Allied Motion Expands Margins on 16% Revenue Growth in Second Quarter 2019
Allied Motion Technologies Inc. (Nasdaq: AMOT) (“Allied Motion” or “Company”), a designer and manufacturer that sells precision and specialty controlled motion products and solutions to the global market, today reported financial results for its second quarter ended June 30, 2019. Results include the TCI, LLC (“TCI”) acquisition that was completed December 6, 2018.
“The One Allied strategy to gain market share through our emphasis to provide engineered solutions for customers in selected target markets is the primary driver of our continued growth. Expanded utilization of our Allied Systematic Tools (“AST”) to improve quality, delivery, cost and innovation is contributing to our improved margins and helped to offset the increased pricing from a supplier of a key electronic assembly. Our recent acquisition of TCI has strategically expanded our addressable market and was a strong contributor to sales and earnings,” commented Dick Warzala, Chairman and CEO.
He added, “We achieved yet another record level of orders and backlog in the quarter as we continued to have strong order flow in the U.S., partially offset by some general economic softness in Europe. Our strong backlog provides us confidence for the near-term as we continue to focus on the long-term by investing in the development of Allied Motion multi-technology solutions that ‘Change the Game’ and create value for our customers.”
Second Quarter 2019 Results (Narrative compares with prior-year period unless otherwise noted)
Revenue of $92.6 million was up $12.6 million, or 16%, and reflects growth across all of the Company’s served markets. Revenue increased more than 18% when excluding a $2.0 million unfavorable impact of changes in foreign currency exchange rates. Organic growth was more than 3%, which reflects double-digit U.S. performance, partially offset by softer market conditions in Europe. Sales to U.S. customers were 58% of total sales for the quarter compared with 52% from the second quarter last year, with the balance of sales to customers primarily in Europe, Canada and Asia. The Company believes that Revenue excluding foreign currency exchange impacts, which is a non-GAAP measurement, is a useful measure in analyzing organic sales results. See the attached table for a description of non-GAAP financial measures and reconciliation of Revenue to Revenue excluding foreign currency exchange impacts.