INDIANAPOLIS, March 10, 2017 (GLOBE NEWSWIRE) -- Hurco Companies, Inc. (Nasdaq:HURC) today reported results for the first fiscal quarter ended January 31, 2017. Hurco recorded net income of $879,000, or $0.13 per diluted share, for the first quarter of fiscal 2017 compared to net income of $3,895,000, or $0.58 per diluted share, for the corresponding period in fiscal 2016.
Hurco CEO Michael Doar stated, “I am encouraged by the increased volume of orders we received from all product lines and geographic regions during the first quarter of fiscal 2017 compared to the first quarter of fiscal 2016. Two strong order quarters back-to-back provide us with confidence that our strategy to penetrate the market with three product lines, Hurco, Takumi and Milltronics, aligns with customer demand for quality machine tools equipped with user-friendly, yet sophisticated control technologies to advance their businesses. Additionally, our geographic reach to serve the global machine tool market proves to be an important part of our ongoing focus to provide customers with machine tools wherever they need them.”
Sales and service fees for the first quarter of fiscal 2017 were $48,744,000, a decrease of $7,759,000, or 14%, compared to the corresponding prior year period and included a negative currency impact of $1,480,000, or 3%, when translating foreign sales to U.S. dollars for financial reporting purposes.
The following table sets forth net sales and service fees by geographic region for the quarter ended January 31, 2017 and 2016 (in thousands):
|2017||2016||$ Change||% Change|
The decrease in sales in all geographic regions during the first quarter of fiscal 2017 compared to the corresponding prior year period was impacted by the timing of customer-requested delivery dates and the availability of specific customer-requested inventory models.
Orders for the first quarter of fiscal 2017 were $61,020,000, an increase of $9,730,000, or 19%, from the corresponding prior year period and included a negative currency impact of $2,161,000, or 4%, when translating foreign orders to U.S. dollars.
The following table sets forth new orders booked by geographic region for the first quarter of fiscal 2017 and 2016 (in thousands):
|2017||2016||$ Change||% Change|
Orders in the Americas for the first quarter of fiscal 2017 increased by $3,479,000, or 21%, compared to the corresponding prior year period primarily due to overall increased customer demand for the higher-performance Hurco machines and entry level Milltronics machines.
European orders for the first quarter of fiscal 2017 increased by $3,731,000 or 13%, compared to the corresponding prior year period and included a negative currency impact of $2,076,000, or 7%, when translating foreign orders to U.S. dollars. The year-over-year growth in European orders for the first quarter of fiscal 2017, excluding the effect of the negative currency impact, was driven by increased orders in the United Kingdom and Germany, partially offset by decreased orders in France and Italy. The increase in European orders included a multiple machine order from a customer in the United Kingdom totaling $2,755,000.
Asian Pacific orders for the first quarter of fiscal 2017 increased by $2,520,000, or 43%, compared to the corresponding prior year period. The year-over-year growth resulted from increased customer demand for Hurco and Takumi machines, particularly in China.
Gross profit for the first quarter of fiscal 2017 was $12,586,000, or 26% of sales, compared to $17,698,000, or 31% of sales, for the corresponding prior year period. The year-over-year reduction in gross profit was driven by the overall reduction in sales volume.
Selling, general and administrative expenses for the first quarter of fiscal 2017 were $11,167,000 compared to $11,961,000 for the corresponding prior year period. The year-over-year reduction in selling, general and administrative expenses included a favorable currency impact of $266,000, or 2%, when translating foreign expenses to U.S. dollars for financial reporting purposes.
The effective tax rate for the first quarter of fiscal 2017 was 38% compared to 31% in the corresponding prior year period. The increase in the effective tax rate for the first quarter of fiscal 2017 compared to the corresponding prior year period was due primarily to a shift in taxable income and loss among the various geographic regions.
Cash and cash equivalents totaled $55,140,000 at January 31, 2017, compared to $41,217,000 at October 31, 2016. Working capital was $161,771,000 at January 31, 2017 compared to $160,413,000 at October 31, 2016. The increase in working capital was primarily due to a reduction of accrued expenses related to the timing of employee compensation payments during the first quarter of fiscal 2017.
Hurco also announced today that its Board of Directors approved the payment of a cash dividend of $0.10 per share. The dividend will be paid on April 10, 2017, to shareholders of record as of the close of business on March 27, 2017. Future declarations of dividends are subject to approval of the Board of Directors and may be adjusted as business needs or market conditions change.
Hurco Companies, Inc. is an international, industrial technology company that sells its three brands of computer numeric control (CNC) machine tools to the worldwide metal cutting and metal forming industry. Two of the Company’s brands of machine tools, Hurco and Milltronics, are equipped with interactive controls that include software that is proprietary to each respective brand. The Company designs these controls and develops the software. The third brand of CNC machine tools, Takumi, is equipped with industrial controls that are produced by third parties, which allows the customer to decide the type of control added to the Takumi CNC machine tool. The end markets for the Company's products are independent job shops, short-run manufacturing operations within large corporations, and manufacturers with production-oriented operations. The Company’s customers manufacture precision parts, tools, dies, and/or molds for industries such as aerospace, defense, medical equipment, energy, transportation and computer equipment. The Company is based in Indianapolis, Indiana, with manufacturing operations in Taiwan, Italy, the U.S. and China, and sells its products through direct and indirect sales forces throughout North and South America, Europe, and Asia. The Company has sales, application engineering support and service subsidiaries in China, England, France, Germany, India, Italy, Poland, Singapore, South Africa, the U.S., and Taiwan. Web Site: www.hurco.com
Certain statements in this news release are forward-looking statements that involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These factors include, among others, the cyclical nature of the machine tool industry, changes in general economic and business conditions that affect demand for our products, the risks of our international operations, changes in manufacturing markets, innovations by competitors, the ability to protect our intellectual property, breaches of our network and system security measures, fluctuations in foreign currency exchange rates, increases in prices of raw materials, quality and delivery performance by our vendors, our ability to effectively integrate acquisitions, negative or unforeseen tax consequences and governmental actions and initiatives including import and export restrictions and tariffs.
|Hurco Companies, Inc.|
|CONDENSED CONSOLIDATED STATEMENTS OF INCOME|
|(Dollars in thousands, except per-share data)|
|Three Months Ended|
|Sales and service fees||$||48,744||$||56,503|
|Cost of sales and service||36,158||38,805|
|Selling, general and administrative expenses||11,167||11,961|
|Other expense, net||51||226|
|Income before taxes||1,422||5,604|
|Provision for income taxes||543||1,709|
|Income per common share|
|Weighted average common shares outstanding|
|OTHER CONSOLIDATED FINANCIAL DATA||Three Months Ended|
|SG&A expense as a percentage of sales||23||%||21||%|
|Operating income as a percentage of sales||3||%||10||%|
|Pre-tax income as a percentage of sales||3||%||10||%|
|Effective tax rate||38||%||31||%|
|Depreciation and amortization||959||962|
|Balance Sheet Data:||1/31/2017||10/31/2016|
|Days sales outstanding (unaudited)||49||52|
|Inventory turns (unaudited)||1.4||1.4|
|Hurco Companies, Inc.|
|CONSOLIDATED BALANCE SHEETS|
|(In thousands, except share and per-share data)|
|January 31,||October 31,|
|Cash and cash equivalents||$||55,140||$||41,217|
|Accounts receivable, net||31,848||48,631|
|Total current assets||217,988||218,381|
|Property and equipment:|
|Machinery and equipment||24,215||23,515|
|Less accumulated depreciation and amortization||(23,495||)||(22,898||)|
|Total property and equipment||12,423||12,297|
|Software development costs, less accumulated amortization||5,119||4,926|
|Intangible assets, net||1,109||1,150|
|Deferred income taxes||6,128||6,138|
|Investments and other assets, net||6,781||6,743|
|Total non-current assets||21,416||21,271|
|LIABILITIES AND SHAREHOLDERS' EQUITY|
|Total current liabilities||56,217||57,968|
|Deferred income taxes||4,618||4,294|
|Accrued tax liability||1,153||963|
|Deferred credits and other obligations||3,291||3,249|
|Total non-current liabilities||9,062||8,506|
|Preferred stock: no par value per share; 1,000,000 shares authorized; no shares issued||-||-|
|Common stock: no par value; $.10 stated value per share; 12,500,000 shares authorized;|
|6,754,922 and 6,720,453 shares issued; and 6,602,863 and 6,573,103 shares outstanding,|
|as of January 31, 2017 and October 31, 2016, respectively||660||657|
|Additional paid-in capital||59,467||59,119|
|Accumulated other comprehensive loss||(10,608||)||(11,043||)|
|Total shareholders' equity||186,548||185,475|
|Total liabilities and shareholders' equity||$||251,827||$||251,949|
Contact: Sonja K. McClelland Vice President, Secretary, Treasurer, & Chief Financial Officer 317-293-5309
Source:Hurco Companies, Inc.