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UPDATE 1-Daktronics posts surprise Q1 profit, shares rise
August 24, 2010 / 3:04 PM / 7 years ago

UPDATE 1-Daktronics posts surprise Q1 profit, shares rise

* Q1 EPS $0.06 vs est. loss $0.04

* Q1 rev down 11 pct at $100.5, beats est. $94.7 mln

* Sees slight sequential increase in Q2 sales

* Shares up 15 pct

Aug 24 (Reuters) - Electronic scoreboard and billboard maker Daktronics Inc (DAKT.O) posted a surprise quarterly profit, helped by lower expenses and a spurt in orders, and said the worst of the downturn was behind it, sending its shares up 15 percent.

The company, which forecast a slight sequential increase in second quarter sales, also said it had won back a significant digital billboard order from a “major outdoor advertising company” during the quarter.

Daktronics, whose main customers are outdoor advertisers Lamar Advertising Co (LAMR.O) and Clear Channel Outdoor Holdings Inc (CCO.N), struggled for the most of last year with falling orders as the credit crisis forced firms to clamp down on advertising and marketing spend.

The company, which uses LED technology to light up its scoreboards and signages, said orders for the two most recent quarters were up from the last year.

The company, however, warned of parts shortages hurting second-quarter sales and said it expects continued pressure on gross profit margins given the current pricing environment and backlog.

For the May-July quarter, the company posted a net income of $2.4 million, or 6 cents a share, compared with $1.4 million, or 3 cents a share, last year.

Sales fell 11 percent to $100.5 million. Total operating expenses dropped 16 percent.

Analysts on average were looking for a loss of 4 cents a share on revenue of $94.7 million, according to Thomson Reuters I/B/E/S.

Daktronics shares rose as much as 16 percent to a high of $9.05 -- their biggest intra-day percentage jump in nearly two years. They have shed more than 13 percent of their value in the last 52 weeks. (Reporting by Saqib Iqbal Ahmed in Bangalore)

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