Exhibit 99.1
SigmaTron International, Inc. Reports First-Quarter
Financial Results for Fiscal 2007
ELK GROVE VILLAGE, Ill.--(BUSINESS WIRE)--Sept. 13,
2006--SigmaTron International, Inc. (NASDAQ:SGMA), an electronic
manufacturing services company, today reported revenues and earnings
for the fiscal quarter ended July 31, 2006.
Revenues increased to $36.9 million in first-quarter fiscal 2007
from $21.3 million for the same quarter in the prior year. Net income
increased to $258,670 in the 2007 period compared to $165,067 for the
same period in the prior year. Basic earnings per share and diluted
earnings per share from continuing operations for the quarter ended
July 31, 2006, were $0.07 compared to $0.05 for the same quarter in
fiscal 2006.
Commenting on SigmaTron's first-quarter fiscal 2007 results, Gary
R. Fairhead, president and chief executive officer, said, "During the
first quarter, the key drivers of our financial results were increased
sales in the appliance, industrial electronics, life sciences, and
gaming marketplaces. The increase in the appliance and gaming
industries is the result of increased orders from existing customers.
The increase in the industrial electronics and life sciences
marketplaces is due to sales to new customers related to the July 2005
acquisition of Able Electronics Corporation ("Able").
"Sales gains in the first quarter of fiscal 2007 were
substantially offset by pricing pressures in various markets,
increases in manufacturing supplies and components costs, costs
related to the acquisition and integration of Able and expenses
related to the conversion to RoHS (a European Union mandate on
restriction of the use of hazardous substances) by various customers
during the quarter. The Company believes it can achieve improved
margins going forward, especially at our Hayward, California and
Tijuana, Mexico facilities. Our operations in Acuna, Mexico, Elk Grove
Village and Suzhou-Wujiang continue to trend well.
"We are beginning to see in fiscal 2007 the benefits from the Able
acquisition. The consolidation of our Fremont, California operation
into Able's Hayward operation provides significant operating
efficiencies. The acquisition is meeting the goals we previously
announced as it has diversified our markets and our customer base, and
expanded the range of services we offer."
Mr. Fairhead concluded, "Our international footprint is an
attractive asset for our existing customer base as well as for
prospective customers. Our focus going forward will be to complete the
transition to RoHS and to get the significant inefficiencies it
created at several of our operations behind us, to work on pricing
pressures with our customers and vendors, and to increase our
productivity. I believe our Company remains well positioned for future
success."
Headquartered in Elk Grove Village, IL, SigmaTron International,
Inc. is an electronic manufacturing services company that provides
printed circuit board assemblies and completely assembled electronic
products. SigmaTron International, Inc. operates manufacturing
facilities in Elk Grove Village, Illinois, Acuna and Tijuana, Mexico,
Hayward, California and Suzhou-Wujiang, China. SigmaTron
International, Inc. maintains engineering and materials sourcing
offices in Taipei, Taiwan.
Note: This press release contains forward-looking statements.
Words such as "continue," "will," "expects," "believe," "plans," and
similar expressions identify forward-looking statements. These
forward-looking statements are based on the current expectations of
SigmaTron (including its subsidiaries). 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 risks and uncertainties
inherent in the Company's business including our continued dependence
on certain significant customers; the continued market acceptance of
products and services offered by the Company and its customers;
pricing pressures from our 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 our operating
results; the variability of our customers' requirements; the
availability and cost of necessary components and materials; the
Company's ability to continue to produce products that are in
compliance with the European Standard of "Restriction of Use of
Hazardous Substance ("RoHS"); the ability of the Company and our
customers to keep current with technological changes within our
industries; regulatory compliance; the continued availability and
sufficiency of our credit arrangements; changes in U.S., Mexican,
Chinese or Taiwanese regulations affecting the Company's business; the
continued stability of the U.S., Mexican, Chinese and Taiwanese
economic systems, labor and political conditions; and the ability of
the Company to manage its growth, including its expansion into China
and its integration of the Able operation acquired in July 2005. 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 risk factors and 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 this press
release and the Company undertakes no obligation to update such
statements in light of future events or otherwise.
Financial tables to follow...
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Three Months
Ended Ended
July 31, July 31,
2006 2005
--------------- ---------------
Net sales $36,959,865 $21,312,693
Cost of products sold 33,101,216 18,771,008
--------------- ---------------
Gross profit 3,858,649 2,541,685
Selling and administrative expenses 3,017,953 2,136,281
--------------- ---------------
Operating income 840,696 405,404
Other expense (income) -net 459,610 94,240
--------------- ---------------
Income from continuing operations
before income tax and interest of
affiliate 381,086 311,164
Income tax expense 122,416 121,366
--------------- ---------------
Income from continuing operations 258,670 189,798
Loss from operations of discontinued
Las Vegas location - (40,542)
Income tax benefit - 15,811
--------------- ---------------
Loss on discontinued operation 258,670 (24,731)
--------------- ---------------
Net income $258,670 $165,067
=============== ===============
Net income per common share -
continuing operations $0.07 $0.05
Net income per common share -
discontinued operations - ($0.01)
-------------------------------
Net income per common share -
basic $0.07 $0.04
=============== ===============
Net income per common share -
assuming dilution $0.07 $0.04
=============== ===============
Weighted average number of common
equivalent shares outstanding -
basic 3,786,986 3,755,420
=============== ===============
Weighted average number of common
equivalent shares outstanding -
assuming dilution 3,866,793 3,822,577
=============== ===============
CONDENSED CONSOLIDATED BALANCE SHEETS
July 31, April 30,
2006 2006
--------------- ---------------
Current assets $60,496,195 $55,362,530
Machinery and equipment-net 30,220,628 30,544,307
Intangible assets 1,973,404 2,186,350
Goodwill 9,298,945 9,298,945
Other assets 1,338,717 1,548,240
--------------- ---------------
Total assets $103,327,889 $98,940,372
=============== ===============
Liabilities and shareholders' equity
Current liabilities 25,709,260 21,029,469
Long-term obligations 29,445,106 30,016,092
Stockholders' equity 48,173,523 47,894,811
--------------- ---------------
Total liabilities and stockholders'
equity $103,327,889 $98,940,372
=============== ===============
CONTACT: SigmaTron International, Inc.
Linda K. Blake, 800-700-9095