Kimball Electronics (NASDAQ: KE) reported Q4 EPS of $0.27. Revenue for the quarter came in at $276.77 million.

Donald D. Charron, Chairman and Chief Executive Officer, stated, “Very strong growth in our automotive and medical end market verticals helped us achieve double-digit year-over-year growth for the fourth consecutive quarter and exceed our long-time stated goal of $1 billion in annual sales in fiscal year 2018.”

Mr. Charron continued, “We are pleased to have improved our operating income margin by 60 basis points from the prior year quarter and 20 basis points sequentially when compared to the third quarter. Partially offsetting the improved operating performance in the fourth quarter were expenses directly associated with our pending acquisition of GES, which we believe is still on track to close in this first quarter of fiscal year 2019. The much-anticipated progress in Romania came through in the fourth quarter helping to drive the improved overall performance, and we look forward to their continued growth and positive contributions in fiscal year 2019. We remain focused on achieving our mid-range goal of 4.5% operating income.”

Fourth Quarter Fiscal Year 2018 Overview:

• Consolidated net sales increased 15% compared to the fourth quarter of fiscal year 2017. Net sales for the quarter includes a 4% favorable impact from foreign currency movements compared to the prior year quarter.
• Costs incurred and included in operating income during the quarter related to the pending acquisition of GES were approximately $0.6 million, $0.4 million net of tax, or $0.01 per diluted share.
• The current quarter results include non-operating expense of $1.1 million related to pre-tax net losses from foreign currency movements, which was a fluctuation of $2.1 million from pre-tax net gains related to foreign currency movements of $1.0 million recognized in the same quarter of the prior year.
• Adjusted Net Income excludes income tax expense of $1.4 million ($0.05 per diluted share) in the fourth quarter for measurement period adjustments to estimated provisions related to the U.S. Tax Cuts and Jobs Act (“Tax Reform”) and subsequent guidance issued by the Internal Revenue Service. See below for additional information and a reconciliation of non-GAAP financial measures.
• Operating activities provided cash flow of $19.3 million during the quarter, which compares to cash flow provided by operating activities of $12.0 million in the fourth quarter of fiscal year 2017.
• Cash conversion days (“CCD”) for the quarter ended June 30, 2018 were 63 days, up from 60 days in the same quarter last year, and up sequentially from 62 days in the prior quarter. CCD is calculated as the sum of days sales outstanding plus production days supply on hand less accounts payable days.
• Investments in capital expenditures were $4.4 million during the quarter.
• Cash and cash equivalents were $46.4 million and borrowings outstanding on credit facilities were $8.3 million at June 30, 2018.

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