Magnetek, Inc. (“Magnetek” or “the Company”, NYSE: MAG) today reported the results of its 2011 fiscal second quarter ended January 2, 2011.
Second Quarter Results
In its second quarter of fiscal 2011, Magnetek recorded revenue of $26.1 million, a 36% increase from the second quarter of fiscal 2010 and a 5% sequential increase from the first quarter of fiscal 2011. The increase in sales from the prior year quarter reflects significant year-over-year sales growth in the Company’s renewable energy product line as well as sales growth in its served traditional markets. Gross profit was $8.5 million (32% of sales) in the second quarter of fiscal 2011 versus $5.9 million (31% of sales) in the same period a year ago, while second quarter income from operations improved more than $2.1 million year-over-year. Increased sales volume and cost containment contributed to the expansion in both gross profit and operating income.
“During the second quarter we continued to build on the positive momentum of the past couple of quarters, as evidenced by achieving our highest levels of sales, profit margin and earnings per share since the economic downturn began. Our end markets showed signs of continuing recovery during the quarter, as each of our primary served markets experienced a sales increase over prior year second quarter levels. Total company sales through the first six months of fiscal 2011 are back to pre-recession levels, led mainly by growth in sales of our E-Force ® wind inverters. Our prospects for continued growth with renewable energy opportunities, combined with expected increasing demand for our traditional products, have us well positioned to outpace overall economic growth rates,” said Peter McCormick, Magnetek’s president and chief executive officer.Total operating expenses, consisting of research and development (R&D), pension expense, and selling, general and administrative (SG&A) costs, were $7.1 million in the second quarter of fiscal 2011 compared to operating expenses of approximately $6.7 million in the prior-year period. Compared to the prior year second quarter, current year operating expenses were impacted by higher R&D expenses, higher variable selling expenses and increased incentive compensation provisions, partially offset by lower pension expense.