ELK GROVE VILLAGE, IL – SigmaTron International reported fiscal second quarter revenue increased 44% to $100.2 million year-over-year.

Net income for the period ended Oct. 31 was $3.15 million, up 402.5% compared to the same period in the prior year.

For the six months ended Oct. 31, revenue was up 43% to $186 million. Net income was $11.9 million, compared to a net loss of $273,808 for the same period the year prior.

“I’m pleased to report record quarterly revenue and operating results for the quarter ending Oct. 31, 2021,” said Gary R. Fairhead, CEO and chairman of the board, Sigmatron. “The revenue line, as well as the cost of products sold, are inflated due to significant premiums paid for raw material by our customers, which are close to a pass through in terms of margin. The premiums were a little over 10% of the revenue reported and roughly the same number in terms of cost of products sold. However, putting that aside, we still reported operating income of $5 million for the quarter, which is a record for income from operations. Coupled with our first quarter results, we also set records for the six months ended Oct. 31, 2021, after eliminating the gain from the forgiveness of the PPP loan previously reported in our first quarter financial results press release.

“The record results were driven by a strong and growing demand from existing customers, as well as several new customers that have been added over the last year. The backlog remains strong, and new opportunities are significant. There has been no perceivable change in terms of trade policy between the United States and China, and this continues to drive existing and potential customers to look at Mexico as a favored supply chain solution. Unfortunately, the volatility of the electronic component marketplace remains with us and, from our perspective, is getting worse and not better. We do not see any end in sight for the shortages. We continue to experience and have reached a stage where shortages in other commodity markets affected final production for our customers, causing them to slow or push out consumption of assemblies from us. Accordingly, the company continues to be negatively affected by the disruptions in the component marketplace and other times are negatively affected by other supply chain providers. Unfortunately, there is no predictability regarding when these disruptions will occur, so it’s a challenge in terms of reacting to these disruptions.

“With that said, these disruptions have required we work closer than ever with our customers, and the silver lining is I believe we have built even stronger relationships. That bodes well going forward.

“I’m also pleased to announce we have reached a new three-year labor agreement with our Elk Grove Village production union, with which we have always enjoyed an excellent working relationship.

“Regarding the pending Wagz acquisition, both companies currently anticipate closing the transaction by the end of calendar 2021. On Dec. 7, the company amended its agreement and plan of merger with Wagz. The amendment decreases the number of SigmaTron shares given to Wagz in conjunction with the transaction.

“While significant uncertainty remains in the electronic manufacturing services market, both in terms of customer requirements and raw material/component availability, I believe we are well positioned with three plants in Mexico to continue to grow as electronics and electronic products continue to be incorporated into more applications and products for the North American market.”

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