Daktronics 4Q profit short of Wall Street forecast

Daktronics Inc., a maker of large video displays and electronic scoreboards, said Tuesday its fiscal fourth-quarter profit fell sharply, missing Wall Street estimates, as the recession cut into demand from commercial and international customers.

Although it did not give a specific forecast, Daktronics expects sales and profits to decline in its current fiscal year that began May 3.

Brookings, S.D.-based Daktronics reported net income for the three months ended May 2 of $344,000, or 1 cent per share, down from a profit of $5.7 million, or 14 cents per share, last year.

Analysts surveyed by Thomson Reuters forecast a profit of 9 cents per share, on average, in the latest quarter.

Sales fell nearly 6 percent to $121.8 million from $129.1 million a year ago. Analysts had forecast revenue of $125 million.

Shares of Daktronics fell $1.12, or 12.2 percent, to $8.10 in morning trading. The stock has traded in a 52-week range of $5.69 to $21.32.

Daktronics makes large-screen displays and electronic scoreboards for sports stadiums, theaters and other uses.

Orders from commercial customers declined 62 percent in the fourth quarter, while orders to the company's international business unit plunged 85 percent.

President and Chief Executive Jim Morgan attributed the commercial order decline to a pullback in capital spending by major outdoor billboard companies.

"Based on industry reports, we do not expect any noticeable recovery in this niche until calendar (year) 2011, at the earliest," Morgan said.

The fiscal fourth-quarter declines in commercial and international orders were partly offset by gains in orders from live events, schools, theaters and transportation customers.

But Morgan said the company's doesn't see improvement overall anytime soon.

"For fiscal 2010, we expect to see a significant reduction in orders and sales," said Morgan. "It's very difficult to forecast the business at this point, but we are focusing our strategic initiatives and cost controls under an assumption that the fourth quarter net sales level is an indicator of the trend for the year as a whole."

For all of fiscal 2009, Daktronics posted net income of $26.4 million, or 64 cents per share. That was up 1 percent from $26.2 million, or 63 cents per share, in fiscal 2008. Sales rose 16 percent to $581.9 million from $499.7 million.