SigmaTron International, Inc. Reports Financial Results For First Quarter Fiscal 2024
11 Septembre 2023 - 2:00PM
SigmaTron International, Inc. (NASDAQ: SGMA), an electronic
manufacturing services company (the “Company”), today reported
revenues and earnings for the fiscal quarter ended July 31, 2023.
Revenues from continuing operations decreased $7.1 million, or 7
percent, to $98.1 million in the first quarter of fiscal 2024,
compared to $105.2 million for the same quarter in the prior year.
Net income from continuing operations for the first quarter ended
July 31, 2023, was $0.3 million, compared to net income of $3.1
million for the same quarter in the prior year. Diluted income per
share from continuing operations for the quarter ended July 31,
2023 was $0.04, compared to $0.50 income per share for the same
quarter in the prior year.
As previously reported, the Company sold a majority position of
its wholly owned subsidiary, Wagz, Inc. (“Wagz”), effective April
1, 2023. As a result, the Company has reported results from Wagz
for fiscal 2023 as discontinued operations. For the first quarter
ended July 31, 2022, net loss from discontinued operations was $1.7
million. Diluted net loss per share from discontinued operations
for the first quarter ended July 31, 2022 was $0.28.
Commenting on SigmaTron’s first quarter fiscal 2024 results,
Gary R. Fairhead, Chief Executive Officer, and Chairman of the
Board, said, “I’m disappointed to report what is essentially a
breakeven quarter to begin our fiscal 2024. Our pre-tax profit was
$107,964 for the quarter. As mentioned in our fiscal year-end press
release, there was a significant amount of uncertainty with the
general economy and our customers. It appears that the effort by
the Federal Reserve to slow inflation has weakened the economy
which has resulted in lower demand from some of our customers. We
have certain customers whose demand remains quite strong and others
who have experienced short-term softness. I’m expecting this
uncertainty to continue through calendar year-end as those
customers are indicating to us that they view this softness as a
short-term condition and expect their requirements to pick up by
year-end.
“While disappointing, we remain enthusiastic about the long-term
prospects for our customers. We have several customers that
participate in the infrastructure programs coming out of Washington
D.C. and we have others in markets where they have a strong
position and forecast future upside. Couple this with several new
opportunities and we think that we can generate later this fiscal
year, the revenue levels we have recently reported in the preceding
fiscal year.
“The electronic component marketplace has modestly improved with
the slowing of the economy. That’s encouraging from a supply chain
perspective and should allow us to continue our focus on reducing
inventory. That remains one of our important objectives during
fiscal 2024. The geopolitical situation, specifically in Asia
remains uncertain and may have an impact of how this fiscal year
will proceed. The trade war with China does not seem to have any
short-term solution so our focus remains working on Chinese
domestic opportunities and other opportunities outside of sales
directly to the United States. Regardless we will continue to grow
our business while utilizing our experienced employees and our
desirable footprint.”
About SigmaTron International, Inc.
Headquartered in Elk Grove Village, Illinois, SigmaTron
International, Inc. operates in one reportable segment as an
independent provider of electronic manufacturing services (“EMS”).
The EMS segment includes printed circuit board assemblies,
electro-mechanical subassemblies and completely assembled
(box-build) electronic products. The Company and its wholly-owned
subsidiaries operate manufacturing facilities in Elk Grove Village,
Illinois; Acuna, Chihuahua, and Tijuana Mexico; Union City,
California; Suzhou, China; and Biên Hòa City, Vietnam. In addition,
the Company maintains an International Procurement Office and
Compliance and Sustainability Center in Taipei, Taiwan. The Company
also provides design services in Elgin, Illinois, U.S.
Forward-Looking Statements
Note: This press release contains forward-looking statements.
Words such as “continue,” “anticipate,” “will,” “expect,”
“believe,” “plan,” and similar expressions identify forward-looking
statements. These forward-looking statements are based on the
current expectations of the Company. Because these forward-looking
statements involve risks and uncertainties, the Company’s plans,
actions and actual results could differ materially. Such statements
should be evaluated in the context of the direct and indirect risks
and uncertainties inherent in the Company’s business including, but
not necessarily limited to, the Company’s continued dependence on
certain significant customers; the continued market acceptance of
products and services offered by the Company and its customers;
pricing pressures from the Company’s customers, suppliers and the
market; the activities of competitors, some of which may have
greater financial or other resources than the Company; the
variability of the Company’s operating results; the results of
long-lived assets and goodwill impairment testing; the risks
inherent in any merger, acquisition or business combination,
including the ability to achieve the expected benefits of
acquisitions as well as the expenses of acquisitions; the
collectability of aged account receivables; the variability of the
Company’s customers’ requirements; the impact of inflation on the
Company’s operating results; the availability and cost of necessary
components and materials; the impact acts of war may have to the
supply chain; the ability of the Company and its customers to keep
current with technological changes within its industries;
regulatory compliance, including conflict minerals; the continued
availability and sufficiency of the Company’s credit arrangements;
the costs of borrowing under the Company’s senior and subordinated
credit facilities, including under the rate indices that replaced
LIBOR; increasing interest rates; the ability to meet the Company’s
financial and restrictive covenants under its loan agreements;
changes in U.S., Mexican, Chinese, Vietnamese or Taiwanese
regulations affecting the Company’s business; the turmoil in the
global economy and financial markets; public health crises,
including COVID-19 and variants; the continued availability of
scarce raw materials, exacerbated by global supply chain
disruptions, necessary for the manufacture of products by the
Company; the stability of the U.S., Mexican, Chinese, Vietnamese
and Taiwanese economic, labor and political systems and conditions;
global business disruption caused by the Russian invasion of
Ukraine and related sanctions; currency exchange fluctuations; and
the ability of the Company to manage its growth. These and other
factors which may affect the Company’s future business and results
of operations are identified throughout the Company’s Annual Report
on Form 10-K, and as risk factors, may be detailed from time to
time in the Company’s filings with the Securities and Exchange
Commission. These statements speak as of the date of such filings,
and the Company undertakes no obligation to update such statements
in light of future events or otherwise unless otherwise required by
law.
For Further Information Contact:SigmaTron International,
Inc.James J. Reiman1-800-700-9095
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CONDENSED CONSOLIDATED STATEMENT OF
OPERATIONS |
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Three
Months |
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Three Months |
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Ended |
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Ended |
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July
31, |
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July 31, |
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2023 |
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2022 |
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Net
sales |
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98,130,356 |
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105,189,979 |
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Cost of
products sold |
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88,479,136 |
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93,612,759 |
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Gross
profit |
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9,651,220 |
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11,577,220 |
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Selling and
administrative expenses |
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6,842,805 |
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6,529,842 |
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Operating
income |
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2,808,415 |
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5,047,378 |
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Other
expense |
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(2,700,451 |
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(917,742 |
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Income
before income tax |
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107,964 |
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4,129,636 |
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Income tax
benefit (expense) |
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154,135 |
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(1,008,296 |
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Net income
from continuing operations |
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$ |
262,099 |
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$ |
3,121,340 |
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Discontinued
operations: |
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Loss before
tax from discontinued operations |
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- |
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(2,223,561 |
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Tax benefit
from discontinued operations |
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- |
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478,896 |
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Net loss
from discontinued operations |
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- |
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(1,744,665 |
) |
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Net
income |
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$ |
262,099 |
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$ |
1,376,675 |
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Net income
(loss) per common share - basic |
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Net income
per common share - basic from continuing operations |
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0.04 |
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0.52 |
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Net loss per
common share - basic from discontinued operations |
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- |
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(0.29 |
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Net income
per common share - basic |
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$ |
0.04 |
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$ |
0.23 |
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Net income
(loss) per common share - diluted |
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Net income
per common share - diluted from continuing operations |
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0.04 |
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0.50 |
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Net loss per
common share - diluted from discontinued operations |
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- |
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(0.28 |
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Net income
per common share - diluted |
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$ |
0.04 |
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$ |
0.22 |
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Weighted
average number of common equivalent |
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shares outstanding - assuming dilution |
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6,100,284 |
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6,191,395 |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
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July
31, |
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April 30, |
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2023 |
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2023 |
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Assets: |
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Current
assets |
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212,583,718 |
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220,466,442 |
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Machinery
and equipment-net |
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35,903,317 |
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35,788,357 |
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Deferred
income taxes |
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2,460,689 |
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2,640,902 |
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Intangibles |
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1,227,615 |
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1,311,030 |
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Other
assets |
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7,659,769 |
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8,420,468 |
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Total
assets |
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$ |
259,835,108 |
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$ |
268,627,199 |
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Liabilities
and stockholders' equity: |
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Current
liabilities |
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143,460,398 |
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152,308,599 |
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Long-term
obligations |
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47,836,767 |
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48,227,573 |
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Stockholders' equity |
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68,537,943 |
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68,091,027 |
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Total
liabilities and stockholders' equity |
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$ |
259,835,108 |
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$ |
268,627,199 |
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Sigmatron (NASDAQ:SGMA)
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Sigmatron (NASDAQ:SGMA)
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