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Sypris Solutions, Inc. reported financial results for its first quarter ended April 3, 2022.
Highlights:
- Revenue for the first quarter increased 30.9% year-over-year, driven by a 32.7% increase for Sypris Electronics and a 30.1% increase for Sypris Technologies.
- Gross profit increased 148.3% year-over-year, with an improvement of 113.5% for Sypris Electronics and 167.5% for Sypris Technologies.
- Gross margin increased 810 basis points to 17.2%, with an increase of 580 basis points to 15.3% for Sypris Electronics and 940 basis points to 18.3% for Sypris Technologies.
- Earnings per diluted share rose to $0.01 per diluted share, up from a loss of $0.08 per share in the prior-year period, reflecting the strong revenue growth and positive operating performance.
- Sypris Electronics announced two important new contract awards during the quarter, including the following:
- A multi-year follow-on contract to produce and test electronic power supply modules for a large, mission-critical U.S. Navy program, which is expected to result in a meaningful growth in shipments from existing levels beginning in 2022; and
- A multi-year follow-on contract award to produce and test a variety of electronic power supply modules for a mission-critical, long-range, precision-guided, anti-ship missile system, which is expected to result in a material increase in production volume from existing levels beginning in 2022.
- Sypris Technologies also recently announced two significant new contract awards, including the following:
- A long-term contract extension to provide drivetrain components for use in the production of medium and heavy-duty commercial vehicles. In addition, the Company was awarded a new program to supply components for use in all-terrain vehicles beginning in 2023; and
- On April 19, Sypris Technologies announced a multi-year contract extension to provide drivetrain components for use in the production of medium and heavy-duty commercial vehicles with a leading global commercial vehicle original equipment manufacturer.
- The Company reaffirmed its full-year outlook for 2022, with revenue expected to increase 25%-30% year-over-year. Additionally, the Company continues to forecast a 200-250 basis point gross margin expansion and strong double-digit percentage growth in cash flow from operations.
“We were very pleased with our first quarter performance, as both operating segments reported significant growth in revenue, gross profit and operating margin. Our teammates have done an excellent job navigating supply chain challenges to position the business for further growth in all three of these key metrics during the remainder of 2022,” commented Jeffrey T. Gill, President and Chief Executive Officer.
“Backlog for Sypris Electronics continued to increase on both a year-over-year and on a sequential basis, resulting in our largest book of business in over a decade, with deliveries now scheduled well into 2023. This record backlog is expected to support a significant expansion of the top line during the year, which we have attempted to further protect by securing customer funding on certain key programs to lock in multi-year component purchases.”
“Demand from customers serving the automotive, commercial vehicle, sport utility and off-highway markets remains strong, while investments made in equipment and continuous improvement initiatives are further improving our operating results. The recent successful extension of long-term contracts with two of our key customers, combined with the healthy outlook for our markets, provides us with a clear path for growth through this year and next.”
“Shipment of energy products increased 30% year-over-year, while orders during the quarter increased sequentially with open quotes yet remaining on several large projects. Additional opportunities for growth may exist with new projects in support of increasing domestic oil and gas production. We are also actively pursuing applications for our products in adjacent markets to further diversify our industry and customer portfolios.”
First Quarter Results
The Company reported revenue of $26.2 million for the first quarter of 2022, compared to $20.0 million for the prior-year comparable period. Additionally, the Company reported net income of $0.2 million, or $0.01 per diluted share, compared to a net loss of $1.6 million, or $0.08 per share, for the prior-year period.
