Daktronics: Didn't Score So Well in Q4

Daktronics (DAKT), which makes scoreboards, electronic billboards and other large-scale digital displays, Tuesday morning posted weaker-than-expected results for its fiscal fourth quarter ended April 30.

The Brookings, South Dakota-based company posted revenue of $121.8 million and a profit of 1 cent a share; the Street had expected $125 million and 9 cents. The company said gross margin was lower than expected, noting that it is seeing pressure from excess capacity, warranty costs and the competitive environment. Daktronics said some rivals are being very aggressive on pricing, particularly on larger projects. Daktronics also said it is seeing a pullback in capital spending by the outdoor billboard companies, with no recovery likely in that niche before calendar 2011 at the earliest.

Backlog at quarter-end was $120 million, down from $175 million a year ago, and $128 million at the end of the January quarter.

For the April 2010 fiscal year, the company expects “a significant reduction in orders and sales.” Daktronics said it assumes Q4 sales are an indicator of the trend for the year, which would suggest revenue for the year of about $488 million, below the current Street estimate of $522.9 million and FY 2009 revenues of $581.9 million.

DAKT Tuesday is down $1.02, or 11.1%, to $8.20.

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