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Methode Electronics, Inc. Reports Fiscal 2025 Third Quarter Financial Results
MEIMethode Electronics(MEI) GlobeNewswire·2025-03-05 21:05

Core Insights - Methode Electronics reported a net sales of 239.9millionforQ3fiscal2025,adecreasefrom239.9 million for Q3 fiscal 2025, a decrease from 259.5 million in the same quarter of fiscal 2024, primarily due to lower automotive segment volumes [4][6] - The company experienced a net loss of 14.4millionor14.4 million or 0.41 per diluted share, compared to a net loss of 11.6millionor11.6 million or 0.33 per diluted share in the same quarter of the previous year [6][7] - Despite challenges in the automotive market, Methode reaffirmed its guidance for profitable organic sales growth in fiscal 2026 based on customer forecasts [3][11] Financial Performance - Net sales decreased by 19.6millionyear−over−year,withanotabledropintheAutomotivesegment,whichwaspartiallyoffsetbyhighersalesintheIndustrialsegmentdrivenbypowerproductsfordatacenters[4][6]−Grossprofitincreasedto19.6 million year-over-year, with a notable drop in the Automotive segment, which was partially offset by higher sales in the Industrial segment driven by power products for data centers [4][6] - Gross profit increased to 41.3 million from 37.0millionintheprioryear,attributedtoimprovedoperationalexecutionandproductsalesmix[5][25]−Theadjustedlossfromoperationsimprovedto37.0 million in the prior year, attributed to improved operational execution and product sales mix [5][25] - The adjusted loss from operations improved to 1.3 million from 2.9millioninthesamequarteroffiscal2024,excludingtransformationcosts[5][7]CashFlowandDebt−Thecompanygeneratedpositivefreecashflowof2.9 million in the same quarter of fiscal 2024, excluding transformation costs [5][7] Cash Flow and Debt - The company generated positive free cash flow of 19.6 million, an increase from 12.2millioninthesamequarteroffiscal2024,duetoproactivemanagementofaccountsreceivableandinventorylevels[10][36]−Totaldebtattheendofthequarterwas12.2 million in the same quarter of fiscal 2024, due to proactive management of accounts receivable and inventory levels [10][36] - Total debt at the end of the quarter was 327.9 million, down from 330.9millionattheendoffiscal2024,withnetdebtincreasingto330.9 million at the end of fiscal 2024, with net debt increasing to 224.1 million from 169.4million[9][36]SegmentPerformance−TheAutomotivesegmentreportednetsalesof169.4 million [9][36] Segment Performance - The Automotive segment reported net sales of 115.7 million, down 17.2% from 139.7million,primarilyduetolowervolumesrelatedtoEVlightingprogramroll−offs[13]−TheIndustrialsegmentsawanincreaseinnetsalesto139.7 million, primarily due to lower volumes related to EV lighting program roll-offs [13] - The Industrial segment saw an increase in net sales to 111.9 million, up 4.5% driven by demand for power distribution products for data centers [13] - The Interface segment's net sales slightly decreased to $12.3 million, with an increase in income from operations attributed to product sales mix [13] Management Strategy - The company is in the process of launching 53 new programs over two years, with 20 already launched this fiscal year and 33 more expected in the next five quarters [3][11] - Management emphasized a focus on cost control and operational metrics, alongside rebuilding the executive team with experienced leaders [3][11]