TRT Trio Tech International

Trio-Tech CEO, S.W. Yong, Appointed Chairman of the Board

Trio-Tech International (NYSE MKT: TRT) today announced results for the fourth quarter and fiscal year ended June 30, 2023.

S.W. Yong, CEO and newly elected Chairman said, “Challenging conditions in the global semiconductor industry had a significant impact on Trio-Tech’s performance this past year, especially in the fourth fiscal quarter. Through proactive management of the business, we nevertheless maintained solid operating margins, significantly improved cash flow and delivered a profitable quarter and year. What’s more, we enhanced our cash-rich balance sheet, reduced debt and increased shareholders’ equity. A constant focus on improving our balance sheet enables the Company to be well positioned for investing in opportunities to create new revenue streams, improve profitability and enhance shareholder value.

“While we are very pleased that testing services revenue increased 18.8% for the year, primarily attributable to our subsidiaries in China, the Company experienced a softening of demand for testing services in the second half of fiscal 2023. Testing services revenue is vulnerable to escalating US-China tensions, and we are taking steps to minimize this risk by exploring opportunities for diversification.

“Trio-Tech closed the fiscal year with near-record backlog and market demand for semiconductor equipment shows signs of a gradual recovery as we enter fiscal 2024. Distribution revenue is also projected to increase in fiscal 2024 as the demand for our value-added products shows encouraging signs. With due caution about the overall tone of the semiconductor industry and economic prospects in China, we remain optimistic for continued growth in Trio-Tech’s core businesses in the new fiscal year.

“The semiconductor industry has experienced periods of rapid growth and downturns, often in connection with, or in anticipation of, maturing product cycles of both semiconductor companies, customer products and general economic conditions. Consequently, we are increasing our efforts to expand our lines of businesses to reduce the risks associated with a single industry focus and customer concentration.”

Board of Directors Appoints S.W. Yong Chairman of the Board

Trio-Tech’s Board of Directors announced the appointment of CEO, Mr. Siew Wai Yong, as Chairman of the Board of Directors, effective September 20, 2023. “Mr. Yong joined the Company in 1976 and has been an exceptional leader during his tenure as President and CEO since September 1990. With his appointment as Chairman, Mr. Yong will continue to play a key role shaping the direction of the Company and its long-term success,” said the Board of Directors.

“I would like to thank the Board for the opportunity to serve as the Chairman and feel honored to take on this additional role. On behalf of the Board, I would also like to thank Mr. A. Charles Wilson for his guidance and his contributions as Chairman over the many years of his distinguished service. I look forward to working with the Board and our Management to support the company’s continued growth,” said Mr. Yong.

Fourth Quarter Results

Revenue for the fourth quarter of fiscal 2023 decreased 23.3% to $9,079,000 from $11,834,000 for the fourth quarter of fiscal 2022, reflecting a 52.8% decrease in distribution revenue and a 33.1% decrease in manufacturing revenue. Testing services revenue was essentially flat.

Gross margin decreased 28.2% to $2,290,000, or 25.2% of revenue, compared to $3,190,000, or 27.0% of revenue, for the fourth quarter of fiscal 2022. Income from operations was $129,000 compared to $857,000 for the fourth quarter of the prior fiscal year.

Net income for the fourth quarter of fiscal 2023 was $162,000, or $0.04 per diluted share. This compares to net income of $790,000, or $0.19 per diluted share, for the fourth quarter of fiscal 2022.

Backlog at June 30, 2023 was $17,437,000. This compares to record backlog of $17,463,000 at June 30, 2022.

Fiscal 2023 Results

Fiscal 2023 testing services revenue increased 18.8% to $23,130,000 from $19,477,000 in fiscal 2022, led by higher sales at the Company’s new China joint venture subsidiary. This increase was partially offset by a 43.2% decline in distribution segment revenue to $6,270,000 from $11,037,000 in fiscal 2022. Manufacturing revenue increased to $13,827,000 compared to $13,526,000 in fiscal 2022. Total fiscal 2023 revenue was $43,250,000 compared to revenue of $44,065,000 for fiscal 2022.

Fiscal 2023 gross margin declined slightly to $11,705,000 compared to $11,733,000 for fiscal 2022 and improved to 27.1% of revenue compared to 26.6% of revenue for fiscal 2022.

Operating expenses increased to $9,477,000, or 21.9% of revenue, compared to $9,380,000, or 21.3% of revenue for fiscal 2022.

Net income attributable to our common shareholders for fiscal 2023 was $1,544,000, or $0.37 per diluted share, compared to net income of $2,395,000, or $0.57 per diluted share, for fiscal 2022.

Balance Sheet Highlights

Cash and cash equivalents at June 30, 2023 were $7,583,000, compared to $7,698,000 at June 30, 2022. Shareholders' equity at June 30, 2023 increased to $29,571,000, or $7.22 per outstanding share, compared to $28,002,000, or $6.88 per outstanding share, a year earlier. There were approximately 4,096,680 and 4,071,680 common shares outstanding at June 30, 2023 and June 30, 2022, respectively.

About Trio‑Tech

Established in 1958, Trio-Tech International is located in Van Nuys, California, with its Principal Executive Office and regional headquarter in Singapore. Trio-Tech International is a diversified business group with interests in semiconductor testing services, manufacturing and distribution of semiconductor testing equipment, and real estate. Our subsidiary locations include Tianjin, Suzhou, Chongqing and Jiangsu in China, as well as Kuala Lumpur, Malaysia and Bangkok, Thailand. Further information about Trio-Tech's semiconductor products and services can be obtained from the Company's Web site at www.triotech.com and www.universalfareast.com.

Forward Looking Statements

This press release contains statements that are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and may contain forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and assumptions regarding future activities and results of operations of the Company. In light of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the following factors, among others, could cause actual results to differ materially from those reflected in any forward looking statements made by or on behalf of the Company: market acceptance of Company products and services; changing business conditions or technologies and volatility in the semiconductor industry, which could affect demand for the Company's products and services; the impact of competition; problems with technology; product development schedules; delivery schedules; changes in military or commercial testing specifications which could affect the market for the Company's products and services; difficulties in profitably integrating acquired businesses, if any, into the Company; risks associated with conducting business internationally and especially in Asia, including currency fluctuations and devaluation, currency restrictions, local laws and restrictions and possible social, political and economic instability; changes in U.S. and global financial and equity markets, including market disruptions and significant interest rate fluctuations; public health issues related to the COVID-19 pandemic; trade tension between U.S. and China and other economic, financial and regulatory factors beyond the Company's control. Other than statements of historical fact, all statements made in this release are forward looking, including, but not limited to, statements regarding industry prospects, future results of operations or financial position, and statements of our intent, belief and current expectations about our strategic direction, prospective and future financial results and condition. In some cases, you can identify forward looking statements by the use of terminology such as "may," "will," "expects," "plans," "anticipates," "estimates," "potential," "believes," "can impact," "continue," or the negative thereof or other comparable terminology. Forward looking statements involve risks and uncertainties that are inherently difficult to predict, which could cause actual outcomes and results to differ materially from our expectations, forecasts and assumptions. Many of these risks and uncertainties are beyond the Company's control. Reference is made to the discussion of risk factors detailed in the Company's filings with the Securities and Exchange Commission including its reports on Form 10-K and 10-Q. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.

TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES

 

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

 

AUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)

 

 

 

 

 

 

 

 

Three Months Ended

 

Twelve Months Ended

 

 

 

June 30,

 

June 30,

 

Revenue

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

Manufacturing

$

2,235

 

 

$

3,339

 

 

$

13,827

 

 

$

13,526

 

 

 

Testing services

 

5,421

 

 

 

5,494

 

 

 

23,130

 

 

 

19,477

 

 

 

Distribution

 

1,415

 

 

 

2,999

 

 

 

6,270

 

 

 

11,037

 

 

 

Real estate

 

8

 

 

 

2

 

 

 

23

 

 

 

25

 

 

 

 

 

 

9,079

 

 

 

11,834

 

 

 

43,250

 

 

 

44,065

 

 

Cost of Sales

 

 

 

 

 

 

 

 

 

 

Cost of manufactured products sold

 

1,762

 

 

 

2,309

 

 

 

10,587

 

 

 

10,147

 

 

 

Cost of testing services rendered

 

3,845

 

 

 

3,819

 

 

 

15,658

 

 

 

12,960

 

 

 

Cost of distribution

 

1,164

 

 

 

2,496

 

 

 

5,228

 

 

 

9,147

 

 

 

Cost of real estate

 

18

 

 

 

20

 

 

 

72

 

 

 

78

 

 

 

 

 

 

6,789

 

 

 

8,644

 

 

 

31,545

 

 

 

32,332

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Margin

 

2,290

 

 

 

3,190

 

 

 

11,705

 

 

 

11,733

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses:

 

 

 

 

 

 

 

 

 

General and administrative

 

1,931

 

 

 

2,056

 

 

 

8,403

 

 

 

8,361

 

 

 

Selling

 

144

 

 

 

194

 

 

 

670

 

 

 

643

 

 

 

Research and development

 

86

 

 

 

82

 

 

 

397

 

 

 

375

 

 

 

Loss on disposal of property, plant and equipment

 

--

 

 

 

1

 

 

 

7

 

 

 

1

 

 

 

 

Total operating expenses

 

2,161

 

 

 

2,333

 

 

 

9,477

 

 

 

9,380

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from Operations

 

129

 

 

 

857

 

 

 

2,228

 

 

 

2,353

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income

 

 

 

 

 

 

 

 

 

Interest expense

 

(22

)

 

 

(35

)

 

 

(105

)

 

 

(122

)

 

 

Other income, net

 

155

 

 

 

(74

)

 

 

106

 

 

 

595

 

 

 

Government grant

 

45

 

 

 

228

 

 

 

153

 

 

 

228

 

 

 

 

Total other income

 

178

 

 

 

119

 

 

 

154

 

 

 

701

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations before Income Taxes

 

307

 

 

 

976

 

 

 

2,382

 

 

 

3,054

 

 

Income Tax Expenses

 

(148

)

 

 

(254

)

 

 

(622

)

 

 

(757

)

 

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations

 

 

 

 

 

 

 

 

 

before Non-controlling Interest, net of tax

 

159

 

 

 

722

 

 

 

1,760

 

 

 

2,297

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain / (loss) from discontinued operations, net of tax

 

2

 

 

 

(3

)

 

 

(2

)

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME

 

161

 

 

 

719

 

 

 

1,758

 

 

 

2,299

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Net (loss) / income Attributable to Non-controlling Interest

 

(1

)

 

 

(71

)

 

 

214

 

 

 

(96

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income Attributable to Trio-Tech International

$

162

 

 

$

790

 

 

$

1,544

 

 

$

2,395

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Attributable to Trio-Tech International:

 

 

 

 

 

 

 

 

 

Income from continuing operations, net of tax

 

161

 

 

 

793

 

 

 

1,545

 

 

 

2,396

 

 

 

Income / (Loss) from discontinued operations, net of tax

 

1

 

 

 

(3

)

 

 

(1

)

 

 

(1

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Attributable to Trio-Tech International

 

162

 

 

 

790

 

 

 

1,544

 

 

 

2,395

 

 

 

 

 

 

 

 

 

 

 

Basic Earnings per Share - Continuing Operations

$

0.04

 

 

$

0.20

 

 

$

0.38

 

 

$

0.61

 

 

Basic Loss per Share - Discontinued Operations

 

--

 

 

 

--

 

 

 

--

 

 

 

(0.01

)

 

Basic Earnings per Share

$

0.04

 

 

$

0.20

 

 

$

0.38

 

 

$

0.60

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted Earnings per Share - Continuing Operations

$

0.04

 

 

$

0.19

 

 

 

0.37

 

 

$

0.57

 

 

Diluted Loss per Share - Discontinued Operations

 

--

 

 

 

--

 

 

 

--

 

 

 

--

 

 

Diluted Earnings per Share

$

0.04

 

 

$

0.19

 

 

$

0.37

 

 

$

0.57

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Shares Outstanding - Basic

 

4,082

 

 

 

3,972

 

 

 

4,082

 

 

 

3,972

 

 

Weighted Average Shares Outstanding - Diluted

 

4,159

 

 

 

4,094

 

 

 

4,165

 

 

 

4,174

 

 

TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

AUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Twelve Months Ended

 

 

June 30,

 

June 30,

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

 

 

 

 

 

 

Comprehensive (Loss) / Income

 

 

 

 

 

 

 

Attributable to Trio-Tech International

 

 

 

 

 

 

 

Common Shareholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

161

 

 

$

719

 

 

$

1,758

 

 

$

2,299

 

Foreign currency translation, net of tax

 

(1,137

)

 

 

(1,253

)

 

 

(616

)

 

 

(1,275

)

Comprehensive (Loss) / Income

 

(976

)

 

 

(534

)

 

 

1,142

 

 

 

1,024

 

Less: Comprehensive (Loss) Income

 

 

 

 

 

 

 

 

Attributable to Non-controlling Interests

 

(90

)

 

 

(129

)

 

 

37

 

 

 

(169

)

 

 

 

 

 

 

 

 

 

Comprehensive (Loss) / Income

 

 

 

 

 

 

 

Attributable to Trio-Tech International

$

(886

)

 

$

(405

)

 

$

1,105

 

 

$

1,193

 

 

 

 

 

 

 

 

 

 

 

TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS, EXCEPT NUMBER OF SHARES)

 

 

 

 

 

 

Jun. 30,

 

Jun. 30,

 

2023

 

 

2022

ASSETS

(Audited)

 

(Audited)

 

 

 

 

CURRENT ASSETS:

 

 

 

Cash and cash equivalents

$

7,583

 

$

7,698

Short-term deposits

 

6,627

 

 

5,420

Trade account receivables, net

 

9,804

 

 

11,592

Other receivables

 

939

 

 

998

Inventories, net

 

2,151

 

 

2,258

Prepaid expenses and other current assets

 

694

 

 

1,215

Assets held for sale

 

274

 

 

--

Financed sales receivable

 

16

 

 

21

Restricted term deposit

 

739

 

 

--

Total current assets

 

28,827

 

 

29,202

NON-CURRENT ASSETS:

 

 

 

Deferred tax assets

 

100

 

 

169

Investment properties, net

 

474

 

 

585

Property, plant and equipment, net

 

8,344

 

 

8,481

Operating lease right-of-use assets

 

2,609

 

 

3,152

Other assets

 

116

 

 

137

Financed sales receivable

 

--

 

 

17

Restricted term deposits

 

1,716

 

 

1,678

Total non-current assets

 

13,359

 

 

14,219

TOTAL ASSETS

$

42,186

 

$

43,421

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

Lines of credit

$

--

 

$

929

Accounts payable

 

1,660

 

 

2,401

Accrued expense

 

5,568

 

 

6,004

Income taxes payable

 

418

 

 

787

Current portion of bank loans payable

 

475

 

 

472

Current portion of finance leases

 

107

 

 

118

Current portion of operating leases

 

1,098

 

 

1,218

Total current liabilities

 

9,326

 

 

11,929

NON-CURRENT LIABILITIES:

 

 

 

Bank loans payable, net of current portion

 

877

 

 

1,272

Finance leases, net of current portion

 

42

 

 

119

Operating leases, net of current portion

 

1,511

 

 

1,934

Income taxes payable, net of current portion

 

255

 

 

137

Deferred tax liabilities

 

10

 

 

--

Other non-current liabilities

 

594

 

 

28

Total non-current liabilities

 

3,289

 

 

3,490

TOTAL LIABILITIES

$

12,615

 

$

15,419

 

 

 

 

EQUITY

 

 

 

TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY:

 

 

 

Common stock, no par value, 15,000,000 shares authorized; 4,096,680 and 4,071,680

 

 

 

shares issued and outstanding at June 30, 2023 and June 30, 2022, respectively

 

12,819

 

 

12,750

Paid-in capital

 

5,066

 

 

4,708

Accumulated retained earnings

 

10,763

 

 

9,219

Accumulated other comprehensive income-translation adjustments

 

758

 

 

1,197

Total Trio-Tech International shareholders' equity

 

29,406

 

 

27,874

Non-controlling interest

 

165

 

 

128

TOTAL EQUITY

 

29,571

 

 

28,002

TOTAL LIABILITIES AND EQUITY

$

42,186

 

$

43,421

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20230927018217/en/

Company Contact: Siew Wai Yong Chairman & CEO (818) 787-7000

Investor Contact: Berkman Associates (310) 927-3108 robert.jacobs@jacobscon.com