The discussion and analysis set forth below should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and the related notes included under Item 1 of this Quarterly Report on Form 10-Q, together with Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year endedSeptember 30, 2021 . Forward Looking Statements This report contains certain statements of a forward-looking nature relating to future events or future performance. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates" and similar expressions or variations of such words are intended to identify forward-looking statements but are not the only means of identifying forward-looking statements. Prospective investors are cautioned that such statements are only predictions and actual events or results may differ materially. In evaluating such statements, prospective investors should specifically consider various factors identified in this report and any matters set forth under Part I, Item 1A (Risk Factors) of our Annual Report on Form 10-K, which could cause actual results to differ materially from those indicated by such forward-looking statements.
For the purposes of this quarterly report, the terms “we”, “us”, “our”, “Genasys” and the “Company” mean
Overview
Genasys is a global provider of critical communications hardware and software solutions designed to alert and inform to help keep people safe. Our unified platform receives information from a wide variety of sensors and Internet-of-Things (IoT) inputs to collect real-time information on developing and active emergency situations.Genasys uses this information to create and disseminate alerts, warnings, notifications, and instructions through multiple channels before, during, and after public safety and enterprise threats, critical events, and other crisis situations.
Our multi-channel approach includes:
•
GEM Software is an interactive, cloud-based SaaS solution that sends at-risk individuals or groups critical information when an emergency occurs.GEM Software acts as both a communications input and output, receiving information from state-of-the-art sensors and emergency services, and quickly relaying notifications, alerts, and instructions to at-risk populations and first responders.GEM Software operators can create and send critical, verified, and secure notifications and messages using emails, voice calls, text messages, panic buttons, desktop alerts, television, social media, and more. Integrated Mass Notification System (IMNS) isGenasys' comprehensive emergency response solution, unitingGEM Software andGenasys speaker system hardware in a multichannel solution. IMNS gives operators the ability to communicate critical notifications across platforms using a command and control interface that can be accessed from an emergency operations center, authorized computer, or smart phone. Notifications can be sent using text messages, emails, IPAWS, desktop alerts, television, voice calls, social media, andGenasys speaker systems. By providing several digital, software-based notifications and audible voice alerts through speakers, IMNS creates layered redundancy to enable the maximum number of people receive critical communications. Zonehaven is a multipronged SaaS application that serves both first responders and the communities they protect. Zonehaven can function as a standalone application or as aGEM Software integration. When an incident occurs, it is immediately tracked by the Zonehaven platform, which maps the incident, simulates the speed and direction of the incident, and determines which zones (geographic areas) are at risk and need to be evacuated. As an incident develops, Zonehaven's real-time updates provide emergency organizations and at-risk populations up-to-date information to stay safe. • National Emergency Warning System (NEWS) provides multichannel public safety notifications and instructions to designated areas, groups, or agencies when a crisis occurs. The NEWS platform is cloud-based, geo-redundant, and end-to-end encrypted. NEWS is a SaaS product that requires mobile telecom services for installation, integration and to deliver Location-based SMS and Cell Broadcast alerts and notifications that can be sent to anyone, anywhere, with no recipient opt-in, registration, or download required. NEWS can locate recipients and deliver messages in near real time, compared to other SMS alert providers that can take up to 15 minutes. Despite NEWS' reach and scope, all data is anonymized, helping individuals stay safe and informed without sacrificing privacy. 25
-------------------------------------------------------------------------------- • LRAD is the world's leading Acoustic Hailing Device (AHD) that projects siren tones and audible voice messages with exceptional vocal clarity in a 30° beam from close range to 5,500 meters. LRADs are used throughout the world in multiple applications and circumstances to safely hail and warn, inform and direct, prevent misunderstandings, determine intent, establish large safety zones, resolve uncertain situations, and save lives. Our critical communications systems are being used in more than 100 countries throughout the world in a range of diverse applications, including public safety, emergency warning, mass notification, defense, law enforcement, critical event management and many more. We continue to develop new communication innovations and believe we have established significant competitive advantages in our principal markets.
Development of business during the fiscal quarter ended
•
• Announced Zonehaven Evacuation Software Services Contracts with 13 California
counties announced
• Received a follow-up
operations in aLatin America country received
• Announcement that GEM Enterprise provides emergency and operations communications
for TheGreen Bay Packers andLambeau Field
• Has received
orders received
• Received a follow-up
Navy IDIQ contract received
• Partnership with Danimex Communication to develop sales of hardware and software in
Africa Revenues for the Company's first quarter of fiscal 2022, were$10.7 million , an increase from$8.0 million in the first quarter of fiscal 2021. Both LRAD ($7.5 million ) and IMNS ($2.6 million ) revenues increased$0.4 million and$2.3 million , respectively, offset by a$0.1 million decrease in software revenue ($0.6 million ) compared to the prior year quarter. The timing of budget cycles, government financial issues and military conflict in certain areas of the world, often delay contract awards, resulting in uneven quarterly revenues. Gross profit increased compared to the same quarter in the prior year as a result of higher sales offset by increased software engineering expenses. Operating expenses in the quarter endedDecember 31, 2021 , increased 47.9% to$6.5 million compared to$4.4 million in the same period in the prior year. We reported a net loss of$1.3 million for the first quarter of fiscal 2022, or a loss of$0.04 per share, compared to a net loss of$0.6 million , or a loss of$0.02 per share, for the same quarter in the prior year.
Global Business Outlook
Our products, systems and solutions continue to gain worldwide awareness and recognition through media exposure, product demonstrations, and word of mouth as a result of positive responses and increased acceptance. We believe we have a solid global brand, technology, and product foundation, which we continue to expand to serve new markets and customers for greater business growth. We believe we have strong market opportunities for our product offerings throughout the world in the defense, public safety, emergency warning, mass notification, critical event management and law enforcement sectors as a result of increasing threats to government, commerce,homeland security , and critical infrastructure. Our products, systems and solutions also have many applications within the fire rescue, maritime, asset protection, and wildlife preservation business segments.Genasys has developed a global market and an increased demand for LRAD AHDs and advanced outdoor mass notification speakers. We have a reputation for producing quality products that feature industry leading broadcast area coverage, vocal intelligibility, and product reliability. We intend to continue building on our AHD leadership position by offering enhanced voice broadcast systems and accessories for an expanding range of applications. In executing our strategy, we use direct sales to governments, militaries, large end-users, system integrators, and prime vendors. We have built a worldwide distribution channel consisting of partners and resellers that have significant expertise and experience selling integrated communication solutions into our various target markets. As our primary AHD sales opportunities are with domestic and international governments, military branches, and law enforcement agencies, we are subject to each customer's unique budget cycle, which leads to long selling cycles and uneven revenue flow, complicating our product planning. 26 -------------------------------------------------------------------------------- The proliferation of natural and man-made disasters, emergency events and civil unrest require technologically advanced, multichannel solutions to deliver clear and timely critical communications to help keep people safe during crisis situations. Businesses are also incorporating critical communication and emergency management systems that locate and help safeguard employees when crises occur. By providing the only SaaS platform that unifies sensors and IoT inputs with multichannel, multiagency alerting and notifications,Genasys seeks to deliver reliable, fast, and intuitive solutions for creating and disseminating geolocation-targeted warnings, information, and instructions before, during, and after public safety and business threats, critical events, and other life safety situations.
As the mass notification market is more mature with many established manufacturers and vendors, we believe our advanced technology and unified platform provide opportunities for success in the large and growing markets for public safety, alerts emergency and critical communications.
In fiscal 2022, we intend to continue to pursue domestic and international business opportunities with the support of business development consultants, key representatives, and resellers. We plan to grow our revenue through increased direct sales to governments and agencies that desire to integrate our communication technologies into theirhomeland security and public safety systems. This includes building on fiscal 2021 domestic defense sales by pursuing furtherU.S. military opportunities. We also plan to pursue emergency warning, enterprise and critical event management, government, law enforcement, fire rescue, homeland and international security, private and commercial security, border security, maritime security, and wildlife preservation business opportunities. Our research and development strategy involves incorporating further innovations and capabilities into our GEM, IMNS, Zonehaven, NEWS and LRAD products, systems and solutions to meet the needs of our target markets. Our GEM, IMNS, Zonehaven and NEWS software solutions represent more complex, integrated offerings. We are pursuing certain certifications, which are often required when bidding on government and mass notification opportunities. We intend to invest engineering resources to enhance our GEM, IMNS, Zonehaven and NEWS software solutions to compete for larger emergency warning and critical communications business opportunities. We are also configuring alternative solutions to achieve lower price points to meet the needs of certain customers or applications. We also engage in ongoing value engineering to reduce the cost and simplify the manufacturing of our products. InMarch 2020 , theWorld Health Organization ("WHO") classified the COVID-19 outbreak as a pandemic. While the impact of the COVID-19 pandemic did not have a material adverse effect on our financial position or results of operations for the nine months endedJune 30, 2021 , we monitor the developments and assess areas where there is potential for our business to be impacted. A significant portion of our sales force is working remotely, which could, among other things, negatively impact our ability to engage in sales-related initiatives, or efficiently conduct day-to-day operations. Other businesses and governments with which we engage are likely operating under similar restrictions and experiencing disruptions, which may create obstacles in the coordination of business activities, including the negotiation and fulfillment of orders. Disruptions in the supply chain could negatively impact our ability to source materials or manufacture and distribute products. While we do not currently anticipate a material reduction in demand for our commercialized products, we could experience a decrease in new orders, which could negatively impact our revenues and reduce our liquidity and cash flows. Growth in revenue could also be impeded by these factors. The financial markets have been subject to significant volatility that could impact our ability to enter into, modify, and negotiate favorable terms and conditions relative to equity and debt financing activities. We have$10.1 million in cash and cash equivalents as ofDecember 31, 2021 , which we believe provides sufficient capital to fund our operations for at least the next twelve months and withstand the potential near-term consequences of the pandemic, although liquidity constraints and access to capital markets could adversely impact our liquidity and warrant changes to our investment strategy. While we have not yet experienced a material impact, the full magnitude of the pandemic cannot be measured at this time, and therefore, any of the aforementioned circumstances, as well as other factors, may cause our results of operations to vary substantially from year to year and quarter to quarter. Based on various standards published to date, we believe the work our associates perform is critical, essential and life sustaining. We are taking a variety of measures to promote the safety and security of our employees while ensuring the availability and functionality of our critical infrastructure. We are followingCenter for Disease Control guidelines to reduce the transmission of COVID-19, such as the imposition of travel restrictions, cancellation of events, the promotion of social distancing, the adoption of work-from-home arrangements, and limiting access to our facilities. Some or all of these policies and initiatives could impact our operations. In addition, the following events related to the COVID-19 pandemic could result in lost or delayed revenue to the Company: limitations on the ability of our suppliers to meet delivery requirements and commitments; limitations on the ability of our employees to perform their work due to illness caused by the pandemic, or local, state or federal orders requiring employees to remain at home; limitations on the ability of carriers to deliver our products to customers; unforeseen deviations from customers or foreign governments restricting the ability to do business; and, limitations on the ability of our customers to pay us on a timely basis, if at all. 27 -------------------------------------------------------------------------------- A large number of components and sub-assemblies manufactured by outside suppliers within our supply chain are produced within 50 miles of our facility. We do not source component parts directly from suppliers inChina , however, it is likely that some of our suppliers source parts inChina . The COVID-19 pandemic has adversely impacted worldwide supply chains and the ability to obtain sufficient amounts of component parts, including semiconductor chips and integrated circuits, resins, coating and other equipment and components. Negative impacts on our supply chain could have a material adverse effect on our business. We are in contact with our suppliers and evaluating what impact may result from COVID-19. Critical Accounting Policies We have identified a number of accounting policies as critical to our business operations and the understanding of our results of operations. These are described in our consolidated financial statements located in Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year endedSeptember 30, 2021 . The impact and any associated risks related to these policies on our business operations is discussed below and throughout Management's Discussion and Analysis of Financial Condition and Results of Operations when such policies affect our reported and expected financial results. The methods, estimates and judgments we use in applying our accounting policies, in conformity withU.S. generally accepted accounting principles, have a significant impact on the results we report in our financial statements. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. The estimates affect the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. 28 -------------------------------------------------------------------------------- Comparison of Results of Operations for the Three Months EndedDecember 31, 2021 and 2020 (in thousands) Three Months Ended December 31, 2021 December 31, 2020 % of % of Total Total Fav(Unfav) Amount Revenue Amount Revenue Amount % Revenues: Product sales$ 9,570 89.6 %$ 6,950 86.6 %$ 2,620 37.7 % Contract and other 1,107 10.4 % 1,078 13.4 % 29 2.7 % Total revenues 10,677 100.0 % 8,028 100.0 % 2,649 33.0 % Cost of revenues 5,783 54.2 % 4,324 53.9 % (1,459 ) (33.7 %) Gross Profit 4,894 45.8 % 3,704 46.1 % 1,190 32.1 % Operating expenses Selling, general and administrative 5,134 48.1 % 3,331 41.5 % (1,803 ) (54.1 %) Research and development 1,369 12.8 % 1,066 13.3 % (303 ) (28.4 %) Total operating expenses 6,503 60.9 % 4,397 54.8 % (2,106 ) (47.9 %) Loss from operations (1,609 ) (15.1% %) (693 ) (8.6% ) (916 ) 132.2 % Other income, net 13 0.1 % 69 0.9 % (56 ) (81.2 %) Loss before income taxes (1,596 ) (14.9 %) (624 ) (7.8 %) (972 ) 155.8 % Income tax benefit (291 ) (2.7 %) (5 ) (0.1 %) 286 (5,720.0 %) Net loss$ (1,305 ) (12.2 %)$ (619 ) (7.7 %)$ (686 ) 110.8 % Net revenue Hardware$ 10,127 94.8 %$ 7,387 92.0 % 2,740 37.1 % Software 550 5.2 % 641 8.0 % (91 ) (14.2 %) Total net revenue$ 10,677 100.0 %$ 8,028 100.0 %$ 2,649 33.0 % The tables above set forth for the periods indicated certain items of our condensed consolidated statements of operations expressed in dollars and as a percentage of net revenues. The financial information and the discussion below should be read in conjunction with the condensed consolidated financial statements and notes contained in this report. Revenues Revenues increased$2,649 or 33%, compared to the same quarter in the prior year. LRAD revenues ($7,512 ) increased$444 and IMNS ($2,614 ) increased$2,295 , while software revenue ($550 ) decreased$91 , compared to the prior year quarter. Higher revenue in the first quarter of fiscal 2022 was largely due to the larger backlog at the start of the fiscal year compared to the prior year amount. Software revenue was lower primarily due to lower professional services performed in the current quarter, offset by higher recurring software revenue. The receipt of orders is often uneven due to the timing of budget cycles, government financial issues and military conflict. As ofDecember 31, 2021 , we had aggregate deferred revenue of$1,388 for extended warranty obligations and software support agreements.
Gross profit
The increase in gross profit compared to the same period in the prior year was
due to higher hardware revenue in this year's quarter. Gross profit as a
percentage of sales was essentially unchanged compared to the prior year period
primarily due to greater gross profit recognized on higher hardware revenue in
this year's quarter offset by higher costs from increased software related
personnel added via acquisition and new hires in the last year to support the
growing SasS product line.
As our products have varying gross margins, product mix may affect gross
profits. In addition, our margins vary based on the sales channels through which
our products are sold in a given period. We continue to implement product
updates and changes, including raw material and component changes, that may
impact product costs. We have limited warranty cost experience with product
updates and changes and estimated future warranty costs can impact our gross
margins. We do not believe that historical gross profit margins should be relied
upon as an indicator of future gross profit margins.
29
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Selling, general and administrative expenses
Selling, general and administrative expenses increased$1,803 , or 54.1%, over the prior year quarter. The increase was largely due to$982 of higher compensation expense from a 42% increase in sales and marketing personnel over the prior year,$379 increased amortization expense related to an acquisition, and$323 of higher travel, sales and marketing activities in the current year period. We incurred non-cash share-based compensation expenses allocated to selling, general and administrative expenses in the three-months endedDecember 31, 2021 and 2020 of$531 and$171 , respectively.
We may devote additional resources to marketing and selling our products in future periods as we identify ways to optimize potential opportunities. Commission charges will fluctuate depending on the nature of our sales.
Research and development costs
Research and development expenses increased$303 this year as more engineering time was incurred to expand the base software offering compared to the prior year when more time was devoted to professional service contracts.
Included in research and development expenses for the three months ended
Research and development costs vary period to period due to the timing of projects, and the timing and extent of using outside consulting, design and development firms. We seek to continually improve our product offerings, and we expect to continue to expand our product line with new products, customizations and enhancements. Based on current plans, we may expend additional resources on research and development in the current year compared to the prior year. Net Loss Net loss in the first quarter of fiscal year 2022 was$1,305 , an increase of$686 , compared to the net loss in the first quarter of fiscal year 2021. The increase was primarily due to the increased operating expenses resulting from the acquisition of Zonehaven and additional engineering, sales and marketing employees. Other Metrics We monitor a number of financial and operating metrics, including the following key metrics, to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. Our other business metrics may be calculated in a manner different than similar other business metrics used by other companies (in thousands): Adjusted EBITDA Adjusted EBITDA represents our net income before other income, net, income tax expense (benefit), depreciation and amortization expense and stock-based compensation. We do not consider these items to be indicative of our core operating performance. The items that are non-cash include depreciation and amortization expense and stock-based compensation. Adjusted EBITDA is a measure used by management to understand and evaluate our core operating performance and trends and to generate future operating plans, make strategic decisions regarding allocation of capital and invest in initiatives that are focused on cultivating new markets for our solutions. In particular, the exclusion of certain expenses in calculating adjusted EBITDA facilitates comparisons of our operating performance on a period-to-period basis. Adjusted EBITDA is not a measure calculated in accordance with generally accepted accounting principles inthe United States of America ("U.S. GAAP"). We believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. Nevertheless, use of adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported underU.S. GAAP. Some of these limitations are: (1) although depreciation and amortization are non-cash charges, the intangible assets that are amortized and property and equipment that is depreciated, will need to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacement or for new capital expenditure requirements; (2) adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; (3) adjusted EBITDA does not reflect the potentially dilutive impact of equity-based compensation; (4) adjusted EBITDA does not reflect tax payments or receipts that may represent a reduction or increase in cash available to us; and (5) other companies, including companies in our industry, may calculate adjusted EBITDA or similarly titled measures differently, which reduces the usefulness of the metric as a comparative measure. Because of these and other limitations, you should consider adjusted EBITDA alongside our otherU.S. GAAP-based financial performance measures, net income and our otherU.S. GAAP financial results. 30 -------------------------------------------------------------------------------- The following table presents a reconciliation of adjusted EBITDA to net income, the most directly comparableU.S. GAAP measure, for each of the periods indicated (in thousands): Years ended September 30, 2021 2020 Net loss$ (1,305 ) $ (619 ) Other income, net (13 ) (69 ) Income tax expense (benefit) (291 ) (5 ) Depreciation and amortization 639 281 Stock-based compensation 558 182 Adjusted EBITDA $ (412 )$ (230 )
Cash and capital resources
Cash and cash equivalents as ofDecember 31, 2021 was$10,136 , down$3,031 compared with$13,167 atSeptember 30, 2021 . We had short-term marketable securities of$3,938 as ofDecember 31, 2021 , compared with$5,686 atSeptember 30, 2021 . We had long-term marketable securities of$3,381 atDecember 31, 2021 , compared with$1,875 atSeptember 30, 2021 . In addition to cash and cash equivalents, short and long-term marketable securities, other working capital and expected future cash flows from operating activities in subsequent periods, we have a$10 million revolving line of credit available as a source of liquidity. Although there is uncertainty related to the anticipated impact of the recent COVID-19 outbreak on the Company's future results, we believe our efficient business model and strong balance sheet keep us positioned to manage our business through this crisis as it continues to unfold. We continue to manage all aspects of our business including, but not limited to, monitoring the financial health of our customers, suppliers and other third-party relationships and developing new opportunities for growth.
The main factors that could affect our liquidity include:
• ability to meet sales projections; • government spending levels; • introduction of competing technologies; • product mix and effect on margins; • ability to reduce current inventory levels; • product acceptance in new markets; • value of shares repurchased; • value of dividends declared; • impact of COVID-19 on global market conditions; and • impact of COVID-19 on customers' ability to pay.
The main factors that could affect our ability to obtain liquidity from external sources include:
• volatility in the capital markets; and • market price and trading volume of our common stock. Based on our current cash position, and assuming currently planned expenditures and level of operations, we believe we have sufficient capital to fund operations for the twelve-month period subsequent to the issuance of the interim financial information. However, we operate in a rapidly evolving and unpredictable business environment that may change the timing or amount of expected future cash receipts and expenditures. Accordingly, there can be no assurance that we may not be required to raise additional funds through the sale of equity or debt securities or from credit facilities. Additional capital, if needed, may not be available on satisfactory terms, or at all. 31 --------------------------------------------------------------------------------
Cash Flows
Our cash flows from operating, investing and financing activities, as reflected
in the condensed consolidated statements of cash flows, are summarized in the
table below:
Three months ended
December 31, 2021 December 31, 2020
Cash provided by (used in):
Operating activities $ (2,702 ) $ 1,272
Investing activities $ 72 $ (4,264 )
Financing activities $ (395 ) $ 54
Operating Activities
Net loss of $1,305 for the three months ended December 31, 2021 was decreased by
$1,131 of non-cash items that included an increase to deferred income taxes,
share-based compensation, depreciation and amortization, warranty provision and
inventory obsolescence. Cash used by operating activities in the quarter
reflected an increase in inventory of $2,752 and a decrease in accrued
liabilities and other of $1,743 for payment of incentive compensation earned in
fiscal year 2021. This was offset by an $889 decrease in accounts receivable on
lower revenue this quarter compared to the fourth quarter of fiscal year 2021, a
$979 decrease in prepaid expenses and a $99 increase in accounts payable.
Net loss of $619 for the three months ended December 31, 2020 was increased by
$667 of net non-cash items that included depreciation and amortization,
share-based compensation, operating ROU asset amortization, warranty provision,
inventory obsolescence, and both realized and unrealized loss on a foreign
currency forward contract. Cash used by operating activities in the quarter
reflected an increase in inventory of $1,114 due to a fiscal first quarter
customer order that was not shipped until the fiscal second quarter, and a net
decrease of $314 in accrued and other liabilities primarily for payment of
incentive compensation earned in fiscal year 2020, offset by increased customer
deposits. Cash provided by operating activities included a decrease in accounts
receivable of $2,300 due to lower fiscal first quarter revenue compared to
shipments in the fourth quarter of fiscal year 2020, lower prepaid expenses and
other of $120 , and an increase in accounts payable of $232 .
We had accounts receivable of $6,787 as of December 31, 2021 , compared with
$7,682 as of September 30, 2021 . Terms with individual customers vary greatly.
We regularly provide thirty-day terms to our customers if credit is approved.
Our receivables can vary dramatically due to overall sales volume, quarterly
variations in sales, timing of shipments to and receipts from large customers,
payment terms, and the timing of contract payments.
As of December 31, 2021 and September 30, 2021 , our working capital was $15,433
and $18,019 , respectively. The decrease in working capital was primarily due to
the net loss this quarter, change in the short-term/long-term mix of marketable
securities and the use of cash to repurchase shares of Company stock.
Investing Activities
Our net cash provided by investing activities was $72 for the three months ended
December 31, 2021 , compared with cash used in investing activities of $4,264 for
the three months ended December 31, 2020 . In the first quarter of fiscal 2021,
$4,367 was used for the Amika Mobile asset purchase. In the first quarter of
fiscal 2022, we decreased our holdings of short and long-term marketable
securities by $231 , compared with a decrease of $132 in the three months ended
December 31, 2020 . Cash used in investing activities for the purchase of
property and equipment was $159 and $29 for the three months ended December 31,
2021 and 2020, respectively. We anticipate some additional expenditures for
tooling and equipment during the balance of fiscal year 2022.
Financing Activities
In the three months ended December 31, 2021 , proceeds from the exercise of stock
options provided $46 of cash, compared with proceeds from stock options of $54
for the three months ended December 31, 2020 .
In December 2018 , the Board of Directors approved a new share buyback program
beginning January 1, 2019 , under which the Company was authorized to repurchase
up to $5 million of its outstanding common shares. In December 2020 , the board
voted to extend this program's expiration date to December 31, 2022 . During the
quarter ended December 31, 2021 , 116,868 shares were purchased for $441 . No
shares were repurchased during the quarter ended December 31, 2020 . All
repurchased shares have been retired and as of December 31, 2021 , $3.7 million
was available for share repurchase under this program.
32
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Recent accounting pronouncements
New pronouncements issued for future implementation are described in Note 3, Recent Accounting Pronouncements, to our Condensed Consolidated Financial Statements.
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