Reading time ( words)
Key Tronic Corporation, a provider of electronic manufacturing services (EMS), today announced its results for the three months and full year ended July 2, 2016.
For the fourth quarter of fiscal year 2016, Key Tronic reported total revenue of $123.9 million, up 5% from $118.4 million in the previous quarter and up 3% from $120.4 million in the same period of fiscal year 2015. For the full fiscal year 2016, total revenue was $485.0 million, up 12% from $434.0 million for fiscal year 2015.
As expected, the Company continued to see sequential improvement in operating efficiencies. For the fiscal year 2016, gross margin was by quarter 7.1%, 7.8%, 8.4% and most recently 8.7% during the fourth quarter. Similarly, operating margin improved by quarter from 1.4%, 2.1%, 2.3% and 2.8% throughout the fiscal year 2016.
Net income for the fourth quarter of fiscal year 2016 was $2.1 million or $0.20 per share, compared to $2.3 million or $0.21 per share for the fourth quarter of fiscal year 2015. For the full fiscal year 2016, net income was $6.5 million or $0.58 per share, up 52% from $4.3 million or $0.38 per share for fiscal year 2015.
"We're pleased with how our business rebounded from several unusual challenges in the first two quarters and finished with strong revenue and earnings growth for fiscal year 2016," said Craig Gates, President and Chief Executive Officer. “The continued ramp of new programs and our investment in improving our operations to accommodate a more diversified customer base drove the overall improvement in fiscal 2016. At the same time, we won a number of new significant programs throughout the year, including new programs involving home automation and industrial metering in the fourth quarter."
"In the first quarter, we expect to see a slight decline in revenue due to the closure of our Kentucky facility and our decision to disengage completely from the longstanding customer that adversely impacted our business throughout the year. While impacting our top line revenue, we anticipate improvements in margins in the first quarter as the remaining Kentucky programs are transferred to other facilities and cost savings begin to be realized. We expect our many new programs will continue to ramp up, the continued onboarding of several new customers and see a robust pipeline of potential new business. Moving into fiscal 2017, we feel encouraged by our growth opportunities, the improvements in our operating efficiencies and our competitive strengths."
For the first quarter of fiscal year 2017, the Company expects to report revenue in the range of $117 million to $122 million, and earnings in the range of $0.16 to $0.21 per diluted share. These expected results assume an effective tax rate of 25%.
Key Tronic will host a conference call today to discuss its financial results at 2:00 PM Pacific (5:00 PM Eastern). A broadcast of the conference call will be available at www.keytronic.com under “Investor Relations” or by calling 888-438-5491 or +1-719-325-2420 (Access Code: 9822492). A replay will be available by calling 888-203-1112 or +1 719-457-0820 (Access Code: 9822492). A replay will also be available on the Company’s Web site.
About Key Tronic
Key Tronic is a leading contract manufacturer offering value-added design and manufacturing services from its facilities in the United States, Mexico and China. The Company provides its customers full engineering services, materials management, worldwide manufacturing facilities, assembly services, in-house testing, and worldwide distribution. Its customers include some of the world’s leading original equipment manufacturers. For more information about Key Tronic visit: www.keytronic.com.