Milwaukee-based Strattec Security Corp. Thursday reported fiscal 2016 first quarter net income of $3.8 million, or 90 cents per share, down from $9.3 million, or $2.55 per share, in the first quarter of 2015.
The vehicle access technology manufacturer reported operating income of $5.9 million, down from $14.9 million in the same period a year ago.
Revenue was $96.5 million in the first quarter, down from $122.2 million in the first quarter of 2015.
Net sales to General Motors Co. declined significantly year-over-year, from $44.9 million in the first quarter of 2015 to $18.8 million in the first quarter of 2016. The company attributed the decrease to incremental service parts sales related to a recall campaign of $28 million that shipped in the first quarter of 2015.
“As expected, this quarter compared unfavorably to a very unusual and strong first quarter in fiscal 2015. During this period last year, our associates worked long hours to deliver a large volume of service parts in a short amount of time to support a recall effort by one of our customers,” said Frank Krejci, president and chief executive officer of Strattec. “For Strattec, it resulted in a spike in sales, asset utilization, overhead absorption and profits.
“Comparing to years prior to fiscal 2015 gives a more normalized view of our progress. We have benefitted from product line expansion, winning new business and the strength of the automotive business, particularly in light truck and sport utility vehicles. While sales have increased, profits have increased, but not at the same rate. We are working on programs to further increase the efficiency of our operations. Earnings also continue to be impacted by our diversification efforts both in Strattec Component Solutions and Strattec Advanced Logic, which should benefit us in the long run, but are costing us in the short term.”
