Data I/O Reports Second Quarter 2024 Results
Higher Bookings in First Half 2024 and Continued Strength from New Customer Wins Amid Broader Market Softness
Significant Operating Expense Reductions and Improvement in Direct Product Costs
Second Quarter 2024 Highlights
-
Net sales of
$5.1 million ; bookings of$5.6 million -
Quarter-end backlog of
$5.4 million - Gross margin as a percentage of sales of 54.5%
-
Net loss of (
$797,000 ) or ($0.09 ) per share -
Adjusted EBITDA* of
$3,000 -
Cash & Equivalents of
$11.4 million ; no debt - 8 new customer wins
-
Repatriated
$3.4 million of cash fromChina subsidiary, incurring dividend withholding tax of$337,000
*Adjusted EBITDA is a non-GAAP financial measure. A reconciliation is provided in the tables of this press release.
Management Comments
Commenting on the second quarter ended
“We made significant progress on spending controls, process efficiencies and direct product costs. Successful implementation of this strategy is evident in our second quarter performance. Gross margin as a percentage of sales increased 170 basis points from the first quarter 2024 even as sales declined sequentially. Operating expenses in the second quarter were reduced by 21% from the prior year period and 19% from the first quarter of this year.
“We also improved the flexibility of our cash position as we repatriated
“Looking ahead, there is a significant amount of our contractual backlog that is expected to be shipped and recognized as revenue in the second half of 2024. We look forward to benefiting from the improved operating leverage in our model given the progress made on managing costs and expenses.”
Financial Results
Net sales in the second quarter 2024 were
Gross margin as a percentage of sales was 54.5% in the second quarter 2024, as compared to 59.1% in the prior year period. The difference in gross margin as a percentage of sales primarily reflects lower sales volume on relatively fixed manufacturing and service costs and product mix. Material, production and service costs were all lower than the prior quarter and prior year from ongoing cost reduction initiatives which partially offset the sales decline impact.
Operating expenses in the second quarter 2024 were
Net loss in the second quarter 2024 was (
The Company’s balance sheet remained strong with cash of
Inventories at
Conference Call Information
A conference call discussing financial results for the second quarter ended
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Forward Looking Statement and Non-GAAP financial measures
Statements in this news release concerning economic outlook, expected revenue, expected margins, expected savings, expected results, expected expenses, orders, deliveries, backlog and financial positions, semiconductor chip shortages, supply chain expectations, as well as any other statement that may be construed as a prediction of future performance or events are forward-looking statements which involve known and unknown risks, uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such statements.
Forward-looking statement disclaimers also apply to the demand for the Company’s products and the impact from geopolitical conditions including any related international trade restrictions. These factors include uncertainties as to the ability to record revenues based upon the timing of product deliveries, shipping availability, installations and acceptance, accrual of expenses, coronavirus related business interruptions, changes in economic conditions, part shortages and other risks including those described in the Company’s filings on Forms 10-K and 10-Q with the
Non-GAAP financial measures, such as EBITDA and Adjusted EBITDA, excluding equity compensation, should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding the Company’s results and facilitate the comparison of results.
- tables follow -
CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (UNAUDITED) |
||||||||
Three Months Ended
|
Six Months Ended
|
|||||||
2024 |
2023 |
2024 |
2023 |
|||||
|
|
|
|
|
||||
Cost of goods sold |
2,305 |
3,025 |
5,184 |
5,954 |
||||
Gross margin |
2,757 |
4,373 |
5,977 |
8,675 |
||||
Operating expenses: |
||||||||
Research and development |
1,413 |
1,720 |
2,995 |
3,345 |
||||
Selling, general and administrative |
1,910 |
2,489 |
4,408 |
4,997 |
||||
Total operating expenses |
3,323 |
4,209 |
7,403 |
8,342 |
||||
Operating income (loss) |
(566) |
164 |
(1,426) |
333 |
||||
Non-operating income (loss): |
||||||||
Interest income |
73 |
49 |
153 |
84 |
||||
Foreign currency transaction gain (loss) |
49 |
196 |
62 |
122 |
||||
Total non-operating income (loss) |
122 |
245 |
215 |
206 |
||||
Income (loss) before income taxes |
(444) |
409 |
(1,211) |
539 |
||||
Income tax (expense) benefit |
(353) |
(109) |
(393) |
(144) |
||||
Net income (loss) |
( |
|
( |
|
||||
Basic earnings (loss) per share |
( |
|
( |
|
||||
Diluted earnings (loss) per share |
( |
|
( |
|
||||
Weighted-average basic shares |
9,104 |
8,904 |
9,063 |
8,861 |
||||
Weighted-average diluted shares |
9,104 |
9,075 |
9,063 |
9,052 |
CONSOLIDATED BALANCE SHEETS (in thousands, except share data) (UNAUDITED) |
|||
|
|
||
ASSETS |
|||
CURRENT ASSETS: |
|||
Cash and cash equivalents |
|
|
|
Trade accounts receivable, net of allowance for |
|||
credit losses of |
3,341 |
5,707 |
|
Inventories |
6,741 |
5,875 |
|
Other current assets |
601 |
690 |
|
TOTAL CURRENT ASSETS |
22,123 |
24,613 |
|
Property, plant and equipment – net |
932 |
1,359 |
|
Other assets |
1,032 |
1,429 |
|
TOTAL ASSETS |
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|||
CURRENT LIABILITIES: |
|||
Accounts payable |
|
|
|
Accrued compensation |
|
|
|
Deferred revenue |
|
|
|
Other accrued liabilities |
|
|
|
Income taxes payable |
|
|
|
TOTAL CURRENT LIABILITIES |
4,494 |
6,188 |
|
Operating lease liabilities |
421 |
702 |
|
Long-term other payables |
254 |
192 |
|
STOCKHOLDERS’ EQUITY |
|||
Preferred stock - |
|||
Authorized, 5,000,000 shares, including |
|||
200,000 shares of Series A Junior Participating |
|||
Issued and outstanding, none |
|
|
|
Common stock, at stated value - |
|||
Authorized, 30,000,000 shares |
|||
Issued and outstanding, 9,219,838 shares as of |
|||
2024 and 9,020,819 shares as of |
|
|
|
Accumulated earnings (deficit) |
( |
( |
|
Accumulated other comprehensive income |
( |
|
|
TOTAL STOCKHOLDERS’ EQUITY |
18,918 |
20,319 |
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
NON-GAAP FINANCIAL MEASURE RECONCILIATION |
||||||||
Three Months Ended
|
Six Months Ended
|
|||||||
2024 |
2023 |
2024 |
2023 |
|||||
(in thousands) |
||||||||
Net Income (loss) |
( |
|
( |
|
||||
Interest (income) |
( |
( |
( |
( |
||||
Taxes |
|
|
|
|
||||
Depreciation and amortization |
|
|
|
|
||||
EBITDA earnings |
( |
|
( |
|
||||
Equity compensation |
|
|
|
|
||||
|
|
|
|
|||||
Adjusted EBITDA, excluding equity compensation |
|
|
( |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240725189099/en/
Vice President and CFO
Investor-Relations@dataio.com
(512) 551-9296
jdarrow@darrowir.com
Source: