STRATTEC SECURITY CORPORATION Reports Fiscal 2012 First Quarter Results

MILWAUKEE, Oct. 27, 2011 (GLOBE NEWSWIRE) -- STRATTEC SECURITY CORPORATION
(Nasdaq:STRT) today reported operating results for the fiscal first quarter
ended October 2, 2011.

Net sales for the Company's first quarter ended October 2, 2011 were $66.4
million, compared to net sales of $59.8 million for the prior year quarter ended
September 26, 2010. Net income for the current year quarter was $1,282,000,
compared to net income of $1,418,000 in the prior year quarter. Diluted earnings
per share for the current quarter were $.39 compared to diluted earnings per
share of $.43 in the prior year quarter.

Overall sales to STRATTEC's largest customers increased in the current quarter
compared to the prior year quarter levels primarily due to higher customer
vehicle production volumes. Sales to Chrysler Group LLC were $19.8 million in
the current quarter compared to $19.6 million in the prior year quarter. Sales
to General Motors Company were $16.1 million in the current quarter compared to
$14.8 million in the prior year quarter. Included in the prior year quarter
sales to General Motors were $1.7 million of sales to Nexteer Automotive,
formerly a unit of General Motors. Sales to Ford Motor Company were $8.3 million
in the current quarter compared to $5.5 million in the prior year quarter. Net
sales to Hyundai/Kia were $3.8 million in the current quarter compared to $4.3
million in the prior year quarter, a reduction of $0.5 million primarily due to
lower vehicle production in the current quarter.

The gross profit margin was 17.3 percent in the current quarter compared to 17.0
percent in the prior year quarter. The higher gross profit margin in the current
year quarter was largely the result of higher customer vehicle production
volumes which increased overhead absorption of STRATTEC's manufacturing costs.
Items negatively impacting the current quarter gross margin were an unfavorable
Mexico peso to U.S. dollar exchange rate affecting the Company's operations in
Mexico for most of the quarter, a less favorable product content sales mix and
higher purchased raw material costs for zinc and brass.

Operating expenses were essentially flat at $8.2 million in both the current
quarter and prior year quarter.

Included in Other (Expense) Income in the current quarter compared to the prior
year quarter were the following items (in thousands of dollars):

October September
2, 26,
2011 2010
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Foreign Currency Transaction Gain (Loss) $ 1,699 $ (31)
Unrealized Loss on Mexican Peso Option Contracts (2,305) --
Rabbi Trust (Loss) Gain (241) 124
Equity (Loss) Earnings of VAST LLC Joint Venture (120) 422

Other (21) 106
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$ (988) $ 621
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Increase (Decrease) Diluted Earnings Per Share $ (.13) $ .11
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During the later part of the current quarter, the Mexican peso devalued
significantly to the US dollar creating both transaction gains and unrealized
losses on our Mexican peso currency option contracts entered into during the
later half of fiscal 2011 and early 2012. Our objective in entering into these
currency option contracts is to minimize our earnings volatility resulting from
changes in exchange rates affecting the U.S. dollar cost of our Mexican
operations. The unrealized loss recognized in the current quarter results from
mark-to-market adjustments as of October 2, 2011 and may or may not be realized,
depending on actual Mexican peso to US dollar exchange rates experienced during
the balance of the fiscal year.

During the current quarter our joint ventures in China and Brazil both incurred
relocation costs associated with moves to new facilities and start-up costs
associated with a new product line. Both of these items caused STRATTEC to incur
an equity loss from joint ventures in the current year quarter compared to the
prior year quarter equity earnings from joint ventures. We anticipate these
transition costs to continue over most of the remaining fiscal year.

STRATTEC designs, develops, manufactures and markets automotive Access Control
Products, including mechanical locks and keys, electronically enhanced locks and
keys, steering column and instrument panel ignition lock housings, latches,
power sliding side door systems, power lift gate systems, power deck lid
systems, door handles and related products. These products are provided to
customers in North America, and on a global basis through a unique strategic
relationship with WITTE Automotive of Velbert, Germany and ADAC Automotive of
Grand Rapids, Michigan. Under this relationship, STRATTEC, WITTE and ADAC market
our products to global customers under the "VAST" brand name. STRATTEC's history
in the automotive business spans over 100 years.

The STRATTEC SECURITY CORPORATION logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4700

Certain statements contained in this release contain "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements may be identified by the use of forward-looking words
or phrases such as "anticipate," "believe," "could," "expect," "intend," "may,"
"planned," "potential," "should," "will," and "would." Such forward-looking
statements in this release are inherently subject to many uncertainties in the
Company's operations and business environment. These uncertainties include
general economic conditions, in particular, relating to the automotive industry,
consumer demand for the Company's and its customers' products, competitive and
technological developments, customer purchasing actions, foreign currency
fluctuations, and costs of operations (including fluctuations in the cost of raw
materials). Shareholders, potential investors and other readers are urged to
consider these factors carefully in evaluating the forward-looking statements
and are cautioned not to place undue reliance on such forward-looking
statements. The forward-looking statements made herein are only made as of the
date of this press release and the Company undertakes no obligation to publicly
update such forward-looking statements to reflect subsequent events or
circumstances occurring after the date of this release. In addition, such
uncertainties and other operational matters are discussed further in the
Company's quarterly and annual filings with the Securities and Exchange
Commission.

STRATTEC SECURITY CORPORATION
-----------------------------------------------
Results of Operations
(In Thousands except per share amounts)
(Unaudited)

First Quarter
Ended

October September
2, 2011 26, 2010
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Net Sales $66,377 $59,849

Cost of Goods Sold 54,873 49,696
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Gross Profit 11,504 10,153

Engineering, Selling &
Administrative Expenses 8,208 8,165
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Income from Operations 3,296 1,988

Interest Income 17 23
Interest Expense-Related
Parties (31) (51)

Other (Expense) Income, Net (988) 621
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2,294 2,581

Provision for Income Taxes 321 801
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Net Income 1,973 1,780
Net Income Attributable to
Non-Controlling Interest (691) (362)
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Net Income Attributable to
STRATTEC SECURITY
CORPORATION $1,282 $1,418
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Earnings Per Share:

Basic $0.39 $0.43
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Diluted $0.39 $0.43
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Average Basic Shares
Outstanding 3,294 3,280

Average Diluted Shares
Outstanding 3,326 3,299

Other
Capital Expenditures $3,492 $1,776
Depreciation &
Amortization $1,652 $1,638

STRATTEC SECURITY CORPORATION
-----------------------------------------------------

Condensed Balance Sheet Data
(In Thousands)

October 2, July 3,
2011 2011
----------- ---------
(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 13,188 $ 17,250
Receivables, net 41,232 39,649
Inventories 24,312 22,135

Other current assets 15,120 15,368
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Total Current Assets 93,852 94,402
Deferred Income Taxes 3,945 3,639
Loan to Joint Venture 1,500 1,500
Investment in Joint Venture 7,293 7,276
Other Long Term Assets 610 635
Property, Plant and
Equipment, Net 40,781 40,636
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$ 147,981 $ 148,088
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LIABILITIES AND SHAREHOLDERS'
EQUITY
Current Liabilities:
Accounts Payable $ 24,906 $ 22,851

Other 26,333 28,137
----------- ---------
Total Current Liabilities 51,239 50,988
Borrowings Under Line of
Credit Facility -- --
Accrued Pension and Post
Retirement Obligations 6,995 7,036
Other Long Term Liabilities 804 --
Shareholders' Equity 245,102 243,974
Accumulated Other
Comprehensive Loss (24,619) (21,750)

Less: Treasury Stock (136,000) (136,009)
----------- ---------

Total STRATTEC SECURITY
CORPORATION Shareholders'
Equity 84,483 86,215

Non-Controlling Interest 4,460 3,849
----------- ---------

Total Shareholders' Equity 88,943 90,064
----------- ---------

$ 147,981 $ 148,088
=========== =========

STRATTEC SECURITY CORPORATION
--------------------------------------------------------------
Condensed Cash Flow Statement Data
(In Thousands)
(Unaudited)
First Quarter
Ended

October September
2, 2011 26, 2010
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Cash Flows from Operating Activities:
Net Income $1,973 $1,780
Adjustment to Reconcile Net Income to Net
Cash Used in Operating Activities:
Equity Loss (Earnings) in Joint Venture 120 (422)
Depreciation and Amortization 1,652 1,638
Foreign Currency Transaction Loss (Gain) (1,699) 31
Unrealized Loss on Foreign Currency
Option Contracts 2,305 --
Stock Based Compensation Expense 174 143
Change in Operating Assets/Liabilities (4,749) (5,453)

Other, net 16 4
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Net Cash Used In Operating Activities (208) (2,279)

Cash Flows from Investing Activities:
Purchase of Additional Interest in
Minority Owned Subsidiaries -- (22)
Additions to Property, Plant and
Equipment (3,492) (1,776)
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Net Cash Used in Investing Activities (3,492) (1,798)

Cash Flow from Financing Activities:
Dividends Paid (335) --
Repayment of Loan to Related Parties (400) (500)
Exercise of Stock Options and Employee
Stock Purchases 16 13
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Net Cash Used In Financing Activities (719) (487)

Foreign Currency Impact on Cash 357 19
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Net Decrease in Cash & Cash Equivalents (4,062) (4,545)

Cash and Cash Equivalents:

Beginning of Period 17,250 21,867
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End of Period $13,188 $17,322
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CONTACT: Pat Hansen
Senior Vice President and
Chief Financial Officer
414-247-3435
www.strattec.com