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Smtc Corp (SMTX) – Comments & Business Outlook
- Revenue for the quarter was $75.6 million, a 71% increase over third quarter 2011, and a slight increase over the second quarter 2012 revenue.
- Adjusted EPS for the quarter was $0.08, and benefited $0.02/share from a non-recurring $360 thousand tax recovery for taxes paid in 2011 and 2012. This compares to $(0.09) in the third quarter of 2011, and $0.17 in the second quarter 2012.
Co-Chief Executive Officer Claude Germain stated, “It is worth noting that our guidance does not include any effects of closing, before year end, the previously announced asset purchase from Seksun Array Electronics, nor does it consider any potential impacts from Hurricane Sandy. Note that the purchase of the Seksun Array Electronics assets will cost approximately $2.0 million, which will be funded through our bank debt facility. We expect it to be immediately accretive.”
“Overall, the third quarter was weaker than expected. We have initiated lean manufacturing initiatives in our Mexican operation in order to improve quality, consistency and planning. We are also reviewing our Canadian operations in order to improve profitability,” stated Co-Chief Executive Officer, Alex Walker. “Although our revenue levels are higher than expected, we’ve maintained our adjusted EBITDA guidance to the lower end of our range largely due to a record number of New Program Introductions across our plants. This new business comes with higher manufacturing complexity at the outset, we are working through it and expect improved margins on these programs going forward.”
Added Claude Germain, “We also remain focused on reducing our debt through free cash generation. Consistent with what we have stated previously, we expect to achieve year end net debt of less than 1.5 times 2012 adjusted EBITDA by year end.”
2012-11-09 18:21:07
Source: http://geoinvesting.com/companies/smtx_smtc_corp/research/comments_business_outlook/0040548
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