EX-99.1 2 trioex991.htm ADDITIONAL EXHIBITS SEC Connect
 
 
  EXHIBIT 99.1
 
 
LOS ANGELES
SINGAPORE
KUALA LUMPUR
 
BANGKOK
SUZHOU
TIANJIN
CHONGQING
 
FOR IMMEDIATE RELEASE
 
 
Company Contact:                                     
 A. Charles Wilson                                        
 Chairman                                                      
 (818) 787-7000                                             
Investor Contact:
Berkman Associates
 (310) 477-3118
 info@BerkmanAssociates.com
 
Trio-Tech Fiscal 2017 Second Quarter Net Income Increased to $0.09
Per Share Versus $0.05 Per Share Last Year On 9.0% Revenue Gain
 
 
Van Nuys, CA – February 10, 2017 – Trio-Tech International (NYSE MKT: TRT) today announced financial results for the second quarter and first six months of fiscal 2017:
 
 ● 
Revenue increased 9.0% to $9.1 million for this year's second quarter compared to $8.4 million for the second quarter of fiscal 2016.
 ● 
Second quarter net income attributable to Trio-Tech common shareholders increased 63.2%.
 ● 
EPS increased to $0.09 per diluted share, compared to $0.05 per share, in the second quarter of fiscal 2017.
 ● 
Revenue increased 11.0% to $18.1 million compared to $16.3 million for the first six months of fiscal 2016.
 ● 
Six months net income attributable to Trio-Tech common shareholders increased 36.5%.
 ● 
EPS increased to $0.17 per diluted share, compared to $0.13 per share, in the first six months of fiscal 2016.
 
CEO Comments
S.W. Yong, Trio-Tech's CEO, said, "Revenue increased for each of Trio-Tech's businesses in the second quarter of fiscal 2017, compared to the second quarter of fiscal 2016. Semiconductor testing services delivered double digit revenue growth, compared to the second quarter of fiscal 2016, increasing in all regions except for our China operations. This strength was also reflected in our distribution segment, which continues to achieve strong double digit sales gains, primarily due to higher demand from our Asia customer base.
"Selling, general and administrative expenses increased during the quarter compared to the second quarter of fiscal 2016, reflecting the Company’s efforts to expand sales of manufactured products and testing services." Yong added that net income for this year's second quarter benefitted from a foreign exchange gain, compared to a foreign exchange loss in the second quarter of fiscal 2016.
"We remain cautiously optimistic for the remainder of the fiscal year," Yong concluded.
 
Fiscal 2017 Second Quarter Results
For the three months ended December 31, 2016, revenue increased 9% to $9,104,000 compared to revenue of $8,354,000 for the same quarter last fiscal year. Manufacturing revenue increased 1.3% to $3,320,000 for second quarter of 2017 compared to $3,276,000 in the same quarter last fiscal year. Revenue from semiconductor testing services increased 10.0% to $4,070,000 in second quarter of 2017, compared to $3,701,000 for last year's second quarter. Distribution revenue increased 23.3% to $1,675,000 from $1,359,000 for the second quarter of fiscal 2016.
Gross margin for the second quarter of fiscal 2017 was 25.2% compared to 25.3% in the same quarter last year. Increased sales of lower margin products, compared to the same quarter last year, affected gross margins at the manufacturing segment, while higher volume and increased capacity utilization, compared to the same quarter last year, improved gross margins at the testing segment. Distribution gross margin benefitted from an improved product mix at this segment, compared to the same quarter last year.
 
 
(more)
16139 Wyandotte Street, Van Nuys, CA 91406, USA ● TEL: (818) 787-7000 ● FAX (818) 787-9130
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Trio-Tech Fiscal 2017 Second Quarter Net Income Increased to $0.09 Per Share Versus $0.05 Per Share Last Year On 9.0% Revenue Gain
February 10, 2017
Page Two
 
Operating expenses for the second quarter of fiscal 2017 increased to $2,016,000, or 22.1% of revenue, from $1,787,000, or 21.4% of revenue in the same quarter last year. The increase in operating expenses is attributable to higher selling and overhead expenses for manufacturing and testing services segments, compared to the second quarter last year.
Other income, related to foreign exchange gains, contributed to a 63.2% increase in second quarter net income attributable to Trio-Tech common shareholders to $310,000, or $0.09 per diluted share, compared to net income attributable to Trio-Tech common shareholders of $190,000, or $0.05 per diluted share, in the second quarter of fiscal 2016.
 
Fiscal 2017 Six Months Results
For the six months ended December 31, 2016, revenue increased 11% to $18,075,000 compared to revenue of $16,284,000 for the same period last fiscal year. Manufacturing revenue increased 9.0% to $6,991,000 for the six months compared to $6,416,000 in the first six months of fiscal 2017. Revenue from semiconductor testing services increased 9.9% to $8,227,000 for the six months compared to $7,484,000 for in the same period last year. Distribution revenue increased 19.1% to $2,779,000 from $2,334,000 for the first six months of fiscal 2016.
Gross margin for the first six months of fiscal 2017 was 25.7% compared to 26.4% in the same period in in fiscal 2016. The manufacturing segment margin was 22.5% compared to 28.6% in the same period last year and testing services margin was 33.5% compared to 29.8% for the same period last year. Distribution gross margin for the first six months of both fiscal 2016 and 2017 was 10.3%.
Operating expenses for the first six months of fiscal 2017 were 22.1% of revenue compared to 22.5% of revenue in the same period of fiscal 2016. Net income attributable to Trio-Tech common shareholders increased 36.5% to $613,000, or $0.17 per diluted share, compared to net income attributable to Trio-Tech common shareholders of $449,000, or $0.13 per diluted share, for the same period in fiscal 2016.
Shareholders' equity at December 31, 2016 was $20,087,000, or $5.72 per outstanding share, compared to $20,871,000, or $5.94 per outstanding share, at June 30, 2016. There were approximately 3,513,000 common shares outstanding at December 31, 2016 and June 30, 2016.
 
About Trio-Tech
Established in 1958 and headquartered in Van Nuys, California, Trio-Tech International is a diversified business group with interests in semiconductor testing services, manufacturing and distribution of semiconductor testing equipment, and real estate. Further information about Trio-Tech's semiconductor products and services can be obtained from the Company's Web site at www.triotech.com, www.universalfareast.com, and www.ttsolar.com.
 
Forward Looking Statements
This press release contains statements that are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and may contain forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and assumptions regarding future activities and results of operations of the Company. In light of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the following factors, among others, could cause actual results to differ materially from those reflected in any forward-looking statements made by or on behalf of the Company: market acceptance of Company products and services; changing business conditions or technologies and volatility in the semiconductor industry, which could affect demand for the Company’s products and services; the impact of competition; problems with technology; product development schedules; delivery schedules; changes in military or commercial testing specifications which could affect the market for the Company’s products and services; difficulties in profitably integrating acquired businesses, if any, into the Company; risks associated with conducting business internationally and especially in Southeast Asia, including currency fluctuations and devaluation, currency restrictions, local laws and restrictions and possible social, political and economic instability; changes to government policies, potential legislative changes in U.S. and global financial and equity markets, including market disruptions and significant interest rate fluctuations; and other economic, financial and regulatory factors beyond the Company’s control. Other than statements of historical fact, all statements made in this Quarterly Report are forward-looking, including, but not limited to, statements regarding industry prospects, future results of operations or financial position, and statements of our intent, belief and current expectations about our strategic direction, prospective and future financial results and condition. In some cases, you can identify forward-looking statements by the use of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “estimates,” “potential,” “believes,” “can impact,” “continue,” or the negative thereof or other comparable terminology. Forward-looking statements involve risks and uncertainties that are inherently difficult to predict, which could cause actual outcomes and results to differ materially from our expectations, forecasts and assumptions.
 
(tables attached)
 
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TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
 
 
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
 
 
UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
 
Six Months Ended
 
 
 
December 31,
 
 
December 31,
 
Revenue
 
2016
 
 
2015
 
 
2016
 
 
2015
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Manufacturing 
 $3,320 
 $3,276 
 $6,991 
 $6,416 
  Testing services
  4,070 
  3,701 
  8,227 
  7,484 
  Distribution
  1,675 
  1,359 
  2,779 
  2,334 
  Others
  39 
  18 
  78 
  50 
 
    
    
    
    
 
  9,104 
  8,354 
  18,075 
  16,284 
Cost of Sales
    
    
    
    
   Cost of manufactured products sold
  2,622 
  2,471 
  5,417 
  4,580 
   Cost of testing services rendered
  2,658 
  2,499 
  5,472 
  5,257 
   Cost of distribution
  1,501 
  1,240 
  2,492 
  2,093 
   Others
  29 
  29 
  42 
  61 
 
    
    
    
    
 
  6,810 
  6,239 
  13,423 
  11,991 
 
    
    
    
    
Gross Margin
  2,294 
  2,115 
  4,652 
  4,293 
 
    
    
    
    
Operating Expenses:
    
    
    
    
  General and administrative
  1,776 
  1,599 
  3,519 
  3,261 
  Selling
  180 
  141 
  365 
  312 
  Research and development
  52 
  51 
  105 
  97 
  Loss (gain) on disposal of property, plant and equipment
  8 
  (4)
  8 
  (4)
 
    
    
    
    
     Total operating expenses
  2,016 
  1,787 
  3,997 
  3,666 
 
    
    
    
    
Income from Operations
  278 
  328 
  655 
  627 
 
    
    
    
    
Other (Expenses) Income 
    
    
    
    
  Interest expenses
  (48)
  (51)
  (106)
  (104)
  Other income, net
  203 
  18 
  313 
  226 
 
    
    
    
    
     Total other income (expenses)
  155 
  (33)
  207 
  122 
 
    
    
    
    
Income from Continuing Operations before Income Taxes
  433 
  295 
  862 
  749 
Income Tax Expenses 
  (67)
  (86)
  (150)
  (153)
 
    
    
    
    
Income from Continuing Operations
    
    
    
    
  before Non-controlling Interest, Net of Tax
  366 
  209 
  712 
  596 
(Loss) income from Discontinued Operations, Net of Tax
  (4)
  6 
  (3)
  (4)
 
    
    
    
    
NET INCOME
  362 
  215 
  709 
  592 
 
    
    
    
    
Less: Income Attributable to Non-controlling Interest
  52 
  25 
  96 
  143 
 
    
    
    
    
Net Income Attributable to Trio-Tech International
 $310 
 $190 
 $613 
 $449 
 
    
    
    
    
Net Income Attributable to Trio-Tech International:
    
    
    
    
 
    
    
    
    
Income from Continuing Operations, Net of Tax
  316 
  188 
  619 
  452 
(Loss) income from Discontinued Operations, Net of Tax
  (6)
  2 
  (6)
  (3)
 
    
    
    
    
Net Income attributable to Trio-Tech International
 $310 
 $190 
 $613 
 $449 
 
    
    
    
    
Net income per share - basic
 $0.09 
 $0.05 
 $0.18 
 $0.13 
Net income per share - diluted
  0.09 
  0.05 
  0.17 
  0.13 
 
    
    
    
    
Weighted Average Shares Outstanding - Basic
  3,513 
  3,513 
  3,513 
  3,513 
Weighted Average Shares Outstanding - Diluted
  3,569 
  3,529 
  3,552 
  3,525 
 
 
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TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
 
 
 
Three Months Ended
 
 
Six Months Ended
 

December 31,
December 31,

2016
2015
2016
2015
 
 
 
 
 
 
 
 
 
 
 
 
 
Comprehensive (Loss) Income
 
 
 
 
 
 
 
 
 
 
 
 
    Attributable to Trio-Tech International:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income
 $362 
 $215 
 $709 
 $592 
 
    
    
    
    
Foreign Currency Translation, Net of Tax 
  (1,094)
  22 
  (1,377)
  (1,403)
 
    
    
    
    
Comprehensive (Loss) Income
  (732)
  237 
  (668)
  (811)
 
    
    
    
    
Less: Comprehensive (Loss) Income
    
    
    
    
  Attributable to Non-controlling Interest
  (16)
  114 
  (37)
  (138)
 
    
    
    
    
Comprehensive (Loss) Income
    
    
    
    
  Attributable to Trio-Tech International
 $(716)
 $123 
 $(631)
 $(673)
 
    
    
    
    
 
 
 
 
 
 
 
 
 
 
 
-4-
 
 
TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT NUMBER OF SHARES)
 
 
Dec. 31,
 
 
Jun. 30,
 
 
 
2016
 
 
2016
 
ASSETS
 
(unaudited)
 
 
 
 
 
 
 
 
 
 
 
CURRENT ASSETS:
 
 
 
 
 
 
  Cash and cash equivalents
 $4,336 
 $3,807 
  Short-term deposits
  658 
  295 
  Trade accounts receivable, net
  7,577 
  8,826 
  Other receivables
  316 
  596 
  Inventories, net
  1,666 
  1,460 
  Prepaid expenses and other current assets
  363 
  264 
  Assets held for sale
  82 
  92 
 
    
    
     Total current assets
  14,998 
  15,340 
 
    
    
Deferred tax assets
  371 
  401 
Investment properties, net
  1,234 
  1,340 
Property, plant and equipment, net
  10,290 
  11,283 
Other assets
  1,882 
  1,788 
Restricted term deposits
  1,921 
  2,067 
 
    
    
     Total non-current assets
  15,698 
  16,879 
 
    
    
TOTAL ASSETS
 $30,696 
 $32,219 
 
    
    
 
    
    
LIABILITIES AND SHAREHOLDER'S EQUITY
    
    
 
    
    
CURRENT LIABILITIES:
    
    
  Lines of credit
 $1,419 
 $2,491 
  Accounts payable
  3,730 
  2,921 
  Accrued expenses
  2,681 
  2,642 
  Income taxes payable
  204 
  230 
  Current portion of bank loans payable
  235 
  342 
  Current portion of capital leases
  209 
  235 
 
    
    
     Total current liabilities
  8,478 
  8,861 
 
    
    
Bank loans payable, net of current portion
  1,454 
  1,725 
Capital leases, net of current portion 
  398 
  503 
Deferred tax liabilities
  237 
  216 
Other non-current liabilities
  42 
  43 
 
    
    
     Total non-current liabilities
  2,131 
  2,487 
 
    
    
TOTAL LIABILITIES
  10,609 
  11,348 
 
    
    
COMMITMENTS AND CONTINGENCIES
  -- 
  -- 
 
    
    
EQUITY
    
    
 
    
    
TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY:
    
    
  Common stock, no par value, 15,000,000 shares authorized; 3,513,055 shares
    
    
    issued and outstanding at December 31, 2016 and June 30, 2016, respectively
  10,882 
  10,882 
  Paid-in capital
  3,189 
  3,188 
  Accumulated retained earnings
  3,638 
  3,025 
  Accumulated other comprehensive gain-translation adjustments
  918 
  2,162 
 
    
    
     Total Trio-Tech International shareholders' equity
  18,627 
  19,257 
 
    
    
Non-controlling interest
  1,460 
  1,614 
 
    
    
TOTAL EQUITY
  20,087 
  20,871 
 
    
    
TOTAL LIABILITIES AND EQUITY
 $31,696 
 $32,219 
 
    
    
 
 
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