PITTSBURGH, PENNSYLVANIA, February 6, 2018 --Black Box Corporation (NASDAQ:BBOX), a leading digital solutions provider dedicated to helping customers design, build, manage and secure their IT infrastructure, today reported results for the third quarter of Fiscal 2018 and nine-month period ended December 30, 2017.
Third Quarter Results
- Revenues declined by $15.5 million or 7.4% to $194.9 million compared to the same period last year.
- Gross profit margin was 27.0%, down 270 basis points from 29.7% for the same period last year. This decrease was primarily due to a decline in our higher margin legacy unified communication business and lower margin incremental deals in both our Products and Services segments during this quarter.
- Selling, general and administrative expenses were $59.0 million, up 2.8% from $57.4 million for the same period last year and down 2.3% from $60.3 million in the prior quarter. The increase from the same period last year was primarily due to higher spending on the U.S.-based ERP project, partially offset by lower variable compensation costs while the decrease from the prior quarter was primarily due to these lower variable compensation costs incurred this quarter.
- Loss before income taxes was $9.8 million, compared to income before income taxes of $1.6 million for the same period last year and consistent with a loss before income taxes of $9.0 million in the prior quarter.
- Provision for income taxes was $18.1 million, compared to provision for income taxes of $0.3 million for the same period last year and compared to a provision for income taxes of $2.4 million in the prior quarter. The increase in the provision was primarily due to the impact of the Tax Cuts and Jobs Act, which resulted in tax expense of $13.5 million, and valuation allowances booked against U.S. foreign tax credit carry-forwards.
- Net loss was $27.9 million, compared to net income of $1.3 million for the same period last year and compared to a net loss of $11.4 million in the prior quarter.
- Diluted loss per share was $1.85, compared to diluted income per share of $0.09 for the same period last year and compared to a diluted loss per share of $0.75 in the prior quarter.
- Cash flow used for operating activities was $27.5 million, compared to cash flow provided by operating activities of $9.1 million for the same period last year and compared to cash flow provided by operating activities of $0.6 million in the prior quarter. The variance compared to the prior quarter was principally due to cash used by increases in working capital.
Year to Date Results
- Revenues were $580.7 million, down 10.3% from $647.6 million for the same period last year.
- Loss before income taxes was $33.0 million, compared to $4.1 million for the same period last year.
- Provision for income taxes was $16.1 million, compared to $1.1 million for the same period last year.
- Net loss was $49.1 million, compared to $5.3 million for the same period last year.
- Diluted loss per share was $3.26, compared to $0.35 for the same period last year.
- Cash flow used for operating activities was $43.1 million, compared to cash flow provided by operating activities of $24.7 million for the same period last year.
"I want to reaffirm that we are committed to our Intelligent Digital Edge strategy which will be the cornerstone for future growth," stated Joel Trammell, President and CEO. "I acknowledge the near-term challenges that we need to overcome as noted in the Liquidity section of our Form 10-Q, and we are working on them. I remain excited about our future. The changes in our industry create tremendous opportunities for us, and that is why I accepted the challenge to lead Black Box. We have a lot of work to do to capitalize on these growing markets and to streamline our organization to efficiently deliver our solutions, and I am confident that we have the team and plans in place to accomplish those objectives."
Earnings Conference Call
The Company will conduct a conference call beginning at 5:00 p.m. Eastern Time today, February 6, 2018. Joel Trammell, President and Chief Executive Officer, will host the call. To listen only to the live webcast, access the event at http://investor.blackbox.com/events.cfm. To participate in the teleconference, dial 877-303-3145 (USA) or 253-237-1194 (International) approximately 15 minutes prior to the starting time and ask to be connected to conference 2487578. A replay of the audio webcast will be available at http://investor.blackbox.com/events.cfm for a limited period of time.
About Black Box
Black Box is a leading digital solutions provider dedicated to helping customers design, build, manage and secure their IT infrastructure. Black Box delivers high-value products and services through its global presence and 3,339 team members. To learn more, visit the Black Box Web site at https://ww.blackbox.com.
Black Box® and the Double Diamond logo are registered trademarks of BB Technologies, Inc.
For more details, view the official investor press release.
For Investor Relations Inquiries:
Black Box Corporation
David J. Russo
Senior Vice President and Chief Financial Officer
Phone: (724) 873-6788
Any forward-looking statements contained in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and speak only as of the date of this release. You can identify these forward-looking statements by the fact that they use words such as "should," "anticipate," "estimate," "approximate," "expect," "target," "may," "will," "project," "intend," "plan," "believe" and other words of similar meaning and expression in connection with any discussion of future operating or financial performance. One can also identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. Forward-looking statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those projected. Although it is not possible to predict or identify all risk factors, they may include, among others, levels of business activity and operating expenses, liquidity, expenses relating to compliance requirements, cash flows, global economic and business conditions, successful integration of acquisitions, the timing, benefits and costs of restructuring programs and other initiatives, such as our enterprise resource planning system initiatives, successful marketing of the Company's product and services offerings, successful implementation of the Company's integration initiatives, successful implementation of the Company's government contracting programs, competition, changes in foreign, political and economic conditions, fluctuating foreign currencies compared to the U.S. dollar, rapid changes in technologies, client preferences, the Company's arrangements with suppliers of voice equipment and technology, government budgetary constraints and various other matters, many of which are beyond the Company's control. Additional risk factors are included in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2017 and our quarterly reports on Form 10-Q for Fiscal 2018. We can give no assurance that any goal, plan or target set forth in forward-looking statements will be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. We undertake no obligation to release publicly any revisions to forward-looking statements as a result of future events or developments and caution you not to unduly rely on any such forward-looking statements.