IEC Announces Fiscal 2019 First Quarter Results

Newark, New York, February 6, 2019 — IEC Electronics Corp. (NYSE American: IEC) today announced results for the fiscal 2019 first quarter ended December 28, 2018.

 IEC reported revenues of $35.4 million for the first quarter of fiscal 2019, an increase of 68% as compared to revenues of $21.2 million for the fiscal 2018 first quarter ended December 29, 2017.  Gross profit margin for the first quarter of fiscal 2019 improved to 14.3% as compared to 7.2% in the same quarter last year.  Selling and administrative expenses increased to $3.4 million but decreased as a percentage of sales to 9.5%, as compared to $2.8 million or 13.2% of sales in the first quarter of fiscal 2018.  The Company reported net income of $1.1 million, or $0.10 per basic and diluted share for the first quarter of fiscal 2019, compared to a net loss of $0.5 million, or a loss of $0.05 per basic and diluted share, which includes a $0.10 benefit from a one-time tax adjustment, in the first quarter of fiscal 2018.

 Jeffrey T. Schlarbaum, President and CEO of IEC Electronics commented, “We’re pleased to have delivered a strong start to fiscal 2019, reflected in significantly increased revenue and enhanced profitability.  As we expected, in addition to year over year improvement, we also achieved sequential revenue growth of 4% compared to the fourth quarter of 2018, a notable development as historically our first quarter performance typically shows a sequential decline.   This growth is purely organic, driven largely by our ability to win new programs from existing customers, reflecting growing confidence in IEC as a dependable manufacturing partner and the value of our portfolio of vertically integrated offerings.  Furthermore, we continued to see strong bookings, achieving an increased book to bill ratio of 1.6:1 at December 28, 2018, up from 1.3:1 at September 30, 2018, resulting in a double digit growth to our overall company backlog.

 “Our industry and our Company continue to experience the effects of global component shortages and we are focused on managing our workforce and inventory levels so that we remain in the position to efficiently convert our strong backlog.  In order to support our customers as their orders move from backlog to production, we invest in labor and overhead as necessary to ensure we can support the needs of our expanding customer base.” 

 Mr. Schlarbaum concluded, “As we continue through fiscal 2019, we believe we’re competitively positioned to capture additional market share and grow our leadership position as a reliable and consistent manufacturing partner for life-saving and mission critical products.  We are excited by the opportunities we’re seeing in the marketplace and from our vantage point today, we maintain our expectation of delivering double digit year over year growth in fiscal 2019.”

 

Conference Call:

 IEC will host a conference call, today, Wednesday, February 6, 2019 at 10:00 a.m. Eastern Time, to discuss its financial results for the fiscal 2019 first quarter ended December 28, 2018.

The conference call may be accessed in the U.S. and Canada by dialing toll-free (866) 682-6100. International callers may access the call by dialing (862)298-0702.

A replay of the teleconference will be available for 30 days after the call and may be accessed domestically by dialing (877) 481-4010 and international callers may dial (919) 882-2331.  Callers must enter conference ID: 41835.

To access the live webcast, log onto the IEC website at http://www.iec-electronics.com.  The webcast can also be accessed at http://www.investorcalendar.com/event/41835. An online replay will be available shortly after the call.

 

 

About IEC Electronics

IEC Electronics is a provider of electronic manufacturing services ("EMS") to advanced technology companies that produce life-saving and mission critical products for the medical, industrial, aerospace and defense sectors. The Company specializes in delivering technical solutions for the custom manufacture of complex full system assemblies by providing on-site analytical testing laboratories, custom design and test engineering services combined with a broad array of manufacturing services encompassing electronics, interconnect solutions, and precision metalworking.  As a full service EMS provider, IEC holds all appropriate certifications for the market sectors it supports including ISO 9001:2008, AS9100D, ISO 13485, and Nadcap accredited.  IEC Electronics is headquartered in Newark, NY and also has operations in Rochester, NY and Albuquerque, NM.  Additional information about IEC can be found on its web site at www.iec-electronics.com.

Note Regarding Forward-Looking Statements

 

References in this report to “IEC,” “IEC Electronics,” the “Company,” “we,” “our,” or “us” mean IEC Electronics Corp. and its subsidiaries except where the context otherwise requires. This release contains forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “optimistic,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar words or phrases. These forward-looking statements include, but are not limited to, statements regarding future sales and operating results, future prospects, the capabilities and capacities of business operations, any financial or other guidance and all statements that are not based on historical fact, but rather reflect our current expectations concerning future results and events. The ultimate correctness of these forward-looking statements is dependent upon a number of known and unknown risks and events and is subject to various uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements.

 

The following important factors, among others, could affect future results and events, causing those results and events to differ materially from those views expressed or implied in our forward-looking statements: business conditions and growth or contraction in our customers’ industries, the electronic manufacturing services industry and the general economy; variability of our operating results; our ability to control our material, labor and other costs; our dependence on a limited number of major customers; the potential consolidation of our customer base; availability of component supplies; dependence on certain industries; variability and timing of customer requirements; technological, engineering and other start-up issues related to new programs and products; uncertainties as to availability and timing of governmental funding for our customers; the impact of government regulations, including FDA regulations; risks related to the accuracy of the estimates and assumptions we used to revalue our net deferred tax assets in accordance with the Tax Cuts and Jobs Act of 2017; the types and mix of sales to our customers; litigation and governmental investigations; intellectual property litigation; our ability to maintain effective internal controls over financial reporting; unforeseen product failures and the potential product liability claims that may be associated with such failures; the availability of capital and other economic, business and competitive factors affecting our customers, our industry and business generally; failure or breach of our information technology systems; and natural disasters. Any one or more of such risks and uncertainties could have a material adverse effect on us or the value of our common stock. For a further list and description of various risks, relevant factors and uncertainties that could cause future results or events to differ materially from those expressed or implied in our forward-looking statements, see our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q and our other filings with the Securities and Exchange Commission.

 

All forward-looking statements included in this release are made only as of the date indicated or as of the date of this release. We do not undertake any obligation to, and may not, publicly update or correct any forward-looking statements to reflect events or circumstances that subsequently occur or which we hereafter become aware of, except as required by law. New risks and uncertainties arise from time to time and we cannot predict these events or how they may affect us and cause actual results to differ materially from those expressed or implied by our forward-looking statements. Therefore, you should not rely on our forward-looking statements as predictions of future events.

 

Contact:

Audra Gavelis

 

Director of Marketing & Investor Relations

 

IEC Electronics Corp.

 

(315) 332-4559

 

agavelis@iec-electronics.com

IEC ELECTRONICS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

DECEMBER 28, 2018 and SEPTEMBER 30, 2018

(unaudited; in thousands, except share and per share data)

 

December 28,
 2018

 

September 30,
 2018

ASSETS

 

 

 

Current assets:

 

 

 

Cash

$

 

 

$

 

Accounts receivable, net of allowance

   22,716

 

 

   25,168

 

Unbilled contract revenue

   6,103

 

 

   —

 

Inventories

   37,214

 

 

   34,126

 

Other current assets

   1,527

 

 

   1,747

 

Total current assets

   67,560

 

 

   61,041

 

 

 

 

 

Property, plant and equipment, net

   19,966

 

 

   20,110

 

Deferred income taxes

   8,419

 

 

   8,855

 

Other long term assets

   697

 

 

   442

 

Total assets

$

96,642

 

 

$

90,448

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Current liabilities:

 

 

 

Current portion of long-term debt

$

1,841

 

 

$

1,449

 

Current portion of capital lease obligation

316

 

 

306

 

Accounts payable

28,611

 

 

28,689

 

Accrued payroll and related expenses

2,223

 

 

1,796

 

Other accrued expenses

527

 

 

458

 

Customer deposits

8,673

 

 

7,595

 

Total current liabilities

42,191

 

 

40,293

 

 

 

 

 

Long-term debt

18,754

 

 

16,002

 

Long-term capital lease obligation

6,942

 

 

7,027

 

Other long-term liabilities

1,700

 

 

1,750

 

Total liabilities

69,587

 

 

65,072

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

Preferred stock, $0.01 par value:

 

 

 

500,000 shares authorized; none issued or outstanding

 

 

 

Common stock, $0.01 par value:

 

 

 

Authorized: 50,000,000 shares

 

 

 

Issued: 11,313,998 and 11,304,393
 shares, respectively

 

 

 

Outstanding: 10,258,510 and 10,248,905 shares, respectively

102

 

 

102

 

Additional paid-in capital

47,492

 

 

47,326

 

Accumulated deficit

(18,950)

 

(20,463)

Treasury stock, at cost: 1,055,488 shares

(1,589)

 

(1,589)

Total stockholders’ equity

27,055

 

 

25,376

 

Total liabilities and stockholders’ equity

$

96,642

 

 

$

90,448

 

 

IEC ELECTRONICS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

THREE MONTHS ENDED DECEMBER 28, 2018 and DECEMBER 29, 2017

(unaudited; in thousands, except share and per share data)

 

Three Months Ended

 

December 28,
 2018

 

December 29,
 2017

 

 

Net sales

$

35,441

 

 

$

21,156

 

Cost of sales

30,382

 

 

19,638

 

Gross profit

5,059

 

 

1,518

 

 

 

 

 

Selling and administrative expenses

3,352

 

 

2,788

 

Operating income/(loss)

1,707

 

 

(1,270)

 

 

 

 

Interest and financing expense

323

 

 

234

 

Income/(loss) before income taxes

1,384

 

 

(1,504)

 

 

 

 

Income tax expense/(benefit)

312

 

 

(1,010)

 

 

 

 

Net income/(loss)

$

1,072

 

 

$

(494)

 

 

 

 

Net income/(loss) per common share:

 

 

 

Basic

$

0.10

 

 

$

(0.05)

Diluted

$

0.10

 

 

$

(0.05)

 

 

 

 

Weighted average number of shares outstanding:

 

 

 

Basic

10,262,397

 

 

10,204,413

 

Diluted

10,495,429

 

 

10,204,413

 

 

 

 


Top ↑