Sypris Reports First Quarter Results
Revenue Up 23%; Orders Rise 74%; Backlog Up 121%
HIGHLIGHTS
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- Revenue for the first quarter increased 23.4% year-over-year, driven by double digit expansion of shipments at both segments.
- Orders for the period rose 73.6% from the prior-year period, while backlog increased 121.0%, reflecting positive demand from customers across both segments of the business.
-
Revenue for
Sypris Electronics expanded 42.0% year-over-year, driven by increased sales to customers serving the communications markets and improved material availability compared to the prior-year period. -
Orders for
Sypris Electronics increased 91.4% during the period, driving firm backlog up to over$131.6 million , representing a$73.1 million or 125.0% increase over the prior-year period and an 11.0% increase from year end. -
Revenue for
Sypris Technologies increased 13.7% year-over-year reflecting positive growth across the energy, commercial vehicle and recreational vehicle markets. -
Orders for
Sypris Technologies energy products increased 25.7% during the first quarter compared to the same period in 2022, pushing backlog up 61.0% over the prior-year period and 19.6% from year end. -
During the quarter,
Sypris Electronics announced that it had received an award to produce and test electronic interface modules for aU.S. Department of Defense missile weapons system as part of an ongoing modernization program. Production is expected to begin in 2023. -
Subsequent to quarter end,
Sypris Electronics announced that it received additional releases under a multi-year production contract to produce and test power supply modules for a large, mission-criticalU.S. Navy electronic warfare program, with deliveries to begin in 2023. The upgrade will provide the capability to jam incoming missiles that threaten a warship, cue decoys, and adapt quickly to evolving threats. -
During the quarter,
Sypris Technologies announced that it had entered into an amendment to its existing supply agreement withDetroit Diesel Corporation , a subsidiary ofDaimler Truck North America , to produce a new series of part numbers for driveline components for use in Detroit® Diesel-branded drive axles. The components to be produced bySypris will be essential to the performance of the drive axles of Freightliner’s heavy-duty trucks. Production is expected to begin in 2023. -
Subsequent to quarter end,
Sypris Technologies announced that it was awarded a new program to supply drivetrain components for use in the production of a new model of side-by-side utility-terrain vehicles, with production expected to begin in 2024. - The Company updated its full-year outlook for 2023, maintaining the expected increase in revenue at 25%-30% year-over-year while adjusting the gross margin guidance to a 150-200 basis point increase, with unfavorable foreign currency exchange rates impacting margins in the near term. Cash flow from operations is expected to remain strong, reflecting increased year-over-year profitability.
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“We were pleased with our first quarter performance, as both operating segments reported significant growth in revenue and orders. Our teammates have done an excellent job navigating inflationary pressures, supply chain challenges, customer demand volatility and currency fluctuations to position the business for further growth and increased profitability during the remainder of 2023,” commented
“Backlog for
“Demand from
“We continue to invest in new equipment, maintain or upgrade existing assets, and drive continuous improvement initiatives to add capacity and support more cost-efficient operations in the future. The successful extension of long-term contracts with two of our key Sypris Technologies’ customers in 2022 and new awards in 2023 support our revenue base and provide opportunities to expand these relationships in the coming years.
“Shipment of
First Quarter Results
The Company reported revenue of
Revenue for
Revenue for
Outlook
Commenting on the future,
“With a strong backlog, new program wins and long-term contract extensions in place, we are confident that 2023 has the potential to be very positive for
Webcast and Conference Call Information
The live broadcast of Sypris’ quarterly conference call will also be available online at www.sypris.com on
About
Forward Looking Statements
This press release contains “forward-looking” statements within the meaning of the federal securities laws. Forward-looking statements include our plans and expectations of future financial and operational performance. Each forward-looking statement herein is subject to risks and uncertainties, as detailed in our most recent Form 10-K and Form 10-Q and other
Financial Highlights | ||||||||
(In thousands, except per share amounts) | ||||||||
Three Months Ended |
||||||||
|
|
|
||||||
2023 |
|
2022 |
||||||
(Unaudited) | ||||||||
Revenue |
$ |
32,292 |
|
$ |
26,166 |
|||
Net (loss) income |
$ |
(175 |
) |
$ |
237 |
|
||
(Loss) income per common share: | ||||||||
Basic |
$ |
(0.01 |
) |
$ |
0.01 |
|
||
Diluted |
|
(0.01 |
) |
|
0.01 |
|
||
Weighted average shares outstanding: | ||||||||
Basic |
|
21,796 |
|
|
21,681 |
|
||
Diluted |
|
21,796 |
|
|
22,675 |
|
Consolidated Statements of Operations | ||||||||
(in thousands, except for per share data) | ||||||||
Three Months Ended |
||||||||
|
|
|
||||||
2023 |
|
2022 |
||||||
(Unaudited) | ||||||||
Net revenue: | ||||||||
$ |
19,500 |
|
$ |
17,155 |
||||
|
12,792 |
|
|
9,011 |
|
|||
Total net revenue |
|
32,292 |
|
|
26,166 |
|
||
Cost of sales: | ||||||||
|
16,861 |
|
|
14,023 |
|
|||
|
11,270 |
|
|
7,634 |
|
|||
Total cost of sales |
|
28,131 |
|
|
21,657 |
|
||
Gross profit: | ||||||||
|
2,639 |
|
|
3,132 |
|
|||
|
1,522 |
|
|
1,377 |
|
|||
Total gross profit |
|
4,161 |
|
|
4,509 |
|
||
Selling, general and administrative |
|
3,745 |
|
|
3,389 |
|
||
Operating income |
|
416 |
|
|
1,120 |
|
||
Interest expense, net |
|
226 |
|
|
248 |
|
||
Other expense, net |
|
71 |
|
|
169 |
|
||
Income before taxes |
|
119 |
|
|
703 |
|
||
Income tax expense, net |
|
294 |
|
|
466 |
|
||
Net (loss) income |
$ |
(175 |
) |
$ |
237 |
|
||
(Loss) income per common share: | ||||||||
Basic |
$ |
(0.01 |
) |
$ |
0.01 |
|
||
Diluted |
$ |
(0.01 |
) |
$ |
0.01 |
|
||
Dividends declared per common share |
$ |
- |
|
$ |
- |
|
||
Weighted average shares outstanding: | ||||||||
Basic |
|
21,796 |
|
|
21,681 |
|
||
Diluted |
|
21,796 |
|
|
22,675 |
|
Consolidated Balance Sheets | ||||||||
(in thousands, except for share data) | ||||||||
|
|
|
||||||
2023 |
|
2022 |
||||||
(Unaudited) |
|
(Note) |
||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents |
$ |
19,481 |
|
$ |
21,648 |
|
||
Accounts receivable, net |
|
10,720 |
|
|
8,064 |
|
||
Inventory, net |
|
52,489 |
|
|
42,133 |
|
||
Other current assets |
|
8,384 |
|
|
8,133 |
|
||
Total current assets |
|
91,074 |
|
|
79,978 |
|
||
Property, plant and equipment, net |
|
16,772 |
|
|
15,532 |
|
||
Operating lease right-of-use assets |
|
4,072 |
|
|
4,251 |
|
||
Other assets |
|
4,524 |
|
|
4,383 |
|
||
Total assets |
$ |
116,442 |
|
$ |
104,144 |
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable |
$ |
20,816 |
|
$ |
17,638 |
|
||
Accrued liabilities |
|
35,348 |
|
|
33,316 |
|
||
Operating lease liabilities, current portion |
|
1,196 |
|
|
1,168 |
|
||
Finance lease obligations, current portion |
|
1,169 |
|
|
1,102 |
|
||
Equipment financing obligations, current portion |
|
400 |
|
|
398 |
|
||
Note payable - related party, current portion |
|
4,500 |
|
|
2,500 |
|
||
Total current liabilities |
|
63,429 |
|
|
56,122 |
|
||
Operating lease liabilities, net of current portion |
|
3,398 |
|
|
3,710 |
|
||
Finance lease obligations, net of current portion |
|
2,410 |
|
|
2,536 |
|
||
Equipment financing obligations, net of current portion |
|
1,430 |
|
|
738 |
|
||
Note payable - related party, net of current portion |
|
1,991 |
|
|
3,989 |
|
||
Other liabilities |
|
22,795 |
|
|
17,474 |
|
||
Total liabilities |
|
95,453 |
|
|
84,569 |
|
||
Stockholders’ equity: | ||||||||
Preferred stock, par value |
|
- |
|
|
- |
|
||
Series A preferred stock, par value |
|
- |
|
|
- |
|
||
Common stock, non-voting, par value |
|
- |
|
|
- |
|
||
Common stock, par value |
|
224 |
|
|
221 |
|
||
Additional paid-in capital |
|
155,748 |
|
|
155,535 |
|
||
Accumulated deficit |
|
(115,511 |
) |
|
(115,336 |
) |
||
Accumulated other comprehensive loss |
|
(19,472 |
) |
|
(20,845 |
) |
||
|
- |
|
|
- |
|
|||
Total stockholders’ equity |
|
20,989 |
|
|
19,575 |
|
||
Total liabilities and stockholders’ equity |
$ |
116,442 |
|
$ |
104,144 |
|
||
Note: The balance sheet at |
Consolidated Cash Flow Statements | ||||||||
(in thousands) | ||||||||
Three Months Ended |
||||||||
|
|
|
||||||
2023 |
|
2022 |
||||||
(Unaudited) |
||||||||
Cash flows from operating activities: | ||||||||
Net (loss) income |
$ |
(175 |
) |
$ |
237 |
|
||
Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||||||||
Depreciation and amortization |
|
774 |
|
|
763 |
|
||
Deferred income taxes |
|
(136 |
) |
|
247 |
|
||
Non-cash compensation expense |
|
263 |
|
|
176 |
|
||
Deferred loan costs recognized |
|
2 |
|
|
2 |
|
||
Net loss on the sale of assets |
|
- |
|
|
10 |
|
||
Provision for excess and obsolete inventory |
|
(87 |
) |
|
64 |
|
||
Non-cash lease expense |
|
179 |
|
|
186 |
|
||
Other noncash items |
|
33 |
|
|
12 |
|
||
Contributions to pension plans |
|
(10 |
) |
|
(22 |
) |
||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable |
|
(2,691 |
) |
|
(4,741 |
) |
||
Inventory |
|
(9,942 |
) |
|
(1,166 |
) |
||
Prepaid expenses and other assets |
|
154 |
|
|
653 |
|
||
Accounts payable |
|
3,118 |
|
|
1,403 |
|
||
Accrued and other liabilities |
|
7,277 |
|
|
(1,077 |
) |
||
Net cash used in operating activities |
|
(1,241 |
) |
|
(3,253 |
) |
||
Cash flows from investing activities: | ||||||||
Capital expenditures |
|
(708 |
) |
|
(901 |
) |
||
Net cash used in investing activities |
|
(708 |
) |
|
(901 |
) |
||
Cash flows from financing activities: | ||||||||
Proceeds from equipment financing obligation |
|
210 |
|
|
- |
|
||
Principal payments on finance lease obligations |
|
(271 |
) |
|
(238 |
) |
||
Principal payments on equipment financing obligations |
|
(95 |
) |
|
(82 |
) |
||
Indirect repurchase of shares for minimum statutory tax withholdings |
|
(48 |
) |
|
(17 |
) |
||
Net cash used in financing activities |
|
(204 |
) |
|
(337 |
) |
||
Effect of exchange rate changes on cash balances |
|
(14 |
) |
|
390 |
|
||
Net decrease in cash and cash equivalents |
|
(2,167 |
) |
|
(4,101 |
) |
||
Cash and cash equivalents at beginning of period |
|
21,648 |
|
|
11,620 |
|
||
Cash and cash equivalents at end of period |
$ |
19,481 |
|
$ |
7,519 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20230516005315/en/
Chief Financial Officer
(502) 329-2000
Source: