Boston, MA 05/19/2014 (wallstreetpr) – During 1Q2014, SL Industries, Inc. (NYSEMKT:SLI)’s net sales were $52.6 million, increase by 7% compared to net sales of $49.1 million in 1Q2013. The rise was due to increasing sales of High Power Group and Montevideo Technology (SL-MTI) that partly offset the decreasing sales of RFL Electronics (RFL) and flat growth in SL Power Electronics (SLPE).
High Power & SL-MTI drive future growth
In 1Q2014, High Power Group reported sales of $20.3 million, which accounts 39% of total sales, were up by 19% (1Q2013: $17.1 million) due to higher sales of TEAL and MTE products. TEAL’s sales increased as a result of solid demand in military & aerospace, semiconductor and solar markets. Domestic filter sales to large electronic customers drove the sales of MTE products. Higher sales improved the segment’s operating income to $2.9 million.
SL-MTI’s sales were up by 20% to $10.9 million (1Q2013: $9.1 million), primarily driven by increasing sales of products in the commercial aerospace (+21%), defense (+82%) and medical (56%) industry. The increased sales coupled with lower operating costs improved the segment operating income considerably to $2.1 million.
SLPI and RFL compressed the operating performance
SLPI segment represented 33% of total sales during 1Q2014 and were flat at $17.6 million. The medical equipment sales down by 5% YoY, partly offset by the increased sales of industrial products (+17%). Domestic demands for medical products were low compared to international markets. The growing costs of sales reduced the segment’s operating income to $939K (1Q2013: 1.05 million).
Lower sales of protection products reduced the sales of RFL to $3.8 million (1Q2013: 5.3 million) that resulted in operating loss during 1Q2014.
Profitable segments improved operating efficiency
Based on the operating performance of SL Industries, Inc. (NYSEMKT:SLI)’s segments during 1Q2014, adjusted EBITDA increased by only 4% to $5.6 million (1Q2013: $5.4 million). But, higher provision of tax reduced the reported net income from continuing operations to $2.7 million with diluted EPS of $0.64 (1Q2013: $3.0 million and diluted EPS of $0.71).
Guidance for FY2014
SL Industries, Inc. (NYSEMKT:SLI) updated its guidance for FY2014 based on the continued growth in High Power and SL-MTI segments in 2014. Accordingly, the Company anticipates sales of in the range of $197-$241 million with adjusted EBITDA of $22.5-$27.5 million.
