Knobias Clip Report (10-09-2008) NUHC
Submitted By Knobias ClipReport
NUHC: President Discusses Q2 Results and Growth in Asia-Pacific Region
By Fain Hughes, fhughes@knobias.com
Shares of Nu Horizons Electronics Corp. (NUHC) moved higher during Thursday’s session after the Company reported its financial results for the second quarter ended August 31, 2008.
Net sales for the quarter ended August 31, 2008, increased 14.3 percent to $211,813,000 as compared to $185,369,000 for the comparable period last year. This increase resulted primarily from continued growth in the Company’s core electronics distribution business in the Asia-Pacific region, as well as from significant end-of-life sales in its systems business in North America.
Net income for the quarter was $192,000, or $0.01 per diluted share, as compared to a net income of $783,000, or $0.04 per diluted share for the second quarter of the prior year. On a proforma basis, excluding unusual items, the diluted earnings per share would have been $0.09 for the second quarter of fiscal 2009 compared to $0.08 for the prior year period.
Rich Schuster, President and COO of Nu Horizons Electronics, commented in a conference call, “The financial results for the second quarter were mixed. We achieved record top line revenue and recorded another record quarter for sales in our Asia-Pacific operations which continue to show strong profitability. However, the slowing market in the U.K. and Americas began to impact us, particularly in July and August. Also, much of the top line revenue growth was driven by the end-of-life progam with Sun Microsystems which had a negative impact on our gross profit margin for the quarter.”
He added, “The Asia-Pacific region continues to rapidly grow by double digits. We are bullish about our ability to continue to grow both top and bottom lines there. In the Americas, we saw the benefits of our cost redcution initiatives, but growth here remains an ongoing challenge. The overall market here is not growing, and we do not see prospects for meaningful market growth over the next several quarters. However, we are focused on several opportunities to gain market share here and are beginning to see a positive contribution from new distributors. Despite some current weakness, we believe the European market represents an important growth opportunity for us.”
Mr. Schuster concluded, “Given the diverse end markets and geographic regions that we serve, we believe that we are in a reasonably good position to withstand these uncertain economic times.”
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