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TESSCO Technologies Inc. (TESS) filed Quarterly Report for the period ended 2011-11-02.
Tessco Technologies Inc. has a market cap of $106.3 million; its shares were traded at around $13.71 with a P/E ratio of 8.6 and P/S ratio of 0.2. The dividend yield of Tessco Technologies Inc. stocks is 4.4%. Tessco Technologies Inc. had an annual average earning growth of 15.8% over the past 10 years. GuruFocus rated Tessco Technologies Inc. the business predictability rank of 2-star.
This is the annual revenues and earnings per share of TESS over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of TESS.
Highlight of Business Operations:
Excluding sales to our Tier 1 carriers, our second quarter revenues increased by 0.7%. However, due to a 30.0% decline in sales to our Tier 1 carriers (including AT&T), our second quarter revenues decreased by 9.8% compared to the second quarter of fiscal year 2011. In the second quarter of fiscal year 2012, AT&T, our largest customer, accounted for 24% of total revenues, compared to 33% of total revenues in the second quarter of fiscal year 2011. No other customer accounted for more than 3% of total consolidated revenues during the second quarter of fiscal year 2012. Excluding our Tier 1 carriers, gross profit increased 3.8% in our second quarter of fiscal 2012 as compared to the second quarter of fiscal year 2011. However, gross profit from our Tier 1 carriers declined 39% in the same period, resulting in an overall decrease of 7.6% compared to the second quarter of the prior fiscal year. Selling, general and administrative expenses decreased by 9.8% over the prior year quarter, primarily related to decreases in compensation and benefits, and freight out expenses, partially offset by an increase in our pay for performance bonus expense as a result of strong second quarter fiscal year 2012 results. Consequently, net income increased by 5.8% and diluted earnings per share grew by 2.3% over the prior-year quarter.Commercial Segment. Revenues in our commercial segment totaled $82.6 million in the second quarter of fiscal year 2012, which were flat compared to the prior year period. Gross profit totaled $22.0 million, a 5.8% increase as compared to the second quarter last year. Within this segment, the private system operator and government market grew revenues by 17.3% and gross profits by 26.7%. We continue to see strong opportunities for our proprietary and customized solutions in this market as these customers continue to build and enhance their own private wireless applications. The commercial dealer and reseller market showed a minor 1.3% decline in revenues, but an 8.2% increase in gross profit. The gross profit increase was due in part to an increase in sales of our proprietary products in this market. The public carrier, contractor and program manager market had a revenue decline of 17.2% and a gross profit decline of 23.3% as carriers continued to delay significant network builds.
Retail Segment. Revenues in our retail segment totaled $66.2 million in the second quarter of fiscal year 2012, representing a 19.7% decline from the prior year period. Gross profit totaled $12.0 million, a 25.1% decline. These declines are primarily due to lower sales to our Tier 1 carrier market (primarily AT&T), which showed a 30.0% revenue decline and a 38.7% gross profit decline. The revenue decline was largely due to fewer significant handset launches by our significant Tier 1 carrier customers in this quarter compared to last year s quarter. The gross profit decline was due to lower volumes and the continued pricing pressures in this market. Revenues in our retailer, dealer agent and Tier 2/3 carrier market were up 2.6%, but with a 3.0% decline in gross profit as we have incurred higher royalty expenses associated with selling cellular accessories in carrier packaging in this market due to product and customer mix changes as well as increased competition and changes in product mix.
Commercial Segment. Revenues in our commercial segment totaled $160.9 million in the first six months of fiscal year 2012, up 2.9% to the prior year period. Gross profit totaled $43.9 million, a 9.3% increase as compared to the prior year period. Within this segment, the private system operator and government market grew revenues by 23.4% and gross profits by 32.1%. We continue to see strong opportunities for our proprietary and customized solutions in this market as these customers continue to build and enhance their own private wireless applications. The commercial dealer and reseller market showed a 0.7% increase in revenues, and a 7.9% increase in gross profit. The gross profit increase was due in part to an increase in sales of our proprietary products in this market. The public carrier, contractor and program manager market had a revenue decline of 16.9% and a gross profit decline of 18.2% as carriers continued to delay significant network builds.
Retail Segment. Revenues in our retail segment totaled $151.4 million in the first six months of fiscal year 2012, a 0.6% increase over the prior year period. Gross profit totaled $27.2 million, a 5.7% decline as compared to the prior year period. Revenues in our retailer, dealer agent and Tier 2/3 carrier market were up 8.7% with a 6.8% increase in gross profit. Sales to our Tier 1 carrier market (primarily AT&T), showed a 3.6% revenue decline and a 13.7% gross profit decline. The gross profit decline was due to continued pricing pressures in this market.
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