IEC Electronics Reports Fiscal Q3 Revenue Up But Profits Slide
NEWARK, NY -- IEC Electronics today reported revenues of $49.4 million for its fiscal third quarter ended Jul. 2, up 4.2% versus a year ago.
Gross profit for the period was $5.2 million, or 10.6% of sales, down 21 % from 2020. Operating profit slipped 37% to $1.9 million. Net income plunged 52% to $1 million.
Separately, the company announced a pending merger agreement with Creation Technologies.
For the first nine months of fiscal 2021, the EMS company reported revenues of $142.2 million, up 4.4%. Operating profit was down 46% to $3.9 million, due primarily to investments in a new headquarters facility and incremental manufacturing equipment, and includes $1 million of additional depreciation expense compared to 2020. Net income was down 54% to $2.2 million.
Jeff Schlarbaum, president and CEO, IEC Electronics, commented, “We were pleased to have delivered solid revenue growth during the third quarter of fiscal 2021 of $49.4 million, despite headwinds that we, and many in our industry, are experiencing related to ongoing material shortages and labor constraints. During the fiscal quarter we continued to ramp multiple exciting new programs.
"As we noted last fiscal quarter, given the complexity of the programs we service, the ramping process is not linear and frequently includes process development adaptations which continue to impact profitability. However, once established, we anticipate that these programs will provide considerable long-term revenue and margin opportunity for IEC. As the economy moves beyond the pandemic, we are encouraged by the increased backlog as compared to year-end fiscal 2020 and a solid book to bill ratio of 1.76:1 in the third fiscal quarter, which included a contract extension valued at more than $45 million from a longstanding customer. We believe this recent contract extension serves as a strong endorsement of our capabilities and reliability and speaks to IEC’s position in the marketplace as we pursue new customers and contracts.
“We believe we remain uniquely positioned to drive long-term growth for our shareholders. IEC is an established manufacturing partner with a proven record of success providing a vertically integrated portfolio of services to companies in attractive and growing sectors such as medical and aerospace and defense. Our 100% U.S.-based model positions IEC as the ideal partner for companies seeking the highest levels of intellectual property protection and supply chain management. We are pleased to have made solid progress throughout this challenging year to advance our leadership position and we are excited about the opportunities we are seeing to win new customers and programs as we move toward delivering an expected strong close to fiscal 2021.”
