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IEC reported revenues of $34.2 million for the fourth quarter of fiscal 2018, an increase of 24% as compared to revenues of $27.6 million for the fiscal 2017 fourth quarter ended September 30, 2017 and a sequential increase of 15% as compared to the third quarter of 2018. Gross profit margin for the fourth quarter of fiscal 2018 improved to 13.1% as compared to 12.6% in the same quarter last year. Selling and administrative expenses increased to $2.9 million but decreased slightly as a percentage of sales to 8.5%, as compared to $2.5 million or 9.0% of sales in the fourth quarter of fiscal 2017. The Company reported net income of $9.1 million for the fourth quarter of fiscal 2018, or $0.89 per share, compared to net income of $0.8 million, or $0.07 per share, for the fourth quarter of fiscal 2017. Net income for the fiscal 2018 fourth quarter included a tax benefit of $7.8 million, related to the Company adjusting its deferred tax asset allowance, reflecting confidence that deferred tax assets will be utilized in future periods. On a non-GAAP basis, excluding the one-time tax benefit, fourth quarter net income was $1.3 million or $0.13 per share.
Revenues for the year ended September 30, 2018 increased 21% to $116.9 million as compared to $96.5 million in fiscal 2017. Gross profit margin for fiscal 2018 improved slightly to 12.1% as compared to 11.7% in fiscal 2017. Selling and administrative expenses increased to $11.4 million but decreased as a percentage of sales to 9.8%, as compared to $10.2 million or 10.6% of sales for full year fiscal 2017. Net income for fiscal 2018 was $10.4 million, or $1.01 per share, compared to $0.08 million, or $0.01 per share, in the prior year period. Fiscal 2018 net income included a tax benefit of $8.8 million, related to the previously mentioned deferred tax asset allowance adjustment, as well as a first quarter 2018 release of the valuation allowance on our alternative minimum tax credits as a result of the December 2017 U.S. Tax Cuts and Jobs Act. On a non-GAAP basis, excluding the one-time tax benefit, fiscal 2018 net income was $1.6 million or $0.15 per share.
Jeffrey T. Schlarbaum, President and CEO of IEC Electronics commented, “With the close of fiscal 2018, we believe our Company has fully exited the turnaround phase and is well positioned to drive sustained growth. Our strong fourth quarter performance was characterized by increased revenues levels, which have not been seen in 5 years, as well as strong backlog growth. Revenue and volume growth are being driven in large part by our ability to win new projects from existing customers as they recognize IEC’s value as a reliable and consistent mnufacturing partner and discover the breadth of our diverse, vertically integrated capabilities.
“Gross margin in the quarter improved by 50 bps, despite deliberate additions to overhead and direct labor to support increasing revenue levels expected in fiscal 2019. While global component shortages persist, we continue to strategically manage our inventory and workforce to maximize our ability to convert orders in this challenging environment.”
Schlarbaum concluded, “We are energized by the opportunities we’re seeing in the marketplace from both new and existing customers. As we move through fiscal 2019, we believe we’re well positioned to drive continued growth and to increase our leadership position as a reliable and consistent manufacturing partner for life-saving and mission critical products. Our fiscal fourth quarter backlog increased to $133 million, representing 85% year over year growth, and a level our company has not experienced in more than 20 years. During the fiscal fourth quarter, we also experienced a solid book to bill ratio of 1.3:1. With our visibility today, we expect strong double digit year over year growth in fiscal 2019 and we are eager to start the new year not expecting to experience the seasonal revenue decline from Q4 2018 to Q1 2019 that we have typically experienced in past years.”
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. IEC Electronics is headquartered in Newark, NY and also has operations in Rochester, NY and Albuquerque, NM.