Hurco(HURC) - 2026 Q1 - Quarterly Results

Financial Performance - Hurco reported a net loss of $3,468,000, or $0.54 loss per diluted share, for Q1 FY 2026, an improvement from a net loss of $4,320,000, or $0.67 loss per diluted share, in Q1 FY 2025[1]. - Sales and service fees for Q1 FY 2026 were $42,868,000, a decrease of $3,546,000, or 8%, compared to $46,414,000 in Q1 FY 2025, with a favorable currency impact of $1,813,000, or 4%[2]. - Gross profit for Q1 FY 2026 was $7,938,000, or 19% of sales, compared to $8,290,000, or 18% of sales in the prior year, reflecting improved cost management[9]. - Selling, general, and administrative expenses rose to $11,108,000, or 26% of sales, compared to $10,382,000, or 22% of sales in the prior year, driven by increased employee benefits costs[10]. Orders and Sales Dynamics - Orders for Q1 FY 2026 increased to $41,980,000, up $1,895,000, or 5%, compared to $40,085,000 in Q1 FY 2025, with a favorable currency impact of $1,506,000, or 4%[6]. - Sales in the Americas decreased by 8% to $16,656,000, while orders increased by 18% to $17,301,000, indicating a shift in demand dynamics[3][6]. - European sales decreased by 5% to $20,547,000, with orders down 2% to $18,966,000, impacted by lower demand in key markets like Germany and the UK[4][7]. - Asian Pacific sales fell by 15% to $5,665,000, with orders decreasing by 6% to $5,713,000, primarily due to reduced shipments in China[5][8]. Balance Sheet and Assets - Cash and cash equivalents totaled $48,011,000 at January 31, 2026, a slight decrease from $48,713,000 at October 31, 2025, with working capital at $169,506,000[12]. - Total assets decreased to $261.535 million as of January 31, 2026, from $264.298 million on October 31, 2025, representing a decline of approximately 1%[19]. - Current liabilities increased to $53.218 million, up from $52.023 million, reflecting an increase of about 2.3%[19]. - Shareholders' equity decreased to $195.031 million from $198.787 million, a decline of approximately 1.4%[19]. - Accounts receivable decreased to $25.832 million from $27.928 million, a decline of approximately 7.5%[19]. - Inventories decreased to $141.735 million from $142.931 million, a reduction of about 0.8%[19]. - Retained earnings decreased to $142.837 million from $146.305 million, a decline of approximately 2.5%[19]. - Total non-current assets slightly decreased to $31.168 million from $31.246 million, a reduction of about 0.25%[19]. - Operating lease liabilities decreased to $11.181 million from $11.560 million, a decline of approximately 3.3%[19]. - Derivative assets decreased to $82 million from $263 million, a significant decline of approximately 68.8%[19]. Taxation - The effective tax rate for Q1 FY 2026 was -15%, compared to -90% in the prior year, reflecting changes in the geographic mix of income and loss[17].