Virco Manufacturing Corp. (VIRC, Financial) filed Quarterly Report for the period ended 2010-07-31.
Virco Manufacturing Corp. has a market cap of $40.9 million; its shares were traded at around $2.9 with and P/S ratio of 0.2. The dividend yield of Virco Manufacturing Corp. stocks is 3.5%.
Gross margin for the three months ended July 31, 2010 as a percentage of sales decreased to 31.7% compared to 34.5% in the prior year. The decrease in gross margin was attributable to increased raw material costs compared to the prior year period, increased price competition, a 6.5% reduction in production hours, and changes in product mix. Selling, general and administrative expense for the three months ended July 31, 2010 decreased by approximately $643,000 to $17,599,000 compared to $18,242,000 in the same period last year, and remained stable as a percentage of sales. The decrease in selling, general and administrative expense was primarily attributable to decreased variable expenses. Interest expense decreased by approximately $46,000 compared to the same period last year as a result of reduced interest rates.
For the six months ended July 31, 2010 the Company incurred a pre-tax loss of $1,516,000 on sales of $97,223,000 compared to a pre-tax profit of $2,206,000 on sales of $101,672,000 in the same period last year.
The Company has established a goal of limiting capital spending to approximately $5,000,000 for fiscal 2010, which is slightly less than anticipated depreciation expense. Capital spending for the six months ended July 31, 2010 was $1,254,000 compared to $2,110,000 for the same period last year. Capital expenditures are being financed through the Companys credit facility with Wells Fargo and operating cash flow. Approximately $24,094,000 was available for borrowing under the Companys credit facility as of July 31, 2010.
On June 5, 2008, the Company announced that its Board of Directors authorized a stock repurchase program under which the Company may acquire up to $3 million of the Companys common stock. Such repurchases may be made pursuant to open market or privately negotiated transactions. This $3 million common stock repurchase program includes any unused amounts previously authorized for repurchase by Company such that the maximum aggregate amount of common stock that the Company may repurchase is $3 million of the Companys common stock. Actual repurchases will be made after due consideration of stock price, projected cash flows and alternative uses of capital. For the six months ended July 31, 2010, the Company repurchased 100,000 shares of stock for $344,000.
The Agreement provides the Company with a secured revolving line of credit (the Revolving Credit) of up to $50,000,000, with seasonal adjustments to the credit limit and subject to borrowing base limitations. The Revolving Credit includes a letter of credit sub-facility with a sub-limit of up to $10,000,000 and is secured by a first priority security interest in substantially all of the personal and real property of the Company and its subsidiaries in favor of the Lender. The Revolving Credit is an asset-based line of credit that is subject to a borrowing base limitation and generally provides for advances of up to 80% on eligible accounts receivable and up to 20-60% of eligible inventory, with exceptions and modifications as provided in the Agreement. The Agreement is also subject to an annual clean down provision requiring a 30-day period each fiscal year during which advances and letter of credit usage may not exceed $7,500,000 in the aggregate.
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Virco Manufacturing Corp. has a market cap of $40.9 million; its shares were traded at around $2.9 with and P/S ratio of 0.2. The dividend yield of Virco Manufacturing Corp. stocks is 3.5%.
Highlight of Business Operations:
For the three months ended July 31, 2010, the Company earned a pre-tax profit of $4,978,000 on sales of $72,363,000 compared to a pre-tax profit of $7,093,000 on sales of $74,623,000 in the same period last year.Gross margin for the three months ended July 31, 2010 as a percentage of sales decreased to 31.7% compared to 34.5% in the prior year. The decrease in gross margin was attributable to increased raw material costs compared to the prior year period, increased price competition, a 6.5% reduction in production hours, and changes in product mix. Selling, general and administrative expense for the three months ended July 31, 2010 decreased by approximately $643,000 to $17,599,000 compared to $18,242,000 in the same period last year, and remained stable as a percentage of sales. The decrease in selling, general and administrative expense was primarily attributable to decreased variable expenses. Interest expense decreased by approximately $46,000 compared to the same period last year as a result of reduced interest rates.
For the six months ended July 31, 2010 the Company incurred a pre-tax loss of $1,516,000 on sales of $97,223,000 compared to a pre-tax profit of $2,206,000 on sales of $101,672,000 in the same period last year.
The Company has established a goal of limiting capital spending to approximately $5,000,000 for fiscal 2010, which is slightly less than anticipated depreciation expense. Capital spending for the six months ended July 31, 2010 was $1,254,000 compared to $2,110,000 for the same period last year. Capital expenditures are being financed through the Companys credit facility with Wells Fargo and operating cash flow. Approximately $24,094,000 was available for borrowing under the Companys credit facility as of July 31, 2010.
On June 5, 2008, the Company announced that its Board of Directors authorized a stock repurchase program under which the Company may acquire up to $3 million of the Companys common stock. Such repurchases may be made pursuant to open market or privately negotiated transactions. This $3 million common stock repurchase program includes any unused amounts previously authorized for repurchase by Company such that the maximum aggregate amount of common stock that the Company may repurchase is $3 million of the Companys common stock. Actual repurchases will be made after due consideration of stock price, projected cash flows and alternative uses of capital. For the six months ended July 31, 2010, the Company repurchased 100,000 shares of stock for $344,000.
The Agreement provides the Company with a secured revolving line of credit (the Revolving Credit) of up to $50,000,000, with seasonal adjustments to the credit limit and subject to borrowing base limitations. The Revolving Credit includes a letter of credit sub-facility with a sub-limit of up to $10,000,000 and is secured by a first priority security interest in substantially all of the personal and real property of the Company and its subsidiaries in favor of the Lender. The Revolving Credit is an asset-based line of credit that is subject to a borrowing base limitation and generally provides for advances of up to 80% on eligible accounts receivable and up to 20-60% of eligible inventory, with exceptions and modifications as provided in the Agreement. The Agreement is also subject to an annual clean down provision requiring a 30-day period each fiscal year during which advances and letter of credit usage may not exceed $7,500,000 in the aggregate.
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