SigmaTron International, Inc. Reports Year End Financial Results for Fiscal Year 2020
August 12 2020 - 9:00AM
SigmaTron International, Inc. (NASDAQ: SGMA), an electronic
manufacturing services company, today reported revenues and
earnings for the fiscal year ended April 30, 2020. Revenues
decreased to $281.0 million in fiscal year 2020 from $290.5 million
in the prior fiscal year. Net income increased to $443,102 in
fiscal year 2020 compared to a net loss of $865,114 in fiscal year
2019. Basic and diluted earnings per share for the fiscal
year ended April 30, 2020 were each $0.10 compared to a loss per
share of $0.20 each in fiscal year 2019.
For the fourth quarter of fiscal year 2020,
revenues decreased to $64.8 million compared to $73.3 million for
the same quarter in the prior fiscal year. Basic and diluted
loss per share for the fiscal year 2020 fourth quarter were $0.09,
respectively, compared to basic and diluted earnings per share of
$0.23 each for the same period of fiscal year 2019.
Commenting on SigmaTron’s results for both the
fourth quarter and fiscal year ending April 30, 2020, Gary R.
Fairhead, President, Chief Executive Officer and Chairman of the
Board, said, “SigmaTron posted a pre-tax loss of $172,525 for the
fourth quarter of fiscal 2020. This led to a pre-tax profit
of $1,093,134 for the fiscal year. While it is always
disappointing to report a quarterly loss, the results were impacted
by operational interruptions and extraordinary expenses related to
the COVID pandemic at all of our operations. In some
locations the interruptions and expenses were worse than
others. In addition to those problems we saw a dramatic drop
in revenue of approximately 30% in the month of April as the
pandemic and its effects grew rapidly in North America.
“As previously reported, during the fourth
quarter the Company received a $6.3M PPP Loan under the CARES
Act. If part or all of the loan is forgiven under the
program, that benefit will be recorded in the quarter in which the
forgiveness occurs. The PPP Loan provided assistance to the
Company as intended by the government, and we are grateful that
such a program was made available to the Company. During this
period, we were able to avoid significant lay-offs or compensation
reductions to our employees.
“The first quarter of fiscal 2021 started the
same as fiscal 2020 ended. May’s revenue drop was similar to
April’s and May’s results alone will result in a first quarter
pre-tax loss. However, the revenue trend was positive from
month to month during the quarter and revenue is definitely
trending in the right direction. This, of course, is
primarily based on our customers’ orders and backlog and while the
economic recovery seems fragile at this time, the positive trend
continues with current customers. We are also seeing
potential new opportunities with new and existing customers.
“One of several disappointments tied to the
COVID pandemic is that we were approaching the fourth quarter with
significant momentum and a strong backlog. We fully expected
that it would be a strong quarter on its own and that we would be
heading into fiscal 2021 with continued growth. During the
pandemic, we have seen several customers with an unexpected and
un-forecasted uptick in demand while we’ve seen others have a
precipitous drop in demand. It’s hard to predict how these
various markets will sort themselves out over the next several
quarters. We continue to believe that the trade war with
China is a negative for the general economy as well as the
Company. It’s hard to see any progress in that area until
after the election so it will remain a reality for the Company, our
customers and our suppliers for several more quarters, at a
minimum.
“The one positive item to come out of the
pandemic for the Company was the incredible performance by each of
the operations during the quarter. They had to deal with
various governmental orders in five different countries, all of
which had different requirements and regulations. They had to
deal with sick employees, some of whom were ultimately determined
to have been infected by COVID-19. In addition to dealing
with disrupted supply chains in terms of component availability and
uncertain transportation, all locations had to deal with customers
that had businesses that were uncertain from day to day. In
spite of all these obstacles, all of the operations and Corporate
departments found a way to get the job done and support our
customers’ needs. It was amazing to see the dedication to the
Company and their jobs that the entire team performed in the wake
of such uncertainty. Many of our customers thanked us for our
exceptional support and service and the entire team should be proud
of what we have accomplished during this unprecedented time.
“As always, I want to thank our customers,
supply chain, our bank, our Board of Directors in addition to our
employees for their continued support of the Company during a
difficult period. I am pleased that we are able to report
positive results for the entire fiscal year.”
About SigmaTron International,
Inc.
Headquartered in Elk Grove Village, Illinois,
SigmaTron International, Inc. is an electronic manufacturing
services company that provides printed circuit board assemblies and
completely assembled electronic products. SigmaTron
International, Inc. operates manufacturing facilities in Elk Grove
Village, Illinois; Acuna, Chihuahua, and Tijuana Mexico; Union
City, California; Suzhou, China, and Biên Hòa City, Vietnam.
SigmaTron International, Inc. maintains engineering and materials
sourcing offices in Elgin, Illinois and Taipei, Taiwan.
Forward-Looking Statements
Note: This press release contains
forward-looking statements. Words such as “continue,”
“anticipate,” “will,” “expect,” “believe,” “plan,” and similar
expressions identify forward-looking statements. These
forward-looking statements are based on the current expectations of
the Company. Because these forward-looking statements involve
risks and uncertainties, the Company’s plans, actions and actual
results could differ materially. Such statements should be
evaluated in the context of the direct and indirect risks and
uncertainties inherent in the Company’s business including, but not
necessarily limited to, the Company’s continued dependence on
certain significant customers; the continued market acceptance of
products and services offered by the Company and its customers;
pricing pressures from the Company’s customers, suppliers and the
market; the activities of competitors, some of which may have
greater financial or other resources than the Company; the
variability of the Company’s operating results; the results of
long-lived assets impairment testing; the ability to achieve the
expected benefits of acquisitions; the collection of aged account
receivables; the variability of the Company’s customers’
requirements; the availability and cost of necessary components and
materials; the ability of the Company and its customers to keep
current with technological changes within its industries;
regulatory compliance, including conflict minerals; the continued
availability and sufficiency of the Company’s credit arrangements,
including the phase-out of LIBOR; the ability to meet the Company’s
financial covenant; changes in U.S., Mexican, Chinese, Vietnamese
or Taiwanese regulations affecting the Company’s business; the
turmoil in the global economy and financial markets; the spread of
COVID-19 (commonly known as “Coronavirus”) which has threatened the
Company’s financial stability by causing a decrease in consumer
revenues, caused a disruption to the Company’s global supply chain,
caused plant closings or reduced operations thus reducing output at
those facilities; the stability of the U.S., Mexican, Chinese,
Vietnamese and Taiwanese economic, labor and political systems and
conditions; currency exchange fluctuations; and the ability of the
Company to manage its growth. These and other factors which
may affect the Company’s future business and results of operations
are identified throughout the Company’s Annual Report on Form 10-K,
and as risk factors, may be detailed from time to time in the
Company’s filings with the Securities and Exchange
Commission. These statements speak as of the date of such
filings, and the Company undertakes no obligation to update such
statements in light of future events or otherwise unless otherwise
required by law.
Financial tables follow…
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CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
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Three Months |
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Three Months |
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Twelve Months |
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Twelve Months |
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Ended |
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Ended |
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Ended |
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Ended |
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April 30, |
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April 30, |
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April 30, |
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April 30, |
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2020 |
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2019 |
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2020 |
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2019 |
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Net sales |
$ |
64,769,921 |
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$ |
73,286,753 |
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$ |
281,042,482 |
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$ |
290,553,951 |
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Cost of products sold |
59,276,626 |
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64,957,245 |
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255,937,592 |
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264,212,182 |
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Gross profit |
5,493,295 |
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8,329,508 |
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25,104,890 |
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26,341,769 |
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Selling and administrative
expenses |
5,295,041 |
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5,972,015 |
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22,292,309 |
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23,263,117 |
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Operating income |
198,254 |
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2,357,493 |
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2,812,581 |
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3,078,652 |
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Other expense |
370,779 |
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568,497 |
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1,719,447 |
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2,212,351 |
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(Loss) income before income
tax |
(172,525 |
) |
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1,788,996 |
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1,093,134 |
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866,301 |
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Income tax expense |
189,542 |
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808,036 |
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650,032 |
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1,731,415 |
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Net (loss) income |
($ |
362,067 |
) |
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$ |
980,960 |
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$ |
443,102 |
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($ |
865,114 |
) |
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Net income (loss) per common
share - basic |
($ |
0.09 |
) |
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$ |
0.23 |
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$ |
0.10 |
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($ |
0.20 |
) |
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Net income (loss) per common
share - assuming dilution |
($ |
0.09 |
) |
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$ |
0.23 |
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$ |
0.10 |
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($ |
0.20 |
) |
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Weighted average number of
common equivalent |
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shares outstanding -
assuming dilution |
4,242,508 |
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4,233,266 |
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4,270,050 |
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4,228,592 |
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CONDENSED CONSOLIDATED BALANCE SHEETS |
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April 30, |
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April 30, |
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2020 |
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2019 |
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Assets: |
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Current assets |
$ |
130,616,797 |
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$ |
123,545,289 |
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Machinery and
equipment-net |
33,935,760 |
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33,232,769 |
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Deferred income taxes |
284,435 |
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384,022 |
Intangibles |
2,350,949 |
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2,713,360 |
Other assets |
8,891,090 |
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1,589,325 |
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Total assets |
$ |
176,079,031 |
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$ |
161,464,765 |
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Liabilities and stockholders'
equity: |
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Current liabilities |
$ |
70,048,041 |
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$ |
55,606,766 |
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Long-term obligations |
47,155,191 |
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47,570,550 |
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Stockholders' equity |
58,875,799 |
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58,287,449 |
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Total liabilities and
stockholders' equity |
$ |
176,079,031 |
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$ |
161,464,765 |
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For Further Information Contact:SigmaTron
International, Inc.Linda K. Frauendorfer1-800-700-9095
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