Schmitt Industries, Inc. (NASDAQ:SMIT) today announced its
operating results for the three and six months ended November 30,
2017. For the three months ended November 30, 2017, total
sales increased $1,115,319, or 42.0%, to $3,770,880 from $2,655,561
in the three months ended November 30, 2016. Net income was
$103,248, or $0.03 per fully diluted share, for the three months
ended November 30, 2017 as compared to net loss of $382,470, or
$(0.13) per fully diluted share, for the three months ended
November 30, 2016.
For the six months ended November 30, 2017,
total sales increased $1,306,435, or 23.5%, to $6,854,528 from
$5,548,093 in the six months ended November 30, 2016. For the
six months ended November 30, 2017, net loss was $30,850, or
$(0.01) per fully diluted share, as compared to net loss of
$508,099, or $(0.17) per fully diluted share for the six months
ended November 30, 2016.
Balancer segment sales focus throughout the
world on end-users, rebuilders and original equipment manufacturers
of grinding machines with the target geographic markets in North
America, Asia and Europe. Balancer segment sales increased
$833,180, or 59.6%, to $2,230,846 for the three months ended
November 30, 2017 compared to $1,397,666 for the three months ended
November 30, 2016. Balancer segment sales increased $1,342,701, or
45.4%, to $4,301,243 for the six months ended November 30, 2017
compared to $2,958,542 for the six months ended November 30,
2016.
The Measurement segment product line consists of
laser and white light sensor distance measurement and dimensional
sizing products and ultrasonic-based remote tank monitoring
products for propane, diesel and other tank-based liquids. Total
Measurement segment sales increased $282,139, or 22.4%, to
$1,540,034 for the three months ended November 30, 2017 compared to
$1,257,895 for the three months ended November 30, 2016. Total
Measurement segment sales decreased $36,266, or 1.4%, to $2,553,285
for the six months ended November 30, 2017 compared to $2,589,551
for the six months ended November 30, 2016.
Gross margin for the three months ended November
30, 2017 increased to 45.8% as compared to 38.9% for the three
months ended November 30, 2016. Gross margin for the six
months ended November 30, 2017 increased to 45.6% as compared to
43.4% for the six months ended November 30, 2016.
Operating expenses increased $240,251, or 17.3%,
to $1,625,203 for the three months ended November 30, 2017 as
compared to $1,384,952 for the three months ended November 30,
2016. General, administrative and selling expenses increased
$199,768, or 15.1%, to $1,524,443 for the three months ended
November 30, 2017 as compared to $1,324,675 for the same period in
the prior year. Operating expenses increased $293,536, or 10.2%, to
$3,170,004 for the six months ended November 30, 2017 as compared
to $2,876,468 for the six months ended November 30, 2016. General,
administrative and selling expenses increased $255,443, or 9.3%, to
$2,992,787 for the six months ended November 30, 2017 as compared
to $2,737,344 for the same period in the prior year.
“We are encouraged by our sales results for the
quarter with Balancing segment sales in excess of $2 million again
this quarter and Measurement segment sales up relative to the same
quarter last year,” commented David M. Hudson, President and CEO of
Schmitt Industries. “We are working diligently to achieve
profitability on a consistent basis in the second half of Fiscal
2018,” Hudson concluded.
About Schmitt Industries
Schmitt Industries, Inc. (the Company) designs,
manufactures and sells high precision test and measurement products
for two main business segments: the Balancer Segment and the
Measurement Segment. For the Balancer Segment, the Company designs,
manufactures and sells computer-controlled vibration detection,
balancing and process control systems for the worldwide machine
tool industry, particularly for grinding machines. For the
Measurement Segment, the Company designs, manufactures and sells
laser and white light sensors for distance, dimensional and area
measurement for a wide variety of commercial applications and
ultrasonic measurement products that accurately measure the fill
levels of tanks holding propane, diesel and other tank-based
liquids and transmit that data via satellite to a secure web site
for display. In addition, the Measurement segment includes the
Company’s laser-based microroughness measurement products for the
semiconductor wafer and hard disk drive industries and for other
industrial applications and the Company’s laser-based surface
analysis and measurement products that can be used for a variety of
scientific applications. The Company also provides sales and
service for Europe and Asia through its wholly owned subsidiary,
Schmitt Europe Limited (SEL), located in Coventry, England and
through its sales representative office located in Shanghai,
China.
FORWARD-LOOKING STATEMENTS
Certain statements in this release, including
but not limited to remarks by David M. Hudson, are “forward-looking
statements.” These statements are based upon current expectations,
estimates and projections about the Company’s business that are
based, in part, on assumptions made by management. These
statements are not guarantees of future performance and involve
risks and uncertainties that are difficult to predict. Actual
outcomes and results may differ materially from what is expressed
or forecasted in such forward-looking statements due to numerous
factors, including, but not limited to, general economic conditions
and global financial concerns, the volatility of the Company’s
primary markets, the ability to develop new products to satisfy
changes in consumer demands, the intensity of competition,
increased pricing pressure from both competitors and customers, the
effect on production time and overall costs of products if any of
our primary suppliers are lost or if a primary supplier increases
the prices of raw materials or components, the ability to ramp up
manufacturing to satisfy increasing demand, maintenance of a
significant investment in inventories in anticipation of future
sales, existing cash levels which may not be sufficient to fund
future growth, fluctuations in quarterly and annual operating
results, risks associated with operating a global business
including risks from international sales and currency fluctuations,
ability to reduce operating costs if sales decline, attracting and
retaining key management and qualified technical and sales
personnel, changes in effective tax rates, the increased costs due
to changes in securities laws and regulations, and protection of
intellectual property rights.
For further information regarding risks and
uncertainties associated with the Company’s business, please refer
to Schmitt’s SEC filings, including, but not limited to, its Forms
10-K, 10-Q and 8-K.
The forward-looking statements in this release
speak only as of the date on which they were made, and the Company
does not undertake any obligation to update any forward-looking
statement to reflect events or circumstances after the date of this
release, or for changes to this document made by wire services or
internet service providers.
For more information contact: |
Ann
M. Ferguson, CFO and Treasurer(503) 227-7908 or visit our web site
at www.schmitt-ind.com |
|
SCHMITT INDUSTRIES,
INC.CONSOLIDATED BALANCE
SHEETS(UNAUDITED) |
|
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|
|
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|
November 30, 2017 |
|
May 31, 2017 |
|
|
ASSETS |
|
|
Current assets |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
586,986 |
|
|
$ |
867,607 |
|
|
|
Accounts
receivable, net |
|
2,150,655 |
|
|
|
2,344,373 |
|
|
|
Inventories |
|
4,792,085 |
|
|
|
4,204,723 |
|
|
|
Prepaid expenses |
|
105,436 |
|
|
|
115,756 |
|
|
|
Income taxes receivable |
|
714 |
|
|
|
7,310 |
|
|
|
|
|
7,635,876 |
|
|
|
7,539,769 |
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net |
|
819,219 |
|
|
|
865,224 |
|
|
|
Other assets |
|
|
|
|
|
|
|
Intangible assets, net |
|
549,059 |
|
|
|
601,351 |
|
|
|
TOTAL ASSETS |
$ |
9,004,154 |
|
|
$ |
9,006,344 |
|
|
|
|
|
|
LIABILITIES & STOCKHOLDERS’
EQUITY |
|
|
Current liabilities |
|
|
|
|
|
|
|
Accounts payable |
$ |
1,201,098 |
|
|
$ |
1,101,066 |
|
|
|
Accrued commissions |
|
266,727 |
|
|
|
300,234 |
|
|
|
Accrued payroll liabilities |
|
229,584 |
|
|
|
360,239 |
|
|
|
Other accrued liabilities |
|
318,929 |
|
|
|
267,418 |
|
|
|
Total current
liabilities |
|
2,016,338 |
|
|
|
2,028,957 |
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
|
|
|
Common stock, no par value, 20,000,000 shares
authorized, |
|
|
|
|
|
|
|
2,995,910 shares issued and outstanding at November 30, 2017 |
|
|
|
|
|
|
|
and May 31, 2017 |
|
10,690,126 |
|
|
|
10,649,287 |
|
|
|
Accumulated other comprehensive loss |
|
(427,132 |
) |
|
|
(427,572 |
) |
|
|
Accumulated deficit |
|
(3,275,178 |
) |
|
|
(3,244,328 |
) |
|
|
Total stockholders’ equity |
|
6,987,816 |
|
|
|
6,977,387 |
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
9,004,154 |
|
|
$ |
9,006,344 |
|
|
|
|
|
|
|
|
|
|
|
SCHMITT INDUSTRIES,
INC.CONSOLIDATED STATEMENTS OF
OPERATIONSFOR THE THREE AND SIX MONTHS ENDED
NOVEMBER 30, 2017 AND
2016(UNAUDITED) |
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Three Months Ended November 30, |
|
Six Months Ended November 30, |
|
|
|
|
|
2017 |
|
2016 |
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales |
$ |
3,770,880 |
|
$ |
2,655,561 |
|
|
$ |
6,854,528 |
|
|
$ |
5,548,093 |
|
|
|
Cost of
sales |
|
2,044,898 |
|
|
1,623,151 |
|
|
|
3,729,027 |
|
|
|
3,139,934 |
|
|
|
|
Gross profit |
|
1,725,982 |
|
|
1,032,410 |
|
|
|
3,125,501 |
|
|
|
2,408,159 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General,
administration and sales |
|
1,524,443 |
|
|
1,324,675 |
|
|
|
2,992,787 |
|
|
|
2,737,344 |
|
|
|
|
Research
and development |
|
100,760 |
|
|
60,277 |
|
|
|
177,217 |
|
|
|
139,124 |
|
|
|
|
|
Total operating
expenses |
|
1,625,203 |
|
|
1,384,952 |
|
|
|
3,170,004 |
|
|
|
2,876,468 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
100,779 |
|
|
(352,542 |
) |
|
|
(44,503 |
) |
|
|
(468,309 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense), net |
|
9,078 |
|
|
(23,578 |
) |
|
|
26,621 |
|
|
|
(25,411 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income taxes |
|
109,857 |
|
|
(376,120 |
) |
|
|
(17,882 |
) |
|
|
(493,720 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
6,609 |
|
|
6,350 |
|
|
|
12,968 |
|
|
|
14,379 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
103,248 |
|
$ |
(382,470 |
) |
|
$ |
(30,850 |
) |
|
$ |
(508,099 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share, basic |
$ |
0.03 |
|
$ |
(0.13 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.17 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares, basic |
|
2,995,910 |
|
|
2,995,910 |
|
|
|
2,995,910 |
|
|
|
2,995,910 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share,
diluted |
$ |
0.03 |
|
$ |
(0.13 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.17 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares, diluted |
|
3,024,099 |
|
|
2,995,910 |
|
|
|
2,995,910 |
|
|
|
2,995,910 |
|
|
|
|
|
|
|
|
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|
|
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