IRVINE, Calif., Nov. 13, 2014 /PRNewswire/ -- PRO-DEX, INC. (NasdaqCM: PDEX) today announced financial results for its fiscal 2015 first quarter ended September 30, 2014.
Net sales for the three months ended September 30, 2014 were $2.6 million, an increase of 2% from $2.5 million for the three months ended September 30, 2013. Underlying these relatively stable year-over-year sales levels was a $400,000 increase in sales to the Company's largest medical device customer, partially offset by a $183,000 decrease in repair revenue from the Company's former largest medical device customer and a $151,000 decrease in sales to another customer. The growth in sales to the Company's largest customer arose from the resumption of shipments to this customer in December 2013, following its suspension of orders from March through November 2013 ostensibly to relieve an inventory buildup of the Company's product.
Gross profit for the three months ended September 30, 2014 decreased $117,000, or 12%, to $828,000, compared to $945,000 for the year-ago period, primarily due to a shift in product mix between periods in which there were comparatively reduced volumes of high-margin product repairs and increased volumes of relatively lower-margin product sales. Also contributing to the reduced gross profit between the periods were increases in accruals for anticipated losses on the fixed price product development services portion of certain contracts, and in under-absorbed manufacturing costs due to reduced manufacturing volumes in the quarter ended September 30, 2014, compared to the corresponding year-earlier period. Partially offsetting these increases was a decrease in inventory and warranty charges for the quarter ended September 30, 2014, compared to the corresponding quarter of the prior fiscal year, due primarily to a downward revision in estimated per-unit repair costs. The net increase in the charges and accruals described above also contributed to a decrease in gross margin as a percentage of sales, which declined to 32% for the three months ended September 30, 2014 from 37% for the corresponding year-ago period.
Operating expenses (which include selling, general and administrative, and research and development expenses) for the quarter ended September 30, 2014 increased 10% to $1.0 million from $924,000 in the prior year's corresponding quarter, reflecting primarily increases in business development expenses and project-related legal costs.
Loss from continuing operations for the quarter ended September 30, 2014 was $181,000, compared to income from continuing operations of $18,000 in the prior year's corresponding quarter. Net loss for the quarter ended September 30, 2014 was $170,000, or $0.04 per share, compared to net income of $212,000, or $0.06 per share, for the corresponding prior year period. Net income for the quarter ended September 30, 2013 included a $167,000 gain from the sale of the Company's former Carson City facility, which is reflected in the results of discontinued operations for that period.
CEO Comments
Harold A. ("Hal") Hurwitz, the Company's President and Chief Executive Officer, commented, "A surface-level comparison of our results for the quarter ended September 30, 2014 to the year-earlier period will not do justice to the Pro-Dex narrative.
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