Trio-Tech International (NYSE MKT: TRT) today announced financial results for the first quarter of fiscal 2023.
Revenue for the three months ended September 30, 2022 increased 17% to $11,939,000 compared to $10,171,000 for the three months ended September 30, 2021, highlighted by a 38% increase in testing services revenue.
Overall gross margin increased 14%, but declined to 30% of revenue compared to 31% of revenue in the same quarter last year, primarily related to lower margin product mix at testing services and manufacturing operations.
Net income for the first quarter of fiscal 2023 was $882,000, or $0.21 per diluted share, compared to net income of $917,000, or $0.23 per diluted share, for the first quarter last year.
Shareholders' equity at September 30, 2022 decreased to $27,818,000, or $6.82 per outstanding share, compared to $28,002,000, or $6.88 per outstanding share at June 30, 2022. There were approximately 4,077,000 and 4,072,000 common shares outstanding at September 30, 2022 and June 30, 2022, respectively.
CEO Comments
S.W. Yong, Trio-Tech's CEO, said, “Remarkable revenue growth in our testing services business was the key to another successful quarter for our company, and our manufacturing segment delivered modest revenue growth as well. With encouraging backlog and a strong balance sheet, including cash and short-term deposits of $12,257,000, or about $3.00 per outstanding share, we remain cautiously optimistic about Trio-Tech’s financial performance for fiscal 2023.”
About Trio‑Tech
Established in 1958, Trio-Tech International is located in Van Nuys, California, with its Principal Executive Office and regional headquarters in Singapore. Trio-Tech International is a diversified business group with interests in semiconductor testing services, manufacturing and distribution of semiconductor testing equipment, and real estate. Our subsidiary locations include Tianjin, Suzhou, Chongqing and Jiangsu in China, as well as Kuala Lumpur Malaysia and Bangkok Thailand. Further information about Trio-Tech's semiconductor products and services can be obtained from the Company's Web site at www.triotech.com and www.universalfareast.com.
Forward Looking Statements
This press release contains statements that are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and may contain forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and assumptions regarding future activities and results of operations of the Company. In light of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the following factors, among others, could cause actual results to differ materially from those reflected in any forward looking statements made by or on behalf of the Company: market acceptance of Company products and services; changing business conditions or technologies and volatility in the semiconductor industry, which could affect demand for the Company's products and services; the impact of competition; problems with technology; product development schedules; delivery schedules; changes in military or commercial testing specifications which could affect the market for the Company's products and services; difficulties in profitably integrating acquired businesses, if any, into the Company; risks associated with conducting business internationally and especially in Asia, including currency fluctuations and devaluation, currency restrictions, local laws and restrictions and possible social, political and economic instability; changes in U.S. and global financial and equity markets, including market disruptions and significant interest rate fluctuations; public health issues related to the COVID-19 pandemic; geopolitical conflicts, including the war in Ukraine; trade tension between U.S. and China and other economic, financial and regulatory factors beyond the Company's control. Other than statements of historical fact, all statements made in this release are forward looking, including, but not limited to, statements regarding industry prospects, future results of operations or financial position, and statements of our intent, belief and current expectations about our strategic direction, prospective and future financial results and condition. In some cases, you can identify forward looking statements by the use of terminology such as "may," "will," "expects," "plans," "anticipates," "estimates," "potential," "believes," "can impact," "continue," or the negative thereof or other comparable terminology. Forward looking statements involve risks and uncertainties that are inherently difficult to predict, which could cause actual outcomes and results to differ materially from our expectations, forecasts and assumptions.Many of these risks and uncertainties are beyond the Company's control. Reference is made to the discussion of risk factors detailed in the Company's filings with the Securities and Exchange Commission including its reports on Form 10-K and 10-Q. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.
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TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
|
|
UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
September 30,
|
|
Revenue
|
2022
|
|
2021
|
|
|
Manufacturing
|
$
|
3,585
|
|
|
$
|
3,562
|
|
|
|
Testing services
|
|
6,364
|
|
|
|
4,600
|
|
|
|
Distribution
|
|
1,982
|
|
|
|
1,998
|
|
|
|
Real estate
|
|
8
|
|
|
|
11
|
|
|
|
|
|
|
11,939
|
|
|
|
10,171
|
|
|
Cost of Sales
|
|
|
|
|
|
Cost of manufactured products sold
|
|
2,525
|
|
|
|
2,434
|
|
|
|
Cost of testing services rendered
|
|
4,126
|
|
|
|
2,883
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|
|
|
Cost of distribution
|
|
1,648
|
|
|
|
1,656
|
|
|
|
Cost of real estate
|
|
18
|
|
|
|
19
|
|
|
|
|
|
|
8,317
|
|
|
|
6,992
|
|
|
Gross Margin
|
|
3,622
|
|
|
|
3,179
|
|
|
|
|
|
|
|
|
|
Operating Expense:
|
|
|
|
|
|
General and administrative
|
|
2,305
|
|
|
|
1,980
|
|
|
|
Selling
|
|
173
|
|
|
|
147
|
|
|
|
Research and development
|
|
73
|
|
|
|
82
|
|
|
|
Gain on disposal of property, plant and equipment
|
|
4
|
|
|
|
--
|
|
|
|
|
Total operating expense
|
|
2,555
|
|
|
|
2,209
|
|
|
Income from Operations
|
|
1,067
|
|
|
|
970
|
|
|
Other Income / (Expense)
|
|
|
|
|
|
Interest expense
|
|
(44
|
)
|
|
|
(28
|
)
|
|
|
Other income, net
|
|
179
|
|
|
|
161
|
|
|
|
|
Total other income
|
|
135
|
|
|
|
133
|
|
|
Income from Continuing Operations before Income Taxes
|
|
1,202
|
|
|
|
1,103
|
|
|
Income Tax Expense
|
|
(225
|
)
|
|
|
(180
|
)
|
|
Income from Continuing Operations before Non-controlling Interest, net of tax
|
|
977
|
|
|
|
923
|
|
|
Income from Discontinued Operations, net of tax
|
|
1
|
|
|
|
5
|
|
|
NET INCOME
|
|
978
|
|
|
|
928
|
|
|
Less: Net Income Attributable to the Non-controlling Interest
|
|
96
|
|
|
|
11
|
|
|
Net Income Attributable to Trio-Tech International
|
|
882
|
|
|
|
917
|
|
|
Net Income Attributable to Trio-Tech International:
|
|
|
|
|
|
Income from continuing operations, net of tax
|
|
882
|
|
|
|
914
|
|
|
|
Income from discontinued operations, net of tax
|
|
--
|
|
|
|
3
|
|
|
|
Net Income Attributable to Trio-Tech International
|
$
|
882
|
|
|
$
|
917
|
|
|
Earnings per share
|
|
|
|
|
|
Basic earnings per share
|
$
|
0.22
|
|
|
$
|
0.23
|
|
|
|
Diluted earnings per share
|
$
|
0.21
|
|
|
$
|
0.23
|
|
|
Weighted Average Shares Outstanding - Basic
|
|
4,077
|
|
|
|
3,913
|
|
|
Weighted Average Shares Outstanding - Diluted
|
|
4,158
|
|
|
|
4,007
|
|
|
TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
|
|
UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
|
|
|
|
Three Months Ended
|
|
September 30,
|
|
|
|
2022
|
|
|
|
2021
|
|
|
Comprehensive Income Attributable to Trio-Tech International:
|
|
|
|
|
Net Income
|
$
|
978
|
|
|
$
|
928
|
|
|
Foreign Currency Translation, net of tax
|
|
(1,213
|
)
|
|
|
(289
|
)
|
|
Comprehensive (Loss) / Income
|
|
(235
|
)
|
|
|
639
|
|
|
Less: Comprehensive Income Attributable to Non-controlling Interests
|
|
79
|
|
|
|
4
|
|
|
Comprehensive (Loss) / Income Attributable to Trio-Tech International
|
$
|
(314
|
)
|
|
$
|
635
|
|
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TRIO‑TECH INTERNATIONAL AND SUBSIDIARIES
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
(IN THOUSANDS, EXCEPT NUMBER OF SHARES)
|
|
|
|
|
|
|
|
|
|
Sep. 30,
|
|
June 30,
|
|
2022
|
|
2022
|
|
ASSETS
|
(Unaudited)
|
|
(Audited)
|
|
CURRENT ASSETS:
|
|
|
|
|
Cash and cash equivalents
|
$
|
9,428
|
|
$
|
7,698
|
|
Short-term deposits
|
|
2,829
|
|
|
5,420
|
|
Trade account receivables, net
|
|
12,491
|
|
|
11,592
|
|
Other receivables
|
|
942
|
|
|
998
|
|
Inventories, net
|
|
3,548
|
|
|
2,258
|
|
Prepaid expenses and other current assets
|
|
631
|
|
|
1,215
|
|
Financed sales receivable
|
|
20
|
|
|
21
|
|
Total current assets
|
|
29,889
|
|
|
29,202
|
|
Deferred tax assets
|
|
173
|
|
|
169
|
|
Investment properties, net
|
|
533
|
|
|
585
|
|
Property, plant and equipment, net
|
|
8,687
|
|
|
8,481
|
|
Operating lease right-of-use assets
|
|
2,759
|
|
|
3,152
|
|
Other assets
|
|
121
|
|
|
137
|
|
Financed sales receivable
|
|
11
|
|
|
17
|
|
Restricted term deposits
|
|
1,632
|
|
|
1,678
|
|
Total non-current assets
|
|
13,916
|
|
|
14,219
|
|
TOTAL ASSETS
|
$
|
43,805
|
|
$
|
43,421
|
|
|
|
|
|
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LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
Lines of credit
|
$
|
482
|
|
$
|
929
|
|
Accounts payable
|
|
3,469
|
|
|
2,401
|
|
Accrued expense
|
|
6,179
|
|
|
6,004
|
|
Income taxes payable
|
|
968
|
|
|
787
|
|
Current portion of bank loans payable
|
|
491
|
|
|
472
|
|
Current portion of finance leases
|
|
104
|
|
|
118
|
|
Current portion of operating leases
|
|
1,130
|
|
|
1,218
|
|
Total current liabilities
|
|
12,823
|
|
|
11,929
|
|
Bank loans payable, net of current portion
|
|
1,251
|
|
|
1,272
|
|
Finance leases, net of current portion
|
|
91
|
|
|
119
|
|
Operating leases, net of current portion
|
|
1,629
|
|
|
1,934
|
|
Income taxes payable
|
|
137
|
|
|
137
|
|
Deferred tax liabilities
|
|
30
|
|
|
--
|
|
Other non-current liabilities
|
|
26
|
|
|
28
|
|
Total non-current liabilities
|
|
3,164
|
|
|
3,490
|
|
TOTAL LIABILITIES
|
|
15,987
|
|
|
15,419
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY:
|
|
|
|
|
Common stock, no par value, 15,000,000 shares authorized; 4,076,680 and 4,071,680
|
|
|
|
|
shares issued and outstanding at September 30, 2022 and June 30, 2022, respectively
|
|
12,769
|
|
|
12,750
|
|
Paid-in capital
|
|
4,740
|
|
|
4,708
|
|
Accumulated retained earnings
|
|
10,101
|
|
|
9,219
|
|
Accumulated other comprehensive gain-translation adjustments
|
|
1
|
|
|
1,197
|
|
Total Trio-Tech International shareholders' equity
|
|
27,611
|
|
|
27,874
|
|
Non-controlling interest
|
|
207
|
|
|
128
|
|
TOTAL EQUITY
|
|
27,818
|
|
|
28,002
|
|
TOTAL LIABILITIES AND EQUITY
|
$
|
43,805
|
|
$
|
43,421
|
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