Daktronics Registers 14% Sales Growth In Q2; Margins Shrink Due To Inflation, Supply Chain Headwinds

Anusuya Lahiri
1 min read
0
In this article:

  • Daktronics, Inc (NASDAQ: DAKT) reported second-quarter FY23 net sales growth of 14% year-over-year to $187.4 million, beating the consensus of $184.2 million.

  • Orders for the quarter increased by 11.7% Y/Y.

  • Gross margin contracted 270 bps to 16.9% was caused by inflation in materials, freight, and personnel-related costs and supply chain disruptions.

  • Operating margin decreased by 190 bps to 0.8%.

  • Daktronics recognized a $14.0 million tax expense for Q2 due to a $13.0 million valuation allowance against its net deferred tax assets and the reversal of tax benefits recognized in Q1 due to its going concern assessment.

  • EPS loss was $(0.29) versus $0.05 profit a year earlier.

  • The product order backlog was $463.1 million. DAKT held $7.7 million in cash and equivalents.

  • Chair and CEO Reece Kurtenbach stated, "We achieved sales increases even though our capacity was constrained due to significant and unusual part shortages, a challenging labor environment, operating disruptions from COVID-19 related absences, and the first quarter COVID-19 mandated shutdown of our Shanghai production facilities."

  • The company also revealed that several conditions raise substantial doubt about its ability to continue as a going concern.

  • Price Action: DAKT shares closed higher by 13.1% at $1.98 on Friday.

See more from Benzinga

Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better.

© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Advertisement

Recommended Stories