Trio-Tech International (NYSE MKT: TRT) today announced
financial results for the fourth quarter and fiscal year ended June
30, 2020.
Fourth Quarter Results
Revenue for the fourth quarter of fiscal 2020 decreased 32% to
$7,179,000 compared to $10,625,000 for the fourth quarter of fiscal
2019, primarily due to the global COVID-19 pandemic which affected
demand for Trio-Tech’s semiconductor manufacturing products and
testing services. Manufacturing revenue decreased 43% to $2,724,000
compared to $4,803,000 in the same quarter last year, testing
services revenue decreased 28% to $2,822,000 compared to
$3,941,000, and distribution revenue decreased 13% to $1,620,000
compared to $1,864,000 in the same quarter last year.
The pandemic contributed to a decline in revenue, which, coupled
with a change in product mix, reduced gross margin to $1,323,000
for the fourth quarter of fiscal 2020 from $2,468,000 for last
year’s fourth quarter. As a percentage of revenue, gross margin
declined to 18% compared to 23% of revenue for the same quarter
last fiscal year.
The decline in sales, triggered primarily by the effect of the
pandemic, resulted in a fourth quarter loss from operations of
$541,000, compared to income from operations of $321,000 in the
same quarter last fiscal year.
Net income for the fourth quarter of fiscal 2020 was $197,000,
or $0.05 per diluted share, compared to net income of $449,000, or
$0.12 per diluted share, in the same quarter last year. Net income
for the fourth quarter of fiscal 2020 benefited from $455,000 in
other income which is included in financial assistance received
from local government in Singapore, Malaysia and China to mitigate
the negative impact of the COVID-19 pandemic.
Shareholders' equity at June 30, 2020 increased to $25,146,000,
or $6.84 per outstanding share, compared to $24,861,000, or $6.77
per outstanding share, at June 30, 2019. There were 3,673,055
common shares outstanding at June 30, 2020.
CEO Comments
S.W. Yong, Trio-Tech's CEO, said, “There is no doubt that
Trio-Tech was hit hard in the past few months by the COVID-19
pandemic. Under these difficult circumstances we are proud to
report that Trio-Tech remained profitable for the fiscal year and
fourth quarter, posting profits from sales of properties held for
sale in our Malaysia operation. Additionally, backlog at the close
of fiscal 2020 was $9,340,000, a solid figure which compares
favorably to our backlog of $10,149,000 at the end of fiscal 2019.
While the continuing pandemic presents obstacles to the Company’s
short-term outlook, we are taking significant steps to trim
operations, cutting operating and overhead expenses to deal with
the financial effects of the pandemic."
Fiscal 2020 Results
For the fiscal year ended June 30, 2020, revenue decreased 12%
to $34,465,000 compared to $39,198,000 in fiscal 2019, primarily
related to the effects of the COVID-19 pandemic. Manufacturing
revenue decreased 22% to $11,605,000 compared to $14,889,000 and
testing services revenue decreased 11% to $14,840,000 compared to
$16,760,000 for fiscal 2019. Distribution revenue increased 7% to
$7,958,000 compared to $7,451,000 for fiscal 2019.
Fiscal 2020 gross margin decreased to $7,266,000, or 21% of
revenue, compared to $9,001,000, or 23% of revenue for fiscal
2019.
The revenue decline, primarily brought about by the pandemic,
contributed to an operating loss for fiscal 2020 of $859,000,
compared to income from operations of $794,000 for fiscal 2019.
Net income for fiscal 2020 was $966,000, or $0.26 per diluted
share, compared to net income of $1,545,000, or $0.41 per diluted
share, for fiscal 2019.
Net income for fiscal 2020 benefited from other income of
$2,054,000, which included a pre-tax gain of $1,172,000 from the
sale of real estate properties and an additional $718,000 in
governmental grants to mitigate the negative impacts on our
businesses from the pandemic. In fiscal 2019, other income
amounting to $615,000 included a pre-tax gain of $685,000 from the
sale of properties.
About Trio-Tech
Established in 1958, Trio-Tech International is located in Van
Nuys, California, with its Principal Executive Office and regional
headquarter in Singapore. Trio-Tech International is a diversified
business group with interests in semiconductor testing services,
manufacturing and distribution of semiconductor testing equipment,
and real estate. Our subsidiary locations include Tianjin, Suzhou,
Chongqing in China, as well as Kuala Lumpur, Malaysia and Bangkok,
Thailand. Further information about Trio-Tech's semiconductor
products and services can be obtained from the Company's Web site
at www.triotech.com and www.universalfareast.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 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; public health issues
related to the COVID-19 pandemic; 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
2020
2019
2020
2019
Manufacturing
$
2,724
$
4,803
$
11,605
$
14,889
Testing services
2,822
3,941
14,840
16,760
Distribution
1,620
1,864
7,958
7,451
Real estate
13
17
62
98
7,179
10,625
34,465
39,198
Cost of Sales
Cost of manufactured products sold
2,138
3,587
8,927
11,393
Cost of testing services rendered
2,307
2,851
11,353
12,202
Cost of distribution
1,393
1,674
6,847
6,505
Cost of real estate
18
45
72
97
5,856
8,157
27,199
30,197
Gross Margin
1,323
2,468
7,266
9,001
Operating Expenses:
General and administrative
1,657
1,826
6,976
7,049
Selling
132
246
679
826
Research and development
75
75
355
345
Impairment loss on long-lived assets
--
--
139
--
Gain on disposal of property, plant and
equipment
--
--
(24
)
(13
)
Total operating expenses
1,864
2,147
8,125
8,207
(Loss) Income from Operations
(541
)
321
(859
)
794
Other (Expenses) Income
Interest expense
(44
)
(69
)
(230
)
(319
)
Other income, net
522
29
1,112
249
Gain on sale of properties
--
--
1,172
685
Total other Income (Expenses)
478
(40
)
2,054
615
(Loss) Income from Continuing Operations
before Income Taxes
(63
)
281
1,195
1,409
Income Tax Benefit
124
201
12
42
Income from Continuing Operations before
Non-controlling Interest, net of tax
61
482
1,207
1,451
Gain (Loss) from discontinued operations,
net of tax
18
(1
)
(3
)
(3
)
NET INCOME
79
481
1,204
1,448
Less: Net income (loss) attributable to
the non-controlling interest
(118
)
32
238
(97
)
Net Income attributable to Trio-Tech
International
197
449
966
1,545
Net Income Attributable to Trio-Tech
International:
Income from continuing operations, net of
tax
187
451
967
1,548
Gain (Loss) from discontinued operations,
net of tax
10
(2
)
(1
)
(3
)
Net Income Attributable to Trio-Tech
International
197
449
966
1,545
Basic Earnings per Share - Continuing
Operations
$
0.05
$
0.12
$
0.26
$
0.42
Basic Loss per Share - Discontinued
Operations
--
--
--
--
Basic Earnings per Share
$
0.05
$
0.12
$
0.26
$
0.42
Diluted Earnings per Share – Continuing
Operations
$
0.05
$
0.12
$
0.26
$
0.41
Diluted Loss per Share – Discontinued
Operations
--
--
--
--
Diluted Earnings per Share
$
0.05
$
0.12
$
0.26
$
0.41
Weighted Average Shares Outstanding -
Basic
3,673
3,673
3,673
3,673
Weighted Average Shares Outstanding -
Diluted
3,688
3,681
3,722
3,762
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,
2020
2019
2020
2019
Comprehensive Income Attributable to
Trio-Tech International Common Shareholders:
Net income
$
79
$
481
$
1,204
$
1,448
Foreign currency translation, net of
tax
309
(231
)
(742
)
(420
)
Comprehensive Income
388
250
462
1,028
Less: Comprehensive (Loss) Income
attributable to non-controlling interests
(156
)
(11
)
220
(202
)
Comprehensive Income Attributable to
Trio-Tech International
$
544
$
261
$
242
$
1,230
TRIO-TECH INTERNATIONAL AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(IN THOUSANDS, EXCEPT NUMBER OF
SHARES)
June 30,
2020
2019
ASSETS
(Audited)
CURRENT ASSETS:
Cash and cash equivalents
$
4,150
$
4,863
Short-term deposits
6,697
4,144
Short-term advances
141
--
Trade accounts receivable, net
5,951
7,113
Other receivables
998
817
Inventories, net
1,922
2,427
Prepaid expenses and other current
assets
341
287
Assets held for sale
--
89
Total current assets
20,200
19,740
Deferred tax assets
247
390
Investment properties, net
690
782
Property, plant and equipment, net
10,310
12,159
Operating lease right-of-use assets
944
--
Other assets
1,609
1,750
Restricted term deposits
1,660
1,706
Total non-current assets
15,460
16,787
TOTAL ASSETS
$
35,660
$
36,527
LIABILITIES AND SHAREHOLDERS’
EQUITY
CURRENT LIABILITIES:
Lines of credit
$
172
$
187
Accounts payable
2,590
3,272
Accrued expenses
3,005
3,486
Income taxes payable
344
417
Current portion of bank loans payable
370
488
Current portion of finance leases
231
283
Current portion of operating leases
477
--
Current portion of PPP loan
54
--
Total current liabilities
7,243
8,133
Bank loans payable, net of current
portion
1,836
2,292
Finance leases, net of current portion
435
442
Operating leases, net of current
portion
467
--
Deferred tax liabilities
--
327
Income taxes payable
430
439
PPP loan, net of current portion
67
--
Other non-current liabilities
36
33
Total non-current liabilities
3,271
3,533
TOTAL LIABILITIES
10,514
11,666
EQUITY
TRIO-TECH INTERNATIONAL'S SHAREHOLDERS'
EQUITY:
Common stock, no par value, 15,000,000
shares authorized; 3,673,055 shares issued and outstanding at June
30, 2020 and June 30, 2019, respectively
11,424
11,424
Paid-in capital
3,363
3,305
Accumulated retained earnings
8,036
7,070
Accumulated other comprehensive
gain-translation adjustments
1,143
1,867
Total Trio-Tech International
shareholders' equity
23,966
23,666
Non-controlling interest
1,180
1,195
TOTAL EQUITY
25,146
24,861
TOTAL LIABILITIES AND EQUITY
$
35,660
$
36,527
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200923005330/en/
Company Contact: A. Charles Wilson Chairman (818)
787-7000 Investor Contact: Berkman Associates (310) 927-3108
info@BerkmanAssociates.com
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