Pro-Dex, Inc. displayed remarkable financial fortitude during the fourth quarter of fiscal 2024, registering substantial growth in earnings per share and revenues. The company revealed a net income of $1.6 million for the quarter, equating to 46 cents per share, a noticeable uptick from the same period the previous year.
The standout feature of this quarter was the impressive 41% surge in net sales, climbing to $15 million from $10.6 million in the corresponding quarter last year. This surge was predominantly fueled by a $3.4 million boost in revenues from Pro-Dex’s primary customer, stemming from enhanced repair program revenues and new unit sales.
Pro-Dex, Inc. Financial Performance Overview
Pro-Dex’s quarter was marked by significant sales growth, despite a contraction in gross margin from 32% to 27%. This decline in gross margin was primarily a result of persistent price pressures and heightened indirect labor costs necessary to support the company’s expansion endeavors.
Operating expenses maintained stability at $1.7 million, closely mirroring the figures from the previous year. Notable shifts included a strategic reduction in general and administrative costs alongside a slight uptick in engineering expenses, indicating a pivot towards sustaining engineering activities over billable project endeavors.
The quarter also witnessed a 46% rise in operating income year over year, climbing to $2.4 million. This increase underscored the effectiveness of Pro-Dex’s operational adjustments and sales initiatives.
Balance Sheet and Cash Flows
As of June 30, 2024, Pro-Dex reported cash and cash equivalents of $2.6 million, slightly lower than the $2.9 million reported at the end of the previous fiscal year. Total assets saw a marginal uptick from $51.8 million to $52.5 million. Additionally, shareholders’ equity declined from $31.6 million to $30.9 million.
The company generated $6.2 million in operating cash flows during fiscal 2024, showcasing an increase compared to the $5.5 million generated in the prior year.
Fiscal Year 2024 Insights
For the entire fiscal year, net sales surged by 17% to reach $53.8 million, primarily driven by consistent increments in repair and new unit sales to the main customer. However, despite the sales growth, net income for the year saw a substantial decline to $2.1 million, equivalent to 60 cents per share, down from $1.95 per share in the preceding year.
This downturn in net income was largely attributed to a $4.1 million unrealized loss on marketable equity investments, underlining the volatile nature of investment valuations that overshadowed the positive operational income growth. The year also showcased a steady rise in research and development expenditures, reflecting Pro-Dex’s unwavering commitment to technology and product development to solidify its competitive stance in the medical device industry.