Trio-Tech International (NYSE MKT: TRT) today announced
financial results for the second quarter and first six months of
fiscal 2017:
- Revenue increased 9.0% to $9.1 million
for this year's second quarter compared to $8.4 million for the
second quarter of fiscal 2016.
- Second quarter net income attributable
to Trio-Tech common shareholders increased 63.2%.
- EPS increased to $0.09 per diluted
share, compared to $0.05 per share, in the second quarter of fiscal
2017.
- Revenue increased 11.0% to $18.1
million compared to $16.3 million for the first six months of
fiscal 2016.
- Six months net income attributable to
Trio-Tech common shareholders increased 36.5%.
- EPS increased to $0.17 per diluted
share, compared to $0.13 per share, in the first six months of
fiscal 2016.
CEO CommentsS.W. Yong, Trio-Tech's CEO, said, "Revenue
increased for each of Trio-Tech's businesses in the second quarter
of fiscal 2017, compared to the second quarter of fiscal 2016.
Semiconductor testing services delivered double digit revenue
growth, compared to the second quarter of fiscal 2016, increasing
in all regions except for our China operations. This strength was
also reflected in our distribution segment, which continues to
achieve strong double digit sales gains, primarily due to higher
demand from our Asia customer base.
"Selling, general and administrative expenses increased during
the quarter compared to the second quarter of fiscal 2016,
reflecting the Company’s efforts to expand sales of manufactured
products and testing services." Yong added that net income for this
year's second quarter benefitted from a foreign exchange gain,
compared to a foreign exchange loss in the second quarter of fiscal
2016.
"We remain cautiously optimistic for the remainder of the fiscal
year," Yong concluded.
Fiscal 2017 Second Quarter ResultsFor the three months
ended December 31, 2016, revenue increased 9% to $9,104,000
compared to revenue of $8,354,000 for the same quarter last fiscal
year. Manufacturing revenue increased 1.3% to $3,320,000 for second
quarter of 2017 compared to $3,276,000 in the same quarter last
fiscal year. Revenue from semiconductor testing services increased
10.0% to $4,070,000 in second quarter of 2017, compared to
$3,701,000 for last year's second quarter. Distribution revenue
increased 23.3% to $1,675,000 from $1,359,000 for the second
quarter of fiscal 2016.
Gross margin for the second quarter of fiscal 2017 was 25.2%
compared to 25.3% in the same quarter last year. Increased sales of
lower margin products, compared to the same quarter last year,
affected gross margins at the manufacturing segment, while higher
volume and increased capacity utilization, compared to the same
quarter last year, improved gross margins at the testing segment.
Distribution gross margin benefitted from an improved product mix
at this segment, compared to the same quarter last year.
Operating expenses for the second quarter of fiscal 2017
increased to $2,016,000, or 22.1% of revenue, from $1,787,000, or
21.4% of revenue in the same quarter last year. The increase in
operating expenses is attributable to higher selling and overhead
expenses for manufacturing and testing services segments, compared
to the second quarter last year.
Other income, related to foreign exchange gains, contributed to
a 63.2% increase in second quarter net income attributable to
Trio-Tech common shareholders to $310,000, or $0.09 per diluted
share, compared to net income attributable to Trio-Tech common
shareholders of $190,000, or $0.05 per diluted share, in the second
quarter of fiscal 2016.
Fiscal 2017 Six Months ResultsFor the six months ended
December 31, 2016, revenue increased 11% to $18,075,000 compared to
revenue of $16,284,000 for the same period last fiscal year.
Manufacturing revenue increased 9.0% to $6,991,000 for the six
months compared to $6,416,000 in the first six months of fiscal
2017. Revenue from semiconductor testing services increased 9.9% to
$8,227,000 for the six months compared to $7,484,000 for in the
same period last year. Distribution revenue increased 19.1% to
$2,779,000 from $2,334,000 for the first six months of fiscal
2016.
Gross margin for the first six months of fiscal 2017 was 25.7%
compared to 26.4% in the same period in fiscal 2016. The
manufacturing segment margin was 22.5% compared to 28.6% in the
same period last year and testing services margin was 33.5%
compared to 29.8% for the same period last year. Distribution gross
margin for the first six months of both fiscal 2016 and 2017 was
10.3%.
Operating expenses for the first six months of fiscal 2017 were
22.1% of revenue compared to 22.5% of revenue in the same period of
fiscal 2016. Net income attributable to Trio-Tech common
shareholders increased 36.5% to $613,000, or $0.17 per diluted
share, compared to net income attributable to Trio-Tech common
shareholders of $449,000, or $0.13 per diluted share, for the same
period in fiscal 2016.
Shareholders' equity at December 31, 2016 was $20,087,000, or
$5.72 per outstanding share, compared to $20,871,000, or $5.94 per
outstanding share, at June 30, 2016. There were approximately
3,513,000 common shares outstanding at December 31, 2016 and June
30, 2016.
About Trio-TechEstablished 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 StatementsThis 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 to government policies,
potential legislative 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 CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
Three Months Ended Six Months Ended December 31, December
31, Revenue 2016 2015
2016 2015 Manufacturing $ 3,320 $ 3,276
$ 6,991 $ 6,416 Testing services 4,070 3,701 8,227 7,484
Distribution 1,675 1,359 2,779 2,334 Others 39
18 78 50 9,104
8,354 18,075 16,284 Cost
of Sales Cost of manufactured products sold 2,622 2,471 5,417 4,580
Cost of testing services rendered 2,658 2,499 5,472 5,257 Cost of
distribution 1,501 1,240 2,492 2,093 Others 29
29 42 61 6,810
6,239 13,423 11,991 Gross
Margin 2,294 2,115 4,652 4,293 Operating Expenses: General
and administrative 1,776 1,599 3,519 3,261 Selling 180 141 365 312
Research and development 52 51 105 97 Loss (gain) on disposal of
property, plant and equipment 8 (4 ) 8
(4 ) Total operating expenses 2,016
1,787 3,997 3,666 Income
from Operations 278 328 655 627 Other (Expenses) Income
Interest expenses (48 ) (51 ) (106 ) (104 ) Other income, net
203 18 313 226
Total other income (expenses) 155 (33 ) 207 122
Income from Continuing Operations before Income Taxes 433 295 862
749 Income Tax Expenses (67 ) (86 ) (150 )
(153 ) Income from Continuing Operations before
Non-controlling Interest, Net of Tax 366 209 712 596 (Loss) income
from Discontinued Operations, Net of Tax (4 ) 6
(3 ) (4 ) NET INCOME 362 215 709 592
Less: Income Attributable to Non-controlling Interest 52
25 96 143 Net
Income Attributable to Trio-Tech International $ 310 $ 190 $ 613 $
449 Net Income Attributable to Trio-Tech International:
Income from Continuing Operations, Net of Tax 316 188 619
452 (Loss) income from Discontinued Operations, Net of Tax
(6 ) 2 (6 ) (3 ) Net Income
attributable to Trio-Tech International $ 310 $ 190 $ 613 $ 449
Net income per share - basic $ 0.09 $ 0.05 $
0.18 $ 0.13 Net income per share - diluted
0.09 0.05 0.17 0.13
Weighted Average Shares Outstanding - Basic 3,513
3,513 3,513 3,513 Weighted Average Shares Outstanding - Diluted
3,569 3,529 3,552 3,525
TRIO-TECH INTERNATIONAL AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME UNAUDITED (IN THOUSANDS, EXCEPT
EARNINGS PER SHARE) Three Months Ended Six
Months Ended December 31, December 31, 2016 2015 2016
2015 Comprehensive (Loss) Income Attributable to Trio-Tech
International: Net income $ 362 $ 215 $ 709 $ 592
Foreign Currency Translation, Net of Tax (1,094 ) 22
(1,377 ) (1,403 ) Comprehensive (Loss) Income (732 )
237 (668 ) (811 ) Less: Comprehensive (Loss) Income
Attributable to Non-controlling Interest (16 ) 114
(37 ) (138 ) Comprehensive (Loss) Income Attributable
to Trio-Tech International $ (716 ) $ 123 $ (631 ) $ (673 )
TRIO-TECH INTERNATIONAL AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT NUMBER
OF SHARES) Dec. 31, Jun. 30, 2016 2016
ASSETS
(unaudited) CURRENT ASSETS: Cash and cash equivalents $
4,336 $ 3,807 Short-term deposits 658 295 Trade accounts
receivable, net 7,577 8,826 Other receivables 316 596 Inventories,
net 1,666 1,460 Prepaid expenses and other current assets 363 264
Assets held for sale 82 92 Total current assets
14,998 15,340 Deferred tax assets 371 401 Investment
properties, net 1,234 1,340 Property, plant and equipment, net
10,290 11,283 Other assets 1,882 1,788 Restricted term deposits
1,921 2,067 Total non-current assets 15,698
16,879 TOTAL ASSETS $ 30,696 $ 32,219
LIABILITIES
AND SHAREHOLDER'S EQUITY CURRENT LIABILITIES: Lines of
credit $ 1,419 $ 2,491 Accounts payable 3,730 2,921 Accrued
expenses 2,681 2,642 Income taxes payable 204 230 Current portion
of bank loans payable 235 342 Current portion of capital leases
209 235 Total current liabilities 8,478 8,861
Bank loans payable, net of current portion 1,454 1,725 Capital
leases, net of current portion 398 503 Deferred tax liabilities 237
216 Other non-current liabilities 42 43 Total
non-current liabilities 2,131 2,487 TOTAL LIABILITIES
10,609 11,348 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 December 31, 2016 and
June 30, 2016, respectively 10,882 10,882 Paid-in capital 3,189
3,188 Accumulated retained earnings 3,638 3,025 Accumulated other
comprehensive gain-translation adjustments 918 2,162
Total Trio-Tech International shareholders' equity 18,627 19,257
Non-controlling interest 1,460 1,614 TOTAL
EQUITY 20,087 20,871 TOTAL LIABILITIES AND EQUITY $
31,696 $ 32,219
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version on businesswire.com: http://www.businesswire.com/news/home/20170210005057/en/
Company Contact:Trio-Tech InternationalA. Charles
WilsonChairman(818) 787-7000orInvestor Contact:Berkman
Associates(310) 477-3118info@BerkmanAssociates.com
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