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Richardson Electronics, Ltd. (RELL) today reported sales and
earnings for its first quarter ended September 1, 2012. The Company also
announced that its Board of Directors declared a $0.06 per share
quarterly cash dividend.
Net sales for the first quarter of fiscal 2013 were $35.7 million, down
14.1% from net sales of $41.5 million during the first quarter of last
year. Gross profit for the first quarter of fiscal 2013 was $10.6
million, or 29.9% of net sales, compared to $12.7 million, or 30.6% of
net sales, during the first quarter of fiscal 2012. Operating income
during the first quarter of fiscal 2013 was $0.5 million, or 1.4% of net
sales, compared to operating income of $2.0 million, or 4.8% of net
sales, during the first quarter of last year. Income from continuing
operations for the first quarter of fiscal 2013 was $0.7 million, or
$0.05 per diluted common share, compared to income from continuing
operations of $1.0 million, or $0.06 per diluted common share during the
first quarter of last year.
"Global economic conditions continued to weaken as we progressed through
the first quarter contributing to the decline in our overall sales
volume. However, backlog is improving within both our EDG and Canvys
businesses. EDG continues to strengthen its service capabilities which
will drive incremental end user sales of both laser and industrial
tubes. In addition, we remain optimistic that healthcare reform and our
continued focus on custom solutions for OEMs will provide new display
opportunities for Canvys," said Edward J. Richardson, Chairman, Chief
Executive Officer and President.
"We believe our second quarter sales should be in the range of $36 to
$38 million. We remain focused on building our business to achieve
sustainable growth over the long term," said Mr. Richardson.
FINANCIAL SUMMARY -- THREE MONTHS ENDED SEPTEMBER
1, 2012
--
Net sales for the first quarter of fiscal 2013 were $35.7 million,
down 14.1%, compared to net sales of $41.5 million during the first
quarter of last year.
--
Gross margin as a percentage of net sales decreased to 29.9% during
the first quarter of fiscal 2013 compared to 30.6% during the first
quarter of last year.
--
SG&A expenses during the first quarter of fiscal 2013 were $10.1
million, or 28.5% of net sales, compared to $10.8 million, or 25.9% of
net sales, during the first quarter of last year.
--
Operating income during the first quarter of fiscal 2013 was $0.5
million, or 1.4% of net sales, compared to operating income of $2.0
million, or 4.8% of net sales, during the first quarter of last year.
--
Income from continuing operations during the first quarter of fiscal
2013 was $0.7 million, or $0.05 per diluted common share, compared to
income from continuing operations of $1.0 million, or $0.06 per
diluted common share, during the first quarter of last year.
--
Loss from discontinued operations, net of tax, was $0.1 million,
during the first quarter of fiscal 2013 compared to income from
discontinued operations, net of tax, of $2.6 million, or $0.15 per
diluted common share, during the first quarter of last year.
--
Net income during the first quarter of fiscal 2013 was $0.6 million,
or $0.04 per diluted common share, compared to net income of $3.6
million, or $0.21 per diluted common share, during the first quarter
of last year.
CASH USED FOR SHARE REPURCHASES
"Cash and investments at the end of our first quarter were $150.9
million. We used $5.6 million to repurchase 0.5 million shares during
the first quarter. As of today, we have repurchased a total of 3.2
million shares for $40.1 million under our share repurchase
authorization and currently have $34.9 million remaining. With our
strong balance sheet, we are committed to returning value to our
shareholders through a combination of cash dividends, share repurchases,
and strategic acquisitions," said Mr. Richardson.
Share repurchases may be made on the open market or in privately
negotiated transactions, subject to market conditions and trading
restrictions. This authorization has no expiration and may be cancelled
at any time.
CASH DIVIDEND
The Company also announced today that its Board of Directors declared a
$0.06 dividend per share to all holders of common stock and a $0.054
cash dividend per share to all holders of Class B common stock. The
dividend will be payable on November 27, 2012, to all common
stockholders of record on November 13, 2012. The Company currently has
12,512,927 million outstanding shares of common stock and 2,889,882
outstanding shares of Class B common stock.
CONFERENCE CALL INFORMATION
On Thursday, October 11, 2012, at 9:00 a.m. CT, Edward J. Richardson,
Chairman and Chief Executive Officer, and Kathleen S. Dvorak, Chief
Financial Officer, will host a conference call to discuss the Company’s
first quarter results for fiscal 2013. A question and answer session
will be included as part of the call’s agenda. To listen to the call,
please dial 888-339-2688 and enter passcode 95966127 approximately five
minutes prior to the start of the call. A replay of the call will be
available beginning at 11:00 a.m. CT on October 11, 2012, for seven
days. The telephone numbers for the replay are (USA) 888-286-8010 and
(International) 617-801-6888; access code 51866673.
FORWARD-LOOKING STATEMENTS
This release includes certain "forward-looking" statements as defined by
the Securities and Exchange Commission. Statements in this press release
regarding the Company’s business which are not historical facts
represent "forward-looking" statements that involve risks and
uncertainties. For a discussion of such risks and uncertainties, which
could cause actual results to differ from those contained in the
forward-looking statements, see Item 1A, "Risk Factors" in the Company’s
Annual Report on Form 10-K filed on July 27, 2012, and in the Company’s
Proxy Statement on Schedule 14A filed on August 30, 2012. The Company
assumes no responsibility to update the forward-looking statements in
this release as a result of new information, future events, or otherwise.
ABOUT RICHARDSON ELECTRONICS, LTD.
Richardson Electronics, Ltd. is a leading global provider of engineered
solutions, power grid and microwave tubes and related consumables, and
customized display solutions serving customers in the alternative
energy, aviation, broadcast, communications, industrial, marine,
medical, military, scientific and semiconductor markets. The Company’s
strategy is to provide specialized technical expertise and "engineered
solutions" based on our core engineering and manufacturing capabilities.
The Company provides solutions and adds value through design-in support,
systems integration, prototype design and manufacturing, testing,
logistics, and aftermarket technical service and repair. More
information is available online at www.rell.com.
Richardson Electronics common stock trades on the NASDAQ Global Select
Market under the ticker symbol RELL.
Richardson Electronics, Ltd.
Consolidated Balance Sheets
(in thousands, except per share amounts)
Unaudited Audited
------------------ ----------------
September 1, June 2,
2012 2012
------------------ ----------------
Assets
Current assets:
Cash and cash equivalents $ 41,238 $ 43,893
Accounts receivable, less allowance of $1,085 and $1,058 20,537 19,727
Inventories 35,437 34,675
Prepaid expenses and other assets 1,453 806
Deferred income taxes 2,041 2,095
Income tax receivable 6,417 6,572
Investments - current 98,714 105,009
Discontinued operations - assets 358 514
------- -------
Total current assets 206,195 213,291
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Non-current assets:
Property, plant and equipment, net 4,201 4,375
Goodwill 1,337 1,261
Other intangibles 278 355
Non-current deferred income taxes 1,448 1,458
Investments - non-current 10,975 10,683
------- -------
-
Total non-current assets 18,239 18,132
------- -------
Total assets $ 224,434 $ 231,423
==== ======= === =======
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable $ 11,192 $ 12,611
Accrued liabilities 8,521 8,466
Discontinued operations - liabilities 178 253
------- -------
Total current liabilities 19,891 21,330
------- -------
Non-current liabilities:
Long-term income tax liabilities 6,943 7,306
Other non-current liabilities 1,290 1,213
Discontinued operations - non-current liabilities 1,380 1,361
------- -------
Total non-current liabilities 9,613 9,880
------- -------
Total liabilities 29,504 31,210
------- -------
Commitments and contingencies - -
Stockholders’ equity
Common stock, $0.05 par value; issued 12,651 shares at September 633 654
1, 2012, and 13,074 shares at June 2, 2012
Class B common stock, convertible, $0.05 par value; issued 2,890 144 146
shares at September 1, 2012 and 2,920 shares at June 2, 2012
Preferred stock, $1.00 par value, no shares issued - -
Additional paid-in-capital 82,912 88,217
Common stock in treasury, at cost, 25 shares at September 1, 2012, (305 ) (216 )
and 18 shares at June 2, 2012
Retained earnings 103,872 104,139
Accumulated other comprehensive income 7,674 7,273
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Total stockholders’ equity 194,930 200,213
------- -------
Total liabilities and stockholders’ equity $ 224,434 $ 231,423
==== ======= === =======
Richardson Electronics, Ltd.
Unaudited Consolidated Statements of Comprehensive Income
(in thousands, except per share amounts)
Three Months Ended
--------------------------------
September 1, September 3,
2012 2011
--------------- ---------------
Net sales $ 35,650 $ 41,511
Cost of sales 25,004 28,809
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Gross profit 10,646 12,702
Selling, general, and administrative expenses 10,149 10,772
Gain on disposal of assets (4 ) (70 )
------ - ------ -
Operating income 501 2,000
------ ------
Other (income) expense:
Investment/interest income (383 ) (364 )
Foreign exchange (gain) loss (37 ) 781
Other, net (23 ) (21 )
------ - ------ -
Total other (income) expense (443 ) 396
------ - ------
Income from continuing operations before income taxes 944 1,604
Income tax provision 210 575
------ ------
Income from continuing operations 734 1,029
Income (loss) from discontinued operations, net of tax (87 ) 2,602
------ - ------
Net income 647 3,631
------ ------
Foreign currency translation gain, net of tax 400 1,368
Fair value adjustments on investments 1 (48 )
------ ------ -
Comprehensive income $ 1,048 $ 4,951
===== ====== ===== ======
Net income per Common share - Basic:
-------------------------------------------------------
Income from continuing operations $ 0.05 $ 0.06
Income (loss) from discontinued operations (0.01 ) 0.15
------ - ------
Total net income per Common share - Basic: $ 0.04 $ 0.21
===== ====== ===== ======
Net income per Class B common share - Basic:
-------------------------------------------------------
Income from continuing operations $ 0.04 $ 0.05
Income from discontinued operations - 0.14
------ ------
Total net income per Class B common share - Basic: $ 0.04 $ 0.19
===== ====== ===== ======
Net income per Common share - Diluted:
-------------------------------------------------------
Income from continuing operations $ 0.05 $ 0.06
Income (loss) from discontinued operations (0.01 ) 0.15
------ - ------
Total net income per Common share - Diluted: $ 0.04 $ 0.21
===== ====== ===== ======
Net income per Class B common share -
Diluted:
-------------------------------------------------------
Income from continuing operations $ 0.04 $ 0.05
Income from discontinued operations - 0.14
------ ------
Total net income per Class B common share - Diluted: $ 0.04 $ 0.19
===== ====== ===== ======
Weighted average number of shares:
Common shares - Basic 12,772 14,343
====== ======
Class B common shares - Basic 2,913 2,952
====== ======
Common shares - Diluted 15,787 17,469
====== ======
Class B common shares - Diluted 2,913 2,952
====== ======
Dividends per common share $ 0.060 $ 0.050
===== ====== ===== ======
Dividends per Class B common share $ 0.054 $ 0.045
===== ====== ===== ======
Richardson Electronics, Ltd.
Unaudited Consolidated Statements of Cash Flows
(in thousands)
Three Months Ended
---------------------------------------
September 1, September 3,
2012 2011
------------------ -------------------
Operating activities:
Net income $ 647 $ 3,631
Adjustments to reconcile net income to cash provided
by (used in) operating activities:
Depreciation and amortization 299 284
Gain on sale of investments (20 ) (10 )
Gain on disposal of assets (4 ) (70 )
Stock compensation expense 124 155
Deferred income taxes (1 ) 5,329
Accounts receivable (646 ) (225 )
Income tax receivable 155 (8,270 )
Inventories (550 ) (3,614 )
Prepaid expenses and other assets (622 ) 2,795
Accounts payable (1,430 ) (2,581 )
Accrued liabilities (1,006 ) (33,636 )
Long-term income tax liabilities (321 ) (11,411 )
Other 42 4
------- --------
(3,333 ) (47,619 )
Net cash used in operating activities
------- ---- -------- ----
Investing activities:
Capital expenditures (79 ) (74 )
Proceeds from sale of assets 4 16
Proceeds from maturity of investments 57,747 137,534
Purchases of investments (51,725 ) (216,285 )
Proceeds from sales of available-for-sale securities 54 63
Purchases of available-for-sale securities (54 ) (63 )
Other 1 48
------- --------
5,948 (78,761 )
Net cash provided by (used in) investing activities
------- -------- ----
Financing activities:
Repurchase of common stock (5,552 ) (7,691 )
Proceeds from issuance of common stock 11 87
Cash dividends paid - (846 )
Other - 7
------- --------
(5,541 ) (8,443 )
Net cash used in financing activities
------- ---- -------- ----
Effect of exchange rate changes on cash and cash equivalents 271 1,084
------- --------
(2,655 ) (133,739 )
Decrease in cash and cash equivalents
Cash and cash equivalents at beginning of period 43,893 170,975
$ 41,238 $ 37,236
Cash and cash equivalents at end of period
==== ======= ==== ==== ======== ====
Richardson Electronics, Ltd.
Net Sales and Gross Profit
For the First Quarter of Fiscal 2013 and Fiscal 2012
(in thousands)
By Strategic Business Unit:
Net Sales
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FY 2013 FY 2012 % Change
----------- ----------- -----------
First Quarter
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EDG $ 25,627 $ 30,729 (16.6 %)
Canvys 10,023 10,782 (7.0 %)
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Total $ 35,650 $ 41,511 (14.1 %)
=== ====== === ======
Gross Profit % of % of
-------------
FY 2013 Net Sales FY 2012 Net Sales
----------- ---------- ----------- ----------
First Quarter
-------------
EDG $ 8,000 31.2 % $ 9,671 31.5 %
Canvys 2,646 26.4 % 3,031 28.1 %
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Total $ 10,646 29.9 % $ 12,702 30.6 %
=== ====== === ======
SOURCE: Richardson Electronics, Ltd.
Richardson Electronics, Ltd.
Edward J. Richardson, (630) 208-2340
Chairman and CEO
info@rell.com
or
Kathleen S. Dvorak, (630) 208-2208
EVP & CFO
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