Trio-Tech Reports Second Quarter Results

About this update from Trio-tech International

Trio-Tech International (NYSE MKT: TRT) today announced financial results for the second quarter and first six months of fiscal 2024. Fiscal 2024 Second Quarter Results For the three months ended December 31, 2023, revenue decreased 2% to $12,202,000 compared to $12,390,000 for the same quarter last year, primarily related to a decline in revenue in the Company’s testing services segment. The overall gross margin was $2,854,000, or 23% of revenue, compared to $3,335,000, or 27% of revenue, for the same quarter last year. Operating income was $677,000, or 6% of revenue, compared to $1,069,000, or 9% of revenue, for the same quarter last year. Total other expenses were $100,000, compared to $253,000 in the same quarter last year, due principally to an increase in interest income to $96,000 from $37,000, and a strengthening of the US dollar against the Singapore dollar, which reduced currency exchange losses to $236,000, compared to $349,000 in the same quarter last year. Net income for the second quarter of fiscal 2024 was unchanged at $507,000, or $0.12 per diluted share from the second quarter of fiscal 2023. Net income for this year’s second quarter benefited from non-controlling interests’ after-tax loss of $21,000, versus an after-tax income of $58,000 in the same quarter last year. Cash and cash equivalents at December 31, 2023, increased to $10,966,000, compared to $7,583,000 at June 30, 2023, and shareholders' equity increased to $31,528,000, or $7.58 per outstanding share, compared to $29,571,000, or $7.22 per outstanding share at June 30, 2023. There were approximately 4,160,555 and 4,096,680 common shares outstanding at December 31, 2023 and June 30, 2023, respectively. CEO Comments S.W. Yong, Trio-Tech's CEO, said, “Distribution revenue increased 63% in the quarter and distribution margins improved to 18% from 15% compared to the second quarter last year. In addition, we received customer acceptance for the initial dynamic test system delivered in the recent first quarter and anticipate delivering the remaining five units in the second half of fiscal 2024. “Semiconductor industry capital spending improved last fall, boosting second quarter manufacturing segment revenue and contributing to backlog, which is expected to be delivered during the remainder of fiscal 2024. “We remain optimistic and encouraged by improvements in our manufacturing and distribution segments. Our strong cash position, improving operating efficiency and tight expense controls will enable the Company to quickly evaluate and react proactively when the semiconductor industry gradually recovers from the current downturn.” Fiscal 2024 First Half Results For the first six months of fiscal 2024, revenue decreased 9% to $22,168,000 compared to $24,329,000 for the same period last year. Gross margin for the first six months of fiscal 2024 was $5,374,000, or 24% of revenue, compared to $6,957,000, or 29% of revenue for the same period last year. Income from operations was $676,000, or 3% of revenue, compared to $2,136,000, or 9% of revenue for the same period last year. Total other income was $145,000, compared to expenses of $118,000 in the same quarter last year, due to an increase in interest income to $174,000, compared to $55,000, and reduced currency exchange losses of $177,000, compared to $279,000 in the same period last year. Net income for the first half of fiscal 2024 was $737,000, or $0.17 per diluted share, compared to $1,389,000, or $0.33 per diluted share for the same period last year. About Trio‑Tech Established in 1958, Trio-Tech International is located in Van Nuys, California, with its Principal Executive Office and regional headquarter in Singapore. Trio-Tech International is a diversified business group with interests in semiconductor testing services, manufacturing and distribution of semiconductor testing equipment, and real estate. Our subsidiary locations include Tianjin, Suzhou, Chongqing and Jiangsu in China, as well as Kuala Lumpur Malaysia and Bangkok Thailand. Further information about Trio-Tech's semiconductor products and services can be obtained from the Company's Web site at www.triotech.com and www.universalfareast.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; the divestiture of one or more business segments in response to, among other factors, 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; public health issues related to the COVID-19 pandemic; trade tension between U.S. and China; inflation; the war in Ukraine and Russia, the war between Israel and Hamas; and other economic, financial and regulatory factors beyond the Company's control. Other than statements of historical fact, all statements made in this release 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. Many of these risks and uncertainties are beyond the Company's control. Reference is made to the discussion of risk factors detailed in the Company's filings with the Securities and Exchange Commission including its reports on Form 10-K and 10-Q. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made. TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES 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 2023 2022 2023 2022 Manufacturing $ 4,790   $ 5,044   $ 7,675   $ 8,629   Testing services   4,646     5,648     9,810     12,012   Distribution   2,760     1,694     4,670     3,676   Real estate   6     4     13     12       12,202     12,390     22,168     24,329   Cost of Sales         Cost of manufactured products sold   3,609     3,849     5,658     6,374   Cost of testing services rendered   3,464     3,747     7,248     7,873   Cost of distribution   2,256     1,441     3,852     3,089   Cost of real estate   19     18     36     36       9,348     9,055     16,794     17,372   Gross Margin   2,854     3,335     5,374     6,957   Operating Expenses:         General and administrative   1,817     1,919     3,975     4,224   Selling   248     193     435     366   Research and development   131     151     216     224   (Gain) Loss on disposal of property, plant and equipment   (19 )   3     72     7   Total operating expenses   2,177     2,266     4,698     4,821   Income from Operations   677     1,069     676     2,136   Other (Expenses) Income         Interest expenses   (22 )   (10 )   (46 )   (54 ) Other (expenses) income, net   (82 )   (264 )   114     (106 ) Government grant   4     21     77     42   Total other (expenses) income   (100 )   (253 )   145     (118 ) Income from Continuing Operations before Income Taxes   577     816     821     2,018   Income Tax Expenses   (95 )   (241 )   (132 )   (466 ) Income from Continuing Operations before         Non-controlling Interest, Net of Tax   482     575     689     1,552   Income (Loss) from Discontinued Operations, Net of Tax   4     (10 )   4     (9 ) NET INCOME   486     565     693     1,543   Less: Net (Loss) Income Attributable to Non-controlling Interest   (21 )   58     (44 )   154   Net Income Attributable to Trio-Tech International   507     507     737     1,389   Net Income Attributable to Trio-Tech International:         Income from Continuing Operations, Net of Tax   503     512     730     1,394   Income (Loss) from Discontinued Operations, Net of Tax   4     (5 )   7     (5 ) Net Income attributable to Trio-Tech International $ 507   $ 507   $ 737   $ 1,389   Basic Earnings per Share $ 0.12   $ 0.12   $ 0.18   $ 0.34   Diluted Earnings per share $ 0.12   $ 0.12   $ 0.17   $ 0.33   Weighted Average Shares Outstanding - Basic   4,120     4,074     4,109     4,074   Weighted Average Shares Outstanding - Diluted   4,259     4,162     4,270     4,160   TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)     Three Months Ended Six Months Ended December 31, December 31, 2023 2022 2023 2022 Comprehensive Income Attributable to Trio-Tech International Common Shareholders:         Net income $ 486   $ 565 $ 693   $ 1,543 Foreign Currency Translation, Net of Tax   1,158     1,568   975     355 Comprehensive Income   1,644     2,133   1,668     1,898 Less: Comprehensive (loss) income Attributable to Non-controlling Interest   (72 )   133   (74 )   212 Comprehensive Income Attributable to Trio-Tech International Common Shareholders $ 1,716   $ 2,000 $ 1,742   $ 1,686 TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT NUMBER OF SHARES)     Dec. 31, Jun. 30, 2023 2023 ASSETS (Unaudited) (Audited) CURRENT ASSETS:     Cash and cash equivalents $ 10,966 $ 7,583 Short-term deposits   5,791   6,627 Trade account receivables, net   12,388   9,804 Other receivables   1,029   939 Inventories, net   3,546   2,151 Prepaid expenses and other current assets   589   694 Assets held for sale   --   274 Financed sales receivable   6   16 Restricted term deposit   762   739 Total current assets   35,077   28,827 NON-CURRENT ASSETS:     Deferred tax assets   153   100 Investment properties, net   461   474 Property, plant and equipment, net   6,601   8,344 Operating lease right-of-use assets   2,359   2,609 Other assets   169   116 Restricted term deposits   1,778   1,716 Total non-current assets   11,521   13,359 TOTAL ASSETS $ 46,598 $ 42,186 LIABILITIES AND SHAREHOLDERS’ EQUITY     CURRENT LIABILITIES:     Lines of credit $ 384 $ -- Accounts payable   2,345   1,660 Accrued expense   4,506   4,291 Contract liabilities   3,808   1,277 Income taxes payable   257   418 Current portion of bank loans payable   375   475 Current portion of finance leases   81   107 Current portion of operating leases   1,119   1,098 Total current liabilities   12,875   9,326 NON-CURRENT LIABILITIES:     Bank loans payable, net of current portion   762   877 Finance leases, net of current portion   15   42 Operating leases, net of current portion   1,240   1,511 Income taxes payable, net of current portion   141   255 Deferred tax liabilities   7   10 Other non-current liabilities   30   594 Total non-current liabilities   2,195   3,289 TOTAL LIABILITIES $ 15,070 $ 12,615       EQUITY     TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY:     Common stock, no par value, 15,000,000 shares authorized; 4,160,555 and 4,096,680 shares issued and outstanding at December 31 and June 30, 2023, respectively   13,018   12,819 Paid-in capital   5,156   5,066 Accumulated retained earnings   11,500   10,763 Accumulated other comprehensive income-translation adjustments   1,763   758 Total Trio-Tech International shareholders' equity   31,437   29,406 Non-controlling interest   91   165 TOTAL EQUITY   31,528   29,571 TOTAL LIABILITIES AND EQUITY $ 46,598 $ 42,186   View source version on businesswire.com: https://www.businesswire.com/news/home/20240212111431/en/

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