IEC Electronics: IEC Announces Strong Third Quarter for Fiscal 2009

NEWARK, NY--(Marketwire - July 23, 2009) - IEC Electronics Corp. (NYSE Amex: [ IEC ]) announced its results for the third quarter of fiscal 2009 ending June 26, 2009.

The Company reported revenue of $17.3 million for the quarter, operating profit of $1.3 million and net income of $903,000 or $0.10 per share. This compares with revenue of $11.9 million, operating profit of $585,000 and net income of $868,000 or $0.09 per share for the quarter ending June 27, 2008. The third quarter of 2008 included $691,000 deferred tax benefit or $.07 per share.

IEC had revenue of $49.5 million for the first nine months of fiscal 2009 and a net income of $4,053,000 or $.43 per share. This compares to revenue of $35.0 million for the first nine months of fiscal 2008 and net income of $1,963,000 or $.21 per share. Both periods were impacted by deferred tax benefit. 2009 year-to-date results include net deferred tax benefit of $724,000 or $.08 per share compared to the first nine months of 2008 which included net deferred tax benefit of $1,181,000 or $.13 per share. 2009 also included receipt of $150,000 from the settlement of a ten year old tax claim, for the overpayment of taxes with the state of Alabama and the city of Arab where IEC owned a facility in the late 1990s.

W. Barry Gilbert, Chairman of the Board and CEO, stated, "It was a very good quarter. This quarter IEC achieved several significant milestones. We were listed on a national exchange, NYSE Amex in June, without the need to execute a reverse stock split. Both our gross profit margin and our operating profit expanded to the highest level in more than ten years, 16.1% and 7.7% as a percent of sales respectively."

"The gross profit margin of 16.1% compares with Q3 2008 gross profit margin of 11.9%. This stems from the fact that our contract manufacturing business continues to improve. For the second consecutive quarter we have experienced gains in manufacturing efficiency attributable to investments in equipment and personnel over the last twelve months. Moreover, the improved gross profit margin benefited from some favorable product mix which may not continue in the future. We expect our gross profit margin as a percent of sales to normalize in a slightly higher range of between 15% and 16% than presented last quarter."

"By virtue of the strong operating results, and careful management of expenses, our Q3 operating profit increased to 7.7% of sales versus 4.9% for the same period last year. We will experience operating profits of this level from time to time; however this is above our internal expectations of between 7% and 7.3%."

"We have been fortunate to succeed in a recession that seems to be slow in abating, and have succeeded in adding three new customers and in obtaining numerous new projects from existing customers over the first nine months of the year. However, two customers continue to experience declining demand for their products in the current economic climate, and do not expect that to change in the foreseeable future."

"Our entry into the cable business by the acquisition of Val-U-Tech Corp., May 30th 2008, has proven to be beneficial to the company. Accordingly, we have engaged an investment banking firm to support our 'buy-side' activities to expand our position in cable assemblies. Though we have looked at a number of opportunities we will not hastily execute a transaction in this turbulent market."

"In summary, the Company continues to move in the right direction. We are confident that we are creating value for our customers, our shareholders, and opportunity for our employees."

As a full service EMS provider, IEC is AS9100 and ISO-9001:2000 registered, and a NSA approved supplier under the COMSEC standard. The Company offers its customers a wide range of services including design, prototype and high reliability printed circuit board assembly, material procurement and control, manufacturing and test engineering support, and systems build. Information regarding IEC's third quarter 2009 results can be found on its web site at [ www.iec-electronics.com/documents/finance/Q3-2009release.pdf ]

The foregoing, including any discussion regarding the Company's future prospects, contains certain forward-looking statements that involve risks and uncertainties, including uncertainties associated with economic conditions in the electronics industry, particularly in the principal industry sectors served by the Company, changes in customer requirements and in the volume of sales to principal customers, the ability of the Company to assimilate acquired businesses and to achieve the anticipated benefits of such acquisitions, competition and technological change, the ability of the Company to control manufacturing and operating costs, satisfactory relationships with vendors. The Company's actual results of operations may differ significantly from those contemplated by any forward-looking statements as a result of these and other factors, including factors set forth in the Company's 2008 Annual Report on Form 10-K and in other filings with the Securities and Exchange Commission.

 IEC ELECTRONICS CORP - CONSOLIDATED BALANCE SHEET JUN 26, 2009 AND SEP 30, 2008 (In Thousands) JUN 26, 2009 SEP 30, 2008 ASSETS CURRENT ASSETS Cash 0 0 Accounts Receivable 9,976 10,345 Inventories 6,592 6,230 Deferred Income Taxes 1,908 1,908 Other Current Assets 116 61 ---------- ---------- Total Current Assets 18,592 18,544 ---------- ---------- NET FIXED ASSETS 1,944 853 NON-CURRENT ASSETS Deferred Income Taxes 13,557 14,727 Other Non-Current Assets 50 60 ---------- ---------- TOTAL ASSETS 34,143 34,184 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Short Term Borrowings 1,197 1,098 Accounts Payable 4,214 6,125 Accrued Payroll and Related Taxes 970 808 Other Accrued Expenses 398 603 Other Current Liabilities 292 664 ---------- ---------- Total Current Liabilities 7,071 9,298 ---------- ---------- LONG TERM DEBT 7,864 8,910 ---------- ---------- TOTAL LIABILITIES 14,935 18,208 SHAREHOLDER'S EQUITY Authorized - 50,000,000 shares Issued - 9,549,420, Outstanding - 8,536,547 Common stock, par value $.01 per share 95 93 Treasury Shares at Cost - 1,012,873 shares (1,413) (223) Additional Paid-in Capital 40,490 40,124 Retained Earnings (19,964) (24,018) ---------- ---------- TOTAL SHAREHOLDER'S EQUITY 19,208 15,976 ---------- ---------- TOTAL LIABILITIES & EQUITY 34,143 34,184 ========== ========== IEC ELECTRONICS CORP - CONSOLIDATED STATEMENT OF INCOME FOR QUARTER END & YTD JUN 26, 2009 AND JUN 27, 2008 (In Thousands) ACTUAL PRIOR ACTUAL PRIOR QUARTER QUARTER YTD YTD JUN 26, 2009 JUN 27, 2008 JUN 26, 2009 JUN 27, 2008 Sales 17,346 11,888 49,538 34,988 Cost of Sales 14,556 10,475 41,908 31,046 -------- -------- -------- -------- Gross Profit 2,790 1,413 7,630 3,942 Less: Operating Expenses Selling & G&A 1,463 828 4,214 2,580 Restructuring 0 0 0 0 -------- -------- -------- -------- Total Operating Expenses 1,463 828 4,214 2,580 -------- -------- -------- -------- Operating Profit 1,327 585 3,416 1,362 Interest and Financing Expense 90 106 304 281 (Gain)/Loss on Disposal of Fixed Assets 0 0 (5) (2) Other Expense/(Income) (151) 302 (212) 301 -------- -------- -------- -------- Net Income before Income Taxes 1,388 177 3,329 782 Provision for / (benefit from) Income Tax 485 (691) (724) (1,181) -------- -------- -------- -------- Net Income 903 868 4,053 1,963 ======== ======== ======== ========

N@N

IEC Electronics: IEC Announces Strong Third Quarter for Fiscal 2009