- Kimball Electronics (KE, Financial) reports Q3 fiscal 2025 net sales of $374.6 million, with operating income at $11.7 million.
- The company reiterates fiscal 2025 guidance, expecting sales and operating income at the high-end of their range.
- A new facility in Indianapolis will support growth in the medical industry sector.
Kimball Electronics, Inc. (KE) revealed its financial performance for the third quarter of fiscal 2025, ending March 31, 2025. The company reported net sales of $374.6 million, a decrease from $425.0 million in the same quarter the previous year. Operating income reached $11.7 million, which accounts for 3.1% of net sales, with an adjusted operating income margin of 4.2%.
Cash generated from operating activities during Q3 was $30.9 million, marking the fifth consecutive quarter of positive cash flow. Borrowings on credit facilities decreased by $26.2 million from Q2, and by $116 million, or 40%, over the fiscal year. Kimball Electronics ended the quarter with cash and cash equivalents of $51.4 million and a borrowing capacity of $253.2 million.
The company's commitment to growth is underscored by its decision to establish a new manufacturing facility in Indianapolis, focusing on expanding its medical contract manufacturing organization (CMO) strategy. This facility is aimed at driving growth within the medical industry sector.
Kimball Electronics has maintained its fiscal 2025 guidance, anticipating sales and operating income at the high end of its projected range. Estimated net sales for the fiscal year are between $1.40 billion and $1.44 billion, with adjusted operating income expected to be between 3.4% and 3.6% of net sales.
Capital expenditures for the year are projected to be on the lower side of the guided range of $40-$50 million. The fiscal year 2025 guidance adjustment reflects a shift in adjusted operating income calculations, now excluding stock compensation expense for better alignment with industry practices.
CEO Richard D. Phillips expressed his satisfaction with the company's results despite uncertainties, noting improvements in margins and continuous debt reduction efforts. He emphasized the company's liquidity and readiness to invest strategically to enhance business opportunities.
