Schmitt Industries, Inc. (NASDAQ:SMIT) today announced its
operating results for the quarter ended August 31, 2015. For the
three months ended August 31, 2015, total sales increased $55,096,
or 1.8%, to $3,104,384 from $3,049,288 for the three months ended
August 31, 2014. Net loss was $195,062, or $(0.07) per fully
diluted share, for the three months ended August 31, 2015 as
compared to net income of $51,783, or $0.02 per fully diluted
share, for the three months ended August 31, 2014.
Balancer segment sales focus throughout the world on end-users,
rebuilders and original equipment manufacturers of grinding
machines with the target geographic markets of North America, Asia,
Europe and South America. Balancer segment sales increased $87,325,
or 4.7%, to $1,927,495 for the three months ended August 31, 2015
compared to $1,840,170 for the three months ended August 31, 2014,
primarily due to stronger sales in North America and Europe.
The Measurement segment product line consists of SMS® and
Lasercheck® laser-based surface microroughness measurement systems,
Acuity® laser-based distance measurement and dimensional sizing
laser sensors, and Xact® ultrasonic-based remote tank monitoring
products. Total Measurement segment sales decreased $32,229, or
2.7%, to $1,176,889 for the three months ended August 31, 2015
compared to $1,209,118 for the three months ended August 31, 2014.
This decrease is primarily due to lower sales in our SMS product
line in the first quarter of Fiscal 2016 due to the delivery and
acceptance of one of our CASI® products that occurred during the
first quarter of the prior year, offset by increases in revenues in
other product lines within the Measurement segment.
Gross margin for the three months ended August 31, 2015
decreased to 46.5% as compared to 48.0% for the three months ended
August 31, 2014. The fluctuations in gross margin in the three
months period ended August 31, 2015 compared to the same three
month period in the prior fiscal year is primarily influenced by
shifts in the product sales mix involving our five product
lines.
Operating expenses increased $214,326, or 15.2%, to $1,624,794
for the three months ended August 31, 2015 as compared to
$1,410,468 for the three months ended August 31, 2014. General,
administrative and selling expenses increased $199,858, or 14.9%,
for the three months ended August 31, 2015 as compared to the same
period in the prior year primarily due to increases in sales
commissions and increases in personnel expense.
"Our first quarter results primarily reflect lower sales of our
SMS surface microroughness measurement products during the summer
as compared to the prior year, combined with slightly higher
operating costs," commented James A. Fitzhenry, President and CEO
of Schmitt Industries. "We are continuing to focus on execution of
our growth strategies for our product lines as we progress through
the year," Fitzhenry concluded.
About Schmitt Industries
Schmitt Industries, Inc. (the Company) designs, manufactures and
sells high precision test and measurement products for two main
business segments: the Balancer Segment and the Measurement
Segment. For the Balancer Segment, the Company designs,
manufactures and sells computer-controlled vibration detection,
balancing and process control systems for the worldwide machine
tool industry, particularly for grinding machines. For the
Measurement Segment, the Company designs, manufactures and sells
laser and white light sensors for distance, dimensional and area
measurement for a wide variety of commercial applications,
laser-based microroughness measurement products for the
semiconductor wafer and hard disk drive industries and for other
industrial applications, laser-based surface analysis and
measurement products for a variety of scientific applications, and
ultrasonic measurement products that accurately measure the liquid
levels of propane and diesel tanks and transmit that data via
satellite to a secure web site for display. The Company also
provides sales and service for Europe and Asia through its wholly
owned subsidiary, Schmitt Europe Limited (SEL), located in
Coventry, England and through its sales representative office
located in Shanghai, China.
FORWARD-LOOKING STATEMENTS
Certain statements in this release, including but not limited to
remarks by James A. Fitzhenry, are "forward-looking statements."
These statements are based upon current expectations, estimates and
projections about the Company's business that are based, in part,
on assumptions made by management. These statements are not
guarantees of future performance and involve risks and
uncertainties that are difficult to predict. Actual outcomes
and results may differ materially from what is expressed or
forecasted in such forward-looking statements due to numerous
factors, including, but not limited to, general economic conditions
and global financial concerns, the volatility of the Company's
primary markets, efforts to continue to accelerate growth in sales
of the Xact® tank monitoring system and the ability to satisfy
expected demand, the ability to develop new products to satisfy
changes in consumer demands, the intensity of competition, the
effect on production time and overall costs of products if any of
our primary suppliers are lost or if a primary supplier increases
the prices of raw materials or components, the ability to ramp up
manufacturing to satisfy increasing demand, maintenance of a
significant investment in inventories in anticipation of future
sales, existing cash levels which may not be sufficient to fund
future growth, the ability to obtain financing if needed to fund
operations or growth through commercial loans or capital fund
raising at terms acceptable to the Company and its shareholders,
fluctuations in quarterly and annual operating results, attracting
and retaining key management and qualified technical and sales
personnel, changes in effective tax rates, the ability to reduce
operating costs if sales decline, increased costs due to changes in
securities laws and regulations, protection of intellectual
property rights, and risks from international sales and currency
fluctuations.
For further information regarding risks and uncertainties
associated with the Company's business, please refer to Schmitt's
SEC filings, including, but not limited to, its Forms 10-K, 10-Q
and 8-K.
The forward-looking statements in this release speak only as of
the date on which they were made, and the Company does not
undertake any obligation to update any forward-looking statement to
reflect events or circumstances after the date of this release, or
for changes to this document made by wire services or internet
service providers.
SCHMITT INDUSTRIES,
INC. |
CONSOLIDATED BALANCE
SHEETS |
(UNAUDITED) |
|
|
|
|
August 31, 2015 |
May 31, 2015 |
ASSETS |
Current assets |
|
|
Cash and cash equivalents |
$ 1,491,823 |
$ 1,795,654 |
Accounts receivable, net |
2,604,980 |
2,660,426 |
Inventories |
4,776,612 |
4,557,567 |
Prepaid expenses |
146,638 |
153,970 |
Income taxes receivable |
2,239 |
1,029 |
|
9,022,292 |
9,168,646 |
|
|
|
Property and equipment,
net |
1,073,513 |
1,110,878 |
Other assets |
|
|
Intangible assets, net |
796,529 |
824,411 |
TOTAL ASSETS |
$ 10,892,334 |
$ 11,103,935 |
|
|
|
LIABILITIES &
STOCKHOLDERS' EQUITY |
Current liabilities |
|
|
Accounts payable |
$ 724,562 |
$ 834,002 |
Accrued commissions |
367,649 |
284,944 |
Accrued payroll
liabilities |
132,172 |
140,872 |
Other accrued liabilities |
342,101 |
355,513 |
Income taxes payable |
3,750 |
-- |
Total current
liabilities |
1,570,234 |
1,615,331 |
|
|
|
Stockholders' equity |
|
|
Common stock, no par value,
20,000,000 shares authorized, 2,995,910 shares issued and
outstanding at August 31, 2015 and May 31, 2015 |
10,533,523 |
10,511,324 |
Accumulated other comprehensive
loss |
(360,586) |
(366,945) |
Accumulated deficit |
(850,837) |
(655,775) |
Total stockholders'
equity |
9,322,100 |
9,488,604 |
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY |
$ 10,892,334 |
$ 11,103,935 |
|
|
|
|
|
|
SCHMITT INDUSTRIES,
INC. |
CONSOLIDATED STATEMENTS
OF OPERATIONS |
FOR THE THREE MONTHS
ENDED AUGUST 31, 2015 AND 2014 |
(UNAUDITED) |
|
|
|
|
Three Months
Ended August 31, |
|
2015 |
2014 |
|
|
|
Net sales |
$ 3,104,384 |
$ 3,049,288 |
Cost of sales |
1,661,892 |
1,585,721 |
Gross profit |
1,442,492 |
1,463,567 |
|
|
|
Operating expenses: |
|
|
General, administration and
sales |
1,537,882 |
1,338,024 |
Research and development |
86,912 |
72,444 |
Total operating expenses |
1,624,794 |
1,410,468 |
|
|
|
Operating income (loss) |
(182,302) |
53,099 |
|
|
|
Other income (loss), net |
(5,920) |
1,061 |
|
|
|
Income (loss) before income taxes |
(188,222) |
54,160 |
|
|
|
Provision for income taxes |
6,840 |
2,377 |
|
|
|
Net income (loss) |
$ (195,062) |
$ 51,783 |
|
|
|
Net income (loss) per
common share, basic |
$ (0.07) |
$ 0.02 |
|
|
|
Weighted average number of
common shares, basic |
2,995,910 |
2,995,910 |
|
|
|
Net income (loss) per
common share, diluted |
$ (0.07) |
$ 0.02 |
|
|
|
Weighted average number of
common shares, diluted |
2,995,910 |
2,999,172 |
|
|
|
CONTACT: For more information contact:
Ann M. Ferguson, CFO and Treasurer
(503) 227-7908
or visit our web site at www.schmitt-ind.com
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