Daktronics, Inc. (NASDAQ: DAKT) missed F4Q2016 expectations by a wide margin and investors had little choice but to dump the stock. But Daktronics’ CEO, Reece Kurtenbach, didn’t lack words to tell the disappointed investors. He said that weak macroeconomic conditions but not poor management execution were to blame for the poor quarterly performance.
Without directly mentioning the expected recovery of oil prices, CEO Kurtenbach said that he expected a better F2017 for Daktronics, Inc. (NASDAQ: DAKT). But you could see him alluding to improving customer purchasing power as oil prices strengthen. The CEO earlier said that lower oil prices caused the weaker demand for their products in F4Q2016, thus leading to the steep decline in revenues relative to a year ago period.
OPEC members are meeting to try and find a solution to the global supply glut that has destroyed crude oil prices. Investors and executives in companies that have been affected by collapse in crude prices are hoping that a deal will be reached to curb crude output. When oil output is frozen, the supply glut will be eliminated faster and prices can recover quickly. But it remains to be seen whether a lift in crude prices will provide reprieve for Daktronics, Inc. (NASDAQ: DAKT).
Uncertain future for Daktronics, Inc. (NASDAQ: DAKT)
Because of the uncertainty created by volatility of oil prices and economic slowdown in many international markets, Daktronics, Inc. (NASDAQ:DAKT) didn’t provide guidance for F2017. However, CEO Kurtenbach only said they expected modest growth in the fiscal year.
What happened in F4Q2016?
Daktronics reported revenue of $138.5 million for quarter, indicating a 12.4% decline from the corresponding quarter a year ago. The reported revenue was also $17.7 million less than what analysts expected.
Daktronics’ bookings also contracted as the company reported bookings of $143.2 million against $196.1 million in the year ago quarter.
Coming to the bottom-line, Daktronics, Inc. (NASDAQ: DAKT) logged EPS loss of $0.07 at a time when analysts were looking for EPS profit of $0.08. Daktronics posted EPS of $0.09 a year ago.