Jaco Electronics Reports Fiscal 2007 First Quarter Diluted EPS of $0.04.HAUPPAUGE, N.Y. -- Jaco Electronics, Inc. (Nasdaq: JACO):
Conference Call: November 14, 2006 at 9:00 a.m. ET
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Jaco Electronics, Inc. (Nasdaq: JACO), a distributor and integrator of electronic components and flat panel solutions, today reported results for its fiscal 2007 first quarter ended September 30, 2006. [TABLE OMITTED] Commenting on the results, Jaco's Chairman and Chief Executive Officer Joel Girsky, stated, "The fiscal 2007 first quarter marked our third consecutive profitable reporting period as our focused approach continues to show results. Jaco's three primary sources of revenue are core distribution, including flat panel display A thin display screen for computer and TV usage. The first flat panels appeared on laptop computers in the mid-1980s, and the LCD technology became the standard. Stand-alone LCD screens became available for desktop computers in the mid-1990s and exceeded sales of CRTs for the first time (FPD (1) (Flat Panel Display) See LCD, plasma display, EL display, FED and flat panel display. (2) (Field Programmable Device) An umbrella term for all chips that can be programmed by the customer including SPLDs, CPLDs and FPGAs. See PLD. ) product, FPD integration and technical support, and value-added logistics. During the fiscal 2007 first quarter, we generated strong growth in logistics sales, which drove a 33 percent increase in total net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight and a 21.6 percent increase in gross profit, compared to last year. "Jaco's gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. is a reflection of our sales mix sales mix See product mix. and varies based on fluctuations related to sales to major contract manufacturers through our value-added logistics programs. On a year over year basis, we recorded a 12.4 percent gross profit margin in 1Q '07, versus a 13.6 percent gross profit margin a year ago and the change largely reflects the business mix during the two periods. "Substantially higher net sales and gross profit in 1Q '07 enabled Jaco to realize significant operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. as SG&A expenses fell to 10.8 percent of net sales, as compared to 13.1 percent a year ago. Interest expense rose $280,000 from 1Q '06 levels, primarily due to higher interest rates and borrowings. Jaco reported fiscal 2007 first quarter diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of of $0.04, a significant turnaround from the $0.02 per share loss recorded in the year-earlier period. "Logistics sales and support to global contract manufacturers rose 98 percent from last year's first quarter and increased to $32.8 million. Logistics remains an inventory-driven market resulting in quarterly net sales variances. We continue to see positive results in our flat panel display (FPD) segment, as sales in Q1 were $16.0 million, or 32 percent higher than last year's first quarter. Mr. Girsky, concluded, "The fiscal '07 first quarter is another step in executing our goal to position ourselves as a value-added service A value-added service (VAS) is a telecommunications industry term for non-core services or, in short, all services beyond standard voice calls and fax transmissions. leader. With our diversified sales mix and well-managed cost structure, we believe Jaco is well-positioned to capitalize upon future opportunities in distribution, logistics and the FPD market." About Jaco Electronics Jaco is a leading distributor of electronic components to industrial OEMs and contract manufacturers. Jaco distributes products such as semiconductors, capacitors, resistors, electromechanical devices Noun 1. electromechanical device - a mechanical device that is operated by electricity mechanical device - mechanism consisting of a device that works on mechanical principles , flat panel displays (FPD) and power supplies, which are used in the manufacture and assembly of electronic products, including: telecommunications equipment, computers and office equipment, medical devices and instrumentation, industrial equipment and controls, military/aerospace systems and automotive and consumer electronics. Jaco has two distribution centers and 16 strategically located sales offices throughout the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , and one in Beijing, China. The Company operates an in-house FPD integration center housing its engineering and manufacturing staff and operations. The integration center enhances Jaco's ability to provide customers with unique value-added display solutions and a "one-stop" source for their FPD supply and integration requirements. In addition to customized FPD solutions, Jaco provides a variety of value-added services including automated inventory management services and assembling stock items for customers into pre-packaged kits. "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " Statement under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995: This press release provides historical information and includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are subject to numerous assumptions, risks and uncertainties, including, but not limited to, our dependence on a limited number of distributors for our products, that most of our distributor agreements are cancelable upon short notice, the impact of downturns in our industry and the general economy, the market for our products is very competitive, the impact of disruptions in air or sea transportation and possible future legislative or regulatory changes on our business, volatility in electronic components' pricing may reduce our profit margins, the level of costs or difficulties incurred in connection with integrating the operations of businesses we acquire, the financial strength of our customers and suppliers, and other risks disclosed from time to time in our Securities and Exchange Commission filings. The forward-looking statements in this press release involve assumptions, risks and uncertainties that could cause our actual results or performance, including margins, SG&A expenses as a percentage of revenues and earnings per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, to differ materially from those expressed in the forward-looking statements. We believe that all forward-looking statements made by us have a reasonable basis, but we cannot assure you that management's expectations, beliefs or projections as expressed in the forward-looking statements will actually occur or prove to be correct. As a result, our actual results may differ materially from the information set forth herein. [TABLE OMITTED] [TABLE OMITTED] |
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