- The shares of IEC Electronics Corp (NASDAQ: IEC) increased by over 45% during intraday trading. This is why it happened.
The shares of IEC Electronics Corp (NASDAQ: IEC) increased by over 45% during intraday trading. Investors are responding to the company’s deal with Creation Technologies. Creation Technologies will acquire all outstanding shares of IEC for $15.35 per share in cash.
IEC also reported the results for its third quarter. The company reported revenues of $49.4 million for the third quarter of fiscal 2021, an increase of 4.2% as compared to revenues of $47.4 million for the third quarter of the year ended September 30, 2020. The gross profit for the third quarter of fiscal 2021 was $5.2 million, or 10.6% of sales, compared to gross profit of $6.6 million, or 14% of sales in the third quarter of fiscal 2020.
The operating profit was $1.9 million for the third quarter of fiscal 2021, compared to operating profit of $3.0 million for the same quarter in the prior fiscal year. And the company reported net income of $1 million or $0.10 per basic share and $0.09 per diluted share for the third quarter of fiscal 2021, compared net income of $2.1 million or $0.20 per basic and diluted share in the third quarter of fiscal 2020.
For the first nine months of fiscal 2021, IEC Electronics reported revenues of $142.2 million, an increase of 4.4% compared to $136.3 million for the first nine months of fiscal 2020. The gross profit for the first nine months of fiscal 2021 was $14.3 million, or 10% of sales, compared to gross profit of $17.4 million, or 12.8% of sales in the same period in the prior fiscal year.
“We were pleased to have delivered solid revenue growth during the third quarter of fiscal 2021 of $49.4 million, despite headwinds that we, and many in our industry, are experiencing related to ongoing material shortages and labor constraints. During the fiscal quarter we continued to ramp multiple exciting new programs. As we noted last fiscal quarter, given the complexity of the programs we service, the ramping process is not linear and frequently includes process development adaptations which continue to impact profitability. However, once established, we anticipate that these programs will provide considerable long-term revenue and margin opportunity for IEC. As the economy moves beyond the pandemic, we are encouraged by the increased backlog as compared to year-end fiscal 2020 and a solid book to bill ratio of 1.76:1 in the third fiscal quarter, which included a contract extension valued at more than $45 million from a longstanding customer. We believe this recent contract extension serves as a strong endorsement of our capabilities and reliability and speaks to IEC’s position in the marketplace as we pursue new customers and contracts.”
“We believe we remain uniquely positioned to drive long-term growth for our shareholders. IEC is an established manufacturing partner with a proven record of success providing a vertically integrated portfolio of services to companies in attractive and growing sectors such as medical and aerospace and defense. Our 100% U.S.-based model positions IEC as the ideal partner for companies seeking the highest levels of intellectual property protection and supply chain management. We are pleased to have made solid progress throughout this challenging year to advance our leadership position and we are excited about the opportunities we are seeing to win new customers and programs as we move toward delivering an expected strong close to fiscal 2021.”
— Jeffrey T. Schlarbaum, President and CEO of IEC Electronics Corp.
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