THE WOODLANDS, Texas, Sept. 4, 2019 /PRNewswire/ -- Mitcham Industries, Inc. (NASDAQ: MIND) ("Mitcham" or "the Company") today announced financial results for its fiscal 2020 second quarter ended July 31, 2019.
Total revenues for the second quarter of fiscal 2020 increased 7% to $8.9 million, compared to $8.4 million in the second quarter of fiscal 2019. The improvement was driven primarily by further growth within the Marine Technology Products segment. Revenues from the Marine Technology Products segment rose 12% to $6.7 million in the second quarter, compared to $6.0 million in the same period last year. Revenue from the Equipment Leasing segment was $2.2 million in the second quarter, down 12% from $2.5 million in the same period last year.
The Company reported a net loss of $3.1 million in the second quarter of fiscal 2020 compared to a net loss of $4.6 million in the same period during fiscal 2019. The net loss attributable to common shareholders of $3.6 million, or $(0.30) per share, in the second quarter of fiscal 2020 improved from a loss of $5.0 million, or $(0.41) per share, in the second quarter of fiscal 2019.
Adjusted EBITDA for the second quarter of fiscal 2020 was a loss of $1.0 million, relatively flat with the loss of approximately $1.1 million in the same period last year. Adjusted EBITDA, which is a non-GAAP measure, is defined and reconciled to reported net loss and cash provided by operating activities in the accompanying financial tables.
Rob Capps, Mitcham's Co-Chief Executive Officer, stated, "Our fiscal 2020 second quarter results came in as expected. We continue to see encouraging order activity for our Marine Technology products segment and saw a 12% year-over-year increase in top-line growth this quarter. Our revenues were affected mostly by the delay of seismic source controller orders that appear to have been pushed out until later this year. However, our backlog of firm orders continues to grow and reached approximately $14 million as of July 31, 2019, an increase of 27% from $11.0 million at April 30, 2019 and up from $8.7 million at January 31, 2019. Orders for our new MA-X sonar technology contributed to our backlog growth. We ramped up our research and development expenses by 60% in the quarter as we continue to expand our technology offerings and respond to specific customer requests.
"As we continue to implement our strategic shift away from energy-dependent markets, we are making progress expanding our position in marine markets with our new technology and products. For example, we are seeing new opportunities for commercial and military programs, fueled in part, we believe, by some of our recent technology developments. We are also working on a number of fronts to form partnerships with others as another means of expanding our product and technology offerings," added Capps. "The flow of firm orders in the marine seismic market, specifically for source controller solutions, has been slower than we anticipated. Our customers have shown us a number of instances in which enhancements in technology are desired, or even necessary. However, most customers have been reluctant to pull the trigger on committing the capital necessary for the enhancements. We remain confident that these opportunities will come to fruition, but the timing continues to be uncertain.
"In the Equipment Leasing segment, we saw a 12% decline in top-line growth, as expected. While we believe that this business will not return to historical levels this year, we are seeing opportunities within this part of our business, particularly in Europe.
"Regarding our financial position, our capital structure remains strong, with no funded debt on our balance sheet and ample liquidity, including cash and cash equivalents of $7.6 million as of July 31, 2019. Overall, we are very pleased with the steady pace of order activity so far this year although the uncertainty surrounding the global economy, which has impacted capital availability and product demand, has caused some of our customers to delay the timing of certain order deliveries. For this reason, we now expect to produce positive operating income by the fourth quarter of this fiscal year rather than completing our full fiscal year in positive territory."
FISCAL 2020 SECOND QUARTER RESULTS
Total revenues for the second quarter of fiscal 2020 increased compared to last year's second quarter to $8.9 million, driven by higher marine technology products sales. Marine technology products segment sales increased to $6.7 million in the second quarter of fiscal 2020 compared to $6.0 million in last year's second quarter. Seamap sales increased 29% from the prior year period to $4.9 million, and Klein sales increased 16% compared to the same period last year to $1.8 million. Included in last year's second quarter sales was a $797,000 contribution from SAP, which was sold in the first quarter of fiscal 2020 and therefore, not included in the recent quarterly results.
Total Equipment leasing revenues were $2.2 million in the second quarter of fiscal 2020 compared to $2.5 million in the same period last year. Equipment leasing revenues, excluding equipment sales, were $1.4 million, a decrease of 16% compared to the same period last year. Lease pool equipment sales were $455,000 in the second quarter of fiscal 2020 compared to $718,000 in the second quarter a year ago. Other equipment sales were $347,000 in the second quarter of fiscal 2019 compared to $125,000 in the second quarter a year ago.
Lease pool depreciation expense in the second quarter of fiscal 2020 decreased 53% to $1.1 million from $2.4 million in the same period a year ago due to lease pool sales and minimal purchase of lease pool equipment in recent periods.
Selling, general and administrative expenses were $4.8 million in the second quarter of fiscal 2020 compared to $5.5 million in the second quarter of fiscal 2019 and $5.2 million in the first quarter of fiscal 2019. As a percentage of revenues, SG&A expenses in the second quarter of 2020 decreased to 54% from 66% in last year's second quarter.
Management has scheduled a conference call for Thursday, September 5 at 9:00 a.m. Eastern Time (8:00 a.m. Central Time) to discuss fiscal 2020 second quarter results. To access the call, please dial (412) 902-0030 and ask for the Mitcham Industries call at least 10 minutes prior to the start time. Investors may also listen to the conference live on the Mitcham Industries corporate website, http://www.mitchamindustries.com , by logging onto the site and clicking "Investor Relations." A telephonic replay of the conference call will be available through September 12, 2019 and may be accessed by calling (201) 612-7415 and using passcode 13693821#. A webcast archive will also be available at http://www.mitchamindustries.com shortly after the call and will be accessible for approximately 90 days. For more information, please contact Dennard Lascar Investor Relations (713) 529-6600 or email email@example.com .
About Mitcham Industries
Mitcham Industries, Inc. provides technology to the oceanographic, hydrographic, defense, seismic and security industries. Headquartered in The Woodlands, Texas, Mitcham has a global presence with operating locations in the United States, Canada, Singapore, Malaysia, Hungary, Colombia and the United Kingdom. Mitcham's worldwide Marine Technology Products segment, which includes its Seamap and Klein Marine Systems units, designs, manufactures and sells specialized, high performance, marine sonar and seismic equipment. Through its Equipment Leasing segment, Mitcham believes it is the largest independent provider of exploration equipment to the seismic industry.
Certain statements and information in this press release concerning results for the quarter ended July 31, 2019 may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. 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. 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.
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, whether as a result of new information, future events or otherwise.
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SOURCE Mitcham Industries, Inc.