Schmitt Industries, Inc. (Nasdaq:SMIT) today announced its
operating results for the first quarter ended August 31, 2012.
Sales for the three months ended August 31, 2012 increased
$209,180, or 6.0%, to $3,680,665 compared to $3,471,485 for the
same period last year. Net income for the first quarter ended
August 31, 2012 was $120,148, or $.04 per diluted share, compared
to net income of $137,028, or $.05 per diluted share, for the same
period last year.
For the first quarter ended August 31, 2012, sales in the SBS
Balancer segment decreased $257,516, or 10.2%, to $2,263,023 from
$2,520,539 in the first quarter of Fiscal 2012. Sales in the
Measurement segment increased $466,696, or 49.1%, to $1,417,642 in
the first quarter of Fiscal 2013 from $950,946 in the first quarter
of the prior year. Measurement segment sales increased from
the prior period due primarily to higher volumes of shipments of
laser-based distance measurement and dimensional sizing products
and remote tank monitoring products. Sales of the Company's
balancer products decreased primarily due to lower volumes of
shipments in Asia and North America.
Gross margin for the first quarter increased to 50.9% as
compared to 49.2% in the first quarter of the prior year primarily
due to a shift in the sales mix towards higher margin products and
as a result of the Company's efforts to reduce the material or
component costs from certain key suppliers. Operating expenses
increased $174,383, or 11.1%, to $1,748,124 for the three months
ended August 31, 2012 as compared to $1,573,741 for the three
months ended August 31, 2011 primarily due to higher commissions
related to the increased sales, higher sales and marketing expenses
and higher research and development expenses.
"We are pleased with the increase in revenues this quarter,
particularly from our Acuity® laser sensor and our Xact® tank
measurement system product lines," commented Wayne A. Case, CEO of
Schmitt Industries. "Going forward, we continue to expect
Xact® to make an increasingly significant contribution to our
revenue growth," Case concluded.
Jim Fitzhenry, President of Schmitt Industries, added, "As our
financial results indicate, we are seeing continuous improvement in
our top line which is translating to more consistent
profitability. We are realizing the positive results of the
investments we have made in new product development and in sales
and marketing. We are continuing to focus on these areas in
addition to ramping up production while also monitoring
developments in the global economy as it relates to manufacturing,"
Fitzhenry concluded.
About Schmitt Industries
Schmitt Industries, Inc. designs, manufactures and markets
computer-controlled vibration detection and balancing equipment
(the Balancer segment) primarily to the machine tool
industry. Through its wholly owned subsidiary, Schmitt
Measurement Systems, Inc., the Company designs, manufactures and
markets precision laser-based surface measurement products for a
wide variety of commercial applications in addition to the disk
drive, silicon wafer and optics industries; laser-based distance
measurement products for a wide variety of industrial applications;
and ultrasonic measurement products that accurately measure the
fill levels of liquefied propane tanks and transmit that data via
satellite to a secure web site (the Measurement segment). The
Company also sells and markets its products in Europe through its
wholly owned subsidiary, Schmitt Europe Ltd. located in the United
Kingdom.
FORWARD-LOOKING STATEMENTS
Certain statements in this release, including but not limited to
remarks by Wayne Case and Jim Fitzhenry, 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, global financial concerns, the volatility of the
Company's primary markets, the Xact® tank monitoring system's
commercial viability and our ability to satisfy expected demand,
the ability to meet production requirements for new products, the
ability to develop new products to satisfy changes in consumer
demands, protection of intellectual property rights, the intensity
of competition, 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, fluctuations in quarterly and annual operating
results, the ability to reduce operating costs if sales decline,
maintenance of a significant investment in inventories in
anticipation of future sales, attracting and retaining key
management and qualified technical and sales personnel, changes in
effective tax rates, increased costs due to changes in securities
laws and regulations, and risks from international sales and
currency fluctuations.
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.
|
|
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SCHMITT
INDUSTRIES, INC. |
|
|
CONSOLIDATED BALANCE SHEETS |
|
|
(UNAUDITED) |
|
|
|
August 31, 2012 |
May 31, 2012 |
ASSETS |
|
|
Current assets |
|
|
Cash and cash equivalents |
$3,068,779 |
$2,776,817 |
Accounts receivable, net of
allowance of $26,985 and $26,720 at August 31, 2012 and May 31,
2012, respectively |
2,410,959 |
2,493,889 |
Inventories |
3,952,438 |
3,975,600 |
Prepaid expenses |
170,928 |
186,489 |
Income taxes receivable |
6,521 |
7,780 |
|
9,609,625 |
9,440,575 |
Property and equipment |
|
|
Land |
299,000 |
299,000 |
Buildings and improvements |
1,723,273 |
1,723,273 |
Furniture, fixtures and
equipment |
1,274,881 |
1,247,720 |
Vehicles |
121,835 |
121,835 |
|
3,418,989 |
3,391,828 |
Less accumulated depreciation
and amortization |
(2,044,654) |
(2,019,692) |
|
1,374,335 |
1,372,136 |
Other assets |
|
|
Intangible assets, net |
1,179,254 |
1,213,204 |
TOTAL
ASSETS |
$12,163,214 |
$12,025,915 |
|
|
|
|
|
|
LIABILITIES &
STOCKHOLDERS' EQUITY |
|
|
Current liabilities |
|
|
Accounts payable |
$718,903 |
$770,586 |
Accrued commissions |
403,967 |
335,104 |
Accrued payroll
liabilities |
166,235 |
142,665 |
Other accrued liabilities |
228,706 |
286,319 |
Total current
liabilities |
1,517,811 |
1,534,674 |
Long-term liabilities |
7,500 |
7,500 |
Stockholders' equity |
|
|
Common stock, no par value,
20,000,000 shares authorized, |
|
|
2,990,910 shares issued and
outstanding at both August 31, 2012 and May 31, 2012 |
10,302,277 |
10,279,636 |
Accumulated other comprehensive
loss |
(301,922) |
(313,295) |
Retained earnings |
637,548 |
517,400 |
Total stockholders'
equity |
10,637,903 |
10,483,741 |
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY |
$12,163,214 |
$12,025,915 |
|
|
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SCHMITT
INDUSTRIES, INC. |
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
FOR THE
THREE MONTHS ENDED AUGUST 31, 2012 AND 2011 |
|
(UNAUDITED) |
|
|
|
|
Three Months Ended August
31, |
|
2012 |
2011 |
|
|
|
Net sales |
$3,680,665 |
$3,471,485 |
Cost of sales |
1,806,717 |
1,763,581 |
Gross profit |
1,873,948 |
1,707,904 |
|
|
|
Operating expenses: |
|
|
General, administration and
sales |
1,632,815 |
1,512,190 |
Research and development |
115,309 |
61,551 |
Total operating expenses |
1,748,124 |
1,573,741 |
|
|
|
Operating income |
125,824 |
134,163 |
|
|
|
Other income |
512 |
9,438 |
|
|
|
Income before income taxes |
126,336 |
143,601 |
|
|
|
Provision for income taxes |
6,188 |
6,573 |
|
|
|
Net income |
$120,148 |
$137,028 |
|
|
|
Net earnings per common
share: |
|
|
|
|
|
Basic |
$0.04 |
$0.05 |
|
|
|
Weighted average number of
common shares, basic |
2,990,910 |
2,895,635 |
|
|
|
Diluted |
$ 0.04 |
$ 0.05 |
|
|
|
Weighted average number of
common shares, diluted |
3,005,291 |
2,967,264 |
CONTACT: Jeffrey T Siegal, CFO and Treasurer
(503) 227-7908
or visit our web site at www.schmitt-ind.com
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