 |
LOS
ANGELES
SINGAPORE
KUALA
LUMPUR
BANGKOK
SUZHOU
TIANJIN
CHONGQING
|
|
FOR IMMEDIATE
RELEASE
|
Company
Contact:
Investor Contact:
A. Charles
Wilson
Berkman Associates
Chairman
(310) 477-3118
(818)
787-7000
info@BerkmanAssociates.com
|
Trio-Tech
Reports Fourth Quarter and Fiscal 2019 Results
Van Nuys, CA – September 23, 2019
– Trio-Tech International
(NYSE MKT: TRT) today announced financial results for the
fourth quarter and fiscal year ended June 30, 2019.
Fourth
Quarter Results
Overall
revenue for the fourth quarter of fiscal 2019 decreased 1% to
$10,625,000 from $10,760,000 for the fourth quarter of fiscal 2018.
While manufacturing revenue increased 17% to $4,803,000 compared to
$4,116,000 last year, reflecting increased demand in the
Company’s Singapore operations, and distribution revenue
increased 11% to $1,864,000 from $1,678,000, lower demand in
Trio-Tech’s Malaysia and Tianjin, China operations led to a
20% decrease in testing services revenue to $3,941,000 from
$4,937,000 last year.
The
decline in overall revenue, coupled with a change in product mix,
reduced gross margin to $2,468,000 for the fourth quarter of fiscal
2019 from $2,851,000 for last year’s fourth quarter. As a
percentage of revenue, gross margin declined to 23% compared to 27%
of revenue for the same quarter last fiscal year.
Income
from operations was $321,000 for the fourth quarter of fiscal 2019
compared to $709,000 for the fourth quarter of fiscal
2018.
Net
income for the fourth quarter of fiscal 2019 was $449,000, or $0.12
per diluted share. This compares to net income for the fourth
quarter of fiscal 2018 $675,000, or $0.17 per diluted
share.
Shareholders'
equity at June 30, 2019 was $24,861,000, or $6.77 per outstanding
share, compared to $23,501,000, or $6.61 per outstanding share, at
June 30, 2018. There were 3,673,055 common shares outstanding at
June 30, 2019.
CEO
Comments
S.W.
Yong, Trio-Tech's CEO, said, “Despite the decrease in
Trio-Tech’s fiscal 2019 revenue, we achieved a 31% increase
in net income to $1,545,000, or $0.41 per diluted share, compared
to $1,184,000, or $0.31 per diluted in fiscal 2018. Net income
benefitted from a one-off gain on the sale of properties in our
Chongqing real-estate operation and lower tax expenses for fiscal
2019. We remain convinced of the quality of our business and our
opportunities for long term growth despite the headwinds created by
the ongoing trade tension between the United States and
China.
"We are
encouraged by the sharp increase in fourth quarter revenue in our
manufacturing and distribution segments, compared to the fourth
quarter of fiscal 2018. We continued to invest in the business in
fiscal 2019, including increased capital expenditures to address
opportunities for growth in specific markets. We also were able to
present Trio-Tech’s world-class capabilities in introductory
and follow-up meetings with our counterparts at several potentially
large new accounts, an effort we believe will benefit the Company
over time."
16139
Wyandotte Street, Van Nuys, CA 91406, USA ● TEL: (818)
787-7000 ● FAX (818) 787-9130
Trio-Tech
Reports Fourth Quarter and Twelve Months Results
September 23,
2019
Page
Two
Fiscal
2019 Results
For the
fiscal year ended June 30, 2019, revenue decreased 7% to
$39,198,000 compared to $42,361,000 in fiscal 2018. Manufacturing
revenue decreased 7% to $14,889,000 from $15,978,000, and testing
services revenue decreased 14% to $16,760,000 from $19,391,000 for
fiscal 2018. Distribution revenue increased 9% to $7,451,000 from
$6,853,000 for fiscal 2018.
Gross
margin for fiscal 2019 decreased to $9,001,000, or 23% of revenue,
compared to $10,638,000, or 25% of revenue, for fiscal
2018.
Income
from operations decreased 64% to $794,000 for fiscal 2019 compared
to $2,188,000 for fiscal 2018.
Net
income for fiscal 2019 was $1,545,000, or $0.41 per diluted share.
This compares to net income for fiscal 2018 of $1,184,000, or $0.31
per diluted share.
Net
income for fiscal 2019 benefited from $615,000 in other income,
which included a gain of $685,000 on the sale of properties. In
comparison, other income contributed a gain of $102,000 for fiscal
2018. Net income for fiscal 2018 also was affected by a one-time,
non-cash income tax expense of $900,000 related to the 2017 United
States Tax Cuts and Jobs Act. As of December 31, 2018, the
Company’s accounting for the Tax Act was complete. The
provision for income taxes for the year ended June 30, 2019
includes a $145,000 decrease from the completion of our provisional
accounting for the effects of the Tax Act under SAB 118. The
decrease is associated with the one-time mandatory repatriation tax
related to certain post-1986 earnings and profits that were
deferred from U.S. taxation by the Company’s foreign
subsidiaries. The US federal income tax return was filed during Q4,
which included the $755,000 one-time repatriation tax as well as
utilization of net operating losses and tax credits amounting to
$192,000 which was not finalized until the filing of
return.
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 Asia, including currency fluctuations and devaluation, currency
restrictions, local laws and restrictions and possible social,
political and economic instability; 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
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|||||||||
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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
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|||||||||
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AUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
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|
|||||||||
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Three Months Ended
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Twelve
Months Ended
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||
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June 30,
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June 30,
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||
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Revenue
|
2019
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2018
|
2019
|
2018
|
|
|
|
|
|
|
|
Manufacturing
|
$4,803
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$4,116
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$14,889
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$15,978
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|
Testing services
|
3,941
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4,937
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16,760
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19,391
|
|
Distribution
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1,864
|
1,678
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7,451
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6,853
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|
Real
estate
|
17
|
29
|
98
|
139
|
|
|
|
|
|
|
|
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10,625
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10,760
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39,198
|
42,361
|
|
Cost of Sales
|
|
|
|
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Cost of manufactured
products sold
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3,587
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2,967
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11,393
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12,213
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|
Cost of testing services rendered
|
2,851
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3,442
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12,202
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13,323
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Cost of
distribution
|
1,674
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1,470
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6,505
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6,068
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|
Cost of real
estate
|
45
|
30
|
97
|
119
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|
|
|
|
|
|
|
|
8,157
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7,909
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30,197
|
31,723
|
|
|
|
|
|
|
|
Gross Margin
|
2,468
|
2,851
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9,001
|
10,638
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|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
General and administrative
|
1,826
|
1,911
|
7,049
|
7,250
|
|
Selling
|
246
|
214
|
826
|
826
|
|
Research and development
|
75
|
74
|
345
|
451
|
|
Gain
on disposal of property, plant and equipment
|
--
|
(57)
|
(13)
|
(77)
|
|
|
|
|
|
|
|
Total operating expenses
|
2,147
|
2,142
|
8,207
|
8,450
|
|
|
|
|
|
|
|
Income
from Operations
|
321
|
709
|
794
|
2,188
|
|
|
|
|
|
|
|
Other (Expenses)
Income
|
|
|
|
|
|
Interest expense
|
(69)
|
(59)
|
(319)
|
(233)
|
|
Other income, net
|
29
|
24
|
249
|
335
|
|
Gain on sale of
properties
|
--
|
--
|
685
|
--
|
|
|
|
|
|
|
|
Total other
(Expenses) Income
|
(40)
|
(35)
|
615
|
102
|
|
|
|
|
|
|
|
Income from Continuing Operations before Income Taxes
|
281
|
674
|
1,409
|
2,290
|
|
Income Tax
Benefit (Expense)
|
201
|
48
|
42
|
(987)
|
|
|
|
|
|
|
|
Income from Continuing Operations
|
|
|
|
|
|
before Non-controlling Interest, net of tax
|
482
|
722
|
1,451
|
1,303
|
|
|
|
|
|
|
|
Loss
from discontinued operations, net of tax
|
(1)
|
(2)
|
(3)
|
(13)
|
|
|
|
|
|
|
|
NET INCOME
|
481
|
720
|
1,448
|
1,290
|
|
|
|
|
|
|
|
Less: Net income
(loss) attributable to the non-controlling interest
|
32
|
45
|
(97)
|
106
|
|
|
|
|
|
|
|
Net Income attributable to Trio-Tech International
|
449
|
675
|
1,545
|
1,184
|
|
|
|
|
|
|
|
Net Income Attributable to Trio-Tech International:
|
|
|
|
|
|
Income from continuing operations, net of tax
|
451
|
677
|
1,548
|
1,197
|
|
Loss
from discontinued operations, net of tax
|
(2)
|
(2)
|
(3)
|
(13)
|
|
|
|
|
|
|
|
Net Income Attributable to Trio-Tech International
|
449
|
$675
|
1,545
|
$1,184
|
|
|
|
|
|
|
|
Basic Earnings per
Share - Continuing Operations
|
$0.12
|
$0.19
|
$0.42
|
$0.34
|
|
Basic Loss per
Share - Discontinued Operations
|
--
|
(0.01)
|
--
|
(0.01)
|
|
Basic
Earnings per Share
|
$0.12
|
$0.18
|
$0.42
|
$0.33
|
|
|
|
|
|
|
|
Diluted Earnings per Share
– Continuing Operations
|
$0.12
|
$0.18
|
$0.41
|
$0.32
|
|
Diluted Loss per
Share – Discontinued Operations
|
--
|
(0.01)
|
--
|
(0.01)
|
|
Diluted
Earnings per Share
|
$0.12
|
$0.17
|
$0.41
|
$0.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares Outstanding - Basic
|
3,673
|
3,553
|
3,673
|
3,553
|
|
Weighted Average Shares Outstanding - Diluted
|
3,681
|
3,714
|
3,762
|
3,771
|
|
TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
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|||||||||
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
|
|||||||||
|
AUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
|
|
|
Three Months Ended
June 30,
|
Twelve
Months Ended
June
30,
|
||
|
|
2019
|
2018
|
2019
|
2018
|
|
Comprehensive Income
Attributable to
|
|
|
|
|
|
Trio-Tech International Common
Shareholders:
|
|
|
|
|
|
|
||||
|
Net income
|
$481
|
$720
|
$1,448
|
$1,290
|
|
Foreign currency translation, net of tax
|
(231)
|
(1,081)
|
(420)
|
728
|
|
Comprehensive Income
(Loss)
|
250
|
(361)
|
1,028
|
2,018
|
|
Less: Comprehensive
(Loss) Income
|
|
|
|
|
|
attributable to non-controlling interests
|
(11)
|
30
|
(202)
|
285
|
|
|
|
|
|
|
|
Comprehensive Income
(Loss)
|
|
|
|
|
|
Attributable to Trio-Tech International
|
$261
|
$(391)
|
$1,230
|
$1,733
|
|
TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
|
|||
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|||
|
(IN THOUSANDS, EXCEPT NUMBER OF SHARES)
|
|
|
June
30,
|
|
|
|
2019
|
2018
|
|
ASSETS
|
(Audited)
|
|
|
|
|
|
|
CURRENT ASSETS:
|
|
|
|
Cash and cash equivalents
|
$4,863
|
$6,539
|
|
Short-term deposits
|
4,144
|
653
|
|
Trade accounts receivable, net
|
7,113
|
7,747
|
|
Other receivables
|
817
|
881
|
|
Inventories, net
|
2,427
|
2,930
|
|
Prepaid expenses and other current assets
|
287
|
208
|
|
Assets held for sale
|
89
|
91
|
|
|
|
|
|
Total current assets
|
19,740
|
19,049
|
|
|
|
|
|
Deferred tax assets
|
390
|
400
|
|
Investment properties, net
|
782
|
1,146
|
|
Property, plant and equipment, net
|
12,159
|
11,935
|
|
Other assets
|
1,750
|
2,249
|
|
Restricted term deposits
|
1,706
|
1,695
|
|
|
|
|
|
Total non-current assets
|
16,787
|
17,425
|
|
|
|
|
|
TOTAL ASSETS
|
$36,527
|
$36,474
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
Lines of credit
|
$187
|
$2,043
|
|
Accounts payable
|
3,272
|
3,704
|
|
Accrued expenses
|
3,486
|
3,172
|
|
Income taxes payable
|
417
|
285
|
|
Current portion of bank loans payable
|
488
|
367
|
|
Current portion of capital leases
|
283
|
250
|
|
|
|
|
|
Total current liabilities
|
8,133
|
9,821
|
|
|
|
|
|
Bank loans payable, net of current portion
|
2,292
|
1,437
|
|
Capital leases, net of current portion
|
442
|
524
|
|
Deferred tax liabilities
|
327
|
327
|
|
Income
taxes payable
|
439
|
828
|
|
Other non-current liabilities
|
33
|
36
|
|
|
|
|
|
Total non-current liabilities
|
3,533
|
3,152
|
|
|
|
|
|
TOTAL LIABILITIES
|
11,666
|
12,973
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY:
|
|
|
|
Common stock, no par value, 15,000,000 shares authorized; 3,673,055 and
|
|
|
|
3,553,055
issued and outstanding at June
30, 2019 and June 30, 2018,
respectively
|
11,424
|
11,023
|
|
Paid-in capital
|
3,305
|
3,249
|
|
Accumulated retained earnings
|
7,070
|
5,525
|
|
Accumulated other comprehensive gain-translation adjustments
|
1,867
|
2,182
|
|
|
|
|
|
Total Trio-Tech International shareholders' equity
|
23,666
|
21,979
|
|
|
|
|
|
Non-controlling interest
|
1,195
|
1,522
|
|
|
|
|
|
TOTAL EQUITY
|
24,861
|
23,501
|
|
|
|
|
|
TOTAL LIABILITIES AND EQUITY
|
$36,527
|
$36,474
|