Flow International Corporation
) reported its fiscal first quarter of 2014 (ended Jul 31, 2013)
financial results on Sep 9, 2013. The company reported loss per
share of 2 cents as compared to earnings per share of 5 cents
recorded in the year-ago quarter. Results also lagged the Zacks
Consensus Estimate of 1 cent earnings per share.
The above quarterly results include $1.6 million of non-recurring
expenses and $1.3 million of unrealized foreign currency exchange
Flow International reported 10.9% year-over-year decline in sales
to $59.0 million.
Standard segment revenues declined 18% year over year to $50.7
million, while Advanced segment reported sales of $8.3 million,
up 97% year over year.
In the sales category, Flow International's Standard System sales
in the first quarter declined 27% to $29.4 million; Advanced
System sales were $8.3 million, up 100%; and Consumable Parts
sales were down 4% year over year at $21.3 million.
Cost of sales in the first quarter went down 9.8% year over year
and represented 63.4% of total revenue, up from 62.6% in the
year-ago quarter. Gross margin in the quarter came in at 36.6%.
Sales and marketing, research and engineering, and general and
administrative expenses, as a percentage of total revenue, stood
Flow International reported 78% fall in its operating income that
came in at $0.9 million versus $4.2 million in the year-ago
Balance Sheet/Cash Flow
Exiting the fiscal first quarter 2014, Flow International's cash
and cash equivalents stood at $13.4 million, a decrease of 13%
The company used roughly $0.5 million of cash for operating
activities as compared with $2.1 million used in the year-ago
quarter. Capital spending increased 5.2% to $1.5 million.
For the fiscal second quarter 2014, management of Flow
International anticipates roughly 5% sequential increase in
revenues to a range of $60-$62 million. Gross margin is expected
to be toward the lower end of 38%-42% range. Operating income is
expected to be roughly within $3.15-$3.85 million range. Tax rate
is expected to be roughly 40%.
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Also, as announced previously, Flow International's initiatives
to reduce its operating costs will save $9 million annually. An
additional $4 million saving is expected from a new product line
launched recently. All these savings are expected to be realized
by the end of fiscal year 2014.
Flow International is one of the leading manufacturers of
industrial waterjet machines and currently has a $178 million
market capitalization. The stock carries a Zacks Rank #4 (Sell).
Other stocks to watch out for are
Lennox International, Inc.
), with a Zacks Rank #1 (Strong Buy) while
Adept Technology Inc.
) each carry a Zacks Rank #2 (Buy).