VAN NUYS, Calif.--(BUSINESS WIRE)--Trio-Tech International (NYSE MKT: TRT) today announced financial results for the second quarter and first six months of fiscal 2017:
- Revenue increased 9.0% to $9.1 million for this year's second quarter compared to $8.4 million for the second quarter of fiscal 2016.
- Second quarter net income attributable to Trio-Tech common shareholders increased 63.2%.
- EPS increased to $0.09 per diluted share, compared to $0.05 per share, in the second quarter of fiscal 2017.
- Revenue increased 11.0% to $18.1 million compared to $16.3 million for the first six months of fiscal 2016.
- Six months net income attributable to Trio-Tech common shareholders increased 36.5%.
- EPS increased to $0.17 per diluted share, compared to $0.13 per share, in the first six months of fiscal 2016.
CEO Comments
S.W. Yong, Trio-Tech's CEO, said, "Revenue
increased for each of Trio-Tech's businesses in the second quarter of
fiscal 2017, compared to the second quarter of fiscal 2016.
Semiconductor testing services delivered double digit revenue growth,
compared to the second quarter of fiscal 2016, increasing in all regions
except for our China operations. This strength was also reflected in our
distribution segment, which continues to achieve strong double digit
sales gains, primarily due to higher demand from our Asia customer base.
"Selling, general and administrative expenses increased during the quarter compared to the second quarter of fiscal 2016, reflecting the Company’s efforts to expand sales of manufactured products and testing services." Yong added that net income for this year's second quarter benefitted from a foreign exchange gain, compared to a foreign exchange loss in the second quarter of fiscal 2016.
"We remain cautiously optimistic for the remainder of the fiscal year," Yong concluded.
Fiscal 2017 Second Quarter Results
For the three months
ended December 31, 2016, revenue increased 9% to $9,104,000 compared to
revenue of $8,354,000 for the same quarter last fiscal year.
Manufacturing revenue increased 1.3% to $3,320,000 for second quarter of
2017 compared to $3,276,000 in the same quarter last fiscal year.
Revenue from semiconductor testing services increased 10.0% to
$4,070,000 in second quarter of 2017, compared to $3,701,000 for last
year's second quarter. Distribution revenue increased 23.3% to
$1,675,000 from $1,359,000 for the second quarter of fiscal 2016.
Gross margin for the second quarter of fiscal 2017 was 25.2% compared to 25.3% in the same quarter last year. Increased sales of lower margin products, compared to the same quarter last year, affected gross margins at the manufacturing segment, while higher volume and increased capacity utilization, compared to the same quarter last year, improved gross margins at the testing segment. Distribution gross margin benefitted from an improved product mix at this segment, compared to the same quarter last year.
Operating expenses for the second quarter of fiscal 2017 increased to $2,016,000, or 22.1% of revenue, from $1,787,000, or 21.4% of revenue in the same quarter last year. The increase in operating expenses is attributable to higher selling and overhead expenses for manufacturing and testing services segments, compared to the second quarter last year.
Other income, related to foreign exchange gains, contributed to a 63.2% increase in second quarter net income attributable to Trio-Tech common shareholders to $310,000, or $0.09 per diluted share, compared to net income attributable to Trio-Tech common shareholders of $190,000, or $0.05 per diluted share, in the second quarter of fiscal 2016.
Fiscal 2017 Six Months Results
For the six months ended
December 31, 2016, revenue increased 11% to $18,075,000 compared to
revenue of $16,284,000 for the same period last fiscal year.
Manufacturing revenue increased 9.0% to $6,991,000 for the six months
compared to $6,416,000 in the first six months of fiscal 2017. Revenue
from semiconductor testing services increased 9.9% to $8,227,000 for the
six months compared to $7,484,000 for in the same period last year.
Distribution revenue increased 19.1% to $2,779,000 from $2,334,000 for
the first six months of fiscal 2016.
Gross margin for the first six months of fiscal 2017 was 25.7% compared to 26.4% in the same period in fiscal 2016. The manufacturing segment margin was 22.5% compared to 28.6% in the same period last year and testing services margin was 33.5% compared to 29.8% for the same period last year. Distribution gross margin for the first six months of both fiscal 2016 and 2017 was 10.3%.
Operating expenses for the first six months of fiscal 2017 were 22.1% of revenue compared to 22.5% of revenue in the same period of fiscal 2016. Net income attributable to Trio-Tech common shareholders increased 36.5% to $613,000, or $0.17 per diluted share, compared to net income attributable to Trio-Tech common shareholders of $449,000, or $0.13 per diluted share, for the same period in fiscal 2016.
Shareholders' equity at December 31, 2016 was $20,087,000, or $5.72 per outstanding share, compared to $20,871,000, or $5.94 per outstanding share, at June 30, 2016. There were approximately 3,513,000 common shares outstanding at December 31, 2016 and June 30, 2016.
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 Southeast Asia, including currency fluctuations and devaluation,
currency restrictions, local laws and restrictions and possible social,
political and economic instability; changes to government policies,
potential legislative 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 | |||||||||||||||
| CONDENSED 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 | 2016 | 2015 | 2016 | 2015 | |||||||||||
| Manufacturing | $ | 3,320 | $ | 3,276 | $ | 6,991 | $ | 6,416 | |||||||
| Testing services | 4,070 | 3,701 | 8,227 | 7,484 | |||||||||||
| Distribution | 1,675 | 1,359 | 2,779 | 2,334 | |||||||||||
| Others | 39 | 18 | 78 | 50 | |||||||||||
| 9,104 | 8,354 | 18,075 | 16,284 | ||||||||||||
| Cost of Sales | |||||||||||||||
| Cost of manufactured products sold | 2,622 | 2,471 | 5,417 | 4,580 | |||||||||||
| Cost of testing services rendered | 2,658 | 2,499 | 5,472 | 5,257 | |||||||||||
| Cost of distribution | 1,501 | 1,240 | 2,492 | 2,093 | |||||||||||
| Others | 29 | 29 | 42 | 61 | |||||||||||
| 6,810 | 6,239 | 13,423 | 11,991 | ||||||||||||
| Gross Margin | 2,294 | 2,115 | 4,652 | 4,293 | |||||||||||
| Operating Expenses: | |||||||||||||||
| General and administrative | 1,776 | 1,599 | 3,519 | 3,261 | |||||||||||
| Selling | 180 | 141 | 365 | 312 | |||||||||||
| Research and development | 52 | 51 | 105 | 97 | |||||||||||
| Loss (gain) on disposal of property, plant and equipment | 8 | (4 | ) | 8 | (4 | ) | |||||||||
| Total operating expenses | 2,016 | 1,787 | 3,997 | 3,666 | |||||||||||
| Income from Operations | 278 | 328 | 655 | 627 | |||||||||||
| Other (Expenses) Income | |||||||||||||||
| Interest expenses | (48 | ) | (51 | ) | (106 | ) | (104 | ) | |||||||
| Other income, net | 203 | 18 | 313 | 226 | |||||||||||
| Total other income (expenses) | 155 | (33 | ) | 207 | 122 | ||||||||||
| Income from Continuing Operations before Income Taxes | 433 | 295 | 862 | 749 | |||||||||||
| Income Tax Expenses | (67 | ) | (86 | ) | (150 | ) | (153 | ) | |||||||
| Income from Continuing Operations | |||||||||||||||
| before Non-controlling Interest, Net of Tax | 366 | 209 | 712 | 596 | |||||||||||
| (Loss) income from Discontinued Operations, Net of Tax | (4 | ) | 6 | (3 | ) | (4 | ) | ||||||||
| NET INCOME | 362 | 215 | 709 | 592 | |||||||||||
| Less: Income Attributable to Non-controlling Interest | 52 | 25 | 96 | 143 | |||||||||||
| Net Income Attributable to Trio-Tech International | $ | 310 | $ | 190 | $ | 613 | $ | 449 | |||||||
| Net Income Attributable to Trio-Tech International: | |||||||||||||||
| Income from Continuing Operations, Net of Tax | 316 | 188 | 619 | 452 | |||||||||||
| (Loss) income from Discontinued Operations, Net of Tax | (6 | ) | 2 | (6 | ) | (3 | ) | ||||||||
| Net Income attributable to Trio-Tech International | $ | 310 | $ | 190 | $ | 613 | $ | 449 | |||||||
| Net income per share - basic | $ | 0.09 | $ | 0.05 | $ | 0.18 | $ | 0.13 | |||||||
| Net income per share - diluted | 0.09 | 0.05 | 0.17 | 0.13 | |||||||||||
| Weighted Average Shares Outstanding - Basic | 3,513 | 3,513 | 3,513 | 3,513 | |||||||||||
| Weighted Average Shares Outstanding - Diluted | 3,569 | 3,529 | 3,552 | 3,525 | |||||||||||
| TRIO-TECH INTERNATIONAL AND SUBSIDIARIES | ||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||||||
| UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE) | ||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||
| December 31, | December 31, | |||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||
| Comprehensive (Loss) Income | ||||||||||||||
| Attributable to Trio-Tech International: | ||||||||||||||
| Net income | $ | 362 | $ | 215 | $ | 709 | $ | 592 | ||||||
| Foreign Currency Translation, Net of Tax | (1,094 | ) | 22 | (1,377 | ) | (1,403 | ) | |||||||
| Comprehensive (Loss) Income | (732 | ) | 237 | (668 | ) | (811 | ) | |||||||
| Less: Comprehensive (Loss) Income | ||||||||||||||
| Attributable to Non-controlling Interest | (16 | ) | 114 | (37 | ) | (138 | ) | |||||||
| Comprehensive (Loss) Income | ||||||||||||||
| Attributable to Trio-Tech International | $ | (716 | ) | $ | 123 | $ | (631 | ) | $ | (673 | ) | |||
|
TRIO-TECH INTERNATIONAL AND SUBSIDIARIES |
|||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||
| (IN THOUSANDS, EXCEPT NUMBER OF SHARES) | |||||
| Dec. 31, | Jun. 30, | ||||
| 2016 | 2016 | ||||
| ASSETS | (unaudited) | ||||
| CURRENT ASSETS: | |||||
| Cash and cash equivalents | $ | 4,336 | $ | 3,807 | |
| Short-term deposits | 658 | 295 | |||
| Trade accounts receivable, net | 7,577 | 8,826 | |||
| Other receivables | 316 | 596 | |||
| Inventories, net | 1,666 | 1,460 | |||
| Prepaid expenses and other current assets | 363 | 264 | |||
| Assets held for sale | 82 | 92 | |||
| Total current assets | 14,998 | 15,340 | |||
| Deferred tax assets | 371 | 401 | |||
| Investment properties, net | 1,234 | 1,340 | |||
| Property, plant and equipment, net | 10,290 | 11,283 | |||
| Other assets | 1,882 | 1,788 | |||
| Restricted term deposits | 1,921 | 2,067 | |||
| Total non-current assets | 15,698 | 16,879 | |||
| TOTAL ASSETS | $ | 30,696 | $ | 32,219 | |
| LIABILITIES AND SHAREHOLDER'S EQUITY | |||||
| CURRENT LIABILITIES: | |||||
| Lines of credit | $ | 1,419 | $ | 2,491 | |
| Accounts payable | 3,730 | 2,921 | |||
| Accrued expenses | 2,681 | 2,642 | |||
| Income taxes payable | 204 | 230 | |||
| Current portion of bank loans payable | 235 | 342 | |||
| Current portion of capital leases | 209 | 235 | |||
| Total current liabilities | 8,478 | 8,861 | |||
| Bank loans payable, net of current portion | 1,454 | 1,725 | |||
| Capital leases, net of current portion | 398 | 503 | |||
| Deferred tax liabilities | 237 | 216 | |||
| Other non-current liabilities | 42 | 43 | |||
| Total non-current liabilities | 2,131 | 2,487 | |||
| TOTAL LIABILITIES | 10,609 | 11,348 | |||
| COMMITMENTS AND CONTINGENCIES | -- | -- | |||
| EQUITY | |||||
| TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY: | |||||
| Common stock, no par value, 15,000,000 shares authorized; 3,513,055 shares | |||||
| issued and outstanding at December 31, 2016 and June 30, 2016, respectively | 10,882 | 10,882 | |||
| Paid-in capital | 3,189 | 3,188 | |||
| Accumulated retained earnings | 3,638 | 3,025 | |||
| Accumulated other comprehensive gain-translation adjustments | 918 | 2,162 | |||
| Total Trio-Tech International shareholders' equity | 18,627 | 19,257 | |||
| Non-controlling interest | 1,460 | 1,614 | |||
| TOTAL EQUITY | 20,087 | 20,871 | |||
| TOTAL LIABILITIES AND EQUITY | $ | 31,696 | $ | 32,219 | |
