JASPER, IN – Kimball Electronics reported fiscal third quarter net sales increased 18.6% year-over-year to $368.1 million. Foreign currency had a 2% unfavorable impact on net sales compared to the same period a year ago.

For the quarter ended Mar. 31, net income was $13.6 million, up 30.2% year-over-year. Operating income was $20.3 million, growth of 38.5%.

"I am very pleased with the results in the third quarter,” said Donald D. Charron, chairman and CEO. “Sales exceeded our all-time high in a quarter by 10%; operating margin was 5.5% of net sales, which is significantly better than the first half of the fiscal year and 80 basis points higher than a year ago; and diluted EPS increased by more than 30% year-over-year. With our backlog of open orders at record levels, and manufacturing facilities running at higher utilization and expanding capacity, we are ideally positioned to maintain strength and momentum in this bifurcated year, and we expect a strong pace to carry through the fourth quarter. I continue to be extremely impressed with our team and how we’ve managed the global supply chain issues stemming from the pandemic and component parts shortages.

"The challenges in the third quarter, however, were compounded by the devastation in Ukraine. We have Ukrainian associates in our US and European operations, and facilities located in nearby Poland and Romania. Our number one priority has been the health and safety of our associates and supporting their families directly affected by the conflict. We are also closely monitoring the impact of China’s zero-tolerance policy related to Covid-19. Several cities experienced shutdowns recently due to a rise in Covid cases. If shutdowns continue to occur in major cities across China, there may be temporary disruptions in both the supply chain and demand as our customers balance manufacturing delays. We’ve updated our guidance for net sales to reflect the uncertainty from these developments. However, we are reiterating our guidance for operating income margin for fiscal year 2022."

Cash flow used for operating activities was $28.2 million during the fiscal third quarter, driven by an increase in accounts receivable as a result of the strong sales in the quarter. Investments in capital expenditures were $22.3 million. Cash and cash equivalents were $35.6 million, and borrowings outstanding on credit facilities were $137.1 million at Mar. 31, including $95 million classified as long term.

For the nine months ended Mar. 31, net sales were $976 million, up 1.4% year-over-year. Net income was $21.3 million, down 49.7% compared to the same period in 2021. Operating income was $32 million, a decrease of 34.2%.

The company expects fiscal year 2022 net sales in the range of $1.345 billion to $1.365 billion, a 4% to 6% increase year-over-year.

“We are very pleased with how the company is positioned. Third quarter results were excellent. While supply chain disruptions from the pandemic continue to normalize and improve, the recent wave of lockdowns in China add a level of unpredictability that did not exist a few months ago. We expect the fourth quarter to be robust with net sales in the range of $370 million to $390 million, and operating margin once again above 5%. Our record level of open orders and recent facility expansions support our growth objectives as we look toward the $2 billion annual revenue milestone. Finally, our hearts and thoughts are with all people both inside and outside the Kimball Electronics family impacted by the tragic turn of events in Ukraine."

• Prev
• Next