Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________

FORM 8-K

_________________

CURRENT REPORT

Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 8, 2024

_______________________________

SIGMATRON INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

_______________________________

Delaware	000-23248	36-3918470
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

2201 Landmeier Road

Elk Grove Village, Illinois 60007

(Address of Principal Executive Offices) (Zip Code)

(847) 956-8000

(Registrant's telephone number, including area code)

Not applicable

(Former name or former address, if changed since last report)

_______________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock $0.01 par value per share	SGMA	The NASDAQ Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On March 8, 2024, the Registrant issued a press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number		Description

99.1		Press Release dated March 8, 2024
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	SIGMATRON INTERNATIONAL, INC.


Date: March 8, 2024	By:	/s/ Gary R. Fairhead
		Gary R. Fairhead
		Chief Executive Officer

EXHIBIT 99.1

SigmaTron International, Inc. Reports Financial Results for the Third Quarter of Fiscal 2024

ELK GROVE VILLAGE, Ill., March 08, 2024 (GLOBE NEWSWIRE) -- SigmaTron International, Inc. (NASDAQ: SGMA), an electronic manufacturing services company (the “Company”), today reported revenues and earnings for the fiscal quarter ended January 31, 2024.

Revenues from continuing operations increased $3.2 million, or 3 percent, to $95.9 million in the third quarter of fiscal 2024, compared to $92.7 million for the same quarter in the prior year. Net income from continuing operations for the third quarter ended January 31, 2024, was $0.6 million, compared to $2.7 million for the same quarter in the prior year. Diluted income per share from continuing operations for the quarter ended January 31, 2024 was $0.10, compared to $0.44 income per share for the same quarter in the prior year.

For the nine months ended January 31, 2024, revenues from continuing operations decreased $13.4 million, or 4 percent, to $292.7 million, compared to $306.1 million for the same period in the prior year. Net income from continuing operations for the nine months ended January 31, 2024, was $0.9 million, compared to net income of $8.9 million for the same period in the prior year. Diluted income per share from continuing operations for the nine months ended January 31, 2024 was $0.14, compared to $1.47 income per share for the same period in the prior year.

As previously reported, the Company sold a majority position of its wholly owned subsidiary, Wagz, Inc. (“Wagz”), effective April 1, 2023. As a result, the Company has reported results from Wagz for fiscal 2023 as discontinued operations. For the third quarter ended January 31, 2023, net loss from discontinued operations was $25.8 million. For the nine months ended January 31, 2023, net loss from discontinued operations was $29.8 million. Diluted net loss per share from discontinued operations for the third quarter ended January 31, 2023 was $4.25 and was $4.91 for the nine month period ending January 31, 2023.

Commenting on SigmaTron’s third quarter, fiscal 2024 results, Gary R. Fairhead, Chief Executive Officer and Chairman of the Board, said “I’m pleased to report pre-tax profits of $676,742 for our third quarter of fiscal 2024. As mentioned in our second quarter press release, as we were heading into the quarter, our short-term backlog was soft and our third quarter historically is our weakest quarter. Accordingly, it was good to be profitable. We did see a modest increase in revenue compared to the third quarter of the prior year, but at lower margins. This is related to both mix and cost structure. As you can see, our year-to-date revenue is still running significantly behind the prior year. We are continuing to see that trend in the short-term. There is a general softness from our customer base overall. I think it reflects the uncertainty of the general economy overall and we will continue to manage expenses and working capital accordingly. The Company has reduced inventory by $30 million during the first nine months of our fiscal year.

“In addition to the modest softness overall, several new projects have not come to market as anticipated. They all remain on track to launch but just further out. This should bode well for fiscal 2025 but short-term, they will not contribute to our performance. However, we remain optimistic about those projects as well as several new ones that are under discussion with our customers.

“The report on the electronic component marketplace remains the same as the second quarter. There are still supply chain issues but there have been some modest improvements. The uncertainty related to the geopolitical situations as well as the upcoming elections have negatively affected the overall economy. We remain positive regarding the future but there will definitely be some short-term volatility for the next quarter or two.”

About SigmaTron International, Inc.

Headquartered in Elk Grove Village, Illinois, SigmaTron International, Inc. operates in one reportable segment as an independent provider of electronic manufacturing services (“EMS”). The EMS segment includes printed circuit board assemblies, electro-mechanical subassemblies and completely assembled (box-build) electronic products. The Company and its wholly-owned subsidiaries operate manufacturing facilities in Elk Grove Village, Illinois; Acuna, Chihuahua, and Tijuana Mexico; Union City, California; Suzhou, China; and Biên Hòa City, Vietnam. In addition, the Company maintains an International Procurement Office and Compliance and Sustainability Center in Taipei, Taiwan. The Company also provides design services in Elgin, Illinois, U.S.

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 and goodwill impairment testing; the risks inherent in any merger, acquisition or business combination, including the ability to achieve the expected benefits of acquisitions as well as the expenses of acquisitions; the collectability of aged account receivables; the variability of the Company’s customers’ requirements; the impact of inflation on the Company’s operating results; the availability and cost of necessary components and materials; the impact acts of war may have to the supply chain; 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; the costs of borrowing under the Company’s senior and subordinated credit facilities, including under the rate indices that replaced LIBOR; increasing interest rates; the ability to meet the Company’s financial and restrictive covenants under its loan agreements; changes in U.S., Mexican, Chinese, Vietnamese or Taiwanese regulations affecting the Company’s business; the turmoil in the global economy and financial markets; public health crises, including COVID-19 and variants; the continued availability of scarce raw materials, exacerbated by global supply chain disruptions, necessary for the manufacture of products by the Company; the stability of the U.S., Mexican, Chinese, Vietnamese and Taiwanese economic, labor and political systems and conditions; global business disruption caused by the Russian invasion of Ukraine and related sanctions and the Israel-Hamas conflict; 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.

For Further Information Contact:
SigmaTron International, Inc.
James J. Reiman
1-800-700-9095


CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS


	Three Months		Three Months		Nine Months		Nine Months
	Ended		Ended		Ended		Ended
	January 31,		January 31,		January 31,		January 31,
	2024		2023		2024		2023

Net sales	95,919,888		92,736,725		292,741,928		306,147,772

Cost of products sold	85,992,928		81,575,820		263,475,993		270,103,569

Gross profit	9,926,960		11,160,905		29,265,935		36,044,203

Selling and administrative expenses	6,683,488		6,358,591		20,139,927		19,394,529

Operating income	3,243,472		4,802,314		9,126,008		16,649,674

Other expense	(2,566,730	)	(1,909,630	)	(7,969,374	)	(4,768,389	)

Income before income tax	676,742		2,892,684		1,156,634		11,881,285

Income tax expense	(77,736	)	(196,473	)	(267,267	)	(2,948,323	)

Net income from continuing operations	$599,006		$2,696,211		$889,367		$8,932,962

Discontinued operations:
Loss before tax from discontinued operations	-		(26,027,124	)	-		(30,981,811	)
Tax benefit from discontinued operations	-		253,249		-		1,219,732

Net loss from discontinued operations	-		(25,773,875	)	-		(29,762,079	)

Net income (loss)	$599,006		($23,077,664	)	$889,367		($20,829,117	)

Net income (loss) per common share - basic
Net income per common share - basic from continuing operations	0.10		0.44		0.15		1.47
Net loss per common share - basic from discontinued operations	-		(4.25	)	-		(4.91	)

Net income (loss) per common share - basic	$0.10		($3.81	)	$0.15		($3.44	)

Net income (loss) per common share - diluted
Net income per common share - diluted from continuing operations	0.10		0.44		0.14		1.47
Net loss per common share - diluted from discontinued operations	-		(4.25	)	-		(4.91	)

Net income (loss) per common share - diluted	$0.10		($3.81	)	$0.14		($3.44	)

Weighted average number of common equivalent
shares outstanding - assuming dilution	6,120,317		6,071,288		6,152,073		6,067,161


CONDENSED CONSOLIDATED BALANCE SHEETS

	January 31,		April 30,
	2024		2023

Assets:

Current assets	$194,481,791		220,466,442

Machinery and equipment-net	35,498,047		35,788,357

Deferred income taxes	3,049,434		2,640,902
Intangibles	1,061,997		1,311,030
Other assets	9,449,861		8,420,468

Total assets	$243,541,130		$268,627,199

Liabilities and stockholders' equity:

Current liabilities	$85,186,560		152,308,599

Long-term obligations	88,986,827		48,227,573

Stockholders' equity	69,367,743		68,091,027

Total liabilities and stockholders' equity	$243,541,130		$268,627,199

Cover	Mar. 08, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Mar. 08, 2024
Entity File Number	000-23248
Entity Registrant Name	SIGMATRON INTERNATIONAL, INC.
Entity Central Index Key	0000915358
Entity Tax Identification Number	36-3918470
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	2201 Landmeier Road
Entity Address, City or Town	Elk Grove Village
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60007
City Area Code	847
Local Phone Number	956-8000
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock $0.01 par value per share
Trading Symbol	SGMA
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false