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Daktronics Inc (DAKT) SEC Filing 10-K Annual Report for the fiscal year ending Saturday, May 1, 2021

Daktronics Inc

CIK: 915779 Ticker: DAKT

 

Exhibit 99.1

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Daktronics, Inc. Announces Fiscal Year and Fourth Quarter 2021 Results

 

Brookings, S.D., June 9, 2021 (GLOBE NEWSWIRE) -- Daktronics, Inc. (NASDAQ - DAKT) today reported fiscal year and fourth quarter 2021 results. Daktronics reported fiscal year 2021 net sales of $482.0 million, operating income of $17.1 million, net income of $10.9 million, and earnings per diluted share of $0.24. This compares to net sales of $608.9 million, operating loss of $0.2 million, and net income of $0.5 million, or $0.01 earnings per diluted share for fiscal 2020. Fiscal 2021 orders were $515.9 million compared to $620.8 million for fiscal 2020.

 

Daktronics reported fiscal 2021 fourth quarter net sales of $116.9 million, operating income of $1.1 million, and net income of $0.3 million, or $0.01 earnings per diluted share, compared to net sales of $126.1 million, operating loss of $3.5 million, and net loss of $1.1 million, or $0.02 loss per diluted share for the fourth quarter of fiscal 2020. Fiscal 2021 fourth quarter orders were $171.2 million compared to $147.2 million for the fourth quarter of fiscal 2020. Product backlog at the end of the fiscal 2021 fourth quarter was $251 million, compared to a backlog of $212 million a year earlier and $195 million at the end of the third quarter of fiscal 2021.

 

Fiscal 2021 is a 52-week year and fiscal 2020 was a 53-week year. Sales, orders and other results of operations were impacted due to the additional week of operations.

 

Cash generated by operating activities for the fiscal year ended May 1, 2021 was $66.2 million, compared to cash generated of $10.8 million in fiscal 2020. Cash generated by operating activities is primarily derived from cash received from customers, offset by cash payments for inventories, subcontractors, employee related costs, and operating expense outflows. Cash provided from operations differed as compared to last year primarily due to a focus on customer collections, decreasing inventory levels, and lowering personnel and operating expense outflows as we managed operations through the uncertain times created by the COVID-19 pandemic. Cash generation and use can vary based on order timing and levels, varying contractual payment terms from customers, and payments for inventory to meet delivery and installation schedules. Free cash flow, defined as cash provided from or used in operating activities less net investment in property and equipment, was a positive $61.5 million for fiscal 2021, as compared to a negative free cash flow of $7.0 million for fiscal 2020. Net investment in property and equipment was $4.7 million for fiscal 2021, as compared to $17.8 million for fiscal 2020. During fiscal 2021, the share repurchase and dividend programs were suspended with no related cash outflows. Cash, restricted cash, and marketable securities at the end of the fourth quarter of fiscal 2021 were $80.4 million, which compares to $41.6 million at the end of the fourth quarter of fiscal 2020. At the end of fiscal year 2021, there were no advances under the loan portion of the line of credit compared to $15 million borrowed at the end of fiscal year 2020

 

Fourth Quarter Fiscal 2021 Consolidated Financial Results

Orders for the fourth quarter of fiscal 2021 increased 16.3 percent as compared to the fourth quarter of fiscal 2020. Orders increased in the Commercial, Live Events, High School Park and Recreation, and International business units and decreased in the Transportation business unit. Overall, market activity began increasing as COVID-19 restrictions were reduced which improved economic outlooks.  This resulted in customers committing to large project and placing global account orders. The increase in the Live Events business unit was due to upgrades in university sports stadiums, primarily for football venues. The Commercial and International business units experienced an increase in orders mainly in the out-of-home ("OOH") market as advertising spend expanded. The Transportation business unit orders decreased due to a decline in state procurement project activity as compared to last year. 

 

Net sales for the fourth quarter of fiscal 2021 decreased by 7.3 percent as compared to the fourth quarter of fiscal 2020. Net sales decreased in Live Events and International business units. Live Events was impacted the most due to lower order activity earlier this fiscal year. Commercial, High School Park and Recreation, and Transportation businesses were relatively flat year over year.

 

Gross profit as a percentage of net sales was 23.6 percent for the fourth quarter of fiscal 2021 as compared to 22.7 percent a year earlier. The increase in gross profit percentage was primarily due to the change in mix of project types and lower warranty charges. Warranty as a percent of sales improved to 1.3 percent as compared to 1.6 percent last year. Operating expense for the fourth quarter of 2021 was $26.4 million, compared to $32.1 million for the fourth quarter of fiscal 2020. This decrease is attributable to our focus on managing our expenses to expected order volumes through the COVID-19 pandemic. Declines in overall operating expenses were attributable to lower personnel related costs, reduced third-party contract use, and lower travel and entertainment activities. Operating income as a percentage of sales was 1.0 percent for the fourth quarter of fiscal 2021 as compared to an operating loss as a percentage of sales of 2.7 percent for the fourth quarter of fiscal 2020.

 

The provision for income taxes during the fourth quarter is calculated based on actual results for the full fiscal year to income or loss, excluding unusual or infrequently occurring discrete items for the reporting period. Our effective tax rate was 49.7 percent for the fourth quarter of fiscal 2021 as compared to 66.9 percent for the fourth quarter of fiscal 2020

 

Fiscal 2021 Consolidated Financial Results

Orders for fiscal 2021 decreased by 16.9 percent as compared to fiscal 2020. Each business unit's order volume was lower in fiscal 2021 due to lower market activity from the resulting economic and business impacts of the COVID-19 pandemic and related timing of large contract orders. Each business unit’s orders were impacted by the additional week in fiscal 2020.

 

Net sales for fiscal 2021 decreased 20.8 percent as compared to fiscal 2020 as a result of order booking declines and delayed conversions to sales based on customer project schedules.

 

Gross profit as a percentage of net sales improved to 25.0 percent for fiscal 2021 as compared to 22.8 percent a year earlier. Warranty as a percent of sales was 1.4 percent as compared to 1.9 percent last year. Operating expenses for fiscal 2021 were $103.5 million as compared to $138.9 million for fiscal 2020. The decrease in total operating expenses was primarily attributable to our focus on managing our expenses to expected order volumes. Declines in overall operating expenses included lower personnel related costs, reduced third-party contract use, lower travel and entertainment activities, and lowered marketing and convention events offset by an increase in bad debt expense. Operating margin improved to 3.5 percent as a percent of sales for fiscal 2021 as compared to a breakeven as percent of sales for fiscal 2020.

 

The effective tax rate for fiscal 2021 was 22.3 percent. The fiscal 2020 tax benefit was the result of permanent tax credits exceeding a valuation allowance.

 

 

The following information was filed by Daktronics Inc (DAKT) on Wednesday, June 9, 2021 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Daktronics Inc's 10-K Annual Report:

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Document And Entity Information
Consolidated Balance Sheets
Consolidated Balance Sheets (Parentheticals)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Comprehensive Income
Consolidated Statements Of Operations
Consolidated Statements Of Shareholders' Equity
Consolidated Statements Of Shareholders' Equity (Parentheticals)
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies (Details Textual)
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies (Tables)
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies - Allowance For Doubtful Accounts (Details)
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies - Cash, Cash Equivalents, And Restricted Cash (Details)
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies - Earnings (Loss) Per Share (Details)
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies - Equity Method Investments (Details)
Note 1 - Nature Of Business And Summary Of Significant Accounting Policies - Estimated Useful Lives (Details)
Note 10 - Shareholders' Equity And Share-Based Compensation
Note 10 - Shareholders' Equity And Share-Based Compensation (Details Textual)
Note 10 - Shareholders' Equity And Share-Based Compensation (Tables)
Note 10 - Shareholders' Equity And Share-Based Compensation - Nonvested Restricted Stock And Restricted Stock Units (Details)
Note 10 - Shareholders' Equity And Share-Based Compensation - Summary Of Share-Based Compensation (Details)
Note 10 - Shareholders' Equity And Share-Based Compensation -Stock Option (Details)
Note 10 - Shareholders' Equity And Share-Based Compensation -Weighted-Average Fair Value Of Options Granted (Details)
Note 11 - Retirement Benefits
Note 11 - Retirement Benefits (Details Textual)
Note 12 - Income Taxes
Note 12 - Income Taxes (Details Textual)
Note 12 - Income Taxes (Tables)
Note 12 - Income Taxes - Components Of Net Deferred Tax Assets (Details)
Note 12 - Income Taxes - Effective Income Tax (Details)
Note 12 - Income Taxes - Income Tax (Benefit) Expense (Details)
Note 12 - Income Taxes - Pretax Income Attribute To Domestic And Foreign Operations (Details)
Note 12 - Income Taxes - Unrecognized Uncertain Tax Benefits (Details)
Note 13 - Cash Flow Information
Note 13 - Cash Flow Information (Tables)
Note 13 - Cash Flow Information - Changes In Operating Assets And Liabilities (Details)
Note 13 - Cash Flow Information - Supplement Disclosure Of Cash Flow Information (Details)
Note 13 - Cash Flow Information - Supplement Schedule Of Non-Cash Investing And Financing Activities (Details)
Note 14 - Fair Value Measurement
Note 14 - Fair Value Measurement (Tables)
Note 14 - Fair Value Measurement - Contingent Liabilities (Details)
Note 14 - Fair Value Measurement - Fair Value Hierarchy (Details)
Note 15 - Derivative Financial Instruments
Note 15 - Derivative Financial Instruments (Details Textual)
Note 15 - Derivative Financial Instruments (Tables)
Note 15 - Derivative Financial Instruments - Aggregated Notional Amount (Details)
Note 16 - Commitments And Contingencies
Note 16 - Commitments And Contingencies (Details Textual)
Note 16 - Commitments And Contingencies (Tables)
Note 16 - Commitments And Contingencies - Change In Warranty Obligation (Details)
Note 16 - Commitments And Contingencies - Purchase Commitments (Details)
Note 2 - Revenue Recognition
Note 2 - Revenue Recognition (Tables)
Note 2 - Revenue Recognition - Contract Assets And Liabilities (Details)
Note 2 - Revenue Recognition - Disaggregation Of Revenue (Details)
Note 2 - Revenue Recognition 1 (Details Textual)
Note 2 - Revenue Recognition 2 (Details Textual)
Note 3 - Segment Reporting
Note 3 - Segment Reporting (Details Textual)
Note 3 - Segment Reporting (Tables)
Note 3 - Segment Reporting - Net Sales And Property And Equipment (Details)
Note 3 - Segment Reporting - Segment Reporting Information (Details)
Note 4 - Goodwill And Intangible Assets
Note 4 - Goodwill And Intangible Assets (Details Textual)
Note 4 - Goodwill And Intangible Assets (Tables)
Note 4 - Goodwill And Intangible Assets - Amortization Expenses (Details)
Note 4 - Goodwill And Intangible Assets - Goodwill (Details)
Note 4 - Goodwill And Intangible Assets - Intangible Assets, Net (Details)
Note 5 - Selected Financial Statement Data
Note 5 - Selected Financial Statement Data (Details Textual)
Note 5 - Selected Financial Statement Data (Tables)
Note 5 - Selected Financial Statement Data - Accrued Expenses (Details)
Note 5 - Selected Financial Statement Data - Inventories (Details)
Note 5 - Selected Financial Statement Data - Other (Expense) Income (Details)
Note 5 - Selected Financial Statement Data - Property And Equipment, Net (Details)
Note 6 - Receivables
Note 6 - Receivables (Details Textual)
Note 7 - Financing Agreements
Note 7 - Financing Agreements (Details Textual)
Note 8 - Share Repurchase Program
Note 8 - Share Repurchase Program (Details Textual)
Note 9 - Leases
Note 9 - Leases (Details Textual)
Note 9 - Leases (Tables)
Note 9 - Leases - Cash Flow Information Related To Lease Liabilities (Details)
Note 9 - Leases - Future Minimum Operating Lease Payments (Details)
Significant Accounting Policies (Policies)
Ticker: DAKT
CIK: 915779
Form Type: 10-K Annual Report
Accession Number: 0001437749-21-014600
Submitted to the SEC: Fri Jun 11 2021 4:15:05 PM EST
Accepted by the SEC: Fri Jun 11 2021
Period: Saturday, May 1, 2021
Industry: Miscellaneous Manufacturing Industries

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