Shiloh Industries Inc. SHLO reported moderate results for first-quarter fiscal 2015 (ended Jan 31, 2015). Net income decreased 25.6% year over year to $3.7 million, while earnings came in at 21 cents per share, down from 29 cents earned in the prior-year quarter. The bottom-line results declined year over year due primarily to a significant rise in its cost of sales.
Revenues
Shiloh Industries generated net revenue of $257.1 million in first-quarter fiscal 2015, up 40.1% from the year-ago tally of $183.5 million. The remarkable improvement was primarily driven by acquisition benefits, strategic innovations and efficient organic programs.
Margins
Shiloh Industries’ cost of sales escalated 42.8% year over year, representing roughly 92.0% of net revenue versus 90.3% in first-quarter fiscal 2014. Gross margin decreased 170 basis points (bps) to 8.0%. Selling, general and administrative expenses stood at 5.3% of net revenue versus 5.7% recorded in first-quarter fiscal 2014.
Operating income was $6.3 million, down 21.6% year over year; while operating margin was recorded at 2.4% versus 4.4% in the prior-year quarter. Interest expenses soared nearly 98.9% year over year, reflecting the company’s increased financial obligations due to higher debt levels.
Balance Sheet and Cash Flow
Exiting first-quarter fiscal 2015, Shiloh Industries’ cash and cash equivalents decreased 41.3% to $7.0 million from $12.0 million in the previous quarter. Long-term debt inched up 1.3% sequentially to $271.6 million.
In first-quarter fiscal 2015, Shiloh Industries generated cash of $2.6 million from its operating activities, down from $5.9 million in the previous year. Capital expenditure stood at $10.9 million, considerably up from $3.8 million incurred in the year-ago comparable period.
Outlook
Supported by a variable range of sound and lightweighting management solutions, Shiloh Industries aims to expand the scale of its business in the upcoming quarters. Further, the company intends to drive future growth on the back of new technological innovations and superior operational excellence. Also, Shiloh Industries expects rising global demand for its products and services to aid the improvement of its top-line values in the upcoming quarters.
Other Stocks to Consider
Shiloh Industries, currently, has a market capitalization of $212.84 million. Other stocks worth considering in the industry include Kobe Steel Ltd. KBSTY, ThyssenKrupp AG TYEKF and Abengoa SA ABGB. All three stocks currently sport a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment