Methode Electronics(MEI) - 2025 Q2 - Quarterly Results

Financial Performance - Net sales for the second quarter of fiscal 2025 were $292.6 million, an increase from $288.0 million in the same quarter of fiscal 2024, driven by higher volume for power distribution products[5]. - Pre-tax income was $1.6 million, with adjusted pre-tax income at $6.2 million, compared to a loss of $51.3 million in the same quarter of fiscal 2024[3][6]. - The net loss was $1.6 million, or $0.05 per diluted share, significantly improved from a net loss of $55.3 million, or $1.55 per diluted share, in the same quarter of fiscal 2024[7]. - Adjusted net income was $5.2 million, or $0.14 per diluted share, up from $2.4 million, or $0.06 per diluted share, in the same quarter of fiscal 2024[7]. - EBITDA for the quarter was $22.1 million, compared to a negative $36.7 million in the same quarter of fiscal 2024, with adjusted EBITDA at $26.7 million[8]. - Gross profit for the quarter was $57.9 million, compared to $52.3 million in the same quarter last year, reflecting a gross margin improvement[29]. - The company reported a net loss of $1.6 million for the quarter, a significant improvement from a net loss of $55.3 million in the prior year[29]. - Free cash flow for the three months ended November 2, 2024, was $(58.4) million, compared to $(11.3) million for the same period last year[35]. - The company reported a diluted loss per share of $(1.55) for the three months ended November 2, 2024[40]. - Pre-tax loss income for the three months ended November 2, 2024, was $(55.5) million[40]. Segment Performance - The Automotive segment reported net sales of $145.5 million, down 5.7% from $154.3 million, primarily due to lower volume in Asia[11]. - The Industrial segment's net sales increased by 9.1% to $131.4 million, driven by higher demand for power distribution products for data centers[12]. - The Interface segment's net sales rose to $15.7 million, up from $11.7 million, attributed to higher volume of transceivers and touch panels[13]. Guidance and Future Plans - The company raised its adjusted pre-tax income guidance for fiscal 2025 to approximately breakeven, while reaffirming net sales expectations similar to fiscal 2024[14]. - The company plans to continue focusing on cost reduction initiatives to improve profitability moving forward[34]. - The company plans to focus on market expansion and new product development in the upcoming quarters[39]. Balance Sheet and Cash Flow - Cash and cash equivalents decreased to $97.0 million as of November 2, 2024, down from $161.5 million at the end of the previous reporting period[31]. - Total assets decreased to $1,375.1 million from $1,403.5 million, indicating a reduction in overall asset base[31]. - Total liabilities remained relatively stable at $636.8 million compared to $637.5 million in the previous period[31]. - The company incurred $42.6 million in selling and administrative expenses for the quarter, up from $40.9 million in the same quarter last year[29]. - The company’s long-term debt increased to $340.4 million from $330.7 million, indicating a rise in financial leverage[31]. - Net debt as of November 2, 2024, was $243.6 million, up from $169.4 million at the end of the previous year[37]. - Total debt increased to $340.6 million, while cash and cash equivalents decreased to $(97.0) million[37]. - The company incurred transformation costs of $4.8 million for the three months ended November 2, 2024[36]. - Goodwill impairment charges were $56.5 million for the three months ended October 28, 2023[36].