Kimball Electronics Inc (KE, Financial) released its earnings report for the first quarter of fiscal 2024 on November 6, 2023. The company reported a strong start to the fiscal year with an 8% increase in net sales, totaling $438.1 million. This was an improvement compared to the first quarter of fiscal 2023, where net sales totaled $405.9 million. The company's operating income also improved to $19.5 million, or 4.4% of net sales, compared to $13.6 million, or 3.3% of net sales, in the same period last year.
Financial Performance and Challenges
Kimball Electronics Inc (KE, Financial) reported a net income of $10.8 million, or $0.43 per diluted share, an improvement compared to $9.5 million, or $0.38 per diluted share, in the first quarter of fiscal 2023. Despite the positive results, the company acknowledged the impact of recent short-term market disruptions, including the UAW strike, global economic conditions, and geopolitical events, and updated its guidance for the full year of fiscal 2024 to reflect softening demand in the end market verticals it serves.
Financial Achievements and Outlook
Kimball Electronics Inc (KE, Financial) ended the first quarter of fiscal 2024 with cash and cash equivalents of $56.6 million and borrowings outstanding on credit facilities of $296.7 million, including $235.0 million classified as long term, and $90.5 million of borrowing capacity available. Cash flow generated from operating activities in the first quarter of fiscal 2024 was $12.8 million, and capital expenditures were $11.3 million.
However, the company revised its sales forecast for fiscal year 2024, now expecting it to be flat with the prior year, compared to the previous estimate of a 4% to 7% increase. Operating income is also estimated to be in line with fiscal 2023, compared to the previous guidance range of 4.7% to 5.2% of net sales.
Key Financial Tables
Net Sales by Vertical Market for Q1 Fiscal 2024 showed a 13% increase in the Automotive sector, a 12% decrease in the Medical sector, and a 21% increase in the Industrial sector. This resulted in a total net sales increase of 8% compared to the same period in the previous year.
The Condensed Consolidated Statements of Income showed a net sales increase of 8% and a gross profit increase of 0.9% compared to the same period in the previous year. The operating income also increased by 1.1%, while the net income increased by 0.2%.
Explore the complete 8-K earnings release (here) from Kimball Electronics Inc for further details.
