First Half Net Income $0.11 Per Diluted
Share
Trio-Tech International (NYSE MKT: TRT) today announced
financial results for the second quarter and first six months of
fiscal 2019.
Fiscal 2019 Second Quarter Results
For the three months ended December 31, 2018, revenue decreased
8% to $9,690,000 compared to revenue of $10,552,000 for the same
quarter last year. Manufacturing revenue was $3,352,000, a 16%
decline compared to $3,973,000 for the same quarter last year.
Semiconductor testing services revenue was $4,393,000, an 11%
decline compared to $4,936,000 in the same quarter last year.
Distribution revenue was $1,916,000, a 19% increase compared to
$1,606,000 for the same quarter last year.
Gross margin for the second quarter of fiscal 2019 was
$2,258,000, or 23% of revenue, compared to $2,795,000, or 26% of
revenue, for the same quarter last year, reflecting lower sales and
a less favorable product mix in manufacturing and testing
services.
Operating expenses declined 3% to $2,031,000, or 21% of revenue,
from $2,097,000, or 20% of revenue, primarily due to reduced
selling expenses.
Net income attributable to Trio-Tech common shareholders for the
fiscal 2019 second quarter was $348,000, or $0.09 per diluted
share. This compares to net income attributable to Trio-Tech common
shareholders for the second quarter of fiscal 2018 of $673,000, or
$0.18 per diluted share.
Net income for the second quarter of fiscal 2019 benefitted from
adjustments related to the finalization of the One-Time Mandatory
Repatriation Tax expense of $900,000 which was recognized in the
third quarter of fiscal 2018. Upon finalization of the accounting
analysis, Trio-Tech recorded a reversal of $145,000 from provision
of income tax to reduce the tax liability related to the one-time
transition tax to $755,000. This estimated tax is payable over a
period of eight years at no interest and is not expected to have a
material effect on the Company’s working capital position.
CEO Comments
S.W. Yong, Trio-Tech's CEO, said, "We are glad to report higher
profitability for the second quarter of fiscal 2019 compared to the
year’s first quarter and are working diligently to improve the
Company’s financial performance in the second half of fiscal 2019.
Our state-of-the-art products and services, in many cases, are
available only from Trio-Tech. Based on customer inquiries and
follow-up meetings, we believe Trio-Tech has a competitive
advantage in today’s complex and increasingly competitive
semiconductor manufacturing and testing environment."
Fiscal 2019 First Half Results
For the six months ended December 31, 2018, revenue decreased 8%
to $19,735,000 compared to revenue of $21,497,000 for the first
half of fiscal 2018. Manufacturing revenue decreased 20% to
$6,989,000 compared to $8,738,000 last year. Semiconductor testing
services revenue was down 7% to $8,830,000 compared to $9,541,000 a
year ago, while distribution revenue increased 23% to $3,860,000
compared to $3,142,000.
Gross margin for the first six months of fiscal 2019 decreased
22% to $4,359,000, or 22% of revenue, compared to $5,555,000, or
26% of revenue, for last year’s first six months.
Operating expenses for the first six months of fiscal 2019
decreased 7% to $4,009,000 compared to $4,310,000 for the same
period last year. Operating expenses were 20% of revenue in both
periods.
Net income attributable to Trio-Tech common shareholders for the
first six months of fiscal 2019 was $413,000, or $0.11 per diluted
share, compared to $1,248,000, or $0.34 per diluted share, for the
first six months of fiscal 2018.
Shareholders' equity at December 31, 2018 was $23,511,000, or
$6.40 per outstanding share, compared to $23,501,000, or $6.61 per
outstanding share, at June 30, 2018. There were approximately
3,673,055 Trio-Tech International common shares outstanding at
December 31, 2018.
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 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 UNAUDITED (IN
THOUSANDS, EXCEPT EARNINGS PER SHARE) Three
Months Ended Six Months Ended December 31, December 31,
Revenue 2018 2017 2018 2017 Manufacturing $
3,352 $ 3,973 $ 6,989 $ 8,738 Testing services 4,393 4,936 8,830
9,541 Distribution 1,916 1,606 3,860 3,142 Others 29
37 56 76 9,690
10,552 19,735 21,497
Cost of Sales Cost of manufactured products sold 2,646 3,068
5,503 6,717 Cost of testing services rendered 3,106 3,251 6,489
6,390 Cost of distribution 1,662 1,409 3,348 2,777 Others 18
29 36 58
7,432 7,757 15,376 15,942
Gross Margin 2,258 2,795 4,359 5,555 Operating
Expenses: General and administrative 1,722 1,727 3,481 3,566
Selling 187 252 334 431 Research and development 122 118 194 302
Loss on disposal of property, plant and equipment --
-- -- 11 Total operating
expenses 2,031 2,097 4,009
4,310 Income from Operations 227 698 350 1,245
Other (Expenses) Income Interest expenses (98 ) (52 ) (176 )
(110 ) Other income, net 49 42
92 200 Total other (expenses) income (49 ) (10
) (84 ) 90 Income from Continuing Operations before Income
Taxes 178 688 266 1,335 Income Tax Benefit (expenses) 124
(13 ) 50 (55 ) Income from
Continuing Operations before Non-controlling Interest, Net of Tax
302 675 316 1,280 Income (Loss) from Discontinued Operations, Net
of Tax 4 (2 ) (4 ) (5 )
NET INCOME 306 673 312 1,275 Less: Income Attributable to
Non-controlling Interest (42 ) -- (101
) 27 Net Income Attributable to Trio-Tech
International 348 $ 673 413 $ 1,248 Net Income Attributable
to Trio-Tech International: Income from Continuing
Operations, Net of Tax 346 678 415 1,254 Income (Loss) from
Discontinued Operations, Net of Tax 2 (5 )
(2 ) (6 ) Net Income attributable to Trio-Tech
International $ 348 $ 673 $ 413 $ 1,248 Basic Earnings per
Share $ 0.09 $ 0.19 $ 0.11 $ 0.35 Diluted Earnings per share
$ 0.09 $ 0.18 $ 0.11 $ 0.34
Weighted Average Shares Outstanding B
Basic
3,673 3,548 3,673 3,548 Weighted Average Shares Outstanding B
Diluted 3,781 3,793 3,815 3,770
TRIO-TECH
INTERNATIONAL AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE INCOME UNAUDITED (IN THOUSANDS, EXCEPT
EARNINGS PER SHARE) Three Months Ended
Six Months Ended December 31, December 31, 2018 2017 2018
2017
Comprehensive Income Attributable to
Trio-Tech International Common Shareholders:
Net income $ 306 $ 673 $ 312 $ 1,275 Foreign Currency
Translation, Net of Tax (51 ) 588 (590 )
963 Comprehensive Income (Loss) 255 1,261 (278 )
2,238
Less: Comprehensive Income (Loss)
Attributable To Non-controlling Interest
(57 ) 88 (192 ) 115
Comprehensive Income (Loss) Attributable
to Trio-Tech International Common Shareholders
$ 312 $ 1,173 $ (86 ) $ 2,123
TRIO-TECH
INTERNATIONAL AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE
SHEETS (IN THOUSANDS, EXCEPT NUMBER OF SHARES) Dec.
31, Jun. 30, 2018 2018
ASSETS (unaudited) CURRENT
ASSETS: Cash and cash equivalents $ 6,192 $ 6,539 Short-term
deposits 2,121 653 Trade accounts receivable, net 6,996 7,747 Other
receivables 991 881 Inventories, net 2,630 2,930 Prepaid expenses
and other current assets 279 208 Assets held for sale 486
91 Total current assets 19,695 19,049 Deferred tax
asset 335 400 Investment properties, net 678 1,146 Property, plant
and equipment, net 12,749 11,935 Other assets 1,750 2,249
Restricted term deposits 1,688 1,695 Total
non-current assets 17,200 17,425 TOTAL ASSETS $
36,895 $ 36,474
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES: Lines of credit $ 2,033 $ 2,043
Accounts payable 2,532 3,704 Accrued expenses 3,978 3,172 Income
taxes payable 256 285 Current portion of bank loans payable 480 367
Current portion of capital leases 252 250
Total current liabilities 9,531 9,821 Bank loans payable,
net of current portion 2,525 1,437 Capital leases, net of current
portion 382 524 Deferred tax liabilities 296 327 Income taxes
payable 613 828 Other non-current liabilities 37 36
Total non-current liabilities 3,853 3,152 TOTAL
LIABILITIES $ 13,384 $ 12,973 EQUITY TRIO-TECH
INTERNATIONAL'S SHAREHOLDERS' EQUITY: Common stock, no par value,
15,000,000 shares authorized; 3,673,055 and 3,553,055 issued and
outstanding at December 31, 2018 and June 30, 2018, respectively
11,424 $ 11,023 Paid-in capital 3,258 3,249 Accumulated retained
earnings 5,938 5,525 Accumulated other comprehensive
gain-translation adjustments 1,683 2,182 Total
Trio-Tech International shareholders' equity 22,303 21,979
Non-controlling interest 1,208 1,522 TOTAL
EQUITY $ 23,511 $ 23,501 TOTAL LIABILITIES AND EQUITY $ 36,895 $
36,474
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version on businesswire.com: https://www.businesswire.com/news/home/20190213005677/en/
Company Contact:A. Charles WilsonChairman(818)
787-7000
Investor Contact:Berkman Associates(310)
477-3118info@BerkmanAssociates.com
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