CHICAGO: Methode Electronics Inc. shares declined as the components maker cut its outlook for the year and reported disappointing revenue for its latest quarter.
The Chicago company’s shares, which are down 22% this year, declined 16% to $28.64 in recent trading.
For the year, the company lowered its per-share earnings estimate to $2.06 to $2.18 on revenue of $805 million to $ 825 million, from its previous estimate for per-share profit of $2.07 to $2.22 and revenue of $830 million to $865 million.
The company said its guidance reflects pricing concessions in its automotive segment, lower revenue from Ford related to the wind down of the center-console program–which was largely finished earlier this year–and continuing sales weakness in Methode’s interface and power-product segments.
However, Methode added that weaker revenue from the Ford program has been partially offset by increased business from General Motors Co.
For the three months ended Oct. 31, Methode reported that its revenue declined 9.3% to $208.4 million from $229.7 million a year earlier. Analysts polled by Thomson Reuters expected revenue of $213.1 million.
Overall, Methode Electronics reported a profit of $21.2 million, or 54 cents a share, down from $26 million, or 66 cents a share, a year earlier. Analysts expected per-share profit of 53 cents.
Gross margin fell to 24.4% from 26.2%, as lower sales in its power products segment contributed to manufacturing inefficiencies.
