Indiana | 001-36454 | 35-2047713 | ||
(State or other jurisdiction of | (Commission File | (IRS Employer Identification No.) | ||
incorporation) | Number) |
1205 Kimball Boulevard, Jasper, Indiana | 47546 | |
(Address of principal executive offices) | (Zip Code) |
Not Applicable |
(Former name or former address, if changed since last report) |
Exhibit | ||
Number | Description | |
99.1 | Earnings Release dated May 2, 2018 | |
99.2 | Supplementary Information |
KIMBALL ELECTRONICS, INC. | |
By: | /s/ Michael K. Sergesketter |
MICHAEL K. SERGESKETTER Vice President, Chief Financial Officer |
Exhibit | ||
Number | Description | |
99.1 | ||
99.2 |
• | Net sales quarterly record of $284 million, a 22% increase from the prior year third quarter |
• | Quarterly records for Net Income of $10.8 million and Diluted EPS of $0.40, each up 33% year-over-year |
• | Cash flow from operating activities of $9.5 million for the quarter |
Three Months Ended | Nine Months Ended | ||||||||||||||
March 31, | March 31, | ||||||||||||||
(Amounts in Thousands, except EPS) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Net Sales | $ | 283,938 | $ | 232,930 | $ | 795,293 | $ | 689,646 | |||||||
Operating Income | $ | 11,211 | $ | 9,539 | $ | 30,994 | $ | 34,602 | |||||||
Adjusted Operating Income (non-GAAP)* | $ | 11,211 | $ | 9,539 | $ | 30,994 | $ | 30,597 | |||||||
Operating Income % | 3.9 | % | 4.1 | % | 3.9 | % | 5.0 | % | |||||||
Adjusted Operating Income (non-GAAP) % | 3.9 | % | 4.1 | % | 3.9 | % | 4.4 | % | |||||||
Net Income | $ | 10,835 | $ | 8,117 | $ | 10,968 | $ | 26,051 | |||||||
Adjusted Net Income (non-GAAP)* | $ | 10,705 | $ | 8,117 | $ | 27,418 | $ | 22,627 | |||||||
Diluted EPS | $ | 0.40 | $ | 0.30 | $ | 0.41 | $ | 0.94 | |||||||
Adjusted Diluted EPS (non-GAAP)* | $ | 0.40 | $ | 0.30 | $ | 1.01 | $ | 0.82 |
• | Consolidated net sales increased 22% compared to the third quarter of fiscal year 2017, which included a 7% favorable impact from foreign currency movements. This represents the ninth consecutive quarterly sales record. |
• | The current year quarter results include non-operating income related to pre-tax net gains from foreign currency movements of $2.1 million. In the prior year third quarter, pre-tax net gains from foreign currency movements in non-operating income were less than $0.1 million. |
• | Return on invested capital (“ROIC”) was 10.2% for the first nine months of fiscal year 2018, which compares to 10.7% for the same period of the prior year (see reconciliation of non-GAAP financial measures for ROIC calculation). |
• | Operating activities provided cash flow of $9.5 million during the quarter, which compares to cash flow provided by operating activities of $8.7 million in the third quarter of fiscal year 2017. |
• | Cash conversion days (“CCD”) for the quarter ended March 31, 2018 were 62 days, up slightly from 61 days in the same quarter last year. CCD is calculated as the sum of days sales outstanding plus production days supply on hand less accounts payable days. |
• | Investments in capital expenditures were $7.2 million during the quarter. |
• | Cash and cash equivalents were $44.2 million and borrowings outstanding on credit facilities were $16.3 million at March 31, 2018. |
Three Months Ended | ||||||||||
March 31, | ||||||||||
(Amounts in Millions) | 2018 | 2017 | Percent Change | |||||||
Automotive | $ | 136.2 | $ | 94.3 | 44 | % | ||||
Medical | 77.8 | 59.8 | 30 | % | ||||||
Industrial | 53.3 | 53.8 | (1 | )% | ||||||
Public Safety | 14.3 | 20.6 | (31 | )% | ||||||
Other | 2.3 | 4.4 | (47 | )% | ||||||
Total Net Sales | $ | 283.9 | $ | 232.9 | 22 | % |
Conference Call / Webcast | ||
Date: | May 3, 2018 | |
Time: | 10:00 AM Eastern Time | |
Dial-In #: | 800-992-4934 (International Calls - 937-502-2251) | |
Conference ID: | 4576138 |
Condensed Consolidated Statements of Income | |||||||||||||
(Unaudited) | Three Months Ended | ||||||||||||
(Amounts in Thousands, except Per Share Data) | March 31, 2018 | March 31, 2017 | |||||||||||
Net Sales | $ | 283,938 | 100.0 | % | $ | 232,930 | 100.0 | % | |||||
Cost of Sales | 261,011 | 91.9 | % | 214,212 | 92.0 | % | |||||||
Gross Profit | 22,927 | 8.1 | % | 18,718 | 8.0 | % | |||||||
Selling and Administrative Expenses | 11,716 | 4.2 | % | 9,179 | 3.9 | % | |||||||
Operating Income | 11,211 | 3.9 | % | 9,539 | 4.1 | % | |||||||
Other Income (Expense), net | 1,918 | 0.7 | % | 332 | 0.1 | % | |||||||
Income Before Taxes on Income | 13,129 | 4.6 | % | 9,871 | 4.2 | % | |||||||
Provision for Income Taxes | 2,294 | 0.8 | % | 1,754 | 0.7 | % | |||||||
Net Income | $ | 10,835 | 3.8 | % | $ | 8,117 | 3.5 | % | |||||
Earnings Per Share of Common Stock: | |||||||||||||
Basic | $ | 0.41 | $ | 0.30 | |||||||||
Diluted | $ | 0.40 | $ | 0.30 | |||||||||
Average Number of Shares Outstanding: | |||||||||||||
Basic | 26,714 | 27,266 | |||||||||||
Diluted | 26,846 | 27,416 |
(Unaudited) | Nine Months Ended | ||||||||||||
(Amounts in Thousands, except Per Share Data) | March 31, 2018 | March 31, 2017 | |||||||||||
Net Sales | $ | 795,293 | 100.0 | % | $ | 689,646 | 100.0 | % | |||||
Cost of Sales | 731,914 | 92.0 | % | 632,053 | 91.6 | % | |||||||
Gross Profit | 63,379 | 8.0 | % | 57,593 | 8.4 | % | |||||||
Selling and Administrative Expenses | 32,385 | 4.1 | % | 26,996 | 4.0 | % | |||||||
Other General Income | — | — | % | (4,005 | ) | (0.6 | )% | ||||||
Operating Income | 30,994 | 3.9 | % | 34,602 | 5.0 | % | |||||||
Other Income (Expense), net | 3,556 | 0.4 | % | 81 | 0.0 | % | |||||||
Income Before Taxes on Income | 34,550 | 4.3 | % | 34,683 | 5.0 | % | |||||||
Provision for Income Taxes | 23,582 | 2.9 | % | 8,632 | 1.2 | % | |||||||
Net Income | $ | 10,968 | 1.4 | % | $ | 26,051 | 3.8 | % | |||||
Earnings Per Share of Common Stock: | |||||||||||||
Basic | $ | 0.41 | $ | 0.94 | |||||||||
Diluted | $ | 0.41 | $ | 0.94 | |||||||||
Average Number of Shares Outstanding: | |||||||||||||
Basic | 26,779 | 27,565 | |||||||||||
Diluted | 27,006 | 27,655 |
Condensed Consolidated Statements of Cash Flows | Nine Months Ended | ||||||
(Unaudited) | March 31, | ||||||
(Amounts in Thousands) | 2018 | 2017 | |||||
Net Cash Flow provided by Operating Activities | $ | 20,888 | $ | 34,742 | |||
Net Cash Flow used for Investing Activities | (21,823 | ) | (27,921 | ) | |||
Net Cash Flow used for Financing Activities | (1,718 | ) | (20,529 | ) | |||
Effect of Exchange Rate Change on Cash and Cash Equivalents | 2,342 | (974 | ) | ||||
Net Decrease in Cash and Cash Equivalents | (311 | ) | (14,682 | ) | |||
Cash and Cash Equivalents at Beginning of Period | 44,555 | 54,738 | |||||
Cash and Cash Equivalents at End of Period | $ | 44,244 | $ | 40,056 |
(Unaudited) | |||||||
Condensed Consolidated Balance Sheets | March 31, 2018 | June 30, 2017 | |||||
(Amounts in Thousands) | |||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 44,244 | $ | 44,555 | |||
Receivables, net | 189,502 | 169,785 | |||||
Inventories | 193,240 | 144,606 | |||||
Prepaid expenses and other current assets | 25,243 | 29,219 | |||||
Property and Equipment, net | 141,943 | 137,549 | |||||
Goodwill | 6,191 | 6,191 | |||||
Other Intangible Assets, net | 4,533 | 4,581 | |||||
Other Assets | 16,159 | 18,458 | |||||
Total Assets | $ | 621,055 | $ | 554,944 | |||
LIABILITIES AND SHARE OWNERS’ EQUITY | |||||||
Borrowings under credit facilities | $ | 16,250 | $ | 10,000 | |||
Accounts payable | 190,775 | 154,619 | |||||
Accrued expenses | 32,050 | 34,630 | |||||
Long-term income taxes payable | 11,786 | — | |||||
Other | 13,076 | 13,423 | |||||
Share Owners’ Equity | 357,118 | 342,272 | |||||
Total Liabilities and Share Owners’ Equity | $ | 621,055 | $ | 554,944 |
Reconciliation of Non-GAAP Financial Measures | |||||||||||||||
(Unaudited) | |||||||||||||||
(Amounts in Thousands, except Per Share Data) | |||||||||||||||
Operating Income excluding Lawsuit Proceeds | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
March 31, | March 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Operating Income, as reported | $ | 11,211 | $ | 9,539 | $ | 30,994 | $ | 34,602 | |||||||
Less: Pre-tax Settlement Proceeds from Lawsuit | — | — | — | 4,005 | |||||||||||
Adjusted Operating Income | $ | 11,211 | $ | 9,539 | $ | 30,994 | $ | 30,597 | |||||||
Net Income excluding Tax Reform, Lawsuit Proceeds, and Bargain Purchase Gain | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
March 31, | March 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net Income, as reported | $ | 10,835 | $ | 8,117 | $ | 10,968 | $ | 26,051 | |||||||
Add: Discrete Tax Items Resulting from Tax Reform Act | (130 | ) | — | 16,450 | — | ||||||||||
Less: After-tax Settlement Proceeds from Lawsuit | — | — | — | 2,499 | |||||||||||
Less: Bargain Purchase Gain | — | — | — | 925 | |||||||||||
Adjusted Net Income | $ | 10,705 | $ | 8,117 | $ | 27,418 | $ | 22,627 | |||||||
Diluted Earnings per Share excluding Tax Reform, Lawsuit Proceeds, and Bargain Purchase Gain | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
March 31, | March 31, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Diluted Earnings per Share, as reported | $ | 0.40 | $ | 0.30 | $ | 0.41 | $ | 0.94 | |||||||
Add: Impact of Discrete Tax Items Resulting from Tax Reform Act | 0.00 | — | 0.60 | — | |||||||||||
Less: Impact of Settlement Proceeds from Lawsuits | — | — | — | 0.09 | |||||||||||
Less: Bargain Purchase Gain | — | — | — | 0.03 | |||||||||||
Adjusted Diluted Earnings per Share | $ | 0.40 | $ | 0.30 | $ | 1.01 | $ | 0.82 | |||||||
Return on Invested Capital (ROIC) | |||||||||||||||
Nine Months Ended | |||||||||||||||
March 31, | |||||||||||||||
2018 | 2017 | ||||||||||||||
Adjusted Operating Income | $ | 30,994 | $ | 30,597 | |||||||||||
Annualized Adjusted Operating Income | $ | 41,325 | $ | 40,796 | |||||||||||
Tax Rate | 21.2 | % | 24.3 | % | |||||||||||
Tax Effect | $ | 8,761 | $ | 9,913 | |||||||||||
After Tax Annualized Adjusted Operating Income | $ | 32,564 | $ | 30,883 | |||||||||||
Average Invested Capital * | $ | 319,484 | $ | 289,966 | |||||||||||
ROIC | 10.2 | % | 10.7 | % |
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