Innovative Solutions and Support, Inc. (NASDAQ:ISSC) Q1 2023 Earnings Conference Call February 14, 2022 4:30 PM ET

Company Participants

Michael Linacre - CFO

Shahram Askarpour - CEO

Conference Call Participants

David Campbell - Thompson Davis

Operator

Greetings, and welcome to the Innovative Solutions and Support, Inc. First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host Michael Linacre. Thank you, Mr. Linacre. You may begin.

Michael Linacre

Thank you, operator, and good afternoon, everyone. I would remind our listeners that certain matters discussed in the conference call today, including information about new products and operational and financial results for future periods are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially, either better or worse from those discussed, including other risks and uncertainties reflected in our company's 10-K, which is on file with the SEC and other public filings.

Now, I'll turn it over to our CEO, Shahram Askarpour.

Shahram Askarpour

Thank you, Mike, and good afternoon, everyone. I will begin today with remarks on our performance in the fiscal first quarter of 2023, followed by comments on the upcoming year and our long-term growth strategy. I will then turn the call over to Mike, who will take us through the details of the financials.

We began the year on solid footing with revenues of $6.5 million, driven by stronger OEM volume and engineering development contract. Underlying end markets remain strong, particularly with OEM customers. I'm pleased to announce that during the Q1 2023 period, we received our FAA supplemental type certificate or STC for the King Airs with the G1000 and NXI (ph) flight decks and deliver our first aircraft.

This STC opens an additional 700 potential aircraft for our King Airs Autothrottle, which builds on the existing growing aftermarket King Airs platforms. As we have stated in the past quarters, our winning formula starts with excellent products in attractive growing markets. This effort is supported by more than 500 cockpit upgrades in 757, 767 and 737 platforms combined with a rapidly growing presence in general aviation.

Gross profit in the first quarter was $3.7 million compared to $4 million in the prior year, mainly due to product mix. As a percentage of sales, gross margin was 57.1% compared to 59.3% in the prior year. We believe these results reflect the success of our innovative products in the market and our dedication to excellence in delivering for our customers.