operations before income taxes		178		(2,594)
Provision for income taxes		(418)		(211)
Net loss from continuing operations		(240)		(2,805)
Income from discontinued operations, net of income taxes		—		386
Net loss	$	(240)	$	(2,419)
Preferred stock dividends - declared		—		(947)
Preferred stock dividends - undeclared		(947)		—
Net loss attributable to common stockholders	$	(1,187)	$	(3,366)
Net loss per common share – Basic and Diluted
Continuing operations	$	(0.09)	$	(0.27
Discontinued operations	$	—	$	0.03
Net loss	$	(0.09)	$	(0.24
Shares used in computing net loss per common share:
Basic		13,789		13,775
Diluted		13,789		13,775

MIND TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited)

	For the Three Months Ended April 30,
	2023		2022
Cash flows from operating activities:
Net loss	$	(240)	$	(2,419)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		481		479
Stock-based compensation		50		236
Provision for inventory obsolescence		—		23
Gross profit from sale of other equipment		(138)		(167)
Changes in:
Accounts receivable		(3,462)		(871)
Unbilled revenue		11		(26)
Inventories		979		(260)
Prepaid expenses and other current and long-term assets		1,308		286
Income taxes receivable and payable		206		(66)
Accounts payable, accrued expenses and other current liabilities		(2,788)		(622)
Deferred revenue and customer deposits		606		(115)
Net cash used in operating activities		(2,987)		(3,522)
Cash flows from investing activities:
Purchases of property and equipment		(57)		(107)
Sale of other equipment		138		283
Net cash provided by investing activities		81		176
Cash flows from financing activities:
Purchase of treasury stock		—		(1)
Net proceeds from short-term loan		2,945		—
Preferred stock dividends		—		(947)
Net cash (used in) provided by financing activities		2,945		(948)
Effect of changes in foreign exchange rates on cash and cash equivalents		(2)		(3)
Net increase (decrease) in cash and cash equivalents		37		(4,297)
Cash and cash equivalents, beginning of period		778		5,114
Cash and cash equivalents, end of period	$	815	$	817

MIND TECHNOLOGY, INC. Reconciliation of Net Loss From Continuing Operations and Net Cash Used in Operating Activities to EBITDA (loss) and Adjusted EBITDA (Loss) From Continuing Operations (in thousands) (unaudited)

	For the Three Months Ended April 30,
	2023		2022
	(in thousands)
Reconciliation of Net loss from Continuing Operations to EBITDA (Loss) and Adjusted EBITDA (loss)
Net loss from continuing operations	$	(240)	$	(2,805)
Interest expense, net		204		—
Depreciation and amortization		481		479
Provision for income taxes		418		211
EBITDA (loss) from continuing operations (1)		863		(2,115)
Stock-based compensation		50		236
Adjusted EBITDA (loss) from continuing operations (1)	$	913	$	(1,879)
Reconciliation of Net Cash Used in Operating Activities to EBITDA (loss) from continuing operations
Net cash used in operating activities	$	(2,987)	$	(3,522)
Stock-based compensation		(50)		(236)
Provision for inventory obsolescence		—		(23)
Changes in accounts receivable (current and long-term)		3,451		1,037
Interest paid		204		4
Taxes paid, net of refunds		189		277
Gross profit (loss) from sale of other equipment		138		(113)
Changes in inventory		(979)		260
Changes in accounts payable, accrued expenses and other current liabilities and deferred revenue		2,182		397
Changes in prepaid expenses and other current and long-term assets		(1,308)		(175)
Other		23		(21)
EBITDA (loss) from continuing operations (1)	$	863	$	(2,115)


	(1)	EBITDA and Adjusted EBITDA are non-GAAP financial measures. EBITDA is defined as net income before (a) interest income and interest expense, (b) provision for (or benefit from) income taxes and (c) depreciation and amortization. Adjusted EBITDA excludes non-cash foreign exchange gains and losses, stock-based compensation, impairment of intangible assets, other non-cash tax related items and non-cash costs of lease pool equipment sales. We consider EBITDA and Adjusted EBITDA to be important indicators for the performance of our business, but not measures of performance or liquidity calculated in accordance with GAAP. We have included these non-GAAP financial measures because management utilizes this information for assessing our performance and liquidity, and as indicators of our ability to make capital expenditures, service debt and finance working capital requirements and we believe that EBITDA and Adjusted EBITDA are measurements that are commonly used by analysts and some investors in evaluating the performance and liquidity of companies such as us. In particular, we believe that it is useful to our analysts and investors to understand this relationship because it excludes transactions not related to our core cash operating activities. We believe that excluding these transactions allows investors to meaningfully trend and analyze the performance of our core cash operations. EBITDA and Adjusted EBITDA are not measures of financial performance or liquidity under GAAP and should not be considered in isolation or as alternatives to cash flow from operating activities or to net income as indicators of operating performance or any other measures of performance derived in accordance with GAAP. In evaluating our performance as measured by EBITDA, management recognizes and considers the limitations of this measurement. EBITDA and Adjusted EBITDA do not reflect our obligations for the payment of income taxes, interest expense or other obligations such as capital expenditures. Accordingly, EBITDA and Adjusted EBITDA are only two of the measurements that management utilizes. Other companies in our industry may calculate EBITDA or Adjusted EBITDA differently than we do and EBITDA and Adjusted EBITDA may not be comparable with similarly titled measures reported by other companies.

Contacts:	Rob Capps, President & CEO
	MIND Technology, Inc.
	281-353-4475

	Ken Dennard / Zach Vaughan
	Dennard Lascar Investor Relations
	713-529-6600
	MIND@dennardlascar.com

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SOURCE MIND Technology, Inc.

MIND TECHNOLOGY, INC. REPORTS FISCAL 2024 FIRST QUARTER RESULTS