The L.S. Starrett Company (SCX, Financial) filed Quarterly Report for the period ended 2010-05-06.
The L.s. Starrett Company has a market cap of $81.6 million; its shares were traded at around $12.23 with a P/E ratio of 12.3 and P/S ratio of 0.4. The dividend yield of The L.s. Starrett Company stocks is 2%.SCX is in the portfolios of Arnold Van Den Berg of Century Management, Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC.
Net sales in North America increased $5.0 million or 23% from $21.3 million to $26.3 million led by strong gains across most product lines in the industrial markets due to improvements in the economy. International sales increased $0.9 million or 4% from $21.5 million to $22.4 million; however, a weaker dollar represented a $4.0 million sales exchange gain. In constant dollars, International sales declined $3.7 million or 16% as the worldwide recession adversely impacted operation in Europe, Latin America and China.
Gross margin increased $4.4 million from $11.1 million (26.0% of sales) to $15.5 million (31.9% of sales) with a North American improvement of $5.5 million partially offset by a $1.1 million International decline. Reduced manufacturing overhead spending coupled with the LIFO benefit of $4.8 million due to reduced inventory levels were the key factors influencing a North American margin improvement from 14% in fiscal 2009 to 32% in fiscal 2010. International margin declined due to lower revenue volume and higher costs in local currency of $2.4 million, which was partially offset by a favorable currency gain of $1.3 million as overall margins declined from 40% to 32%.
Selling and general expenses increased $1.4 million or 11% from $13.2 million to $14.6 million as International expenses rose $1.4 million to $7.2 million while North American expense remained flat at $7.4 million. International expenses were flat in local currency but increased in consolidated dollars due to the weakening U. S. currency, particularly related to the Brazilian Real.
Net sales declined $25.0 million or 15% from $164.8 million to $139.8 million. Operating income improved $1.0 million as an erosion of gross margin of $7.2 million was offset by a reduction in selling and general expenses of $2.8 million and the absence of a goodwill impairment charge in fiscal 2010 compared to a $5.2 goodwill impairment charge in fiscal 2009. Other income was $1.7 million unfavorable principally due to a comparative $1.6 million negative impact from foreign exchange rates. The net loss increased $2.3 million from a loss of $1.0 million ($0.15 per share) to a loss of $3.3 million ($0.49 per share).
Selling and general expenses declined $2.9 million, but increased as a percentage of revenue from 28% in fiscal 2009 to 31 % in fiscal 2010. North American expenses were lowered $1.0 million or 4% while International expenses declined $1.9 million or 9%. North American savings were salaries and travel of $0.6 million and $0.2 million, respectively coupled with reduced catalog and advertising expenses of $0.2 million International savings were the result of salaries ($0.1) million, bonus and commissions of ($1.6) million and travel of ($0.1) million.
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The L.s. Starrett Company has a market cap of $81.6 million; its shares were traded at around $12.23 with a P/E ratio of 12.3 and P/S ratio of 0.4. The dividend yield of The L.s. Starrett Company stocks is 2%.SCX is in the portfolios of Arnold Van Den Berg of Century Management, Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Net sales increased $5.9 million or 14% from $42.8 million to $48.7 million. Operating income improved $8.2 million as a $4.4 million gain in gross margin more than offset a $1.4 million increase in selling and general expenses as well as the absence of a goodwill impairment charge in fiscal 2010 compared to a $5.2 goodwill impairment charge in fiscal 2009. Net income improved $4.9 million from a loss of $4.7 million ($0.72 per share) in fiscal 2009 to a profit of $0.2 million ($0.03 per share) in fiscal 2010. Excluding the goodwill impairment recorded in Tru-Stone, the third quarter fiscal 2009 loss would have been $1.4 million or $0.22 per share.Net sales in North America increased $5.0 million or 23% from $21.3 million to $26.3 million led by strong gains across most product lines in the industrial markets due to improvements in the economy. International sales increased $0.9 million or 4% from $21.5 million to $22.4 million; however, a weaker dollar represented a $4.0 million sales exchange gain. In constant dollars, International sales declined $3.7 million or 16% as the worldwide recession adversely impacted operation in Europe, Latin America and China.
Gross margin increased $4.4 million from $11.1 million (26.0% of sales) to $15.5 million (31.9% of sales) with a North American improvement of $5.5 million partially offset by a $1.1 million International decline. Reduced manufacturing overhead spending coupled with the LIFO benefit of $4.8 million due to reduced inventory levels were the key factors influencing a North American margin improvement from 14% in fiscal 2009 to 32% in fiscal 2010. International margin declined due to lower revenue volume and higher costs in local currency of $2.4 million, which was partially offset by a favorable currency gain of $1.3 million as overall margins declined from 40% to 32%.
Selling and general expenses increased $1.4 million or 11% from $13.2 million to $14.6 million as International expenses rose $1.4 million to $7.2 million while North American expense remained flat at $7.4 million. International expenses were flat in local currency but increased in consolidated dollars due to the weakening U. S. currency, particularly related to the Brazilian Real.
Net sales declined $25.0 million or 15% from $164.8 million to $139.8 million. Operating income improved $1.0 million as an erosion of gross margin of $7.2 million was offset by a reduction in selling and general expenses of $2.8 million and the absence of a goodwill impairment charge in fiscal 2010 compared to a $5.2 goodwill impairment charge in fiscal 2009. Other income was $1.7 million unfavorable principally due to a comparative $1.6 million negative impact from foreign exchange rates. The net loss increased $2.3 million from a loss of $1.0 million ($0.15 per share) to a loss of $3.3 million ($0.49 per share).
Selling and general expenses declined $2.9 million, but increased as a percentage of revenue from 28% in fiscal 2009 to 31 % in fiscal 2010. North American expenses were lowered $1.0 million or 4% while International expenses declined $1.9 million or 9%. North American savings were salaries and travel of $0.6 million and $0.2 million, respectively coupled with reduced catalog and advertising expenses of $0.2 million International savings were the result of salaries ($0.1) million, bonus and commissions of ($1.6) million and travel of ($0.1) million.
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