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Standex Upcoming Earnings - What To Look At

Ivan Sadov profile picture
Ivan Sadov
61 Followers

Summary

  • A highly diversified company reported Q1, 2018 EPS of $1.10 on $214.4 million in revenues, down 1.8% and up 19.4% from the year-earlier level, respectively.
  • Yearly revenue growth is marked by an increase in long-term liabilities, goodwill, and intangibles.
  • A major segment which is accountable for 51% of company's sales is in a decline after having a record revenue in 2015.
  • During the Q1, 2018, restructuring costs, acquisition-related cost, and interest expense did not let revenue seep into net income.

The company has reported Q1, 2018 earnings. The research provides highlights of the report and makes an evaluation of previous financial results and long-term performance of the company so as to investors would know at what numbers they should look in the report.

Standex (NYSE:SXI) failed to increase net income and EPS due to three factors. The company incurred $1 million of acquisition-related costs, $3 million of restructuring costs, and interest expense rose by $1 million compared to the first quarter of fiscal 2017.

(Data: Company's report, calculations by author)

In the previous reporting period SXI achieved quarterly revenue of $217 million, representing a year-over-year increase of 18.1%. The top line increase translated to the bottom line. Therefore net income was $14.1 million, which represents YoY growth of 15.9%. Thanks to the expenses, whose growth was less than that of revenue. Cost of goods sold and SGA represents a growth of 13.7% and 9% respectively. Operating income for the Q4, 2017 came in far better than in the prior year at $20,6 million. This was an increase of 47% versus Q4, 2016 when the company's operating income was $14 million. The improvement in operating income was primarily due to the absence of other operating expenses (which the company incurred in Q4, 2016) related to the divestiture of the Roll, Plate, and Machinery (RPM) business in the Engraving segment. The improvement in quarterly operating income was partially offset by restructuring costs of $2.7 million which SXI incurred during Q4, 2017. In Q4, 2016 the company also recorded $7.3 million non-cash loss to adjust the net assets of this business to their net realizable value.

(Data: Company's SEC files, calculations by author)

While Q4, 2017 results are positive, the full year achievements are not that bright. Revenue and gross profit came in flat. Whereas operating income

This article was written by

Ivan Sadov profile picture
61 Followers
Trader, Stock analyst, US equities

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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