TRT Trio Tech International

Trio-Tech International (NYSE MKT: TRT) today announced financial results for the fourth quarter and fiscal year ended June 30, 2016:

• Fiscal 2016 revenue increased 1.5% to $34,454,000 compared to revenue of $33,932,000 for fiscal 2015. Income from operations increased 21.0%.
• Fiscal 2016 net income increased 49.5% to $0.22 per diluted share compared to $0.15 per diluted share for fiscal 2015.
• Fourth quarter fiscal 2016 revenue increased 5.0% to $8,815,000 compared to revenue of $8,399,000 for the fourth quarter of fiscal 2015. Income from operations increased 21.1%.
• Fourth quarter fiscal 2016 net income decreased to $0.05 per diluted share compared to $0.10 per diluted share for the fourth quarter of fiscal 2015.

CEO Comments

S.W. Yong, Trio-Tech's CEO, said, "We are pleased to report higher revenue and net income for Trio-Tech for fiscal 2016 compared to fiscal 2015, an especially noteworthy performance in view of the challenging operating environment in the global semiconductor industry we confronted again this past year. We attribute these improved results to the success of our efforts to reduce costs while enhancing our reputation for quality service and products.

"Our primary goal is to increase value for our shareholders. Toward this end, we remain focused on continuing to build our core business by expanding our service and product offerings as well as our client base."

Fiscal 2016 Fourth Quarter Results

For the fourth quarter ended June 30, 2016, revenue increased 5.0% to $8,815,000 compared to revenue of $8,399,000 for the fourth quarter of the prior fiscal year. Gross margin improved slightly to 26.6% of revenue compared to 26.2% of revenue for the fourth quarter of fiscal 2015.

General and administrative expenses for the fourth quarter of fiscal 2016 declined to 18.0% of revenue versus 19.9% of revenue for the fourth quarter of fiscal 2015, contributing to a 21.1% increase in income from operations to $510,000 for the fourth quarter of fiscal 2016 compared to $421,000 for the fourth quarter of fiscal 2015.

Net income attributable to Trio-Tech International common shareholders for the fourth quarter of fiscal 2016 was $180,000, or $0.05 per diluted share, compared to net income attributable to Trio-Tech International common shareholders of $352,000, or $0.10 per diluted share, for the fourth quarter of fiscal 2015. Net income for the fourth quarter of fiscal 2016 reflected a foreign exchange loss of $245,000, while net income for the fourth quarter of 2015 benefited from a foreign exchange gain of $256,000.

Fiscal 2016 Results

For the fiscal year ended June 30, 2016, revenue increased 1.5% to $34,454,000 compared to revenue of $33,932,000 in fiscal 2015. Gross margin for fiscal 2016 decreased to 25.5% of revenue from 26.3% of revenue for fiscal 2015.

General and administrative expenses for fiscal 2016 decreased to 18.7% of revenue compared to 20.2% of revenue for fiscal 2015, contributing to a 21.0% increase in income from operations to $1,460,000 for fiscal 2016 compared to $1,207,000 for fiscal 2015.

Fiscal 2016 net income attributable to Trio-Tech International common shareholders increased 49.5% to $779,000, or $0.22 per diluted share, compared to $521,000, or $0.15 per diluted share, for fiscal 2015. Net income for fiscal 2016 reflected a foreign exchange loss of $371,000, while net income for fiscal 2015 benefited from a foreign exchange gain of $84,000.

Shareholders' equity at June 30, 2016 was $20,871,000, or $5.94 per outstanding share, compared to $20,722,000, or $5.90 per outstanding share, at June 30, 2015. There were approximately 3,513,000 common shares outstanding at June 30, 2016 and June 30, 2015.

About Trio-Tech

Established in 1958 and headquartered in Van Nuys, California, Trio-Tech International is a diversified business group with interests in semiconductor testing services, manufacturing and distribution of semiconductor testing equipment, and real estate. Further information about Trio-Tech's semiconductor products and services can be obtained from the Company's Web site at www.triotech.com, www.universalfareast.com, and www.ttsolar.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 Southeast 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; and other economic, financial and regulatory factors beyond the Company's control. Other than statements of historical fact, all statements made in this Quarterly Report 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.

 

TRIO-TECH INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

AUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)

     

Three Months Ended

   

Twelve Months Ended

June 30,

June 30,

Revenue 2016     2015 2016     2015 Products $ 3,626 $ 3,119 $ 14,510 $ 12,873 Testing services 4,174 4,191 15,280 18,020 Distribution 976 1,046 4,542 2,866 Other   39     43     122     173     8,815     8,399     34,454     33,932   Cost of Sales Cost of products sold 2,831 2,175 11,008 10,318 Cost of testing services rendered 2,760 3,068 10,587 12,059 Distribution 849 925 3,967 2,493 Other   31     34     123     137     6,471     6,202     25,685     25,007   Gross Margin 2,344 2,197 8,769 8,925   Operating Expenses: General and administrative 1,588 1,673 6,449 6,848 Selling 206 186 676 717 Research and development 52 44 200 182 Impairment loss -- -- -- 70 (Loss) on disposal of property, plant and equipment   (12 )   (127 )   (16 )   (99 ) Total operating expenses   1,834     1,776     7,309     7,718     Income from Operations 510 421 1,460 1,207   Other Income (Expenses) Interest expense (53 ) (71 ) (204 ) (245 ) Other income, net   (83 )   306     46     363   Total other income (expense)   (136 )   235     (158 )   118     Income from Continuing Operations before Income Taxes 374 656 1,302 1,325 Income Tax (Expense)   (69 )   (251 )   (237 )   (507 )  

Income from Continuing Operations before Non-controlling Interest, net of tax

305 405 1,065 818 Loss (income) from discontinued operations, net of tax   1     (1 )   (4 )   6     NET INCOME $ 306 $ 404 $ 1,061 $ 824   Less: Net income attributable to the non-controlling interest   126     52     282     303   Net Income attributable to Trio-Tech International 180 352 779 521   Net Income Attributable to Trio-Tech International: Income from continuing operations, net of tax 181 351 788 517 Income (loss) from discontinued operations, net of tax   (1 )   1     (9 )   4   Net Income Attributable to Trio-Tech International $ 180   $ 352   $ 779   $ 521     Basic and diluted earnings per share From continuing operations $ 0.05 $ 0.10 $ 0.22 $ 0.15 From discontinued operations   --     --     --     --   Basic and diluted Earnings per Share $ 0.05   $ 0.10   $ 0.22   $ 0.15     Weighted Average Shares Outstanding - Basic 3,513 3,513 3,513 3,513 Weighted Average Shares Outstanding - Diluted 3,535 3,529 3,535 3,529    

TRIO-TECH INTERNATIONAL AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

AUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)

       

Three Months Ended

Twelve Months Ended

June 30,

June 30,

2016     2015 2016     2015 Comprehensive Income (Loss) Attributable to Trio-Tech International: Net income $ 306 $ 404 $ 1,061 $ 824 Foreign currency translation, net of tax   (208 )   (283 )   (832 )   (1,050 ) Comprehensive Income (Loss) 98 121 229 (226 ) Less: Comprehensive (loss) income

attributable to non-controlling interests

  27     (106 )   59     4     Comprehensive Income (Loss) Attributable to Trio-Tech International $ 71   $ 227   $ 170   $ (230 )     TRIO-TECH INTERNATIONAL AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT NUMBER OF SHARES)           June 30,     June 30, 2016 2015 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 3,807 $ 3,711 Short-term deposits 295 101 Trade accounts receivable, net 8,826 7,875 Other receivables 596 389 Inventories, net 1,460 1,141 Prepaid expenses and other current assets 264 244 Assets held for sale   92   98 Total current assets 15,340 13,559   Deferred tax assets 401 453 Investment properties, net 1,340 1,540 Property, plant and equipment, net 11,283 12,522 Other assets 1,788 1,823 Restricted term deposits   2,067   2,140 Total non-current assets   16,879   18,478 TOTAL ASSETS $ 32,219 $ 32,037  

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES: Lines of credit $ 2,491 $ 1,578 Accounts payable 2,921 2,770 Accrued expenses 2,642 3,084 Income taxes payable 230 296 Current portion of bank loans payable 342 346 Current portion of capital leases   235   197 Total current liabilities 8,861 8,271   Bank loans payable, net of current portion 1,725 2,198 Capital leases, net of current portion 503 475 Deferred tax liabilities 216 333 Other non-current liabilities   43   38 Total non-current liabilities   2,487   3,044 TOTAL LIABILITIES   11,348   11,315   COMMITMENTS AND CONTINGENCIES -- --   EQUITY

TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY:

Common stock, no par value, 15,000,000 shares authorized; 3,513,055 shares issued and outstanding at June 30, 2016 and June 30, 2015, respectively

10,882 10,882 Paid-in capital 3,188 3,087 Accumulated retained earnings 3,025 2,246 Accumulated other comprehensive gain-translation adjustments   2,162   2,771 Total Trio-Tech International shareholders' equity 19,257 18,986 Non-controlling interest   1,614   1,736 TOTAL EQUITY   20,871   20,722 TOTAL LIABILITIES AND EQUITY $ 32,219 $ 32,037

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Company Contact:Trio-Tech InternationalA. Charles WilsonChairman(818) 787-7000orInvestor Contact:Berkman Associates(310) 477-3118info@BerkmanAssociates.com