EX-99.1
EXHIBIT 99.1
Press Release
For Immediate Release
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For Details Contact: |
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40W267 Keslinger Road |
Edward J. Richardson |
Robert J. Ben |
PO BOX 393 |
Chairman and CEO |
EVP & CFO |
LaFox, IL 60147-0393 USA |
Phone: (630) 208-2320 |
(630) 208-2203 |
(630) 208-2200 | Fax: (630) 208-2550 |
RICHARDSON ELECTRONICS REPORTS FIRST QUARTER RESULTS; DECLARES QUARTERLY CASH DIVIDEND
Q1 FY26 net sales increased YoY for the 5th consecutive quarter; led by a 52.2% YoY increase in
semi-conductor wafer fab net sales
Generated $1.0 million of operating income and ended Q1 FY26 with positive operating cash flow for the 6th consecutive quarter
LaFox, IL, OCTOBER 8, 2025: Richardson Electronics, Ltd. (NASDAQ: RELL) today reported financial results for its first quarter ended August 30, 2025. The Company also announced that its Board of Directors declared a $0.06 per share quarterly cash dividend.
“We are pleased with our solid first quarter fiscal 2026 results, reflecting the value we provide our global customers, the diversity of our end markets, and the hard work and commitment of our associates. Excluding Healthcare, which the majority of assets were sold in January 2025, net sales grew by 6.8%, led by strong year-over-year growth in our semiconductor wafer fab business. A more profitable sales mix, combined with our continued focus on controlling fixed costs, drove a significant improvement in operating income, that more than tripled from the prior year’s first quarter. We also generated positive operating cash flow for the sixth consecutive quarter,” said Edward J. Richardson, Chairman, CEO, and President.
“Our focus on driving growth and pursuing opportunities to enhance sales and profitability has provided a strong start to fiscal 2026. With a solid balance sheet, and a highly capable team, we are confident in our ability to deliver improved results this year,” concluded Mr. Richardson.
First Quarter Results
Net sales for the first quarter of fiscal 2026 were $54.6 million, a 1.6% increase from $53.7 million in the prior year’s first quarter. When excluding Healthcare, net sales increased 6.8% year-over-year.
Year-over-year net sales growth was due to higher sales in the Power and Microwave Technologies Group (PMT) and Canvys. As a result of the January 2025 Healthcare asset sale, the Healthcare segment has been consolidated into the PMT segment for the first quarter of fiscal 2026 and fiscal 2025. Sales for PMT increased $1.1 million, or 2.8% from the first quarter of fiscal 2025, as a result of higher demand from the Company’s semiconductor wafer fab customers and distributed electron tube products. When excluding Healthcare net sales, PMT net sales increased 10.5%. Canvys sales increased $0.6 million, or 8.3%, reflecting improved market conditions in Europe. GES sales declined by $0.8 million. Within GES, sales in the wind segment increased year-over-year but were offset mainly by the non-recurrence of a large EV Locomotive order that occurred in the prior fiscal year’s first quarter.
Backlog totaled $134.7 million at the end of the first quarter of fiscal 2026, versus $134.2 million at the end of fiscal 2025, primarily driven by increases in PMT and Canvys. Backlog in GES declined due to the timing of new orders, which can fluctuate quarter-to-quarter given the project-based nature of this segment. However, the GES sales pipeline remains healthy, supported by positive global demand and strong interest from both new and existing programs.
Gross margin for the first quarter was 31.0% of net sales, compared to 30.6% during the first quarter of fiscal 2025. PMT gross margin increased to 31.3%, compared to 30.1%, as a result of a favorable product mix and an improvement in manufacturing absorption. GES gross margin increased to 29.6%, from 29.4% also due to product mix. Canvys gross margin decreased to 30.9%, from 34.3% primarily due to product mix and higher freight costs.
Operating expenses were $16.0 million, compared to $16.1 million in the first quarter of fiscal 2025. As a percentage of net sales, operating expenses were 29.2% in the first quarter of fiscal 2026 versus 30.0% in the prior year’s first quarter. The decrease in operating expenses resulted from lower travel expenses.
Operating income was $1.0 million for the first quarter of fiscal 2026, compared to operating income of $0.3 million in the prior year’s first quarter. Other income for the first quarter of fiscal 2026, including interest income, foreign exchange, and other was $1.4 million, compared to other income of $0.3 million in the first quarter of fiscal 2025. The increase from the prior year’s first quarter was mainly due to a non-recurring gain of $0.9 million.
Income tax provision was $0.4 million for the first quarter of fiscal 2026, versus an income tax provision of less than $0.1 million in the prior year’s first quarter. The effective tax rate for the quarter was 18.1% compared to 9.0% in the first quarter of fiscal 2025.
Net income was $1.9 million for the first quarter of fiscal 2026, compared to $0.6 million in the first quarter of fiscal 2025. Earnings per common share (diluted) were $0.13 in the first quarter of fiscal 2026, compared to earnings per common share (diluted) of $0.04 in the first quarter of fiscal 2025.
EBITDA for the first quarter of fiscal 2026 was $3.3 million versus $1.7 million in the prior year’s first quarter.
The Company maintained a solid financial position and had cash and cash equivalents of $35.7 million as of August 30, 2025, versus $35.9 million as of May 31, 2025. Cash used during the first quarter of fiscal 2026 primarily related to the payment of dividends. The Company invested $1.0 million during the quarter in capital expenditures primarily related to its manufacturing business, facilities improvements, and IT systems, versus $0.9 million during last year’s first quarter.
As of the end of the first quarter of fiscal 2026, the Company had no outstanding debt on its revolving line of credit with PNC Bank. In addition, the Company has extended this Credit Agreement through October 6, 2028, with similar terms and a $20 million borrowing limit.
CASH DIVIDEND DECLARED
The Board of Directors of Richardson Electronics declared a $0.06 quarterly cash dividend per share to holders of common stock and a $0.054 cash dividend per share to holders of Class B common stock. The dividend will be payable on November 26, 2025, to common stockholders of record as of November 7, 2025.
NON-GAAP FINANCIAL MEASURE
In addition to the results reported in accordance with generally accepted accounting principles in the United States (GAAP) included throughout this press release, the Company has provided information regarding “EBITDA” (a “non-GAAP financial measure”). This non-GAAP financial measure reflects earnings before interest, income tax, depreciation and amortization expenses. Detailed reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in this press release.
Management believes that the disclosure of this non-GAAP financial measure provides useful information to investors in assessing the Company’s financial performance excluding items that are not considered by the Company to be indicative of the Company’s ongoing results. Our management uses this non-GAAP financial measure along with the most directly comparable GAAP financial measure in evaluating our financial performance and when planning, forecasting and analyzing future periods. The non-GAAP financial measure presented herein, as determined and presented by the Company, may not be comparable to related or similarly titled measures reported by other companies. The non-GAAP financial measure incorporated herein is not intended to be used as a substitute for the related GAAP measurements. The non-GAAP financial measure should be viewed in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP.
CONFERENCE CALL INFORMATION
The Company will host a conference call and question-and-answer session on Thursday, October 9, 2025, at 9:00 a.m. Central Time, to discuss its first quarter fiscal 2026 results.
Participants may register for the call here. While not required, it is recommended you join 10 minutes prior to the event start. A replay of the call will be available beginning at 1:00 p.m. Central Time on October 10, 2025, for seven days. Registration instructions are also on our website at www.rell.com.
In addition, the webcast link is available here.
FORWARD-LOOKING STATEMENTS
This release includes certain “forward-looking” statements as defined by the Securities and Exchange Commission. Statements in this press release regarding the Company’s business that are not historical facts represent “forward-looking” statements that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K filed on August 4, 2025, and other reports we file with the Securities and Exchange Commission. The Company assumes no responsibility to update the “forward-looking” statements in this release as a result of new information, future events or otherwise.
ABOUT RICHARDSON ELECTRONICS, LTD.
Richardson Electronics, Ltd. is a leading global manufacturer of engineered solutions, green energy products, power grid and microwave tubes, and related consumables; power conversion and RF and microwave components including green energy solutions; tubes for diagnostic imaging equipment; and customized display solutions.
More than 55% of our products are manufactured in LaFox, Illinois, Marlborough, Massachusetts, or Donaueschingen, Germany, or by one of our manufacturing partners throughout the world. All our partners manufacture to our strict specifications and per our Supplier Code of Conduct. We serve customers in alternative energy, healthcare, aviation, broadcast, communications, industrial, marine, medical, military, scientific, and semiconductor markets. The Company’s strategy is to provide specialized technical expertise and “engineered solutions” based on our core engineering and manufacturing capabilities. The Company provides solutions and adds value through design-in support, systems integration, prototype design and manufacturing, testing, logistics, and aftermarket technical service and repair through its global infrastructure. More information is available at www.rell.com.
Richardson Electronics’ common stock trades on the NASDAQ Global Select Market under the ticker symbol RELL.
Richardson Electronics, Ltd.
Consolidated Balance Sheets
(in thousands, except per share amounts)
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Unaudited |
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Audited |
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August 30, 2025 |
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May 31, 2025 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
35,654 |
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$ |
35,901 |
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Accounts receivable, less allowance for credit losses of $301 and $250, respectively |
|
|
27,039 |
|
|
|
24,117 |
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Inventories, net |
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104,635 |
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102,799 |
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Prepaid expenses and other assets |
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2,948 |
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|
3,070 |
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Total current assets |
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170,276 |
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165,887 |
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Non-current assets: |
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Property, plant and equipment, net |
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18,439 |
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18,355 |
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Intangible assets, net |
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330 |
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|
345 |
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Right of use lease assets |
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2,026 |
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2,276 |
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Deferred income tax assets |
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8,695 |
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8,744 |
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Other non-current assets |
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301 |
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|
228 |
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Total non-current assets |
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29,791 |
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29,948 |
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Total assets |
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$ |
200,067 |
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$ |
195,835 |
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Liabilities and Stockholders' Equity |
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Current liabilities: |
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Accounts payable |
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$ |
23,172 |
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$ |
21,339 |
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Accrued liabilities |
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14,360 |
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14,276 |
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Lease liabilities current |
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1,167 |
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1,171 |
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Total current liabilities |
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38,699 |
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36,786 |
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Non-current liabilities: |
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Deferred income tax liabilities |
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83 |
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|
81 |
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Lease liabilities non-current |
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859 |
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1,105 |
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Other non-current liabilities |
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1,058 |
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|
1,204 |
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Total non-current liabilities |
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2,000 |
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|
|
2,390 |
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Total liabilities |
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40,699 |
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39,176 |
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Commitments and contingencies |
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Stockholders’ Equity |
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Common stock, $0.05 par value; 12,444 and 12,362 shares issued
and outstanding on August 30, 2025 and May 31, 2025, respectively |
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622 |
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|
618 |
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Class B common stock, convertible, $0.05 par value; 2,049 shares issued
and outstanding on August 30, 2025 and May 31, 2025 |
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102 |
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|
102 |
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Additional paid-in-capital |
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75,044 |
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74,445 |
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Retained earnings |
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80,392 |
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79,340 |
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Accumulated other comprehensive income |
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3,208 |
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|
2,154 |
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Total stockholders' equity |
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159,368 |
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|
|
156,659 |
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Total liabilities and stockholders’ equity |
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$ |
200,067 |
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$ |
195,835 |
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Richardson Electronics, Ltd.
Unaudited Consolidated Statements of Comprehensive Income
(in thousands, except per share amounts)
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Three Months Ended |
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August 30, 2025 |
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August 31, 2024 |
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Net sales |
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$ |
54,607 |
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$ |
53,725 |
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Cost of sales |
|
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37,678 |
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|
|
37,299 |
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Gross profit |
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16,929 |
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|
|
16,426 |
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Selling, general and administrative expenses |
|
|
15,961 |
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|
16,112 |
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Gain on disposal of property, plant and equipment |
|
|
— |
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2 |
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Operating income |
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|
968 |
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|
|
316 |
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Other income (expense): |
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Interest income |
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|
169 |
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|
58 |
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Foreign exchange gain |
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289 |
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|
277 |
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Other, net |
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|
904 |
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(3 |
) |
Total other income |
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1,362 |
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|
|
332 |
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Income before income taxes |
|
|
2,330 |
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|
|
648 |
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Income tax provision |
|
|
421 |
|
|
|
58 |
|
Net income |
|
|
1,909 |
|
|
|
590 |
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Foreign currency translation gain, net of tax |
|
|
1,054 |
|
|
|
636 |
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Comprehensive income |
|
$ |
2,963 |
|
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$ |
1,226 |
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|
|
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|
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Net income per share: |
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|
|
|
|
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Common stock - Basic |
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$ |
0.13 |
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$ |
0.04 |
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Class B common stock - Basic |
|
|
0.12 |
|
|
|
0.04 |
|
Common stock - Diluted |
|
|
0.13 |
|
|
|
0.04 |
|
Class B common stock - Diluted |
|
|
0.12 |
|
|
|
0.04 |
|
|
|
|
|
|
|
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Weighted average number of shares: |
|
|
|
|
|
|
Common stock – Basic |
|
|
12,393 |
|
|
|
12,200 |
|
Class B common stock – Basic |
|
|
2,049 |
|
|
|
2,049 |
|
Common stock – Diluted |
|
|
12,544 |
|
|
|
12,431 |
|
Class B common stock – Diluted |
|
|
2,049 |
|
|
|
2,049 |
|
Richardson Electronics, Ltd.
Unaudited Consolidated Statements of Cash Flows
(in thousands)
|
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Three Months Ended |
|
|
|
August 30, 2025 |
|
|
August 31, 2024 |
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Operating activities: |
|
|
|
|
|
|
Net income |
|
$ |
1,909 |
|
|
$ |
590 |
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Adjustments to reconcile net income to cash provided by operating activities: |
|
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Unrealized foreign currency gain |
|
|
(511 |
) |
|
|
(382 |
) |
Depreciation and amortization |
|
|
971 |
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|
|
1,044 |
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Inventory provisions |
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|
102 |
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|
|
139 |
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Share-based compensation expense |
|
|
641 |
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|
|
593 |
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Gain on disposal of property, plant and equipment |
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— |
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(2 |
) |
Deferred income taxes |
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|
49 |
|
|
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(58 |
) |
Change in assets and liabilities: |
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|
|
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Accounts receivable |
|
|
(2,654 |
) |
|
|
(5,858 |
) |
Inventories |
|
|
(578 |
) |
|
|
(124 |
) |
Prepaid expenses and other assets |
|
|
60 |
|
|
|
(29 |
) |
Accounts payable |
|
|
1,626 |
|
|
|
4,164 |
|
Accrued liabilities |
|
|
(150 |
) |
|
|
(95 |
) |
Other |
|
|
(98 |
) |
|
|
430 |
|
Net cash provided by operating activities |
|
|
1,367 |
|
|
|
412 |
|
Investing activities: |
|
|
|
|
|
|
Capital expenditures |
|
|
(1,025 |
) |
|
|
(926 |
) |
Proceeds from sale of property, plant and equipment |
|
|
— |
|
|
|
7 |
|
Net cash used in investing activities |
|
|
(1,025 |
) |
|
|
(919 |
) |
Financing activities: |
|
|
|
|
|
|
Proceeds from issuance of common stock |
|
|
61 |
|
|
|
144 |
|
Cash dividends paid on common and Class B common stock |
|
|
(857 |
) |
|
|
(850 |
) |
Proceeds from revolving credit facility |
|
|
— |
|
|
|
1,000 |
|
Repayment of revolving credit facility |
|
|
— |
|
|
|
(1,000 |
) |
Other |
|
|
(99 |
) |
|
|
(162 |
) |
Net cash used in financing activities |
|
|
(895 |
) |
|
|
(868 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
306 |
|
|
|
147 |
|
Decrease in cash and cash equivalents |
|
|
(247 |
) |
|
|
(1,228 |
) |
Cash and cash equivalents at beginning of period |
|
|
35,901 |
|
|
|
24,263 |
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Cash and cash equivalents at end of period |
|
$ |
35,654 |
|
|
$ |
23,035 |
|
Richardson Electronics, Ltd.
Unaudited Net Sales and Gross Profit
For the First Quarter of Fiscal 2026 and 2025
($ in thousands)
By Strategic Business Unit
Net Sales
|
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|
|
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|
|
|
|
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Three Months Ended |
|
|
FY26 vs. FY25 |
|
|
|
August 30, 2025 |
|
|
August 31, 2024 |
|
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% Change |
|
PMT |
|
$ |
39,069 |
|
|
$ |
38,001 |
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|
|
2.8 |
% |
GES |
|
|
7,263 |
|
|
|
8,086 |
|
|
|
-10.2 |
% |
Canvys |
|
|
8,275 |
|
|
|
7,638 |
|
|
|
8.3 |
% |
Total |
|
$ |
54,607 |
|
|
$ |
53,725 |
|
|
|
1.6 |
% |
Gross Profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
August 30, 2025 |
|
|
% of Net Sales |
|
|
August 31, 2024 |
|
|
% of Net Sales |
|
PMT |
|
$ |
12,226 |
|
|
|
31.3 |
% |
|
$ |
11,431 |
|
|
|
30.1 |
% |
GES |
|
|
2,150 |
|
|
|
29.6 |
% |
|
|
2,374 |
|
|
|
29.4 |
% |
Canvys |
|
|
2,553 |
|
|
|
30.9 |
% |
|
|
2,621 |
|
|
|
34.3 |
% |
Total |
|
$ |
16,929 |
|
|
|
31.0 |
% |
|
$ |
16,426 |
|
|
|
30.6 |
% |
Richardson Electronics, Ltd.
Unaudited Reconciliation Between GAAP and Non-GAAP Financial Measures
For the First Quarter of Fiscal 2026 and 2025
($ in thousands)
EBITDA
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
August 30, 2025 |
|
|
August 31, 2024 |
|
Net income |
|
$ |
1,909 |
|
|
$ |
590 |
|
Income tax expense |
|
|
421 |
|
|
|
58 |
|
Depreciation & amortization |
|
|
971 |
|
|
|
1,044 |
|
EBITDA |
|
$ |
3,301 |
|
|
$ |
1,692 |
|
