SGMA Sigmatron International Inc

SigmaTron International, Inc.(Nasdaq:SGMA), an electronic manufacturing services company, today reported revenues and earnings for the third quarter ended January 31, 2010.

Revenues increased to $30.6 million for the third quarter of fiscal year 2010 from $27.0 million for the same quarter in the prior year. Net income increased to a profit of $415,468 in the third quarter of fiscal year 2010 compared to a loss of ($265,458) for the same period in the prior year. Basic and diluted earnings per share for the quarter ended January 31, 2010, were $0.11 compared to a loss of ($0.07) for both the same quarter in fiscal 2009.

For the nine months ended January 31, 2010, revenues decreased to $87.5 million compared to $106.6 million for the same period ended January 31, 2009. Net income for the 2010 period was $530,291 compared to $1,819,182 for the same period in the prior year. Basic and diluted earnings per share for the nine months ended January 31, 2010 were $0.14 and $0.13, respectively, compared to $0.48 and $0.47, respectively, for the nine months ending January 31, 2009.

Commenting on SigmaTron's third quarter and nine month results, Gary R. Fairhead, President and Chief Executive Officer, said, "I am pleased to report a solid profit for our third quarter of fiscal 2010, which is one year after we saw our revenue drop precipitously in response to the global economic downturn. Our quarterly results were negatively impacted by expenses related to our changing banks during the quarter but otherwise operationally consistent with our second quarter results. Just like the second quarter, each month during the third quarter was profitable. Historically, our second and third quarters have been nominally stronger than our first and fourth quarters.

"Heading into our fourth quarter, we see many customers adjusting inventory levels short term. My current expectation is that revenue during the fourth quarter will be lower than that of the third quarter. However, I also believe that the second half of calendar 2010 will be stronger than the same period of 2009.

"The basis for my optimism for later this calendar year is that several new programs from both existing and new customers are scheduled to launch mid-year. Barring a short term economic downturn, I have every reason to believe most of these programs will go to market.

"As previously announced in our press release on January 11, 2010, we successfully changed our bank to Wells Fargo / HSBC Trade Bank during the quarter. We believe our new banking arrangement will provide greater financial support and flexibility as the economy recovers. Clearly this transition was an important milestone for SigmaTron, and we look forward to a long term relationship with our new bank.

"While all of this news is positive, uncertainty and volatility in the global economy clearly remains. Our cost reductions remain in place and we continue to monitor both our cost structure as well as our revenue levels. There is reason to be optimistic compared to twelve months ago, but we will remain cautious."

Headquartered in Elk Grove Village, IL, SigmaTron International, Inc. is an electronic manufacturing services company that provides printed circuit board assemblies and completely assembled electronic products. SigmaTron International, Inc. operates manufacturing facilities in Elk Grove Village, Illinois, Acuna and Tijuana, Mexico, Hayward, California and Suzhou-Wujiang, China. SigmaTron International, Inc. maintains engineering and materials sourcing offices in Taipei, Taiwan.

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 risks and uncertainties inherent in the Company's business including 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 our 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 our operating results; the results of long-lived assets impairment testing; the variability of our customers' requirements; the availability and cost of necessary components and materials; the ability of the Company and our customers to keep current with technological changes within our industries; regulatory compliance; the continued availability and sufficiency of our credit arrangements; changes in U.S., Mexican, Chinese or Taiwanese regulations affecting the Company's business; the current turmoil in the global economy and financial markets; the stability of the U.S., Mexican, Chinese and Taiwanese economic systems, labor and political conditions; 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 and 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.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

 

 

 

 

Three Months

Three Months

Nine Months

Nine Months

 

Ended

Ended

Ended

Ended

 

January 31, 2010

January 31, 2009

January 31, 2010

January 31, 2009

 

 

 

 

 

Net sales

$30,599,499

$26,970,927

$87,493,820

$106,581,773

 

 

 

 

 

Cost of products sold

27,219,708

24,218,696

78,570,880

93,268,965

 

 

 

 

 

Gross profit

3,379,791

2,752,231

8,922,940

13,312,808

 

 

 

 

 

Selling and administrative expenses

2,503,571

2,666,375

7,448,821

9,328,834

 

 

 

 

 

Operating income

876,220

85,856

1,474,119

3,983,974

 

 

 

 

 

Other expense

211,860

246,441

627,519

1,096,267

 

 

 

 

 

Income (loss) from operations before income tax

664,360

(160,585)

846,600

2,887,707

 

 

 

 

 

Income tax expense 

248,892

104,873

316,309

1,068,525

 

 

 

 

 

Net income (loss)

$415,468

($265,458)

$530,291

$1,819,182

 

 

 

 

 

Net income (loss) per common share -- basic

$0.11

($0.07)

$0.14

$0.48

 

 

 

 

 

Net income (loss) per common share -- assuming dilution

$0.11

($0.07)

$0.13

$0.47

 

 

 

 

 

Weighted average number of common equivalent 

 

 

 

 

 shares outstanding - assuming dilution

3,873,531

3,822,556

3,853,902

3,869,394

 

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

 

January 31, 2010

April 30, 2009

 

 

 

Assets:

 

 

 

 

 

Current assets

$61,561,244

$59,622,532

 

 

 

Machinery and equipment-net

25,298,583

26,200,578

 

 

 

Intangible assets

420,965

608,887

Other assets

618,613

699,379

 

 

 

Total assets

$87,899,405

$87,131,376

 

 

 

Liabilities and shareholders' equity:

 

 

 

 

 

Current liabilities

$20,568,227

$16,055,185

 

 

 

Long-term obligations

21,384,637

25,674,306

 

 

 

Stockholders' equity

45,946,541

45,401,885

 

 

 

Total liabilities and stockholders' equity

$87,899,405

$87,131,376

CONTACT: SigmaTron International, Inc.

Linda K. Frauendorfer

1-800-700-9095