Strattec Security Corp Reports Fiscal Q4 and Year End Results
31 July 1998
Strattec Security Corporation Reports Fiscal Fourth Quarter and Year End Results
MILWAUKEE, July 30 -- STRATTEC SECURITY CORPORATION
today reported operating results for the fiscal fourth quarter
and year ended June 28, 1998.
Net sales for the three months ended June 28, 1998 were $46.8 million, an
increase of 9 percent compared to net sales of $43.1 million for the three
months ended June 29, 1997. Net income was $3.8 million, compared to
$3.1 million in the prior year quarter. Diluted earnings per share for the
three months ended June 28, 1998, were $.65 compared to $.54 in the prior year
quarter, an increase of 20 percent.
For the year ended June 28, 1998, net sales were $186.8 million, an
increase of 17 percent compared to net sales of $159.1 million in the prior
year period. Net income was $13.5 million compared to $9.8 million and
diluted earnings per share were $2.30 compared to $1.70, an increase of
35 percent.
Sales to General Motors Corporation were equal to the prior year fourth
quarter. Labor disruptions at General Motors Corporation operations reduced
expected sales to this customer by an estimated $3 million during the most
recent quarter. Sales to Chrysler Corporation increased $2.2 million or
40 percent and sales to Ford Motor Company increased $.7 million or 6 percent.
Sales growth was primarily due to higher value mechanical and
electro-mechanical content. However, the increased sales to Chrysler also
reflect that Company's higher vehicle production schedules.
Gross profit margins were 22.8 percent in the current quarter compared to
22.1 percent in the prior year quarter. Operating expenses were $4.9 million
in the current quarter, compared to $4.8 million in the prior year quarter.
Harold M. Stratton II, President and Chief Executive Officer, commented:
"The U.A.W. strikes against General Motors slowed the strong operating
momentum of what would otherwise have been a record quarter for sales and
profitability. Despite the negative impact of the GM strikes, fiscal 1998 was
our fifth consecutive year of strong sales, profitability and growth."
Stratton continued, "With the announced settlement of the labor strikes
against GM, we expect a ramp-up of production volume shipments to occur during
August. Although the GM strikes will have a lingering effect on the first
quarter of our fiscal 1999, we look forward to a return to a normal level of
shipments, and regaining our positive operational momentum during the balance
of the year."
STRATTEC SECURITY CORPORATION designs, develops, manufactures and markets
mechanical locks, electro-mechanical locks and related security products for
North American and select European automotive manufacturers.
Forward looking statements in this release are subject to many
uncertainties in the Company's operations and business environment. These
uncertainties include general economic conditions, demand for the Company's
products and costs of operations. Such uncertainties and other operational
matters are discussed further in the Company's quarterly and annual filings
with the Securities and Exchange Commission.
STRATTEC SECURITY CORPORATION
Results of Operations
(In Thousands)
Three Months Ended Year Ended
June 28, June 29, June 28, June 29,
1998 1997 1998 1997
(Unaudited)
Net Sales $46,795 $43,078 $186,805 $159,054
Cost of Goods Sold 36,108 33,576 146,865 125,735
Gross Profit 10,687 9,502 39,940 33,319
Engineering, Selling &
Administrative Expenses 4,865 4,754 18,925 17,684
Income from Operations 5,822 4,748 21,015 15,635
Interest Income 198 2 351 4
Interest Expense -- (45) (19) (214)
Other Income, Net 47 99 73 125
6,067 4,804 21,420 15,550
Provision for Income Taxes 2,244 1,685 7,931 5,730
Net Income $ 3,823 $ 3,119 $ 13,489 $ 9,820
Earnings Per Share:
Basic $ .67 $ .55 $ 2.36 $ 1.72
Diluted $ .65 $ .54 $ 2.30 $ 1.70
Average Basic
Shares Outstanding 5,717 5,669 5,708 5,716
Average Diluted
Shares Outstanding 5,891 5,750 5,863 5,785
Balance Sheet Data
(In Thousands)
June 28, 1998 June 29, 1997
Cash and Cash Equivalents $14,800 $ 400
Accounts Receivable, Net 25,300 29,700
Inventories 15,000 14,900
Debt -- 5,000
Shareholders' Equity 70,400 56,100