IEC Electronics Corporation announced its unaudited results for the first quarter of fiscal 2012 ending December 30, 2011.
First quarter of fiscal 2012 highlights:
- Q1 revenue increased 18% compared to Q1 2011;
- Operating income decreased 51%;
- EBITDA increased 16%; and
- Q1 debt was reduced $1.3 million.
The company reported revenue of $33.8 million for the quarter, operating income of $954 thousand and net income of $948 thousand or $0.09 per diluted share. This compares to revenue in the prior year first quarter of $28.6 million, operating income of $1.96 million and net income of $1.05 million or $0.11 per diluted share.
W. Barry Gilbert, Chairman of the Board and CEO, stated, "While revenues were up for the entire company, earnings were down significantly from the prior quarter. Key sections of the company continue to perform quite well. We continue to increase our revenue and our organic growth was in line with our estimates at just over 12%. Our cash flow remains solid and we continue to reduce our debt. In that regard, since the acquisition of Southern California Braiding, Inc. (SCB) a year ago we have reduced our debt by $14 million.
"This was a difficult quarter for SCB. As previously discussed, funding associated with approved defense programs was delayed. That said, they are on important platforms including B1, F16, Apache, Predator, and Hunter. SCB is a great strategic addition, and we are confident that their near term performance will be rectified and margins and earnings growth are expected to be back on track in the second half of the year.
"SCB purchase documents contained a contingent consideration clause or clawback, for sales shortfall. In this quarter IEC is making a final adjustment to the purchase price of approximately $900 thousand, which is included in other income, for sales goals which were not met. Between last quarter and this quarter there was a total of approximately $2 million recognized in conjunction with the clawback."
IEC continues to view EBITDA (earnings before interest, taxes, depreciation and amortization) as a useful measure of its operating performance because EBITDA eliminates the aberrations produced by, among other non-cash items, our net operating loss carryforward (NOL). It is the company's view this measure enables the investment community to better evaluate long-term profitability and cash flow being generated by the company. Q1 fiscal 2012 EBITDA was $2.8 million or $0.28 per share, which compares to $2.4 million or $0.25 per share for the first quarter fiscal 2011.
Gilbert concluded, "We are moving forward to build shareholder value via stronger customer relations across all of our markets. We thank you for your continued support."