• Clearfield Reports Record Fiscal Fourth Quarter and Full Year 2021 Results

    المصدر: Nasdaq GlobeNewswire / 04 نوفمبر 2021 15:00:00   America/Chicago

    • Company Achieves Record Annual Net Sales of $140.8 Million, Driven by 66% Year-over-Year Growth in Community Broadband Revenue

    • Revenue for the year grew 51% to $140.8 Million. Backlog Increased 522% to $66.4 Million at Year End compared to $10.7 Million at End of Fiscal 2020

    • Continued Execution on Operational Effectiveness Initiatives and Favorable Product Mix Produces 43.6% Quarterly Gross Profit Margin and Quarterly Record Gross Profit Dollars

    • Fiscal 2021 Net Income Totaled $20.3 Million, or $1.47 per diluted share, an Improvement of 179% from $7.3 Million, or $0.53 per diluted share, in Fiscal 2020

    • Company Increases FY22 Net Sales Guidance to $162 Million to $169 Million, Representing Growth of 15% to 20% Compared to Fiscal 2021 Net Sales

    MINNEAPOLIS, Nov. 04, 2021 (GLOBE NEWSWIRE) -- Clearfield, Inc. (NASDAQ: CLFD), the specialist in fiber management and connectivity platforms for communication service providers, reported results for the fiscal fourth quarter and fiscal year ended September 30, 2021.

    Fiscal Q4 2021 Financial Summary 
    (in millions except per share data and percentages)Q4 2021vs. Q4 2020Change Change (%)
    Net Sales$ 45.2 $27.3 $17.9 66%
         
    Gross Profit ($)$ 19.7 $11.2 $8.5 75%
    Gross Profit (%) 43.6% 41.2% 2.5%6%
         
    Income from Operations$ 9.4 $3.7 $5.7 155%
    Income Tax Expense$ 2.1 $0.8 $1.3 162%
         
    Net Income$ 7.4 $3.0 $4.4 144%
    Net Income per Diluted Share$ 0.53 $0.22 $0.31 141%
         
    Fiscal 2021 Financial Summary 
    (in millions except per share data and percentages)2021vs. 2020 Change Change (%)
    Net Sales$ 140.8 $93.1 $47.7 51%
         
    Gross Profit ($)$ 61.2 $37.9 $23.3 61%
    Gross Profit (%) 43.5% 40.7% 2.7%7%
         
    Income from Operations$ 25.2 $8.4 $16.9 201%
    Income Tax Expense$ 5.4 $1.9 $3.5 190%
         
    Net Income$ 20.3 $7.3 $13.0 179%
    Net Income per Diluted Share$ 1.47 $0.53 $0.94 177%
         

    Management Commentary
    “Clearfield delivered record-setting financial performance in the fourth quarter and for the full fiscal year 2021 in a market that is changing dramatically,” said Company President and CEO Cheri Beranek. “We are in the middle of a historic investment cycle. Due to our consistent focus on customer service, quality product, and our ability to nimbly respond to customers’ changing needs, Clearfield has built an advantageous position in the broadband market and continues to benefit from the rising demand for fiber.”

    “Our record topline results in fiscal Q4 2021 were driven by solid contributions across our core markets, including 90% growth in our MSO (Multiple System Operators or Cable TV) revenue and 64% growth in our Community Broadband revenue. We anticipate the momentum will continue into FY 2022 Q1 in that order backlog (defined as purchase orders received but not yet fulfilled) as of September 30, 2021, increased 65% to $66.4 million from $40.3 million at June 30, 2021 and increased 522% from $10.7 million as of September 30, 2020. Moreover, this backlog is composed of nearly 200 customers, including several distributors representing additional customers, with a quarter of these customers having a backlog of $100,000 or more. The demand for our product is broad.”

    “We continue to make strong progress on the three pillars of our ‘Now of Age’ plan, our multi-year strategic plan that will establish Clearfield as the platform of choice for fiber management and connectivity. Over the course of fiscal year 2021, we were able to deliver significant growth with our current facilities and are prepared to triple our footprint early next quarter following the investment in our Mexican plant. We are committed to scaling our operations to meet the expected demand of the future.”

    “Furthermore, in response to changing customer needs in this market, we are evolving from being a rapid response supplier to a trusted provider focused on meeting our customers’ longer-term planning to address customers with larger scale deployments.   This change enables us to provide material that our customers need to meet their short- and long-term deployment schedules. We have always been focused on delivering stellar customer service and best-in-class, craft-friendly product. We believe that these core competencies, when combined with our agility and consistent drive for operational improvements, provide us a competitive advantage in this new market dynamic.”

    “We remain very optimistic about Clearfield’s growth potential. Demand for high-speed broadband, especially fiber-led broadband, continues to be very strong. We anticipate additional funding from government programs like the Rural Digital Opportunity Fund (RDOF) and the infrastructure package being discussed in Congress will enhance current market tailwinds.   From the beginning, Clearfield’s culture was built for this kind of opportunity, and we are delivering on our value proposition to an increasingly long list of customers. With the overall market strength and current visibility we have into our backlog, we believe we can deliver projected annual net sales of $162 million to $169 million in fiscal year 2022, representing growth of 15-20% over fiscal year 2021 revenues.”

    Fiscal Fourth Quarter 2021 Financial Results
    Net sales for the fourth quarter of fiscal 2021 increased 66% to $45.2 million from $27.3 million in the same year-ago quarter. The increase in net sales was due to higher sales across all markets, led by the Company’s Community Broadband, MSO and International markets.

    As of September 30, 2021, order backlog (defined as purchase orders received but not yet fulfilled) was $66.4 million, an increase of 65% compared to $40.3 million at June 30, 2021 and an increase of 522% from $10.7 million at September 30, 2020.

    Gross profit for the fourth quarter of fiscal 2021 increased 75% to $19.7 million (or 43.6% of net sales), from $11.2 million (or 41.2% of net sales), in the fourth quarter of fiscal 2020. The increase in gross profit margin was due to a favorable product mix associated with higher net sales in the Company’s Community Broadband markets and increased production at its Mexico plants as well as manufacturing efficiencies realized with increased sales volumes.

    Operating expenses for the fourth quarter of fiscal 2021 totaled $10.4 million, which compares to $7.6 million in the same year-ago quarter. The increase in operating expenses consisted primarily of higher compensation costs due to increased personnel and higher performance-based compensation as well as increased travel expenses.

    Income from operations increased 155% to $9.4 million for the fourth quarter of fiscal 2021 from $3.7 million in the same year-ago quarter.

    Income tax expense increased 162% to $2.1 million for the fourth quarter of fiscal 2021 from $786,000 in the same year-ago quarter due to higher taxable income.

    Net income for the fourth quarter of fiscal 2021 totaled $7.4 million, or $0.53 per diluted share, compared to $3.0 million, or $0.22 per diluted share, in the same year-ago quarter.

    Fiscal Year 2021 Financial Results
    Net sales for fiscal 2021 increased 51% to $140.8 million from $93.1 million in fiscal 2020. The increase in net sales was primarily due to higher sales in the Company’s Community Broadband, MSO and International markets, partially offset by decreases in the Company’s National Carrier and Legacy markets.

    Gross profit for fiscal 2021 was $61.2 million (or 43.5% of net sales), an increase of 61% from $37.9 million (or 40.7% of net sales) in fiscal 2020. The increase in gross profit margin for the year was due to a favorable product mix associated with higher net sales in the Company’s Community Broadband markets and cost reduction efforts across the Company’s product lines including increased production at its Mexico plants, as well as manufacturing efficiencies realized with increased sales volumes.

    Operating expenses for fiscal 2021 increased 22% to $35.9 million from $29.5 million in fiscal 2020. The increase in operating expenses consisted primarily of higher compensation costs due to increased personnel and higher performance-based compensation as well as higher stock compensation expense.

    Income from operations for fiscal 2021 totaled $25.2 million compared to $8.4 million in fiscal 2020.

    Income tax expense for fiscal 2021 was $5.4 million, an increase from $1.9 million in fiscal 2020, driven by due to higher taxable income.

    Net income for fiscal 2021 totaled $20.3 million, or $1.47 per diluted share, an improvement from $7.3 million, or $0.53 per diluted share, in fiscal 2020.

    As of September 30, 2021, cash, cash equivalents and investments totaled $60.5 million, up from $52.2 million at September 30, 2020.

    Conference Call
    Clearfield management will hold a conference call today, November 4, 2021 at 5:00 p.m. Eastern Standard Time (4:00 p.m. Central Standard Time) to discuss these results and provide an update on business conditions.

    Clearfield’s President and CEO Cheri Beranek and CFO Dan Herzog will host the presentation, followed by a question-and-answer period.

    U.S. dial-in: 1-844-826-3033
    International dial-in: 1-412-317-5185
    Conference ID: 10161010

    The conference call will be webcast live and available for replay here: https://viavid.webcasts.com/starthere.jsp?ei=1503634&tp_key=eac254e0a6

    Please call the conference telephone number 10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 1-949-574-3860.

    A replay of the call will be available after 8:00 p.m. Eastern time on the same day through November 18, 2021.

    U.S. replay dial-in: 1-844-512-2921
    International replay dial-in: 1-412-317-6671
    Replay ID: 10161010

    About Clearfield, Inc.
    Clearfield, Inc. (NASDAQ: CLFD) designs, manufactures, and distributes fiber optic management, protection, and delivery products for communications networks. Our “fiber to anywhere” platform serves the unique requirements of leading incumbent local exchange carriers (traditional carriers), competitive local exchange carriers (alternative carriers), and MSO/cable TV companies, while also catering to the broadband needs of the utility/municipality, enterprise, data center and military markets. Headquartered in Minneapolis, MN, Clearfield deploys more than a million fiber ports each year. For more information, visit www.SeeClearfield.com.

    Cautionary Statement Regarding Forward-Looking Information
    Forward-looking statements contained herein and in any related presentation or in the related FieldReport are made pursuant to the safe harbor provisions of the Private Litigation Reform Act of 1995. Words such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “outlook,” or “continue” or comparable terminology are intended to identify forward-looking statements. Such forward looking statements include, for example, statements about the Company’s future revenue and operating performance, anticipated shipping on backlog and future lead times, future availability of components and materials from the Company’s supply chain, the impact of the Rural Digital Opportunity Fund (RDOF) or other government programs on the demand for the Company’s products or timing of customer orders, the Company’s ability to add capacity to meet expected future demand, and trends in and growth of the FTTx markets, market segments or customer purchases and other statements that are not historical facts. These statements are based upon the Company's current expectations and judgments about future developments in the Company's business. Certain important factors could have a material impact on the Company's performance, including, without limitation: the COVID-19 pandemic has significantly impacted worldwide economic conditions and could have a material adverse effect on our business, financial condition and operating results; we rely on single-source suppliers, which could cause delays, increase costs or prevent us from completing customer orders; fluctuations in product and labor costs which may not be able to be passed on to customers that could decrease margins; we depend on the availability of sufficient supply of certain materials, such as fiber optic cable and resins for plastics, and global disruptions in the supply chain for these materials could prevent us from meeting customer demand for our products; a significant percentage of our sales in the last three fiscal years have been made to a small number of customers; further consolidation among our customers may result in the loss of some customers and may reduce sales during the pendency of business combinations and related integration activities; we may be subject to risks associated with acquisitions; product defects or the failure of our products to meet specifications could cause us to lose customers and sales or to incur unexpected expenses; we are dependent on key personnel; our business is dependent on interdependent management information systems; to compete effectively, we must continually improve existing products and introduce new products that achieve market acceptance; changes in government funding programs may cause our customers and prospective customers to delay, reduce, or accelerate purchases, leading to unpredictable and irregular purchase cycles; intense competition in our industry may result in price reductions, lower gross profits and loss of market share; our success depends upon adequate protection of our patent and intellectual property rights; if the telecommunications market does not expand as we expect, our business may not grow as fast as we expect; we face risks associated with expanding our sales outside of the United States; and other factors set forth in Part I, Item IA. Risk Factors of Clearfield's Annual Report on Form 10-K for the year ended September 30, 2020 as well as other filings with the Securities and Exchange Commission. The Company undertakes no obligation to update these statements to reflect actual events unless required by law.

    Investor Relations Contact:
    Matt Glover and Sophie Pearson
    Gateway Group, Inc.
    1-949-574-3860
    CLFD@gatewayir.com


    CLEARFIELD, INC.           
    STATEMENTS OF EARNINGS          
                
     (Unaudited)  
     Three Months Ended Year Ended
     September 30, September 30,
      2021  2020  2021  2020
                
    Revenues$45,235,962 $27,317,969 $140,755,399 $93,074,514
                
    Cost of sales 25,506,676  16,072,909  79,577,506  55,160,316
                
    Gross profit 19,729,286  11,245,060  61,177,893  37,914,198
                
    Operating expenses           
    Selling, general and administrative 10,362,218  7,565,160  35,943,752  29,530,198
    Income from operations 9,367,068  3,679,900  25,234,141  8,384,000
                
    Interest income 121,857  155,427  500,120  770,950
    Income before income taxes9,488,925  3,835,327  25,734,261  9,154,950
                
    Income tax expense 2,062,881  785,884  5,406,881  1,861,884
                
    Net income$7,426,044 $3,049,443 $20,327,380 $7,293,066
                
    Net income per share:           
    Basic$0.54 $0.22 $1.48 $0.53
    Diluted$0.53 $0.22 $1.47 $0.53
                
    Weighted average shares outstanding:         
    Basic 13,738,160  13,650,316  13,720,699  13,643,355
    Diluted 13,859,030  13,650,316  13,784,293  13,643,355
                


    CLEARFIELD, INC.
    BALANCE SHEETS

             
             
      September 30,  September 30,   
      2021  2020   
    Assets        
    Current Assets        
    Cash and cash equivalents$13,216,281 $16,449,636   
    Short-term investments 10,373,831  10,582,527   
    Accounts receivable, net 19,437,879  10,496,672   
    Inventories, net 27,524,311  14,408,538   
    Other current assets 953,945  585,436   
    Total current assets 71,506,247  52,522,809   
             
    Property, plant and equipment, net 4,997,658  4,952,819   
             
    Other Assets        
    Long-term investments 36,912,777  25,143,000   
    Goodwill 4,708,511  4,708,511   
    Intangible assets, net 4,696,151  4,986,216   
    Right of use lease assets 2,305,413  2,539,100   
    Deferred tax asset 365,467  178,118   
    Other 418,976  266,857   
    Total other assets 49,407,295  37,821,802   
    Total Assets$125,911,200 $95,297,430   
             
    Liabilities and Shareholders’ Equity        
    Current Liabilities        
    Current portion of lease liability$914,565 $665,584   
    Accounts payable 9,214,782  3,689,587   
    Accrued compensation 8,729,293  4,856,885   
    Accrued expenses 1,612,833  1,202,753   
    Total current liabilities 20,471,473  10,414,809   
             
    Other Liabilities        
    Long-term portion of lease liability 1,615,369  2,129,343   
    Total Liabilities 22,086,842  12,544,152   
             
    Shareholders’ Equity        
    Common stock 137,322  136,500   
    Additional paid-in capital 58,245,783  57,502,905   
    Retained earnings 45,441,253  25,113,873   
    Total Shareholders’ Equity 103,824,358  82,753,278   
    Total Liabilities and Shareholders’ Equity$125,911,200 $95,297,430   
             


    CLEARFIELD, INC.
    STATEMENTS OF CASH FLOWS

           
      Year Ended  Year Ended 
      September 30,  September 30, 
      2021  2020 
    Cash flows from operating activities      
    Net income$20,327,380  $7,293,066  
    Adjustments to reconcile net income to cash provided      
    by (used in) operating activities:      
    Depreciation and amortization 2,301,803   2,421,754  
    Change in allowance for doubtful accounts 209,612   -  
    Amortization of discount on investments (7,326)  (64,327) 
    Deferred income taxes (187,349)  (279,808) 
    Loss on disposal of assets -   5,785  
    Stock-based compensation expense 1,280,135   773,555  
    Changes in operating assets and liabilities      
    Accounts receivable (9,150,819)  (1,378,033) 
    Inventories, net (13,115,773)  (5,395,558) 
    Other assets (531,201)  127,773  
    Accounts payable and accrued expenses 9,776,377   3,151,566  
    Net cash provided by operating activities 10,902,839   6,655,774  
           
    Cash flows from investing activities:      
    Purchases of property, plant and equipment and      
    intangible assets (2,046,004)  (1,806,198) 
    Purchase of investments (24,808,755)  (34,056,930) 
    Proceeds from maturities of investments 13,255,000   35,822,000  
    Net cash used in investing activities (13,599,759)  (41,128) 
           
    Cash flows from financing activities      
    Proceeds from issuance of common stock under 383,697   348,776  
    employee stock purchase plan      
    Tax withholding and proceeds related to exercise of stock options(458,017)  9,564  
    Tax withholding related to vesting of restricted stock grants (462,115)  (176,416) 
    Repurchase of common stock -   (428,654) 
    Net cash used in financing activities (536,435)  (246,730) 
    Increase (Decrease) in cash and cash equivalents (3,233,355)  6,367,916  
    Cash and cash equivalents, beginning of period 16,449,636   10,081,721  
    Cash and cash equivalents, end of period$13,216,281  $16,449,637  
           
    Supplemental disclosures for cash flow information      
    Cash paid during the year for income taxes$5,504,985  $1,442,079  
           
    Non-cash financing activities      
    Cashless exercise of stock options$1,271,472  $97,811  
           

     


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