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Trio-Tech Fiscal 2018 First Quarter Net Income Doubles to $0.16 Per Share On 22.0% Revenue Gain Versus 2017 First Quarter

VAN NUYS, Calif.--(BUSINESS WIRE)-- Trio-Tech International (NYSE MKT: TRT) today announced financial results for the first quarter of fiscal 2018:

● Revenue increased 22.0% compared to the first quarter of fiscal 2017.

● Operating income increased 45.1% compared to the first quarter of fiscal 2017.

● Net income attributable to TRT increased 89.8% compared to the first quarter of fiscal 2017.

● Earnings per share doubled to $0.16 compared to $0.08 for the first quarter of fiscal 2017.

CEO Comments

S.W. Yong, Trio-Tech's CEO, said, "Trio-Tech's excellent first quarter financial results speak for themselves: Revenue increased sharply in each of our business segments, driving commensurate gains in operating income, net income and earnings per share versus the first quarter of last fiscal year. Our Singapore and Tianjin, China operations were especially strong, and business conditions there currently appear likely to remain favorable. This was our strongest quarterly financial performance in quite some time, a tribute to the hard work and dedication of Trio-Tech's entire team, and we are optimistic regarding the remainder of the year."

Fiscal 2018 First Quarter Results

For the first fiscal quarter ended September 30, 2017, revenue increased to $10,945,000 compared to revenue of $8,971,000 for the same quarter last year. Manufacturing revenue increased 29.8% to $4,765,000 for this year's first quarter compared to $3,671,000 for the first quarter a year ago. Semiconductor testing services revenue increased 10.8% to $4,605,000 for the first quarter of fiscal 2018, compared to $4,157,000 a year earlier. Distribution revenue increased 39.1% to $1,536,000 for this year's first quarter from $1,104,000 for the first quarter of fiscal 2017.

Gross margin for the first quarter of fiscal 2018 increased 17.0% to $2,760,000 compared to $2,358,000 in the same quarter last year. A change in product mix at both manufacturing and testing services reduced gross margin to 25.2% of revenue, compared to 26.3% of revenue for the first quarter last year.

Operating expenses for the first quarter of fiscal 2018 increased to $2,213,000, but declined to 20.2% of revenue from $1,981,000, or 22.1% of revenue, a year earlier. The decline in operating expenses, as a percent of revenue, contributed to a 45.1% increase in income from operations to $547,000 from $377,000 for the first quarter of fiscal 2017.

Net income attributable to Trio-Tech common shareholders for the first quarter of fiscal 2018 increased 89.8% to $575,000, or $0.16 per diluted share, compared to $303,000, or $0.08 per diluted share in the same quarter last year.

Shareholders' equity at September 30, 2017 was $22,554,000, or $6.38 per outstanding share, compared to $21,527,000, or $6.11 per outstanding share, at June 30, 2017. There were approximately 3,533,055 common shares outstanding at September 30, 2017.

About Trio-Tech

Established in 1958 and headquartered in Van Nuys, California, Trio-Tech International is a diversified business group with interests in semiconductor testing services, manufacturing and distribution of semiconductor testing equipment, and real estate. Further information about Trio-Tech's semiconductor products and services can be obtained from the Company's Web site at www.triotech.com, www.universalfareast.com, and www.ttsolar.com.

Forward Looking Statements

This press release contains statements that are forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and may contain forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and assumptions regarding future activities and results of operations of the Company. In light of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, the following factors, among others, could cause actual results to differ materially from those reflected in any forward looking statements made by or on behalf of the Company: market acceptance of Company products and services; changing business conditions or technologies and volatility in the semiconductor industry, which could affect demand for the Company's products and services; the impact of competition; problems with technology; product development schedules; delivery schedules; changes in military or commercial testing specifications which could affect the market for the Company's products and services; difficulties in profitably integrating acquired businesses, if any, into the Company; risks associated with conducting business internationally and especially in Asia, including currency fluctuations and devaluation, currency restrictions, local laws and restrictions and possible social, political and economic instability; changes in U.S. and global financial and equity markets, including market disruptions and significant interest rate fluctuations; and other economic, financial and regulatory factors beyond the Company's control. Other than statements of historical fact, all statements made in this Quarterly Report are forward looking, including, but not limited to, statements regarding industry prospects, future results of operations or financial position, and statements of our intent, belief and current expectations about our strategic direction, prospective and future financial results and condition. In some cases, you can identify forward looking statements by the use of terminology such as "may," "will," "expects," "plans," "anticipates," "estimates," "potential," "believes," "can impact," "continue," or the negative thereof or other comparable terminology. Forward looking statements involve risks and uncertainties that are inherently difficult to predict, which could cause actual outcomes and results to differ materially from our expectations, forecasts and assumptions.

TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
Three Months Ended
September 30,
Revenue 2017 2016
Products $ 4,765 $ 3,671
Testing services 4,605 4,157
Distribution 1,536 1,104
Other 39 39
10,945 8,971
Cost of Sales
Cost of products sold 3,649 2,795
Cost of testing services rendered 3,139 2,814
Distribution 1,368 991
Other 29 13
8,185 6,613
Gross Margin 2,760 2,358
Operating Expenses:
General and administrative 1,839 1,743
Selling 179 185
Research and development 184 53
Impairment loss of property, plant and equipment 11 --
Total operating expenses 2,213 1,981
Income from Operations 547 377
Other Income (Expenses)
Interest expense (58 ) (58 )
Other income, net 158 110
Total other income 100 52
Income from Continuing Operations before Income Taxes 647 429
Income Tax Expense (42 ) (83 )
Income from Continuing Operations before Non-controlling Interest, net of tax 605 346
Income (loss) from discontinued operations, net of tax (3 ) 1
NET INCOME 602 347
Less: Net income attributable to the non-controlling interest 27 44
Net Income attributable to Trio-Tech International $ 575 $ 303
Net Income Attributable to Trio-Tech International:
Income from continuing operations, net of tax 576 303
Loss from discontinued operations, net of tax (1 ) --
Net Income Attributable to Trio-Tech International $ 575 $ 303
Earnings per share
Basic earnings per share $ 0.16 $ 0.09
Diluted earnings per share $ 0.16 $ 0.08
Weighted Average Shares Outstanding - Basic 3,533 3,513
Weighted Average Shares Outstanding - Diluted 3,673 3,579
TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
UNAUDITED (IN THOUSANDS, EXCEPT EARNINGS PER SHARE)
Three Months Ended
September 30,
2017 2016
Comprehensive Income Attributable to Trio-Tech International:
Net income $ 602 $ 347
Foreign currency translation, net of tax 375 (283 )
Comprehensive Income 977 64
Less: Comprehensive income (loss) attributable to non-controlling interests 27 (21 )
Comprehensive Income Attributable to Trio-Tech International $ 950 $ 85
TRIO-TECH INTERNATIONAL AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT NUMBER OF SHARES)
Sep. 30, Jun. 30,
2017 2017
ASSETS (unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 3,188 $ 4,772
Short-term deposits 1,043 787
Trade accounts receivable, net 10,172 9,009
Other receivables 302 401
Inventories, net 2,482 1,756
Prepaid expenses and other current assets 336 226
Assets held for sale 87 86
Total current assets 17,610 17,037
Deferred tax assets 432 375
Investment properties, net 1,216 1,216
Property, plant and equipment, net 11,542 11,291
Other assets 2,220 1,922
Restricted term deposits 1,686 1,657
Total non-current assets 17,096 16,461
TOTAL ASSETS $ 34,706 $ 33,498
LIABILITIES AND SHAREHOLDER'S EQUITY
CURRENT LIABILITIES:
Lines of credit $ 1,581 $ 2,556
Accounts payable 3,766 3,229
Accrued expenses 3,483 3,043
Income taxes payable 255 233
Current portion of bank loans payable 343 260
Current portion of capital leases 214 228
Total current liabilities 9,642 9,549
Bank loans payable, net of current portion 1,650 1,552
Capital leases, net of current portion 491 531
Deferred tax liabilities 324 295
Other non-current liabilities 45 44
Total non-current liabilities 2,510 2,422
TOTAL LIABILITIES 12,152 11,971
EQUITY
TRIO-TECH INTERNATIONAL'S SHAREHOLDERS' EQUITY:
Common stock, no par value, 15,000,000 shares authorized; 3,533,055 and 3,523,055
shares issued and outstanding at September 30, 2017 and June 30, 2017, respectively 10,972 10,921
Paid-in capital 3,207 3,206
Accumulated retained earnings 4,916 4,341
Accumulated other comprehensive gain-translation adjustments 2,007 1,633
Total Trio-Tech International shareholders' equity 21,102 20,101
Non-controlling interest 1,452 1,426
TOTAL EQUITY 22,554 21,527
TOTAL LIABILITIES AND EQUITY $ 34,706 $ 33,498

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Company Contact:
Trio-Tech International
A. Charles Wilson
818-787-7000
Chairman
or
Investor Contact:
Berkman Associates
310-477-3118
info@BerkmanAssociates.com

Source: Trio-Tech International