Blonder Tongue Laboratories, Inc.

For Q3 2022, net sales were $5.262 million, up $1.090 million, or 26.1%, from $4.172 million a year ago. Net loss was $703,000, or $0.05 per diluted share, versus a net loss of $201,000, or $0.02 per diluted share in Q3 2021. For the first nine months of 2022, net sales were $12.837 million, up $1.076 million, or 9.2%, from $11.761 million, and net loss was $3.010 million, or $0.23 per diluted share, versus net income of $1.011 million, or $0.08 per diluted share, last year. Management said sales backlog was approximately $7.162 million at September 30, 2022. Forward commentary: the company expects NXG and encoder/transcoder sales to remain at or increase from current levels during the remainder of 2022, DOCSIS sales to remain at current levels, CPE sales to keep declining, and overall 2022 sales to be higher than 2021, though not back to pre-pandemic levels.

Ted Grauch said the company is optimistic because demand for its higher-technology, higher-margin products remains strong, bookings were healthy in Q3 and October, and backlog is growing. He emphasized that the main constraint has been semiconductor allocations and raw-material availability, not demand, and said the supply chain has started to stabilize with better lead times and more allocations expected before year-end and into early 2023. He also noted that the company has been working on operational expense reductions and product development, and that strategic alternatives remain under consideration.

Eric Skolnik walked through the quarter’s financials, citing Q3 net sales of $5.262 million and a net loss of $703,000 versus a $201,000 loss last year. He said loss from operations improved to $475,000 from $703,000 a year ago and improved from a $962,000 operating loss in Q2 2022; net cash used in operating activities was $220,000 versus $753,000 last year and $1.450 million in Q2 2022. He also said the company had about $4.318 million outstanding on the MidCap Facility and $520,000 of additional borrowing availability at September 30, and that the October 28 amendment extended the facility to June 30, 2023 and raised the 2022 over-advance facility to $1.5 million.

Analysts and shareholders pressed management on 2023 guidance, profitability, financing, and whether the company should pursue a broader strategic transaction. Ted said the company does not normally give future-quarter guidance, but expects improving semiconductor allocations, continued demand for newer products, and optimism for next year if supply constraints ease. On financing, Eric said the company’s size and market conditions limit debt and equity options, and Ted reiterated that strategic alternatives such as mergers, acquisitions, or other investments are open and being actively discussed with multiple companies.