SED International Holdings, Inc. (Amex: SED), a multinational supply chain management provider and distributor of leading computer technology, consumer electronics, housewares, small appliances and personal care products, today announced financial results for the Company’s fourth quarter and fiscal year ended June 30, 2012.
Fiscal Year 2012 Financial Results, Year-over-year Comparisons:
- Net sales for the fiscal year ended June 30, 2012 was $577.3 million, compared to $607.0 million for the fiscal year ended June 30, 2011, the decrease was due in large part to weakened technology and consumer electronics demand and an industry-wide disk drive shortage related to flooding in Thailand.
- Gross margin increased to 6.3%, compared to 5.2% in the prior year. The increased gross profit percent is attributable to higher than normal sales prices on hard drives due to inventory supply constraints and an increase in higher margin housewares, small appliances and personal care sales.
- Operating income was $1.8 million compared to $4.8 million for the prior year period. Total operating expenses were $34.9 million for the fiscal year ended June 30, 2012 compared to $26.8 million for the fiscal year ended June 30, 2011. Net income was $1.4 million or $0.29 income per basic and diluted share, compared to net income of $3.1 million, or $0.68 per basic and $0.63 per fully diluted share in the prior year period. Items impacting net income included: approximately $1.2 million in net loss related to the acquisition costs of certain Lehrhoff & Co. assets and its related operating loss; devaluation of approximately $0.6 million for foreign exchange losses related to Latin America; and employee separation costs of approximately $0.4 million.
- EBITDA was $2.9 million compared to $5.6 million in the prior year.
- The Company generated $8.0 million in operating cash flow for fiscal 2012, compared to cash used by operations of $16.3 million in the prior year period. Cash and cash equivalents were $4.7 million for fiscal year end 2012 and $4.8 million for 2011. Borrowings outstanding under SED’s revolving credit lines were $36.9 million at year ended June 30, 2012 compared with $38.4 million as of June 30, 2011.
- Return on Invested Capital, or “ROIC”, for the 2012 fiscal year was 3.2%, compared with 6.6% in the 2011 fiscal year. SED’s ROIC metric is calculated on an annualized basis using operating income divided by an average of quarter-end stockholder’s equity and debt, net of cash.
- Shareholders’ equity at the end of the year was $24.4 million, or $4.98 per diluted share.
“We are disappointed in our bottom-line results for the 2012 fiscal year and are undertaking several initiatives, including a transformation of certain elements of our business model, to deliver stronger results in 2013 and beyond,” said Jonathan Elster, President and Chief Executive Officer of SED International. “In the past year, our PC and Consumer Electronics business was challenged by weakened demand, while long-term investments in our business and devaluation of the peso in Latin America had additional negative impact on earnings.”