SigmaTron International, Inc. Reports Year End Financial Results for Fiscal Year 2010
July 13 2010 - 10:45AM
SigmaTron International, Inc. (Nasdaq:SGMA), an
electronic manufacturing services company, today reported revenues
and earnings for the fiscal year ended April 30, 2010. Revenues
decreased 8.4% to $122.5 million in fiscal year 2010 from $133.7
million in the prior year. Net income increased to $2.24 million in
fiscal year 2010 compared to $1.95 million in fiscal
2009. Diluted earnings per share for the fiscal year ended
April 30, 2010 were $0.58 compared to $0.51 in fiscal 2009.
For the fourth quarter of fiscal year 2010, revenues increased
to $35.0 million compared to $27.2 million for the same quarter in
the prior year. Diluted earnings per share for the fiscal year
2010 fourth quarter were $0.44 per share compared to $0.04 per
share for the same period of fiscal 2009.
Commenting on SigmaTron's results, Gary R. Fairhead, President
and Chief Executive Officer, said, "I am pleased to report our
third consecutive profitable quarter and perhaps even more
significant, a quarter in which our revenue grew nicely from the
levels in quarters two and three. While I have
repeatedly pointed out that revenue levels are not always good
indicators of financial performance in our industry because of the
various types of services we offer and products we assemble, our
increased revenue in the fourth quarter was generally across our
entire customer base and I believe was indicative of improved
levels of economic activity. If that trend continues, it
should point to better days ahead for the Company as the U.S. and
worldwide economies hopefully recover and grow.
"Our results for both the fourth quarter and fiscal 2010, were
positively impacted by a gain recorded as required under Generally
Accepted Accounting Principles (GAAP) for an insurance settlement
made during the year. That gain was recorded as "other income"
on the condensed consolidated statements of operations attached to
the press release. Regardless, the fourth quarter pre-tax
income was $1,284,899 excluding the results of the settlement.
"Similarly, the fiscal year 2010 results were positive when
compared to fiscal 2009, aided in part by the gain from the
insurance settlement which resulted in nominally higher net income
and earnings per share this fiscal year. However, I believe
that the primary point is that the revenue and earnings trend has
been upward and positive for two quarters, and we have continuing
momentum heading into the first quarter of fiscal 2011.
"The increased revenue levels during our fourth quarter have not
been without some challenges to our business. Increased
demands for components have significantly increased lead-times for
many parts. Some vendors have been reluctant to increase
capacity in the short term as the economic outlook remains too
uncertain to justify the expense. In addition, increased
commodity prices have also negatively affected our
margins. The increasing demand and tight capacity have
resulted in upward price pressure from our supply chain. Our
ability to work with our customers and supply chain to manage this
environment will be a big short term challenge.
"As previously mentioned, we are heading into the first quarter
of fiscal 2011 with some positive momentum. Short term demand
remains volatile, but in general it appears that our existing
customer base has recovered to a higher revenue level. Equally
important, we see more new product launches from our existing
customers as they compete in their respective markets, which is
always a positive sign.
"In addition, we have several new customers that are ramping up
and have entered the aviation and medical markets through two of
the new customers. Diversification of markets served is a
constant objective. Finally, we remain engaged with several
potential new customers in additional new markets, which could
positively contribute to our results late in fiscal 2011 if we are
awarded their business.
"In closing, the entire SigmaTron team takes satisfaction in
reporting positive results for the fourth quarter and fiscal year
after the difficult times we encountered the second half of fiscal
2009 and at the beginning of fiscal 2010. I want to thank our
customers, supply chain, banks, our employees and our Board of
Directors for their support and efforts during this difficult
period."
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.
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CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS |
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Three Months |
Three Months |
Twelve Months |
Twelve Months |
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Ended |
Ended |
Ended |
Ended |
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April 30, |
April 30, |
April 30, |
April 30, |
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2010 |
2009 |
2010 |
2009 |
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Net sales |
$34,982,520 |
$27,162,869 |
$122,476,340 |
$133,744,642 |
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Cost of products sold |
30,148,223 |
24,500,775 |
108,719,103 |
117,769,739 |
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Gross profit |
4,834,297 |
2,662,094 |
13,757,237 |
15,974,903 |
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Selling and administrative expenses |
3,378,059 |
2,262,606 |
10,826,880 |
11,591,440 |
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Operating income |
1,456,238 |
399,488 |
2,930,357 |
4,383,463 |
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Other (income) expense |
(1,062,491) |
395,070 |
(434,972) |
1,491,338 |
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Income from operations before income
tax |
2,518,729 |
4,418 |
3,365,329 |
2,892,125 |
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Income tax expense (income) |
804,477 |
(132,247) |
1,120,786 |
936,278 |
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Net income |
$1,714,252 |
$136,665 |
$2,244,543 |
$1,955,847 |
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Net income per common share
-- basic |
$0.45 |
$0.04 |
$0.59 |
$0.51 |
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Net income per common share
-- assuming dilution |
$0.44 |
$0.04 |
$0.58 |
$0.51 |
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Weighted average number of common
equivalent shares outstanding - assuming dilution |
3,883,645 |
3,822,556 |
3,863,505 |
3,859,526 |
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CONDENSED CONSOLIDATED
BALANCE SHEETS |
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April 30, |
April 30, |
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2010 |
2009 |
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Assets: |
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Current assets |
$69,332,932 |
$59,622,532 |
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Machinery and equipment-net |
25,176,664 |
26,200,578 |
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Intangible assets |
363,671 |
608,887 |
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Other assets |
822,341 |
699,379 |
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Total assets |
$95,695,608 |
$87,131,376 |
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Liabilities and shareholders'
equity: |
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Current liabilities |
$27,165,130 |
$16,055,185 |
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Long-term obligations |
20,867,271 |
25,674,306 |
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Stockholders' equity |
47,663,207 |
45,401,885 |
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Total liabilities and stockholders'
equity |
$95,695,608 |
$87,131,376 |
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CONTACT: SigmaTron International, Inc.
Linda K. Frauendorfer
1-800-700-9095
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