Part 1: Performance Analysis
Allied Motion Technologies Inc had a good year in fiscal year 2022, as evidenced by its strong results. The Company reported revenues of $502,988, up 24% from the previous year's revenue of $403,516. The increase in revenues was mainly driven by improved sales in certain markets they serve, specifically industrial and aerospace & defense. Gross profit was $157,259, a 30% increase from $121,056 in 2021. The gross margin increased 130 basis points to 31.3% in 2022 from 30.0% in 2021. This increase was largely driven by volume increases of higher margin products in their industrial and aerospace & defense markets combined with pricing and margin accretive acquisitions.
However, the net income was 28% lower in 2022 compared to 2021, and earnings per diluted share decreased by 34% as the 2021 results include the impact of a $7,373 (or $0.51 per diluted share) discrete tax benefit in the first quarter of 2021. We believe that Allied Motion's performance could have been even better if not for the supply chain constraints that resulted in inefficiencies and additional costs. Allied Motion's bookings were a record $566,226 for 2022 compared with $468,449 for 2021, an increase of 21%. Backlog as of December 31, 2022, was $330,078, an increase of 32% from $249,927 at year-end 2021. Included in backlog as of December 31, 2022, is $21,222 contributed by 2022 business acquisitions.
Part 2: Forward looking Analysis
Allied Motion Technologies Inc is poised for continued growth in fiscal year 2023. As economies recover from the COVID-19 pandemic, the Company expects to see increased demand from many of their served markets, particularly in their Vehicle and Industrial markets. However, the supply chain constraints are expected to continue, which could result in some inefficiencies and additional costs.
Allied Motion Technologies Inc has set growth targets for the Company and will focus and align their resources to meet those targets. They will continue to invest significantly in applied and design engineering resources. The Company has set some critical issues focused on growth and profitability initiatives that they believe are necessary factors in meeting their stated long-term goals and objectives. These issues involve product line platform development to meet the emerging needs of their target markets. The platform development emphasizes a combination of their technologies to create increased value solutions for their customers. The Company believes this approach will allow them to provide increased value to their customers and improved margins for the Company. The Company aims to be a leading global controlled motion solution provider in their selected target markets by further developing their products and services platform.
In conclusion, Allied Motion Technologies Inc is expected to continue its growth trajectory in 2023. The Company had a strong fiscal year in 2022, reporting impressive results in revenues, gross profit and bookings. Their strategic focus, investment in people and critical issues, will position the Company well to meet their growth targets and achieve long-term goals and objectives. However, the supply chain constraints must be properly managed to avoid inefficiencies and additional costs as the Company executes its growth strategy.