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FOR IMMEDIATE RELEASE
Monday, March 9, 2009
SMTC Reports Fourth Quarter Results
Sequential Revenue Growth and Continuing Cash Generation
TORONTO March 9, 2009 SMTC Corporation (Nasdaq: SMTX, TSE: SMX), a global electronics manufacturing services provider, today reported 2008 fourth quarter unaudited results. Revenue for the quarter was $61.1 million up $1.0 million sequentially and $5.7 million lower than the fourth quarter of 2007. The net loss for the quarter of $0.1 million compares with net income of $0.1 million in the third quarter of 2008 and $0.9 million for the comparable period last year. The Company continued to generate positive cash flow in the fourth quarter reducing net debt to an all time low of $16 million.
Gross profit for the fourth quarter was $3.8 million or 6.2% of revenue compared with $4.8 million or 8.0% for the previous quarter and $6.4 million or 9.6% for the fourth quarter of 2007
The fourth quarter results were heavily impacted by considerably lower revenue in the Companys Enclosures Systems division due to industry sector specific and general economic factors. This created significant excess capacity at the Companys larger Enclosures facility located in Franklin, Massachusetts.
Our fourth quarter performance reflects the front end of the weakening North American economy that particularly affected our Enclosures business. The balance of our operations produced solid results, stated John Caldwell, President and Chief Executive Officer. In consideration of the current excess capacity at our Franklin facility and consistent with our longer term strategy to offer our customers competitive solutions from facilities located in low cost regions, we plan to consolidate Enclosures production in our 235,000 square foot facility in Chihuahua, Mexico that houses the full range of contract manufacturing services including enclosures and systems integration capability. The Franklin facility will be closing in the second quarter of 2009.
The following information was filed by Smtc Corp (SMTX) on Friday, March 13, 2009 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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