Firan Technology Group Corp (FTGFF) Q4 2024 Earnings Call Highlights: Record Revenues and Strategic Growth

Firan Technology Group Corporation (FTG) recently announced its full year and fourth quarter 2024 financial results, showcasing record revenues and strategic growth initiatives. The company's strong performance reflects its strategic focus on growth and operational excellence, as well as its successful integration of 2023 acquisitions and expansion into new markets.



Record Revenues and Adjusted EBITDA

FTG's full year revenues increased by 20% to $162.1 million, driven by a 25% increase in total bookings to $184.5 million and a 26% rise in year-end backlog to $122.4 million. The company's adjusted EBITDA also grew significantly, up 33% to $25.8 million, reflecting improvements in throughput, pricing, and cost savings at its Circuits Minnetonka and Circuits Haverhill facilities.



Strategic Growth Initiatives

FTG's strategic growth initiatives include:

1. Integration Progress: The company successfully integrated its 2023 acquisitions, leading to improvements in throughput, pricing, and cost savings. This integration has contributed to FTG's increased operational efficiency and reduced costs, ultimately driving higher earnings.
2. Contract Wins: FTG secured a $17.0 million contract to supply cockpit interface assemblies for COMAC's C919 aircraft, with production spanning from late 2024 to Q3 2026. This contract demonstrates FTG's ability to win large contracts and drive revenue growth.
3. Expansion into New Markets: FTG announced plans to open an Aerospace facility in Hyderabad, India, to support strategic growth and expand its market presence. This expansion into a new market can lead to increased sales and revenue growth in the future.
4. Acquisitions and Product Offerings: FTG acquired FLYHT Aerospace Solutions Ltd., enhancing its presence in the commercial aerospace aftermarket and expanding its product offerings on Airbus aircraft. This acquisition aligns with FTG's strategic priorities and allows the company to ramp up sales of FLYHT's product lines and insource manufacturing to other FTG sites, driving revenue growth.
5. Banking Agreement: FTG completed a new three-year banking agreement with BMO Corporate Finance, providing improved flexibility and reduced costs to support growth and corporate development objectives. This agreement allows FTG to access better financing terms, which can be reinvested into the business to drive growth and operational excellence.



Financial Tables

Table 1: Key Financial Metrics (Full Year)
Metric FY 2024 FY 2023 % Change
Sales $162,096,000 $135,200,000 19.9%
Gross Margin $44,176,000 $39,285,000 12.5%
Gross Margin (%) 27.3% 29.1% -180 bps
Net Earnings to FTG Equity Holders $10,815,000 $11,621,000 -6.9%
Adjusted Net Earnings (1) $10,306,000 $7,012,000 47.0%
Earnings Per Share (Basic) $0.45 $0.49 -8.2%
Earnings Per Share (Diluted) $0.45 $0.48 -6.3%
Adjusted Earnings Per Share (Basic) (1) $0.43 $0.29 48.3%
Adjusted Earnings Per Share (Diluted) (1) $0.43 $0.29 48.3%

(1) Adjusted Net Earnings is not a measure recognized under International Financial Reporting Standards (“IFRS”). Management believes that this measure is important to many of the Corporation’s shareholders, creditors and other stakeholders. The Corporation’s method of calculating Adjusted Net Earnings may differ from other corporations and accordingly may not be comparable to measures used by other corporations.

Table 2: Key Financial Metrics (Quarterly)
Metric Q4 2024 Q4 2023 % Change
Sales $45,244,000 $39,991,000 13.1%
Gross Margin $12,816,000 $10,739,000 19.3%
Gross Margin (%) 28.3% 26.9% 140 bps
Net Earnings to FTG Equity Holders $4,448,000 $3,826,000 16.3%
Adjusted Net Earnings (1) $3,939,000 $2,360,000 66.9%
Earnings Per Share (Basic) $0.18 $0.16 12.5%
Earnings Per Share (Diluted) $0.18 $0.16 12.5%
Adjusted Earnings Per Share (Basic) (1) $0.16 $0.10 60.0%
Adjusted Earnings Per Share (Diluted) (1) $0.16 $0.10 60.0%

(1) Adjusted Net Earnings is not a measure recognized under International Financial Reporting Standards (“IFRS”). Management believes that this measure is important to many of the Corporation’s shareholders, creditors and other stakeholders. The Corporation’s method of calculating Adjusted Net Earnings may differ from other corporations and accordingly may not be comparable to measures used by other corporations.



CEO Commentary

Bradley C. Bourne, President and CEO of FTG, stated, "We are thrilled with FTG’s performance in 2024, which reflects our strategic focus on growth and operational excellence. Our investments in technology and acquisitions have positioned us well for future success, and we are excited about the opportunities ahead, including our expansion into the Indian market."

FTG's record revenues and strategic growth initiatives demonstrate the company's strong performance and commitment to driving increased shareholder returns in both the near term and long term. As FTG continues to invest in existing sites and grow the business organically, it is well-positioned to capitalize on new opportunities and maintain its competitive edge in the aerospace and defense electronics market.