Richardson Electronics, Ltd. reported its financial results for the three months ended August 31, 2024, showing a modest increase in net sales but a decline in profitability compared to the same period in the previous fiscal year. Net sales reached $53.7 million, a 2.2% increase from $52.6 million in the prior year. However, gross profit decreased to $16.4 million from $17.3 million, resulting in a gross margin of 30.6%, down from 32.8%. This decline in gross margin was attributed to an unfavorable product mix and manufacturing under absorption in key segments.
Operating income fell significantly to $316,000 from $1.5 million, while net income also decreased to $590,000 from $1.2 million in the prior year. The effective income tax rate for the quarter was 9.0%, a notable decrease from 23.7% in the same quarter last year. The company reported earnings per share of $0.04, down from $0.09.
Segment performance varied, with the Power and Microwave Technologies (PMT) segment experiencing a 4.3% decline in net sales to $34.2 million, primarily due to slower sales of electron devices. In contrast, the Green Energy Solutions (GES) segment saw a substantial increase of 84.0% in net sales, reaching $8.1 million, driven by higher shipments of power management products. The Healthcare segment also performed well, with net sales increasing by 48.7% to $3.8 million.
Total current assets rose to $167.4 million as of August 31, 2024, compared to $161.7 million on June 1, 2024. Cash and cash equivalents decreased to $23.0 million from $24.3 million during the same period. The company’s total liabilities increased to $38.8 million from $34.5 million, while total stockholders' equity rose slightly to $159.1 million from $158.0 million.
In terms of strategic developments, Richardson Electronics entered into a three-year revolving credit facility with PNC Bank, allowing for maximum borrowings of $30 million. As of August 31, 2024, the company had utilized $1.0 million of this credit line for short-term working capital needs.
The company continues to focus on its core segments, including PMT, GES, and Healthcare, while navigating market challenges such as tariffs on imported products from China, which may impact sales and gross margins.
About RICHARDSON ELECTRONICS, LTD.
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