NEWARK, NY -- (Marketwire) -- 12/08/11 -- IEC Electronics Corp. (NYSE Amex: IEC) announced its results for the fourth quarter and fiscal year ending September 30, 2011.
For the quarter, the Company reported revenue of $34.9 million and net income of $2.6 million or $0.26 per diluted share. Approximately $1.1 million or $0.11 per share stems from an adjustment related to Southern California Braiding (SCB) as discussed below. This compares with revenue of $27.3 million and net income of $1.6 million, or $0.16 per share in the fourth quarter of the prior year.
For fiscal year 2011, IEC reported revenue of $133.3 million compared to revenue of $96.7 million for fiscal 2010. Net income after tax was $6.8 million, or $0.68 per share, for year end 2011 compared to net income after tax of $4.7 million or $0.48 per share for fiscal 2010. Net income included income from the SCB adjustment, discussed below.
W. Barry Gilbert, Chairman of the Board and CEO, stated, "2011 was a solid year for IEC as we continue to improve our operating performance and make strong inroads into the Medical sector. Our backlog grew substantially despite continued economic turbulence. The fiscal 2011 closing backlog was over $121.0 million as compared to a fiscal 2010 closing backlog of $91.4 million. $12.7 million of the backlog increase from fiscal 2010 was associated with the SCB acquisition made in December 2010.
"We primarily used low cost debt to finance our strategic acquisitions, and our goal in the back half of fiscal 2011 has been to reduce our debt $1 million a month. We exceeded this goal by paying down our debt by $10.2 million during the fourth quarter and by $12.2 million since acquisition of SCB nine months ago."
Gilbert continued, "During fiscal 2011 we continued to work toward the integration of SCB into IEC. As mentioned in the past, this acquisition has improved the Company's strategic position by broadening our product offering and diversifying our customer base. However, SCB has not yet performed to our expectations. In the SCB closing documents we provided for an adjustment to be paid to IEC contingent upon SCB failing to achieve certain sales goals for 2011. As a result, we recognized a favorable adjustment to the fair value of this contingent consideration of $1.1 million in Other Income for both the fourth quarter and fiscal 2011 year end results. Our operating margin for the quarter was 7%, slightly below what we have achieved in the past but still at the high end of our industry."
"Our customer mix has changed somewhat during 2011," Gilbert said. "The Medical sector significantly expanded and now represents 22% of revenue ($30.0 million), increasing from 12.6% of revenue ($12.8 million) in fiscal 2010. The Military/Aerospace sector remained strong through most of the year and tailed off at the end. While our programs and platforms were not subject to federal budget cuts, funding for several of our programs has not been released. We anticipate that funding release will be an issue for Q1 fiscal 2012 and may extend into Q2 of fiscal 2012. The Military/Aerospace sector represents 56.0% of revenue ($74.7 million) in fiscal 2011, down slightly from 58.2% of revenue ($56.4 million) in fiscal 2010. Sales to our Industrial customer base decreased to $17.5 million, representing 13.0% of 2011 revenue, down from 20.0% of revenue ($19.4 million) in fiscal 2010. We saw the Industrial sector recover in the first half of the year and then weaken somewhat in the second half of the year. Some of our customers are rapidly expanding and others are struggling. Overall, we are pleased with the results we have achieved in this sector.
"We continue to look for companies that provide a good fit with our strategic vision. Without any acquisitions, our long term annual growth goal is 17%. This year that goal will be difficult to achieve. As mentioned above, we believe we have solid Military and Aerospace platforms. However, the impasse in Congress releasing the funding is uncertain. We expect revenue growth from our existing businesses to be between 9% and 14% for fiscal 2012, and expect both our net income and EBITDA to grow commensurately. The Industrial sector is likely to remain under pressure as long as the broader economy continues to struggle. The pressure is not evenly distributed among the niches we serve, with some of our Industrial customers growing quite rapidly. Our growth in the Medical sector is most encouraging and we believe we can continue to expand our presence in that market."
Mr. Gilbert concluded, "As we have said previously, we firmly believe the Company is continuing to move in the right direction and we are confident that we are creating future value for our customers and shareholders and opportunity for our employees."
IEC Electronics Corporation is a premier provider of electronic manufacturing services ("EMS") to advanced technology companies primarily in the military and aerospace, medical, and industrial sectors. The Company specializes in the custom manufacture of high reliability, complex circuit cards, system level assemblies, a wide array of custom cable and wire harness assemblies, and precision sheet metal products. As a full service EMS provider, IEC is a world-class ISO 9001:2008, AS9100 and ISO13485 certified company. The AS9100 certification enables IEC to serve the military and commercial aerospace markets. The ISO13485 certification supports the quality requirements of medical device markets. The Company is also AC7120 Nadcap accredited for electronics manufacturing to support the most stringent quality requirements of the aerospace industry, as well as ITAR registered and NSA approved under the COMSEC standard. IEC Electronics is headquartered in Newark, NY (outside of Rochester) and also has operations in Victor, NY, Rochester, NY, Albuquerque, NM and Bell Gardens, CA. Additional information about IEC can be found on its web site at www.iec-electronics.com.
The foregoing, including any discussion regarding the Company's future expectations and prospects, contains certain forward-looking statements that involve risks and uncertainties, including uncertainties associated with economic conditions in the electronics industry, particularly in the principal industry sectors served by the Company, changes in customer requirements and in the volume of sales to principal customers, governmental funding uncertainties, competition and technological change, the ability of the Company to control manufacturing and operating costs, the ability of the Company to develop and maintain satisfactory relationships with vendors, and the ability of the Company to efficiently integrate acquired companies into its business. The Company's actual results of operations may differ significantly from those contemplated by any forward-looking statements as a result of these and other factors, including factors set forth in the Company's 2010 Annual Report on Form 10-K and in other filings with the Securities and Exchange Commission.
IEC ELECTRONICS CORP - CONSOLIDATED
BALANCE SHEET
SEP 30, 2011 AND SEP 30, 2010
(In Thousands)
SEP 30, 2011 SEP 30, 2010
ASSETS
CURRENT ASSETS
Cash 0 0
Accounts Receivable 19,423 16,288
Inventories 16,093 12,068
Deferred Income Taxes 3,863 3,359
Other Current Assets 1,834 261
------------ ------------
Total Current Assets 41,213 31,976
------------ ------------
NET FIXED ASSETS 17,886 13,098
NON-CURRENT ASSETS
Intangible Assets 5,964 331
Goodwill 13,810 58
Deferred Income Taxes 6,768 10,113
Other Non-Current Assets 179 106
------------ ------------
TOTAL ASSETS 85,820 55,682
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short Term Borrowings 6,896 2,899
Accounts Payable 12,750 8,145
Accrued Payroll and Related Taxes 3,092 2,279
Other Accrued Expenses 851 941
Other Current Liabilities 332 0
------------ ------------
Total Current Liabilities 23,921 14,264
------------ ------------
LONG TERM DEBT 28,213 15,999
------------ ------------
TOTAL LIABILITIES 52,134 30,263
SHAREHOLDER'S EQUITY
Common stock, par value $.01 par value:
Authorized - 50,000,000 shares
Issued: 10,839,997 and 10,100589 shares,
respectively
Outstanding: 9,824,539 and 9,087,716 shares,
respectively 108 101
Additional Paid-in Capital 42,660 41,138
Retained Earnings (7,647) (14,407)
Treasury Shares, at Cost: 1,015,458 and
1,012,873 shares, respectively (1,435) (1,413)
------------ ------------
TOTAL SHAREHOLDER'S EQUITY 33,686 25,419
------------ ------------
TOTAL LIABILITIES & EQUITY 85,820 55,682
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IEC ELECTRONICS CORP - CONSOLIDATED
STATEMENT OF INCOME
FOR QUARTER END & YTD SEP 30, 2011 AND SEP 30, 2010
(In Thousands)
ACTUAL PRIOR ACTUAL PRIOR
QUARTER QUARTER YTD YTD
SEP 30, 2011 SEP 30, 2010 SEP 30, 2011 SEP 30, 2010
Sales 34,941 27,287 133,296 96,674
Cost of Sales 28,367 22,511 109,039 80,411
------------ ------------ ------------ ------------
Gross Profit 6,574 4,776 24,257 16,263
Less: Operating
Expenses
Selling &
Administrative
Expenses 4,094 2,654 13,868 8,576
------------ ------------ ------------ ------------
Operating Profit 2,480 2,122 10,389 7,687
Interest and
Financing Expense 387 220 1,601 814
Other
(Income)/Expense (1162) (387) (1028) (182)
------------ ------------ ------------ ------------
Net Income before
Income Taxes 3,255 2,289 9,816 7,055
Provision for Income
Tax 624 661 3,056 2,400
------------ ------------ ------------ ------------
Net Income 2,631 1,628 6,760 4,655
============ ============ ============ ============
Basic Earnings Per
Share $ 0.27 $ 0.18 $ 0.71 $ 0.52
Diluted Earnings Per
Share $ 0.26 $ 0.17 $ 0.68 $ 0.48
Basic Shares 9,637,196 9,086,793 9,461,240 8,990,180
Diluted Shares 10,000,506 9,599,377 9,967,702 9,608,174
Contact:
Sue Topel-Samek
IEC Electronics Corp.
(315) 332-4443
John Nesbett/Jennifer Belodeau
Institutional Marketing Services
(203) 972-9200
Email Contact
