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Jun 30, 2020
UFP Technologies Q2 2020 Earnings Report
Net income and sales decreased compared to the same period in 2019, impacted by COVID-19.
Key Takeaways
UFP Technologies reported a decrease in net income and sales for Q2 2020 compared to Q2 2019, primarily due to the adverse impacts of COVID-19 on its various markets. Despite the challenges, the company's product development business showed strong growth, and the company maintained a solid cash balance.
Net income for Q2 2020 was $2.3 million, or $0.31 per diluted share, compared to $4.6 million, or $0.62 per diluted share, for the same period in 2019.
Q2 2020 sales were $42.6 million, compared to $51.4 million in Q2 2019.
The product development business increased by 35% year-to-date.
The company generated approximately $5 million in cash during the quarter, bringing the cash balance to over $12 million.
Forward Guidance
The company anticipates continued near-term softness in elective procedures offsetting modest gains forecasted in non-medical markets.
Positive Outlook
- Strong increase in development business bodes well for revenue growth in 2021 and beyond.
- Q2 generated approximately $5 million in cash.
- Cash balance to over $12 million.
- Substantial borrowing capacity.
- Continue to invest in both internal and external growth opportunities as well as efficiency improvements to enhance competitive position.
Challenges Ahead
- Difficult to predict the impact of COVID-19 on future revenue.
- Anticipate continued near-term softness in elective procedures.
- Revenue for the quarter was down $8.8 million or 17% versus the prior year.
- Net income declined $2.3 million or 50%.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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