May 08, 2002 Atlanta, GA
SMTC Corp. (Toronto, Canada), an electronics manufacturing services (EMS) provider, today reported a first quarter loss per share, before discontinued operations, of $0.09, as compared to a $0.66 loss per share, before discontinued operations, for the first quarter of 2001. On an adjusted basis, the net loss per share is $0.09 for the first quarter 2002, as compared to a loss of $0.07 per share for the same period last year. In a press release, the company stated that this loss is an improvement over analyst expectations of a $0.16 per share loss on an adjusted basis for the first quarter of 2002. According to the company, the financial results represent significant improvement over the fourth quarter 2001 adjusted net loss of $0.17 per share, which excluded restructuring and other charges.
Revenues for the first quarter increased to $139 million, up 10.3 percent from $126 million in the fourth quarter 2001, reflecting organic growth realized during the first quarter. Revenues were down from $198 million for the first quarter of 2001 due to the general decline in the technology market. Gross profit for the first quarter 2002 was $6.7 million versus $2.2 million for the same period last year, which included $6.9 million of restructuring charges. Gross profit margin improved to 4.9 percent in the first quarter of 2002 versus 1.1 percent for the same period last year and versus a loss of 3.9 percent in the fourth quarter 2001, which included $8.0 million of restructuring and other charges.
The operating loss for the first quarter 2002 was $0.8 million compared to an operating loss of $25.2 million during the same period last year. Net loss before discontinued operations for the first quarter improved more than 86 percent to $2.5 million, versus $18.8 million for the same period in 2001, which included $22.5 million in restructuring and other charges. EBITDA, before discontinued operations, for the first quarter of 2002 was $2.7 million.
Loss from discontinued operations of $10.2 million for the quarter included a charge of $9.7 million. The charge was associated with closing the company's facility in Cork, Ireland, and placing the subsidiary, which operates that facility, in voluntary liquidation. SMTC will continue to conduct European operations through its Donegal, Ireland, facility, which is a separately owned subsidiary.
"The company's focus on improving operating efficiencies and cash flow resulted in further improvements in the use of working capital,� said Frank Burke, chief financial officer of SMTC. �Though the company will remain committed to reducing its use of working capital, it will do so in partnership with its customers and suppliers, and we remain committed to continuing to strengthen our balance sheet."
According to the press release, SMTC remains cautious about the current economic climate; however, given the company's focus on improved plant utilization and expense controls, the second quarter outlook is for improved revenue and earnings compared to the first quarter of 2002, continuing the trends in the first quarter versus the fourth quarter last year.
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