KTCC posts a whopping .25 quarter. Unfortunately, guidance is only for .02-.05 in the current quarter. Too bad. If guidance was better, this one would have been off to the races tomorrow.
Key Tronic Corporation Announces Fourth Quarter and Year-End Results
Tuesday August 19, 4:00 pm ET
Fourth Quarter Revenue Up 17% Year-over-Year; Strong Gross Margins
Highest Revenue Since Executing EMS Strategy;
Continued Expansion and Diversification of Customer Base
SPOKANE VALLEY, Wash.--(BUSINESS WIRE)--Key Tronic Corporation (Nasdaq:KTCC - News), a provider of electronic manufacturing services (EMS), today announced its results for the fourth quarter and year ended June 28, 2008.
For the fourth quarter of fiscal 2008, Key Tronic reported total revenue of $57.3 million, up 17% from $49.2 million in the same period of fiscal 2007. For fiscal 2008, total revenue was $204.1 million, up from $201.7 million for fiscal 2007.
Net income for the fourth quarter of fiscal 2008 was $2.6 million or $0.25 per diluted share, compared to $2.7 million or $0.26 per diluted share for the same period of fiscal 2007. Results for the fourth quarter of fiscal 2007 included the benefit of approximately $1.5 million or $0.14 per diluted share from the sale of a facility. For fiscal 2008, net income was $5.6 million or $0.54 per diluted share, up 7% from $5.2 million or $0.51 per diluted share for fiscal 2007.
“We are pleased with our performance for the fourth quarter and for the year,” said Jack Oehlke, President and Chief Executive Officer. “Our year-over-year revenue growth was driven by increased demand from new customer programs, which continue to ramp up. For the fourth quarter and for the year, we achieved the highest revenue since implementing our EMS strategy. In the fourth quarter, we saw very strong year-over-year revenue growth and the strongest gross margins we’ve seen in many years.
“During the fourth quarter, we continued to diversify our customer portfolio across a wide range of industries, winning new customers involved in telecommunications, industrial equipment, fuel cell technology and consumer products. During the year, we had 8 new customers contributing about 13% of our total revenue. In fiscal 2009, we expect 10 additional new customers to come on line. Together, we expect these 18 new customers to contribute approximately 40% of our revenue in fiscal 2009, offsetting the anticipated decline in demand from some of our existing customers.
“While the industry confronts the challenging economic environment, our sustained investment in our world-class facilities in Mexico provides us with strong competitive advantages in a time of rising labor, fuel and transportation costs. We believe Key Tronic is increasingly well-positioned to pursue and win new opportunities for profitable growth in fiscal 2009 and beyond.”
Business Outlook
For the first quarter of fiscal 2009, the Company expects revenue in the range of $45 million to $48 million, with earnings in the range of $0.02 to $0.05 per share.
Conference Call
Key Tronic will host a conference call today to discuss its financial results at 2:00 PM Pacific (5:00 PM Eastern). A broadcast of the conference call will be available at www.keytronic.com under “Investor Relations” or by calling 800-218-0204 or +1-303-262-2137. A 48-hour replay will be available by calling 800-405-2236 or +1-303-590-3000 (Reservation No. 11116514). A replay will also be available on the Company’s Web site.
About Key Tronic
Key Tronic is a leading contract manufacturer offering value-added design and manufacturing services from its facilities in the United States, Mexico and China. The Company provides its customers full engineering services, materials management, worldwide manufacturing facilities, assembly services, in-house testing, and worldwide distribution. Its customers include some of the world's leading original equipment manufacturers. For more information about Key Tronic visit: www.keytronic.com.
Some of the statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all passages containing verbs such as ‘aims, anticipates, believes, estimates, expects, hopes, intends, plans, predicts, projects or targets’ or nouns corresponding to such verbs. Forward-looking statements also include other passages that are primarily relevant to expected future events or that can only be fully evaluated by events that will occur in the future. Forward-looking statements in this release include, without limitation, the Company’s statements regarding its expectations with respect to quarterly revenue and earnings during fiscal 2009. There are many factors, risks and uncertainties that could cause actual results to differ materially from those predicted or projected in forward-looking statements, including but not limited to the accuracy of customers’ forecasts; success of customers’ programs; timing of new programs; success of new-product introductions; acquisitions or divestitures of operations or facilities; technology advances; changes in pricing policies by the Company, its competitors, customers or suppliers; and the other risks and uncertainties detailed from time to time in the Company’s SEC filings.
KEY TRONIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share amounts)
(Unaudited)
Fourth Quarters Ended Twelve Months Ended
June 28 June 30 June 28 June 30
2008 2007 2008 2007
Net sales $ 57,287 $ 49,159 $ 204,122 $ 201,712
Cost of sales 51,263 44,704 187,302 184,042
Gross profit on sales 6,024 4,455 16,820 17,670
Operating expenses:
Research, development and engineering 679 695 2,676 3,162
Selling 549 437 1,650 1,776
General and administrative 1,861 1,616 6,611 7,387
Gain on sale of real estate - (1,465 ) (951 ) (1,465 )
Total operating expenses 3,089 1,283 9,986 10,860
Operating income 2,935 3,172 6,834 6,810
Interest expense 225 309 989 1,374
Income before income taxes 2,710 2,863 5,845 5,436
Income tax provision 112 139 261 206
Net income $ 2,598 $ 2,724 $ 5,584 $ 5,230
Earnings per share:
Earnings per common share - basic $ 0.26 $ 0.27 $ 0.56 $ 0.53
Weighted average shares O/S - basic 10,024 9,920 9,997 9,898
Earnings per common share - diluted $ 0.25 $ 0.26 $ 0.54 $ 0.51
Weighted average shares O/S - diluted 10,187 10,302 10,267 10,342
KEY TRONIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
June 28 June 30
2008 2007
ASSETS
Current Assets:
Cash and cash equivalents $ 2,879 $ 3,386
Trade receivables - net 36,018 30,383
Inventories 37,927 32,346
Other 4,893 6,532
Total current assets 81,717 72,647
Property, plant and equipment, net 10,798 11,248
Other Assets:
Restricted cash 39 509
Deferred income tax asset - net 4,210 3,500
Other - net 815 719
Goodwill 765 765
Total other assets 5,829 5,493
Total Assets $ 98,344 $ 89,388
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 29,497 $ 24,104
Accrued compensation and vacation 4,388 3,713
Current portion of long term obligations 470 344
Other 1,667 3,264
Total current liabilities 36,022 31,425
Long-Term Liabilities:
Revolving loan 12,348 13,081
Other 893 1,638
Total long-term liabilities 13,241 14,719
Shareholders' Equity:
Common stock, no par value, authorized 25,000 shares;
issued and outstanding 10,024 and 9,921 shares
39,301 39,048
Retained earnings 9,780 4,196
Total shareholders' equity 49,081 43,244
Total Liabilities and Shareholders' Equity $ 98,344 $ 89,388
Contact:
Key Tronic Corporation
Ron Klawitter, Chief Financial Officer, 509-927-5295
or
StreetConnect
Michael Newman, Investor Relations, 206-729-3625
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Source: Key Tronic Corporation
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