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Kimball Electronics Inc., a leading global electronic manufacturing services (EMS) provider of high-quality, durable electronic products, has announced financial results for its first quarter ended September 30, 2016. Net sales reached $226.45 million, up from $200.4 million in the same period the previous year. Operating income was $12.8 million, and net income increased to $10.12 million.
“Continued strength in the automotive market combined with double digit growth in our medical end market vertical helped us set a new quarterly sales record in the first quarter of fiscal year 2017. Our new program launch activity remains high as we continue to work diligently to achieve our goal of $1 billion in annual sales by fiscal year 2018,” said Donald D. Charron, chairman and CEO. “We continue to experience pressure on our margins and we still have work to do to achieve our goal of 12.5% ROIC. Margin expansion and capital efficiency will continue to be priorities of focus for us going forward. This will be a pivotal year for us as we work through another year of significant new program launches, the ramp-up of our new Romania operation, and the integration of our recent Medivative and Aircom acquisitions.”
First Quarter Fiscal Year 2017 Overview:
- Consolidated net sales increased 13% compared to the first quarter of fiscal year 2016, setting a new quarterly sales record for the third consecutive quarter.
- The Company received $4.0 million during the quarter, $2.5 million net of tax, related to proceeds from the settlement of a class action lawsuit of which the Company was a member.
- During the quarter, the Company completed the acquisition of Aircom Manufacturing, Inc. As a result of the acquisition, a bargain purchase gain of $0.9 million was recognized during the quarter and included in net income.
- Incremental net loss associated with the start-up of the Company’s Romania facility was $1.1 million during the current fiscal year first quarter.
- Return on invested capital (“ROIC”) was 9.6% for the first quarter of fiscal year 2017, which improved from 7.9% in the prior year quarter (see reconciliation of non-GAAP financial measures for ROIC calculation).
- Cash flow from operating activities was $14.0 million for the quarter.
- Cash conversion days (“CCD”) for the quarter ended September30, 2016 were 58 days, which improved from 61 days for the same quarter last year. CCD is calculated as the sum of days sales outstanding plus production days supply on hand less accounts payable days.
- Investments in capital expenditures, excluding the Aircom acquisition, were $10.3 million during the quarter.
- $6.4 million was returned to Share Owners during the quarter in the form of common stock repurchases. On September 29, 2016, the Company’s Board of Directors authorized an extension of the current stock repurchase plan to allow the repurchase of up to an additional $20 million worth of common stock.
- Cash and cash equivalents were $50.0 million and borrowings outstanding on credit facilities were $9.0 million at September30, 2016.
About Kimball Electronics Inc.
Recognized with a reputation for excellence, Kimball Electronics is committed to a high-performance culture that values personal and organizational commitment to quality, reliability, value, speed, and ethical behavior. Kimball Electronics employees know they are part of a company culture that builds lasting relationships and global success for customers while enabling employees to share in the Company’s success through personal, professional, and financial growth.
Kimball Electronics trades under the symbol “KE” on The NASDAQ Stock Market. Kimball Electronics is a global contract electronic manufacturing services (“EMS”) company that specializes in durable electronics for the medical, automotive, industrial, and public safety markets. Kimball Electronics is well recognized by customers and industry trade publications for its excellent quality, reliability, and innovative service. From its manufacturing operations in the United States, China, Mexico, Poland, Romania, and Thailand, Kimball Electronics provides engineering, manufacturing, and supply chain services which utilize common production and support capabilities to a variety of industries globally. Kimball Electronics is headquartered in Jasper, Indiana.
To learn more about Kimball Electronics, click here.