SMTC Corporation News
SMTC Reports First Quarter
Gross profit for the first quarter of 2008 was
"Despite lower first quarter revenue, we continued to be profitable and generate cash. Importantly, we retained our proportionate share of business with our customers. Through the quarter, several new customers began to ramp production", stated
"Our continuing focus on profitability and cash generation yielded positive results. For five successive quarters we have generated cash and significantly reduced debt. In the first quarter, net debt was reduced to
"The results for the quarter do not reflect the important activity underway," stated
"In the second quarter of 2008, we expect significantly higher sequential revenues and correspondingly improved earnings. We reaffirm our guidance for the full 2008 year with both revenue and earnings growth over 2007 on stronger revenue in the second half of the year."
————————————————————————————————————- Expressed in U.S. dollars ————————————————————————————————————-
About SMTC Corporation: SMTC Corporation, founded in 1985, is a mid-size provider of end-to-end electronics manufacturing services (EMS) including PCBA production, systems integration and comprehensive testing services, enclosure fabrication, as well as product design, sustaining engineering and supply chain management services. SMTC facilities span a broad footprint in
SMTC is a public company incorporated in
Note for Investors: The statements contained in this release that are not purely historical are forward-looking statements which involve risk and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. These statements may be identified by their use of forward-looking terminology such as "believes", "expect", "may", "should", "would", "will", "intends", "plans", "estimates", "anticipates" and similar words, and include, but are not limited to, statements regarding the expectations, intentions or strategies of SMTC Corporation. For these statements, we claim the protection of the safe harbor for forward-looking statements provisions contained in the Private Securities Litigation Reform Act of 1995. Risks and uncertainties that may cause future results to differ from forward-looking statements include the challenges of managing quickly expanding operations and integrating acquired companies, fluctuations in demand for customers' products and changes in customers' product sources, competition in the EMS industry, component shortages, and others discussed in the Company's most recent filings with securities regulators in
Consolidated Statements of Operations and Comprehensive Income (Unaudited) Three months ended ————————————————————————————————————- (Expressed in thousands of U.S. dollars, except March 30, April 1, number of shares and per share amounts) 2008 2007 ————————————————————————————————————- Revenue $55,140 $69,477 Cost of sales 50,739 63,000 ————————————————————————————————————- Gross profit 4,401 6,477 Selling, general and administrative expenses 3,189 3,572 Restructuring recoveries (225) - ————————————————————————————————————- Operating earnings 1,437 2,905 Interest expense 913 1,682 ————————————————————————————————————- Earnings before income taxes 524 1,223 Income tax expense (recovery) Current 112 (1,480) Deferred (9) (98) ————————————————————————————————————- 103 (1,578) ————————————————————————————————————- Net earnings, also being comprehensive income $421 $2,801 ————————————————————————————————————- ————————————————————————————————————- Basic earnings per share $0.03 $0.19 Diluted earnings per share $0.03 $0.19 Weighted average number of shares outstanding Basic 14,646,333 14,646,333 Diluted 14,662,931 14,871,043 Consolidated Balance Sheets as of (Unaudited) ————————————————————————————————————- March 30, December 31, (Expressed in thousands of U.S. dollars) 2008 2007 ————————————————————————————————————- Assets Current assets: Cash $ 473 $ 182 Accounts receivable - net 34,202 38,658 Inventories 38,895 30,879 Prepaid expenses 1,115 940 ————————————————————————————————————- 74,685 70,659 Property, plant and equipment - net 22,123 22,295 Deferred financing fees 1,306 1,410 Deferred income taxes 492 483 ————————————————————————————————————- $ 98,606 $ 94,847 ————————————————————————————————————- ————————————————————————————————————- Liabilities and Shareholders' Equity Current liabilities: Accounts payable $ 40,370 $ 37,172 Accrued liabilities 7,825 7,272 Income taxes payable 590 604 Current portion of long-term debt 3,071 3,071 Current portion of capital lease obligations 874 736 ————————————————————————————————————- 52,730 48,855 Long-term debt 16,893 17,913 Capital lease obligations 1,639 1,244 Shareholders' equity: Capital stock 7,757 7,854 Warrants 10,372 10,372 Loans receivable (5) (5) Additional paid-in capital 249,073 248,888 Deficit (239,853) (240,274) ————————————————————————————————————- 27,344 26,835 ————————————————————————————————————- $ 98,606 $ 94,847 ————————————————————————————————————- ————————————————————————————————————- Consolidated Statements of Cash Flows (Unaudited) Three months ended ————————————————————————————————————- (Expressed in thousands of U.S. dollars) ————————————————————————————————————- March 30, April 1, Cash provided by (used in): 2008 2007 ————————————————————————————————————- Operations: Net earnings $ 421 $ 2,801 Items not involving cash: Depreciation 1,124 1,309 Deferred income taxes (9) (88) Non-cash interest 104 313 Stock-based compensation 208 66 ————————————————————————————————————- 1,848 4,401 Change in non-cash operating working capital: Accounts receivable 4,456 244 Inventories (8,016) (1,942) Prepaid expenses (175) 13 Income taxes payable (14) (1,657) Accounts payable 3,198 2,785 Accrued liabilities 433 154 ————————————————————————————————————- 1,730 3,998 Financing: Repayment of long-term debt (1,020) (3,559) Principal payment of capital lease obligations (176) (130) ————————————————————————————————————- (1,196) (3,689) Investing: Purchase of property, plant and equipment (243) (309) ————————————————————————————————————- (243) (309) ————————————————————————————————————- Increase in cash and cash equivalents 291 - Cash and cash equivalents, beginning of period 182 - ————————————————————————————————————- Cash, end of the period $ 473 $ - ————————————————————————————————————- ————————————————————————————————————- Supplementary Information: Reconciliation of EBITDA ————————————————————————————————————- Three months ended ————————————— March 30, April 1, 2008 2007 ————————————————————————————————————- Operating earnings $ 1,437 $ 2,905 Add: Depreciation 1,124 1,309 ————————————————————————————————————- EBITDA 2,561 4,214 ————————————————————————————————————- ————————————————————————————————————-
SOURCE SMTC Corporation
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