Powell Industries Announces Fiscal 2020 Third Quarter Results
HOUSTON, Aug. 4, 2020 /PRNewswire/ -- Powell Industries, Inc. (NASDAQ: POWL), a leading supplier of custom engineered solutions for the management, control and distribution of electrical energy, today announced results for the fiscal 2020 third quarter ended June 30, 2020.
Revenues for the third quarter of fiscal 2020 were $118.1 million compared to revenues of $151.6 million for the second quarter of fiscal 2020 and revenues of $135.6 million for the third quarter of fiscal 2019. Net income for the third quarter of fiscal 2020 was $3.5 million, or $0.30 per diluted share, compared to net income of $7.4 million, or $0.64 per diluted share, for the second quarter of fiscal 2020 and net income of $5.1 million, or $0.44 per diluted share for the third quarter of fiscal 2019. During the fiscal third quarter, net income was reduced by $1.2 million, or $0.12 per share due to restructuring costs and was offset by $1.7 million, or a $0.14 per share gain resulting from tax benefits recognized. New orders placed during the third quarter of fiscal 2020 totaled $81 million compared to $145 million in the third quarter of fiscal 2019 and $301 million in the second quarter of fiscal 2020 which included the largest order in Company history. The Company's backlog as of June 30, 2020 was $532 million, a decrease of 6% sequentially from $566 million at March 31, 2020 and compared to $407 million as of June 30, 2019.
Brett A. Cope, Powell's Chairman and Chief Executive Officer, stated, "As we continue to navigate through the global market uncertainty and challenges associated with the COVID-19 pandemic, our number one priority remains the safety of our employees, customers and suppliers. I am very proud of all of our employees globally for their continued efforts embracing safe work practices across all of our facilities."
Mr. Cope continued, "Our third quarter results reflected another quarter of solid operating performance resulting in strong margins and cash flow despite the lower sequential and year-over-year revenues. Third quarter gross profit as a percentage of revenue was 18.1%, up 60 basis points from 17.5% in the same period last year as a result of strong project execution and cost management. Additionally, our focus on both operating costs and working capital throughout fiscal 2020 has enabled the business to further enhance our liquidity position, generating $46 million of operating cash flow during the fiscal third quarter."
"We have entered an unprecedented cycle across our industrial end markets, with increased uncertainty across the geographies where we operate and compete. Considering this and in an effort to align operating costs with the current market activity, during the quarter we took the difficult, but necessary decision to reduce our workforce in order to align operating costs with the current market activity."
Mr. Cope concluded by stating, "Looking forward, our backlog is solid at $532 million, up $125 million from the prior year and our balance sheet is very strong, particularly our current liquidity position coupled with minimal leverage. We remain focused on the success of our customers, by continuing to deliver high performance electrical distribution products, solutions and service support."
OUTLOOK
Commenting on the company's outlook, Michael Metcalf, Powell's Chief Financial Officer said, "We continue to show solid operational momentum through the fiscal third quarter of 2020, with both orders and earnings per share at their highest levels through the first nine months of the year dating back to fiscal 2015. As we close out fiscal 2020, we anticipate a more challenging commercial environment with respect to our broader industrial end markets. However, given our robust backlog position, as well as our year-to-date earnings and operational cash flow, we are confident that fiscal 2020 will be a strong year financially for the company."
CONFERENCE CALL
Powell Industries has scheduled a conference call for Wednesday, August 5, 2020 at 11:00 a.m. Eastern time. To participate in the conference call, dial 412-902-0030 at least 10 minutes before the call begins and ask for the Powell Industries conference call. A replay of the call will be available approximately two hours after the live broadcast ends and will be accessible until August 12, 2020. To access the replay, dial 201-612-7415 using a passcode of 13706826#.
Investors, analysts and the general public will also have the opportunity to listen to the conference call over the Internet by visiting powellind.com. To listen to the live call on the web, please visit the website at least 15 minutes before the call begins to register, download and install any necessary audio software. For those who cannot listen to the live webcast, an archive will be available shortly after the call and will remain available for approximately 90 days at powellind.com.
Powell Industries, Inc., headquartered in Houston, designs, manufactures and services custom-engineered equipment and systems for the distribution, control and monitoring of electrical energy. Powell markets include large industrial customers such as utilities, oil and gas producers, refineries, petrochemical plants, pulp and paper producers, mining operations and commuter railways. For more information, please visit powellind.com.
Any forward-looking statements in the preceding paragraphs of this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties in that actual results may differ materially from those projected in the forward-looking statements. In the course of operations, we are subject to certain risk factors, competition and competitive pressures, sensitivity to general economic and industrial conditions, international political and economic risks, availability and price of raw materials and execution of business strategy. For further information, please refer to the Company's filings with the Securities and Exchange Commission, copies of which are available from the Company without charge.
Contacts:
Michael W. Metcalf, CFO
Powell Industries, Inc.
713-947-4422
Ken Dennard / Natalie Hairston
Dennard Lascar Investor Relations
POWL@dennardlascar.com
713-529-6600
POWELL INDUSTRIES, INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Three Months Ended Nine Months Ended
June 30, June 30,
2020 2019 2020 2019
---
(In thousands, except per share data)
(Unaudited)
Revenues $
118,062 $
135,588 $
403,781 $
368,676
Cost of goods sold 96,718 111,873 330,926 310,255
Gross profit 21,344 23,715 72,855 58,421
Selling, general
and administrative
expenses 15,511 17,117 51,372 50,240
Research and
development
expenses 1,605 1,631 4,863 4,988
Amortization of
intangible assets 44 44 132 132
Insurance proceeds - (950) (950)
Restructuring and
other, net 1,400 233 1,400 233
Operating income 2,784 5,640 15,088 3,778
Interest expense 52 59 179 170
Interest income (190) (305) (901) (707)
Income before
income taxes 2,922 5,886 15,810 4,315
Income tax
provision
(benefit) (559) 797 2,133 963
Net income $
3,481 $
5,089 $
13,677 $
3,352
Earnings per share: share:
Basic $
0.30 $
0.44 $
1.18 $
0.29
Diluted $
0.30 $
0.44 $
1.17 $
0.29
Weighted average shares: shares:
Basic 11,631 11,579 11,622 11,567
Diluted 11,698 11,603 11,686 11,589
SELECTED FINANCIAL DATA:
Depreciation and
Amortization $
2,637 $
2,948 $
7,878 $
9,408
Capital
Expenditures $
809 $
1,269 $
4,311 $
3,241
Dividends Paid $
3,019 $
3,003 $
9,047 $
8,991
POWELL INDUSTRIES, INC. & SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, 2020 September 30, 2019
(In thousands)
(Unaudited)
Assets:
Cash, cash
equivalents and
short-term
investments $
163,356 $
124,681
Other current
assets 186,795 203,887
Property, plant
and equipment,
net 114,826 120,812
Long-term assets 22,221 18,031
Total assets $
487,198 $
467,411
Liabilities and
equity:
Current
liabilities $
170,499 $
157,896
Long-term debt,
net of current
maturities 400 800
Deferred and other
long-term
liabilities 12,728 9,562
Stockholders'
equity 303,571 299,153
Total liabilities
and stockholders'
equity $
487,198 $
467,411
SELECTED FINANCIAL
DATA:
Working capital $
179,652 $
170,672
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SOURCE Powell Industries, Inc.
