UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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Accelerated filer ☐ | ||
Non-accelerated filer ☐ | Smaller reporting company | |
Emerging growth company |
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AeroVironment, Inc.
Table of Contents
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Consolidated Balance Sheets as of October 31, 2020 (Unaudited) and April 30, 2020 | 3 | ||
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Management’s Discussion and Analysis of Financial Condition and Results of Operations | 26 | ||
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39 |
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AeroVironment, Inc.
Consolidated Balance Sheets
(In thousands except share and per share data)
October 31, |
| April 30, | |||||
2020 | 2020 | ||||||
| (Unaudited) |
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Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | | $ | | |||
Short-term investments | | | |||||
Accounts receivable, net of allowance for doubtful accounts of $ |
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Unbilled receivables and retentions (inclusive of related party unbilled receivables of $ |
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Inventories |
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Prepaid expenses and other current assets |
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Total current assets |
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Long-term investments | | | |||||
Property and equipment, net |
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Operating lease right-of-use assets | | | |||||
Deferred income taxes |
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Intangibles, net | | | |||||
Goodwill | | | |||||
Other assets |
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Total assets | $ | | $ | | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | | $ | | |||
Wages and related accruals |
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Customer advances |
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Current operating lease liabilities | | | |||||
Income taxes payable | | | |||||
Other current liabilities |
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Total current liabilities |
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Non-current operating lease liabilities | | | |||||
Other non-current liabilities | | | |||||
Liability for uncertain tax positions |
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Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Preferred stock, $ | |||||||
Authorized shares— |
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Common stock, $ | |||||||
Authorized shares— | |||||||
and shares— |
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Additional paid-in capital |
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Accumulated other comprehensive income |
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Retained earnings |
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Total AeroVironment, Inc. stockholders’ equity |
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Noncontrolling interest | ( | — | |||||
Total equity | | | |||||
Total liabilities and stockholders’ equity | $ | | $ | |
See accompanying notes to consolidated financial statements (unaudited).
3
AeroVironment, Inc.
Consolidated Statements of Operations (Unaudited)
(In thousands except share and per share data)
Three Months Ended | Six Months Ended | ||||||||||||
October 31, | October 26, | October 31, | October 26, | ||||||||||
| 2020 |
| 2019 |
| 2020 |
| 2019 |
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Revenue: | |||||||||||||
Product sales | $ | | $ | | $ | | $ | | |||||
Contract services (inclusive of related party revenue of $ |
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Cost of sales: | |||||||||||||
Product sales |
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Contract services |
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Gross margin: |
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Product sales | | | | | |||||||||
Contract services | | | | | |||||||||
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Selling, general and administrative |
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Research and development |
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Income from operations |
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Other income: | |||||||||||||
Interest income, net |
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Other income, net |
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Income before income taxes |
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Provision for income taxes | | |
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Equity method investment loss, net of tax |
| ( |
| ( |
| ( |
| ( | |||||
Net income | | | | | |||||||||
Net loss (income) attributable to noncontrolling interest | | ( | | | |||||||||
Net income attributable to AeroVironment, Inc. | $ | | $ | | $ | | $ | | |||||
Net income per share attributable to AeroVironment, Inc. | |||||||||||||
Basic | $ | | $ | | $ | | $ | | |||||
Diluted | $ | | $ | | $ | | $ | | |||||
Weighted-average shares outstanding: | |||||||||||||
Basic |
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Diluted |
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See accompanying notes to consolidated financial statements (unaudited).
4
AeroVironment, Inc.
Consolidated Statements of Comprehensive Income (Unaudited)
(In thousands)
Three Months Ended | Six Months Ended | ||||||||||||
October 31, | October 26, | October 31, | October 26, | ||||||||||
| 2020 |
| 2019 |
| 2020 |
| 2019 |
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Net income | $ | | $ | | $ | | $ | | |||||
Other comprehensive income: | |||||||||||||
Change in foreign currency translation adjustments | — | | | | |||||||||
Unrealized loss on available-for-sale investments, net of deferred tax (expense) benefit of ($ |
| ( |
| — |
| ( |
| — | |||||
Total comprehensive income | | $ | | | | ||||||||
Net loss (income) attributable to noncontrolling interest | | ( | | | |||||||||
Comprehensive income attributable to AeroVironment, Inc. | $ | | $ | | $ | | $ | |
See accompanying notes to consolidated financial statements (unaudited).
5
AeroVironment, Inc.
Consolidated Statements of Stockholders’ Equity
For the six months ended October 31, 2020 and October 26, 2019 (Unaudited)
(In thousands except share data)
Accumulated |
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Additional | Other | Total | Non- |
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Common Stock | Paid-In | Retained | Comprehensive | AeroVironment, Inc. | Controlling |
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| Shares |
| Amount |
| Capital |
| Earnings |
| Loss | Equity | Interest |
| Total |
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Balance at April 30, 2020 |
| | $ | | $ | | $ | | $ | | $ | | $ | — | $ | | ||||||||
Net income (loss) |
| — |
| — |
| — |
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| — | | ( |
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Unrealized loss on investments | — |
| — |
| — |
| — |
| ( | ( | — |
| ( | |||||||||||
Foreign currency translation | — |
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| — |
| — |
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Stock options exercised |
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| — |
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| — | — | | — |
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Restricted stock awards |
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| — |
| — |
| — | — | — | — |
| — | |||||||||||
Restricted stock awards forfeited |
| ( |
| — |
| — |
| — | — | — | — |
| — | |||||||||||
Tax withholding payment related to net share settlement of equity awards |
| ( |
| — |
| ( |
| — | — | ( | — |
| ( | |||||||||||
Stock based compensation |
| — |
| — |
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| — | — | | — |
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Balance at October 31, 2020 |
| | $ | | $ | | $ | | $ | | $ | | $ | ( | $ | | ||||||||
Accumulated | ||||||||||||||||||||||||
Additional | Other | Total | Non- | |||||||||||||||||||||
Common Stock | Paid-In | Retained | Comprehensive | AeroVironment, Inc. | Controlling | |||||||||||||||||||
| Shares |
| Amount |
| Capital |
| Earnings |
| Loss | Equity | Interest |
| Total | |||||||||||
Balance at April 30, 2019 |
| | $ | | $ | | $ | | $ | | $ | | $ | | $ | | ||||||||
Adoption of ASU 2018-09 | — | — | — | | — | | — | | ||||||||||||||||
Net income (loss) |
| — |
| — |
| — |
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| — | | ( |
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Unrealized gain on investments |
| — |
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| — | — | — |
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Foreign currency translation | — |
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Stock options exercised |
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Restricted stock awards |
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| — |
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| — | — | — | — |
| — | |||||||||||
Restricted stock awards forfeited |
| ( |
| — |
| — |
| — | — | — | — |
| — | |||||||||||
Tax withholding payment related to net share settlement of equity awards |
| ( |
| — |
| ( |
| — | — | ( | — |
| ( | |||||||||||
Stock based compensation | — |
| — |
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| — | — | | — |
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Balance at October 26, 2019 |
| | $ | | $ | | $ | | $ | | $ | | $ | ( | $ | |
See accompanying notes to consolidated financial statements (unaudited).
6
AeroVironment, Inc.
Consolidated Statements of Stockholders’ Equity
For the three months ended October 31, 2020 and October 26, 2019 (Unaudited)
(In thousands except share data)
Accumulated | |||||||||||||||||||||||
Additional | Other | Total | Non- | ||||||||||||||||||||
Common Stock | Paid-In | Retained | Comprehensive | AeroVironment, Inc. | Controlling | ||||||||||||||||||
| Shares |
| Amount |
| Capital |
| Earnings |
| Income | Equity | Interest |
| Total | ||||||||||
Balance at August 1, 2020 |
| | $ | | $ | | $ | | $ | | $ | | $ | ( | $ | | |||||||
Net income (loss) |
| — |
| — |
| — |
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| — | | ( |
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Unrealized loss on investments |
| — |
| — |
| — |
| — |
| ( | ( | — |
| ( | |||||||||
Restricted stock awards forfeited |
| ( |
| — |
| — |
| — | — | — | — |
| — | ||||||||||
Tax withholding payment related to net share settlement of equity awards |
| ( |
| — |
| ( |
| — | — | ( | — |
| ( | ||||||||||
Stock based compensation |
| — |
| — |
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| — | — | | — |
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Balance at October 31, 2020 |
| | $ | | $ | | $ | | $ | | $ | | $ | ( | $ | | |||||||
Accumulated | |||||||||||||||||||||||
Additional | Other | Total | Non- | ||||||||||||||||||||
Common Stock | Paid-In | Retained | Comprehensive | AeroVironment, Inc. | Controlling | ||||||||||||||||||
| Shares |
| Amount |
| Capital |
| Earnings |
| Income | Equity | Interest |
| Total | ||||||||||
Balance at July 27, 2019 |
| | | | | | | ( | | ||||||||||||||
Net income |
| — |
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Foreign currency translation | — |
| — |
| — |
| — |
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Restricted stock awards |
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| — |
| — |
| — | — | — | — |
| — | ||||||||||
Restricted stock awards forfeited |
| ( | — |
| — |
| — | — | — | — |
| — | |||||||||||
Tax withholding payment related to net share settlement of equity awards |
| ( |
| — |
| ( |
| — | — | ( | — |
| ( | ||||||||||
Stock-based compensation | — |
| — |
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| — | — | | — |
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Balance at October 26, 2019 |
| | $ | | $ | | $ | | $ | | $ | | $ | ( | $ | |
See accompanying notes to consolidated financial statements (unaudited).
7
AeroVironment, Inc.
Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
Six Months Ended | |||||||
| October 31, |
| October 26, |
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2020 | 2019 | ||||||
Operating activities | |||||||
Net income | $ | | $ | | |||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||
Depreciation and amortization |
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Losses from equity method investments | | | |||||
Realized gain from sale of available-for-sale investments | ( | — | |||||
Provision for doubtful accounts |
| ( |
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Other non-cash (income) expense | ( | | |||||
Non-cash lease expense | | | |||||
Loss on foreign currency transactions |
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Deferred income taxes |
| ( |
| ( | |||
Stock-based compensation |
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Loss (gain) on sale of property and equipment | | ( | |||||
Amortization of debt securities | ( | ( | |||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||
Accounts receivable |
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| ( | |||
Unbilled receivables and retentions |
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| ( | |||
Inventories |
| ( |
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Income tax receivable | — | | |||||
Prepaid expenses and other assets |
| ( |
| ( | |||
Accounts payable |
| ( |
| ( | |||
Other liabilities | ( | ( | |||||
Net cash provided by operating activities |
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Investing activities | |||||||
Acquisition of property and equipment |
| ( |
| ( | |||
Equity method investments | ( | ( | |||||
Business acquisition, net of cash acquired | — | ( | |||||
Proceeds from sale of property and equipment | — | | |||||
Redemptions of held-to-maturity investments |
| — |
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Purchases of held-to-maturity investments | — | ( | |||||
Redemptions of available-for-sale investments |
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| — | |||
Purchases of available-for-sale investments | ( | ( | |||||
Net cash used in investing activities |
| ( |
| ( | |||
Financing activities | |||||||
Tax withholding payment related to net settlement of equity awards | ( | ( | |||||
Exercise of stock options |
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Net cash used in financing activities |
| ( |
| ( | |||
Net increase (decrease) in cash, cash equivalents, and restricted cash |
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| ( | |||
Cash, cash equivalents and restricted cash at beginning of period |
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Cash, cash equivalents and restricted cash at end of period | $ | | $ | | |||
Supplemental disclosures of cash flow information | |||||||
Cash paid, net during the period for: | |||||||