Methode Electronics Inc. (NYSE:MEI) announced its fiscal first quarter 2016 results before the market opened thus morning, and managed to beat the earnings expectations of analysts, posting a profit of $0.60 per share, though revenues came in light at $203.3 million. Analysts were anticipating revenues of $210 million and earnings of $0.54 per share. Despite the mixed results, the stock has skyrocketed in today’s trading session, gaining more than 22% by noon.
Compared to the three months ended August 2, 2014, revenues fell by 6.78%, but net income rose by roughly 10% to $23.5 million. Methode Electronics Inc. (NYSE:MEI) laments increased legal and travel costs, lower revenues from its Automotive and Power Product segments, and the costs associated with the transfer of its manufacturing from the Philippines to Egypt in the Interface segment for the decrease in net sales. The company reiterated its forecast for the 2016 fiscal year, eyeing revenues in the range of $830 million to $865 million and earnings per share of $2.07 to $2.22.
“First-quarter profitability was positively impacted by favorable currency translation on raw materials and labor costs, favorable commodity pricing and the refund of import duties in our Automotive segment. However, costs and manufacturing inefficiencies in our Interface segment due to the transfer of manufacturing from the Philippines to Egypt and the unfavorable currency effect on sales negatively impacted our results […] While we will continue to make investments in our business through new product development, vertical integration and potential acquisitions, we believe the initiation of a share repurchase program demonstrates our continued commitment to creating and returning value to our shareholders,” commented Donald W. Duda, Chief Executive Officer of Methode Electronics.
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