South Dakota | 0-23246 | 46-0306862 |
(State or Other Jurisdiction of | (Commission | (I.R.S. Employer |
Incorporation or Organization) | File Number) | Identification Number) |
DAKTRONICS, INC. | ||
By: /s/ Sheila M. Anderson | ||
Sheila M. Anderson, Chief Financial Officer | ||
Date: | November 21, 2017 | |
For more information contact: | ||
INVESTOR RELATIONS: | ||
Sheila Anderson, Chief Financial Officer | ||
(605) 692-0200 | ||
Investor@daktronics.com | ||
Daktronics, Inc. and Subsidiaries Consolidated Statements of Operations (in thousands, except per share amounts) (unaudited) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | |||||||||||||
Net sales | $ | 169,309 | $ | 169,992 | $ | 342,037 | $ | 327,138 | ||||||||
Cost of goods sold | 126,705 | 125,684 | 254,787 | 243,763 | ||||||||||||
Gross profit | 42,604 | 44,308 | 87,250 | 83,375 | ||||||||||||
Operating expenses: | ||||||||||||||||
Selling expense | 15,350 | 15,891 | 30,289 | 31,150 | ||||||||||||
General and administrative | 8,868 | 8,625 | 17,803 | 17,408 | ||||||||||||
Product design and development | 8,948 | 7,126 | 17,995 | 14,169 | ||||||||||||
33,166 | 31,642 | 66,087 | 62,727 | |||||||||||||
Operating income | 9,438 | 12,666 | 21,163 | 20,648 | ||||||||||||
Nonoperating income (expense): | ||||||||||||||||
Interest income | 151 | 171 | 362 | 376 | ||||||||||||
Interest expense | (47 | ) | (76 | ) | (133 | ) | (118 | ) | ||||||||
Other (expense) income, net | (87 | ) | 149 | 58 | 55 | |||||||||||
Income before income taxes | 9,455 | 12,910 | 21,450 | 20,961 | ||||||||||||
Income tax expense | 2,323 | 3,889 | 5,889 | 6,401 | ||||||||||||
Net income | $ | 7,132 | $ | 9,021 | $ | 15,561 | $ | 14,560 | ||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 44,412 | 43,988 | 44,345 | 44,051 | ||||||||||||
Diluted | 44,679 | 44,098 | 44,696 | 44,168 | ||||||||||||
Earnings per share: | ||||||||||||||||
Basic | $ | 0.16 | $ | 0.21 | $ | 0.35 | $ | 0.33 | ||||||||
Diluted | $ | 0.16 | $ | 0.20 | $ | 0.35 | $ | 0.33 | ||||||||
Cash dividends declared per share | $ | 0.07 | $ | 0.07 | $ | 0.14 | $ | 0.17 |
Daktronics, Inc. and Subsidiaries Consolidated Balance Sheets (in thousands) | |||||||
October 28, 2017 | April 29, 2017 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
CURRENT ASSETS: | |||||||
Cash and cash equivalents | $ | 39,699 | $ | 32,623 | |||
Restricted cash | 27 | 216 | |||||
Marketable securities | 21,787 | 32,713 | |||||
Accounts receivable, net | 108,719 | 78,846 | |||||
Inventories, net | 70,436 | 66,486 | |||||
Costs and estimated earnings in excess of billings | 31,302 | 36,403 | |||||
Current maturities of long-term receivables | 1,964 | 2,274 | |||||
Prepaid expenses and other assets | 7,566 | 7,553 | |||||
Income tax receivables | 1,725 | 611 | |||||
Total current assets | 283,225 | 257,725 | |||||
Long-term receivables, less current maturities | 2,208 | 2,616 | |||||
Goodwill | 8,190 | 7,812 | |||||
Intangibles, net | 4,338 | 4,705 | |||||
Investment in affiliates and other assets | 4,730 | 4,534 | |||||
Deferred income taxes | 11,287 | 11,292 | |||||
30,753 | 30,959 | ||||||
PROPERTY AND EQUIPMENT: | |||||||
Land | 2,134 | 2,099 | |||||
Buildings | 66,863 | 65,935 | |||||
Machinery and equipment | 86,875 | 84,189 | |||||
Office furniture and equipment | 5,642 | 5,604 | |||||
Computer software and hardware | 53,316 | 51,523 | |||||
Equipment held for rental | 287 | 374 | |||||
Demonstration equipment | 7,143 | 7,109 | |||||
Transportation equipment | 7,508 | 7,108 | |||||
229,768 | 223,941 | ||||||
Less accumulated depreciation | 164,549 | 157,192 | |||||
65,219 | 66,749 | ||||||
TOTAL ASSETS | $ | 379,197 | $ | 355,433 | |||
Daktronics, Inc. and Subsidiaries Consolidated Balance Sheets (continued) (in thousands) | |||||||
October 28, 2017 | April 29, 2017 | ||||||
(unaudited) | |||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||
CURRENT LIABILITIES: | |||||||
Accounts payable | $ | 49,005 | $ | 51,499 | |||
Accrued expenses | 27,399 | 25,033 | |||||
Warranty obligations | 15,400 | 13,578 | |||||
Billings in excess of costs and estimated earnings | 16,561 | 10,897 | |||||
Customer deposits (billed or collected) | 14,349 | 14,498 | |||||
Deferred revenue (billed or collected) | 14,046 | 12,137 | |||||
Current portion of other long-term obligations | 913 | 1,409 | |||||
Income taxes payable | 1,334 | 1,544 | |||||
Total current liabilities | 139,007 | 130,595 | |||||
Long-term warranty obligations | 15,740 | 14,321 | |||||
Long-term deferred revenue (billed or collected) | 6,835 | 5,434 | |||||
Other long-term obligations | 2,333 | 2,848 | |||||
Long-term income tax payable | 3,306 | 3,113 | |||||
Deferred income taxes | 937 | 836 | |||||
Total long-term liabilities | 29,151 | 26,552 | |||||
TOTAL LIABILITIES | 168,158 | 157,147 | |||||
SHAREHOLDERS' EQUITY: | |||||||
Common stock | 53,862 | 52,530 | |||||
Additional paid-in capital | 39,034 | 38,004 | |||||
Retained earnings | 123,330 | 113,967 | |||||
Treasury stock, at cost | (1,834 | ) | (1,834 | ) | |||
Accumulated other comprehensive loss | (3,353 | ) | (4,381 | ) | |||
TOTAL SHAREHOLDERS' EQUITY | 211,039 | 198,286 | |||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 379,197 | $ | 355,433 |
Daktronics, Inc. and Subsidiaries Consolidated Statements of Cash Flows (in thousands) (unaudited) | ||||||||
Six Months Ended | ||||||||
October 28, 2017 | October 29, 2016 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income | $ | 15,561 | $ | 14,560 | ||||
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||||||||
Depreciation and amortization | 8,902 | 9,242 | ||||||
Impairment of intangible assets | — | 830 | ||||||
(Gain) loss on sale of property, equipment and other assets | (1,221 | ) | 33 | |||||
Share-based compensation | 1,341 | 1,484 | ||||||
Equity in loss of affiliate | 191 | — | ||||||
Provision for doubtful accounts | (21 | ) | 962 | |||||
Deferred income taxes, net | 81 | (48 | ) | |||||
Change in operating assets and liabilities | (15,496 | ) | (12,049 | ) | ||||
Net cash provided by operating activities | 9,338 | 15,014 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Purchases of property and equipment | (7,735 | ) | (4,625 | ) | ||||
Proceeds from sale of property, equipment and other assets | 2,000 | 72 | ||||||
Purchases of marketable securities | — | (4,583 | ) | |||||
Proceeds from sales or maturities of marketable securities | 10,802 | 11,328 | ||||||
Purchases of equity investment | (607 | ) | (562 | ) | ||||
Net cash provided by investing activities | 4,460 | 1,630 | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Payments on notes payable | — | (6 | ) | |||||
Proceeds from exercise of stock options | 511 | 102 | ||||||
Principal payments on long-term obligations | (1,027 | ) | (904 | ) | ||||
Dividends paid | (6,197 | ) | (7,482 | ) | ||||
Payments for common shares repurchased | — | (1,825 | ) | |||||
Tax payments related to RSU issuances | (311 | ) | (213 | ) | ||||
Net cash used in financing activities | (7,024 | ) | (10,328 | ) | ||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 113 | (591 | ) | |||||
NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 6,887 | 5,725 | ||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH: | ||||||||
Beginning of period | 32,839 | 28,526 | ||||||
End of period | $ | 39,726 | $ | 34,251 | ||||
Daktronics, Inc. and Subsidiaries Net Sales and Orders by Business Unit (in thousands) (unaudited) | |||||||||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||
October 28, 2017 | October 29, 2016 | Dollar Change | Percent Change | October 28, 2017 | October 29, 2016 | Dollar Change | Percent Change | ||||||||||||||||||||||
Net Sales: | |||||||||||||||||||||||||||||
Commercial | $ | 34,377 | $ | 39,923 | $ | (5,546 | ) | (13.9 | )% | $ | 67,240 | $ | 76,177 | $ | (8,937 | ) | (11.7 | )% | |||||||||||
Live Events | 68,653 | 55,363 | 13,290 | 24.0 | 146,265 | 115,996 | $ | 30,269 | 26.1 | % | |||||||||||||||||||
High School Park and Recreation | 29,660 | 28,707 | 953 | 3.3 | 58,139 | 56,324 | $ | 1,815 | 3.2 | % | |||||||||||||||||||
Transportation | 16,476 | 16,101 | 375 | 2.3 | 35,388 | 30,387 | $ | 5,001 | 16.5 | % | |||||||||||||||||||
International | 20,143 | 29,898 | (9,755 | ) | (32.6 | ) | 35,005 | 48,254 | $ | (13,249 | ) | (27.5 | )% | ||||||||||||||||
$ | 169,309 | $ | 169,992 | $ | (683 | ) | (0.4 | )% | $ | 342,037 | $ | 327,138 | $ | 14,899 | 4.6 | % | |||||||||||||
Orders: | |||||||||||||||||||||||||||||
Commercial | $ | 39,134 | $ | 36,663 | $ | 2,471 | 6.7 | % | $ | 69,071 | $ | 81,731 | $ | (12,660 | ) | (15.5 | )% | ||||||||||||
Live Events | 43,730 | 31,050 | 12,680 | 40.8 | 105,335 | 83,930 | $ | 21,405 | 25.5 | % | |||||||||||||||||||
High School Park and Recreation | 14,737 | 15,764 | (1,027 | ) | (6.5 | ) | 46,917 | 46,877 | $ | 40 | 0.1 | % | |||||||||||||||||
Transportation | 14,245 | 14,754 | (509 | ) | (3.4 | ) | 23,514 | 26,669 | $ | (3,155 | ) | (11.8 | )% | ||||||||||||||||
International | 30,414 | 18,643 | 11,771 | 63.1 | 50,504 | 52,835 | $ | (2,331 | ) | (4.4 | )% | ||||||||||||||||||
$ | 142,260 | $ | 116,874 | $ | 25,386 | 21.7 | % | $ | 295,341 | $ | 292,042 | $ | 3,299 | 1.1 | % |
Reconciliation of Free Cash Flow* (in thousands) (unaudited) | |||||||
Six Months Ended | |||||||
October 28, 2017 | October 29, 2016 | ||||||
Net cash provided by operating activities | $ | 9,338 | $ | 15,014 | |||
Purchases of property and equipment | (7,735 | ) | (4,625 | ) | |||
Proceeds from sales of property and equipment | 2,000 | 72 | |||||
Free cash flow | $ | 3,603 | $ | 10,461 |
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