SPOKANE VALLEY, WA – Key Tronic reported fiscal first quarter revenue of $105.3 million, down 17.4% year-over-year.

A strong increase in the demand for sheet metals from both new and existing customers caused workload balancing challenges in the quarter ended Sept. 28, the firm says. The resulting capacity constraints caused production delays and were the primary reason for the unexpected shortfall in revenue.

For the quarter, net income was $1.6 million, flat with the fiscal first quarter last year.

“As the result of concerns over tariffs and trade tension between the US and China, a number of existing and new customers have accelerated their plans to transition from China facilities to our expanding facilities in Mexico and Vietnam,” said Craig Gates, president and CEO. “While this transition and increasing demands in sheet metals caused delays in production during the first quarter, we see this trend as an important and very positive sign over the longer term, as customers see the increasing advantages of our North American- and Vietnam-based production. We continue to invest in enabling and accelerating this transition as we capitalize on the successful ramp up of our Vietnam facility.

“During the first quarter of fiscal 2020, we continued to win significant new business from EMS competitors and from existing customers, including new programs involving electric vehicle charging infrastructure, LED lighting, oil and gas sensors, and flight controls for experimental aircrafts. To prepare for growth in coming quarters, we continue to invest in new capacity in our Mexico, US and new Vietnam facilities, including a significant increase in our sheet metal capacity to address demand. We remain optimistic about our opportunities for growth in fiscal 2020 and beyond.”

For the fiscal second quarter, the company expects revenue in the range of $117 million to $122 million.

• Prev
• Next