Earnings Review and Free Research Report: Knowles Reported Better Than Expected Results
Research Desk Line-up: Pointer Telocation Post Earnings Coverage
LONDON, UK / ACCESSWIRE / November 22, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Knowles Corp. (NYSE: KN), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=KN, following the Company's announcement of its financial results on October 25, 2017, for the third quarter fiscal 2017. The Company's Precision Device segment's revenue increased 8.5% on a y-o-y basis. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on KN; also brushing on PNTR. With the links below you can directly download the report of your stock of interest free of charge at:
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Earnings Reviewed
For three months ended September 30, 2017, Knowles' revenues decreased 8.8% to $221.7 million from $243.1 million in Q3 FY16. Revenue surpassed analysts' expectations of $221.2 million.
During Q3 FY17, Knowles' gross profit decreased 13.1% to $82.5 million from $94.9 million in the same period last year. For the reported quarter, the Company's gross margin decreased 180 basis points to 37.2% of revenue from 39.0% of revenue in Q3 FY16. For the reported quarter, the Company's adjusted gross margin decreased 110 basis points to 38.3% of revenue from 39.4% of revenue in Q3 FY16.
For the reported quarter, Knowles' research and development (R&D) expenses increased 2.6% to $23.9 million from $23.3 million in Q3 FY16. During Q3 FY17, the Company's selling and administrative expenses decreased 14.4% to $36.8 million from $43.0 million in the same period last year.
During Q3 FY17, Knowles' operating income decreased 21.1% to $20.9 million from $26.5 million in the same period last year. For the reported quarter, the Company's adjusted operating income decreased 20.6% to $31.7 million from $39.9 million in the third quarter of 2016. During Q3 FY17, the Company's adjusted operating margin decreased 210 basis points to 14.3% of revenue from 16.4% of revenue in the same period last year.
For the reported quarter, Knowles' net income decreased 26.3% to $15.4 million from $20.9 million in Q3 FY16. During Q3 FY17, the Company's diluted EPS decreased 29.2% to $0.17 from $0.24 in the same period last year. For the reported quarter, Knowles' adjusted net income decreased 23.8% to $26.0 million from $34.1 million in Q3 FY16. During Q3 FY17, the Company's adjusted diluted EPS decreased 24.3% to $0.28 from $0.37 in the same period last year. Adjusted diluted EPS surpassed analysts' expectations of $0.26.
Knowles' Segment Details
Audio - During Q3 FY17, Audio segment's revenue decreased 13.2% to $167.8 million from $193.4 million in the same period last year. The decrease was due to lower MEM's microphone sales resulting from a later than normal launch of new handsets at the Company's largest customer and a decrease in shipments to Chinese handset OEM's. For the reported quarter, the segment's adjusted gross margin decreased 170 basis points to 39.3% of revenue from 41% of revenue in the third quarter of 2016. For the reported quarter, the Company's operating income decreased 23.5% to $27.7 million from $36.2 million in Q3 FY16.
Precision Device - During Q3 FY17, Precision Device segment's revenue increased 8.5% to $53.9 million from $49.7 million in the same period last year. The increase was due to increased capacitor shipments to the defense, medical, and automotive markets. For the reported quarter, the segment's adjusted gross margin increased 80 basis points to 35.8% of revenue from 35% of revenue in the third quarter of 2016. For the reported quarter, the Company's operating income increased 20.8% to $6.4 million from $5.3 million in Q3 FY16.
Balance Sheet
As on September 30, 2017, Knowles' cash and cash equivalents decreased 12.8% to $57.7 million from $66.2 million on December 31, 2016. For the reported quarter, the Company's long-term debt increased 3.3% to $297.9 million from $288.5 million in Q4 FY16.
For the reported quarter, the Company's net accounts receivable increased 5% to $152.4 million from $145.1 million in the fourth quarter of 2016. For the reported quarter, the Company's accounts payable increased 4.9% to $75.3 million from $71.8 million in Q4 FY16.
Outlook
For Q4 FY17, Knowles expects revenue to be in the range of $225 million-$260 million and gross margin to be in the range of 37% of revenue-39% of revenue. The Company estimates diluted EPS to be in the range of $0.15-$0.21 and adjusted diluted EPS to be in the range of $0.33-$0.39 for the fourth quarter of 2017.
Stock Performance
On Tuesday, November 21, 2017, the stock closed the trading session at $16.71, climbing 3.72% from its previous closing price of $16.11. A total volume of 765.03 thousand shares have exchanged hands. Knowles' stock price surged 8.16% in the last one month, 16.04% in the past three months and 2.26% in the previous twelve months. The stock currently has a market cap of $1.50 billion.
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