Servotronics Announces Fourth-Quarter and Full-Year 2024 Financial Results
-- Continued actions to optimize business results in increased sales and margins for the full year ---- Challenging market conditions and customer delays drive lower revenues in the fourth quarter--
ELMA, N.Y., March 17, 2025 /PRNewswire/ -- Servotronics, Inc. (NYSE American, SVT), a designer and manufacturer of servo-control components and other advanced technology products, today reported financial results for the fourth quarter and full year ended December 31, 2024.
"We achieved a number of significant milestones in 2024, posting increased revenues, improved margins and improved bottom-line results, even in a year where commercial aircraft deliveries decreased nearly 10%," commented Chief Executive Officer William F. Farrell, Jr. "Although the year ended on a challenging note, the industry and Servotronics are well positioned for growth in 2025."
Highlights for the fourth quarter financial results include:
Revenues of $9.8 million, down 20.8% from $12.3 million in the fourth quarter of 2023, driven by significant industry headwinds and deferred customer deliveries resulting in lower volumes, as units shipped decreased by 22.0%.
Gross profit declined to $1.2 million, or 12.3% of revenue, in the fourth quarter, as compared to $2.8 million, or 22.4% of revenue, in the fourth quarter of 2023. The decrease was primarily due to the volume decline, unfavorable product mix, and lower fixed overhead absorption.
Operating loss for the quarter was ($1.1) million, as compared to operating income of $0.5 million in the fourth quarter of 2023, driven by lower volumes and related lower gross margins. Operating loss included a $0.1 million charge relating to legal settlement costs with a former executive.
Loss from continuing operations was ($1.3) million, or ($0.50) per diluted share in the fourth quarter of 2024, compared to income from continuing operations of $0.4 million, or $0.15 per diluted share in the fourth quarter of 2023.
"Shifting customer demand led to a challenging end to 2024. The year started off with robust growth forecasts, but industry headwinds prompted a series of order delays. Early in the year our team was able to pivot effectively, but as the year progressed, these changes pushed fourth quarter deliveries into 2025. This resulted in an increase of finished goods inventory as we had little room to maneuver," said Chief Executive Officer William F. Farrell, Jr. "In order to better align with shifting customer demand, we have moved to a monthly review of all customer forecasts, ensuring changes flow through to all suppliers. We are also redesigning our supply chains to shorten lead-times and improve our ability to rapidly react to market shifts and customer demand changes. As a result, we believe Servotronics is better positioned to manage market volatility as aircraft deliveries resume their growth in 2025."
Operating Results
Three Months Ended
Years Ended
December 31,
Years Ended December 31,
(Dollars in thousands)
2024
2023
% Change
2024
2023
% Change
Revenues
$ 9,768
$ 12,338
(20.8) %
$ 44,917
$ 43,629
3.0 %
Cost of goods sold
8,568
9,577
(10.5) %
36,651
35,824
2.3 %
Gross profit
1,200
2,761
(56.5) %
8,266
7,805
5.9 %
Gross margin
12.3 %
22.4 %
(10.1) %
18.4 %
17.9 %
0.5 %
Selling, general and administrative
2,311
2,245
2.9 %
9,275
9,918
(6.5) %
Operating loss
(1,111)
516
(315.3) %
(1,009)
(2,113)
(52.2) %
Interest & other expense
(143)
(102)
40.2 %
(496)
(336)
47.6 %
(Loss) income before income taxes
(1,254)
414
(402.9) %
(1,505)
(2,449)
(38.5) %
Income taxes
(7)
(36)
(80.6) %
(7)
(1,098)
(99.4) %
Net loss from cont operations
$ (1,261)
$ 378
(433.6) %
$ (1,512)
$ (3,547)
(57.4) %
Non-GAAP measures for comparison:
Operating (loss) income per above
$ (1,111)
$ 516
(315.3) %
$ (1,009)
$ (2,113)
(52.2) %
Addback: one-time expenses
134
-
100.0 %
704
1,211
(41.9) %
Adjusted operating (loss)
$ (977)
$ 516
(289.3) %
$ (305)
$ (902)
(66.2) %
Net (loss) income per above
$ (1,261)
$ 378
(433.6) %
$ (1,512)
$ (3,547)
(57.4) %
Addback: one-time expenses
