Global Citizenship: What I’ve Learned About the American PCB Business
Global Sourcing Spotlight: The Best Products to Buy Offshore Through Global Sourcing
Nolan's Notes: The Rise (and Risk) of Data
Key Tronic Posts Growth in Revenue and Earnings for Q1 FY 2019
November 5, 2018 | Key Tronic Corp.Estimated reading time: 2 minutes
For the first quarter of fiscal year 2019, Key Tronic reported total revenue of $127.5 million, up from $117.0 million in the prior quarter and from $109.2 million in the same period of fiscal year 2018.
For the first quarter of fiscal year 2019, the Company had net income of $1.6 million or $0.15 per share, compared to net income of $0.4 million or $0.04 per share for the same period of fiscal year 2018. For the first quarter of fiscal year 2019, gross margin was 7.5% and operating margin was 2.0%, compared to 7.2% and 1.1%, respectively, in the same period of fiscal 2018. During the first quarter of fiscal year 2019, margins were adversely impacted by rising utility costs in Mexico.
“For the first quarter of fiscal 2019, our new programs continued to ramp, including a strong contribution from Skybell Technologies, despite the continued industry-wide supply chain issues for key components that hampered our growth. During the first quarter, results were adversely impacted by rising utility costs in Mexico and increasing labor costs.” said Craig Gates, President and Chief Executive Officer. “However, we also continued to win new business from EMS competitors, including new programs involving industrial motion control products, power metering, and fire protection systems.
"Moving into the second quarter of fiscal year 2019, although we continue to face industry-wide supply chain issues and increased production costs, we are making significant investments in new equipment and processes to be more productive in both our Mexico and U.S. facilities in anticipation of future growth. Although the details of the tariff situation remain unclear, it seems highly probable that the final outcome will be favorable for our U.S. and Mexican operations. Additionally, customers utilizing our facility in China, who are considering repatriating their business back to North America, are finding our centralized systems and controls to be highly advantageous. For these customers, a move back to our facilities in Mexico or the U.S. can be easily implemented.”
During the quarter the Company adopted the new revenue recognition standard, ASU 2014-09 Revenue from Contracts with Customers (Topic 606), beginning July 1, 2018. The impact of the adoption resulted in the recognition of $4.9 million in accelerated revenue as the standard requires. This new standard is not expected to materially affect future quarters.
Business Outlook
For the second quarter of fiscal year 2019, the Company expects to report revenue in the range of $120 million to $125 million, and earnings in the range of $0.13 to $0.18 per diluted share. These expected results assume an effective tax rate of 20% in the quarter.
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, click here.
Share on:
Suggested Items
Designing for Cost to Manufacture
11/21/2024 | Marcy LaRont, I-Connect007ICAPE's Richard Koensgen, a seasoned field application engineer with a rich background in PCB technology, shares his journey of working with customers and manufacturers through the intricacies of circuit board development and emphasizes the importance of early-stage collaboration with PCB designers. With a focus on tackling the most challenging aspects of PCB design and manufacturing, he discusses everything from layout considerations to the thermal challenges of today's technology when it comes to designing for cost.
Sat Nusapersada Chooses Siemens' Process Preparation Software to Boost NPI and SMT Line Efficiency
11/21/2024 | Siemens Digital Industries SoftwareSiemens Digital Industries Software announced that Sat Nusapersada, one of the largest Electronics Manufacturing Services (EMS) providers in Indonesia, has adopted its Process Preparation software to reduce its timescale for New Product Introduction (NPI) of printed circuit board assemblies and improve the efficiency of its Surface Mount Technology production lines by 23 percent.
ViTrox Americas Expands Reach in Southern U.S. with MaRCTex
11/21/2024 | ViTroxViTrox Americas Inc. is pleased to announce the appointment of MaRCTex Inc. as its new representative for the states of Texas, Louisiana, Oklahoma and Arkansas. Led by industry veteran Mike Gunderson, MaRCTex has a proven track record of supplying essential tools and solutions for the electronics manufacturing and high-tech industry across the United States. Additionally, demos are available at the ViTrox Americas Demo Center in Hutto, Texas.
Offshore Sourcing in the Global Supply Chain
11/20/2024 | Brittany Martin, I-Connect007Bob Duke, president of the Global Sourcing Division at American Standard Circuits, discusses the challenges and benefits of navigating the global supply chain, including the value of strong supplier relationships, rigorous quality control, and strategic sourcing from regions including China, Vietnam, and India.
Cadence Unveils Arm-Based System Chiplet
11/20/2024 | Cadence Design SystemsCadence has announced a groundbreaking achievement with the development and successful tapeout of its first Arm-based system chiplet. This innovation marks a pivotal advancement in chiplet technology, showcasing Cadence's commitment to driving industry-leading solutions through its chiplet architecture and framework.