SigmaTron International, Inc. Reports Financial Results For First Quarter Fiscal 2024
- Revenues from continuing operations decreased by 7% to $98.1 million
- Company remains enthusiastic about long-term prospects for customers
- Net income from continuing operations decreased to $0.3 million
- Geopolitical situation in Asia remains uncertain
ELK GROVE VILLAGE, Ill., Sept. 11, 2023 (GLOBE NEWSWIRE) -- 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
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
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
“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. Reiman
1-800-700-9095
| CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||
| Three Months | Three Months | |||||||||
| Ended | Ended | |||||||||
| July 31, | July 31, | |||||||||
| 2023 | 2022 | |||||||||
| Net sales | 98,130,356 | 105,189,979 | ||||||||
| Cost of products sold | 88,479,136 | 93,612,759 | ||||||||
| Gross profit | 9,651,220 | 11,577,220 | ||||||||
| Selling and administrative expenses | 6,842,805 | 6,529,842 | ||||||||
| Operating income | 2,808,415 | 5,047,378 | ||||||||
| Other expense | (2,700,451 | ) | (917,742 | ) | ||||||
| Income before income tax | 107,964 | 4,129,636 | ||||||||
| Income tax benefit (expense) | 154,135 | (1,008,296 | ) | |||||||
| Net income from continuing operations | $ | 262,099 | $ | 3,121,340 | ||||||
| Discontinued operations: | ||||||||||
| Loss before tax from discontinued operations | - | (2,223,561 | ) | |||||||
| Tax benefit from discontinued operations | - | 478,896 | ||||||||
| Net loss from discontinued operations | - | (1,744,665 | ) | |||||||
| Net income | $ | 262,099 | $ | 1,376,675 | ||||||
| Net income (loss) per common share - basic | ||||||||||
| Net income per common share - basic from continuing operations | 0.04 | 0.52 | ||||||||
| Net loss per common share - basic from discontinued operations | - | (0.29 | ) | |||||||
| Net income per common share - basic | $ | 0.04 | $ | 0.23 | ||||||
| Net income (loss) per common share - diluted | ||||||||||
| Net income per common share - diluted from continuing operations | 0.04 | 0.50 | ||||||||
| Net loss per common share - diluted from discontinued operations | - | (0.28 | ) | |||||||
| Net income per common share - diluted | $ | 0.04 | $ | 0.22 | ||||||
| Weighted average number of common equivalent | ||||||||||
| shares outstanding - assuming dilution | 6,100,284 | 6,191,395 | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
| July 31, | April 30, | |||||||||
| 2023 | 2023 | |||||||||
| Assets: | ||||||||||
| Current assets | 212,583,718 | 220,466,442 | ||||||||
| Machinery and equipment-net | 35,903,317 | 35,788,357 | ||||||||
| Deferred income taxes | 2,460,689 | 2,640,902 | ||||||||
| Intangibles | 1,227,615 | 1,311,030 | ||||||||
| Other assets | 7,659,769 | 8,420,468 | ||||||||
| Total assets | $ | 259,835,108 | $ | 268,627,199 | ||||||
| Liabilities and stockholders' equity: | ||||||||||
| Current liabilities | 143,460,398 | 152,308,599 | ||||||||
| Long-term obligations | 47,836,767 | 48,227,573 | ||||||||
| Stockholders' equity | 68,537,943 | 68,091,027 | ||||||||
| Total liabilities and stockholders' equity | $ | 259,835,108 | $ | 268,627,199 | ||||||
