Daktronics has been on a roll and that trend continues with the reporting of their second quarter results. Here are select information from both their earnings press release and their investor call held yesterday.
Q2 FY2024 financial highlights:
- Sales of $199.4 million, a 6.4 percent increase from the second quarter of fiscal 2023
- Gross profit as a percentage of net sales of 27.2 percent as compared to 16.9 percent in the second quarter of fiscal 2023
- Operating income of $19.4 million as compared to $1.5 million in the second quarter of fiscal 2023
- Product order backlog was $306.9 million(1) at October 28, 2023 compared to $400.7 million at the end of the fourth quarter of fiscal 2023 and $463.1 million in the year-earlier period.
Reese Kurtenbach, CEO, commented on the investor call. “Today we have had a record start to fiscal year 2024 in both sales and operating income and had robust operating cash generation for the quarter. All of this is the result of strong execution … across all our business areas. We continue to benefit from our past decisive and deliberate actions to improve our customers experience while increasing our profitability and working capital levels. Our performance is also a testimony to the resiliency and strength of our teams within Daktronics as well as our strategy of diversified markets and innovation across technology platforms.”
Sheila Anderson commented during the call, “demand outlook remains strong in live events high school park and recreation and transportation as we see customers continue to invest in digital displays to end inform entertain and persuade their audiences. International orders have been increasing this year as global economies recover from the pandemic despite war related events for fiscal 2024. We reported sales of $199.4 million for the second quarter of fiscal 2024 this was an increase of 6.4%. Sales growth was driven by fulfilling orders and backlog. Gross profit as a percentage of net sales increased to 27.2% for the second quarter of fiscal 2024 as compared to 16.9% in the second quarter of fiscal 2023. The over 10 point increase in gross profit percentage is attributable to the increased sales volume over our relatively fixed cost structure strategic pricing actions and a stable supply chain causing fewer operational disruptions during the second quarter of fiscal 2024 as compared to a year earlier.”
Kurtenbach added, “As we look ahead, we expect growth in the global use of sophisticated audio-visual communication systems in both traditional and in new applications. Our attention remains focused on our multi-year journey to capture the market’s expected growth and broaden our leading market position by offering best in class technology, capabilities and services to both our traditional customer base as well as new and adjacent markets.”
“While in FY24 our orders were down because of market conditions, we expect growth over the long term. .. Customers depending on out of home advertising .. use our products and services as an effective medium for both indoor and outdoor applications we expect existing and new customers to purchase displays to install the new locations as well as replacement displays for existing locations to capitalize on the effectiveness of digital technologies.”
Here is a look at their P&L:
You can view the 10-Q for the quarter at this LINK. And the earnings call at this LINK.
Investors were a little disappointed by the quarter as the numbers fell short of Wall Street’s consensus estimates; most analysts were anticipating earnings of $0.13 per share on revenue closer to $213 million. Shares of Daktronics were down from $9.03 to $8.80 for the day, off 2.6%.
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