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Virco (VIRC) Reports Loss for Q4 Despite Higher Net Revenues

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Virco Mfg. Corporation (VIRC - Free Report) reported fourth-quarter fiscal 2024 (ended Jan 31) results, with net revenues surpassing the Zacks Consensus Estimate. Following the results, VIRC's shares gained 6.5% during the trading session on Apr 12.

Demand for VIRC’s PlanSCAPE project-management services continued to grow, along with more traditional full-service delivery and installation.

This leading manufacturer and supplier of moveable furniture and equipment for educational environments reported a loss in the fiscal fourth quarter.

Quarter in Detail

Virco reported a loss of 14 cents per share against the year-ago earnings of 26 cents per share. The Zacks Consensus Estimate was pegged at a loss of 13 cents per share.

Net revenues of $42.6 million topped the consensus mark of $41 million by 4.7%. The top line grew 9.8% from the prior-year quarter’s levels of $38.8 million. The increase was attributable to an improvement in on-time deliveries during the traditional summer season and increased order rates.

In the fiscal fourth quarter, the gross margin increased to 37.7% from the prior-year quarter’s levels of 33.5%. The upside was backed by stabilized raw material costs and operating efficiencies created by higher overall volume.

SG&A, as a percent of sales, decreased to 44.2% from 45.4% reported at the fiscal 2023-end. The company reported an operating loss of $2.77 million compared with $4.59 million reported in the prior-year quarter.

Fiscal 2024 Highlights

For the year, the company reported earnings per share (EPS) of $1.34 versus $1.02 a year ago. Net revenues also increased 16.5% to $269.1 million from $231.1 million reported in the prior year. Its domestically-based vertical business model supported the timely delivery of highly seasonal school furniture. However, seasonality creates operational, logistical, and financing challenges for the school furniture market.

Gross margin increased to 43.1% from the prior-year level of 36.9%. SG&A, as a percent of sales, improved year over year to 31.3% from 32.3%.

Operating income of $31.9 million in the reported quarter rose from $10.6 million reported in the prior-year quarter.

Shipments + Backlog for fiscal 2024 exceeded $317.6 million compared with $289.6 million reported a year ago.

Financials

As of Jan 31, 2024, the company had $5.29 million cash, significantly up from $1.06 million at the fiscal 2023-end.

Long-term debt, less current portion, was $4.14 million in the fiscal 2024-end, significantly down from  $14.38 million reported at the fiscal 2023-end.

Cash flow from operations was $27.0 million in fiscal 2024 versus cash to operations of $3.8 million in the prior year.

Zacks Rank & Key Picks

Virco currently carries a Zacks Rank #3 (Hold).

Here are some better-ranked stocks from the Consumer Discretionary sector.

Strategic Education, Inc. (STRA - Free Report) currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

STRA has a trailing four-quarter earnings surprise of 17.2%, on average. The Zacks Consensus Estimate for STRA’s 2024 sales and EPS indicates an increase of 5% and 23.7%, respectively, from the year-ago levels.

Adtalem Global Education Inc. (ATGE - Free Report) currently sports a Zacks Rank of 1. ATGE has a trailing four-quarter earnings surprise of 16.9%, on average.

The Zacks Consensus Estimate for ATGE’s fiscal 2024 sales and EPS implies growth of 6.4% and 10.2%, respectively, from the year-ago levels.

American Woodmark Corporation (AMWD - Free Report) presently sports a Zacks Rank of 1. AMWD has a trailing four-quarter earnings surprise of 41.3%, on average.

The Zacks Consensus Estimate for AMWD’s fiscal 2025 sales and EPS implies an improvement of 0.8% and 7%, respectively, from the year-ago levels.

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