Company Adds New Facility to Support Strategy to Drive Growth in the Medical CMO
Third Quarter Fiscal 2025 Highlights
- Net sales totaled $374.6 million
- Operating income of $11.7 million, or 3.1% of net sales, adjusted operating income of 4.2%
- Inventory of $296.6 million, a reduction of $9.6 million from Q2
- Cash generated by operating activities of $30.9 million, the fifth consecutive quarter of positive cash flow
- Borrowings on credit facilities of $178.8 million, a $26.2 million decrease from the second quarter, and down $116 million, or 40%, in the fiscal year
JASPER, Ind.–(BUSINESS WIRE)– Kimball Electronics, Inc. (Nasdaq: KE) today announced financial results for the third quarter ended March 31, 2025.
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Three Months Ended |
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Nine Months Ended |
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March 31, |
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March 31, |
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(Amounts in Thousands, except EPS) |
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2025 |
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2024 |
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2025 |
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2024 |
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Net Sales |
$ |
374,607 |
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$ |
425,036 |
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$ |
1,106,255 |
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$ |
1,284,352 |
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Operating Income |
$ |
11,716 |
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$ |
(6,431 |
) |
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$ |
29,061 |
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$ |
29,669 |
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Adjusted Operating Income (non-GAAP) (1) |
$ |
15,706 |
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$ |
18,733 |
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$ |
41,629 |
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$ |
58,802 |
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Operating Income % |
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3.1 |
% |
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(1.5 |
)% |
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2.6 |
% |
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2.3 |
% |
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Adjusted Operating Income (non-GAAP) % |
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4.2 |
% |
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4.4 |
% |
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3.8 |
% |
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4.6 |
% |
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Net Income |
$ |
3,817 |
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$ |
(6,076 |
) |
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$ |
10,403 |
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$ |
12,968 |
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Adjusted Net Income (non-GAAP)(1) |
$ |
6,837 |
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$ |
9,786 |
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$ |
19,718 |
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$ |
31,607 |
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Diluted EPS |
$ |
0.15 |
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$ |
(0.24 |
) |
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$ |
0.41 |
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$ |
0.51 |
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Adjusted Diluted EPS (non-GAAP)(1) |
$ |
0.27 |
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$ |
0.39 |
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$ |
0.79 |
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$ |
1.25 |
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(1) |
Beginning in the first quarter of fiscal year 2025, adjusted results exclude stock compensation expense. Prior reported periods have been revised accordingly. A reconciliation of GAAP and non-GAAP financial measures is included below. |
Commenting on today’s announcement, Richard D. Phillips, Chief Executive Officer, stated, “I’m proud of the results for the third quarter and our team’s ability to navigate an environment of uncertainty, while focusing on what is controllable. Sales in Q3 were in line with expectations, margins improved sequentially, cash generated from operating activities was positive for the fifth consecutive quarter, and the paydown of debt continued with borrowings now 45% lower than peak levels. We have ample liquidity to weather short-term unpredictability and significant dry powder to opportunistically invest in the business.”
Mr. Phillips continued, “As part of today’s release, we are reiterating our guidance for fiscal 2025 with an expectation of sales and operating income at the high-end of the range, as well as, announcing the addition of a new manufacturing facility in Indianapolis focused on the medical industry. This is another step of repositioning the Company for a return to growth and expanding our medical CMO strategy.”
The Company ended the third quarter of fiscal 2025 with cash and cash equivalents of $51.4 million and borrowing capacity available of $253.2 million. Capital expenditures were $4.0 million, and the company invested $3.0 million to repurchase 175,000 shares of common stock.
Net Sales by Vertical Market for Q3 Fiscal 2025:
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Three Months Ended |
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Nine Months Ended |
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March 31, |
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March 31, |
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(Amounts in Millions) |
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2025 |
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* |
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2024 |
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* |
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Percent Change |
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2025 |
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* |
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2024 |
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* |
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Percent Change |
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Automotive |
$ |
173.1 |
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46 |
% |
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$ |
202.0 |
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47 |
% |
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(14 |
)% |
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$ |
554.3 |
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50 |
% |
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$ |
614.7 |
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48 |
% |
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(10 |
)% |
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Medical |
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115.2 |
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31 |
% |
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113.0 |
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27 |
% |
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2 |
% |
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288.9 |
|
26 |
% |
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323.5 |
|
25 |
% |
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(11 |
)% |
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Industrial excluding AT&M (1) |
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86.3 |
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23 |
% |
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101.9 |
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24 |
% |
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(15 |
)% |
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261.0 |
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24 |
% |
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315.3 |
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25 |
% |
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(17 |
)% |
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Net Sales excluding AT&M(1) |
$ |
374.6 |
|
100 |
% |
$ |
416.9 |
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98 |
% |
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(10 |
)% |
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$ |
1,104.2 |
|
100 |
% |
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$ |
1,253.5 |
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98 |
% |
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(12 |
)% |
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AT&M(1) |
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— |
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— |
% |
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8.1 |
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2 |
% |
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(100 |
)% |
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2.1 |
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— |
% |
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30.9 |
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2 |
% |
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(93 |
)% |
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Total Net Sales |
$ |
374.6 |
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100 |
% |
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$ |
425.0 |
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100 |
% |
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(12 |
)% |
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$ |
1,106.3 |
|
100 |
% |
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$ |
1,284.4 |
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100 |
% |
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(14 |
)% |
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* As a percent of Total Net Sales |
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(1) Sales from our Automation, Test, and Measurement business (AT&M), which was divested effective July 31, 2024, were previously included in the Industrial vertical |
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– Automotive includes electronic power steering, body controls, automated driver assist systems, and electronic braking systems |
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– Medical includes sleep therapy and respiratory care, image guided therapy, in vitro diagnostics, drug delivery, AED, and patient monitoring |
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– Industrial includes climate controls, automation controls, and public safety |
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Company Guidance for Fiscal Year 2025
The Company expects to be at the high-end of its guidance range for both net sales and adjusted operating income. The range for net sales is $1.40 – $1.44 billion, while the range for adjusted operating income(a) is 3.4% – 3.6% of net sales. Capital expenditures are estimated to be at the low-end of the guidance range of $40 – $50 million.
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(a) |
Fiscal year 2025 guidance reflects a change in our adjusted operating income calculation beginning in fiscal year 2025, which excludes stock compensation expense. This change better aligns our presentation with others in our industry. A reconciliation of GAAP and non-GAAP financial measures is included below. |
