MILWAUKEE, Aug. 5, 2014 (GLOBE NEWSWIRE) -- STRATTEC SECURITY CORPORATION (Nasdaq:STRT) today reported operating results for the fiscal fourth quarter and year ended June 29, 2014.

Fourth Quarter

Net sales for the fourth quarter ended June 29, 2014 were $102.1 million, compared to net sales of $80.5 million for the fourth quarter ended June 30, 2013. Net income was $5.7 million in the current year quarter compared to $3.2 million in the prior year quarter. Diluted earnings per share for the 2014 fourth quarter were $1.58 compared to $.92 in the prior year quarter.

Net sales to each of our customers in the current year quarter and prior year quarter were as follows (in thousands):

Increased sales to Chrysler Group LLC in the current year quarter was primarily due to higher customer vehicle production volumes and increased content on models for which we supply components. The increase in sales to General Motors Company in the current year quarter was primarily attributed to incremental service parts sales of $11 million, higher vehicle production volume, and greater product content on models introduced during the 2014 model year.  The incremental service parts sales will continue into the first quarter of fiscal year 2015 after which service parts sales will likely return to more normal levels during the second half of the new fiscal year. Sales to Ford Motor Company in the current year quarter were flat.  Sales to Tier 1 Customers during the current year quarter decreased slightly in comparison to the prior year quarter. These customers represent primarily other vehicle access control products, such as latches, fobs, and driver controls, that we have developed in recent years to complement our historic core business of locks and keys. The reduction in sales to Hyundai / Kia in the current year quarter was principally due to lower customer vehicle production volume and the discontinuation of a vehicle model for which we had been supplying components.

Gross profit margins were 20.0 percent in the current year quarter compared to 18.2 percent in the prior year quarter.  The increase in gross profit margin in the current year quarter was attributed to a more favorable product sales mix, higher overhead absorption from increased customer vehicle production volumes and a favorable Mexican Peso to U.S. Dollar exchange rate affecting our operations in Mexico. Items adversely impacting gross margin during the current quarter were higher raw material costs for zinc and higher expense provisions for the company's incentive bonus plans as compared to the prior year quarter.

Operating expenses were $10.8 million in the current year quarter and $9.3 million in the prior year quarter. As a percent of net sales in the current quarter operating expenses decreased to 10.6% from 11.6% in comparison to the prior year quarter. The major contributors to the increased spending during the current quarter were higher engineering development costs and higher expense provisions for our incentive bonus program.

Included in Other Income, Net in the current year quarter compared to the prior year quarter were the following items (in thousands of dollars):

During the current year quarter STRATTEC contributed $2.5 million to its Defined Benefit Pension Trust to improve the overall funded status of the Plan.

Full Year

STRATTEC's fiscal 2014 net sales reached a record high, exceeding the prior year record by approximately 17% and diluted earnings per share increased approximately 69% in comparison to the prior year. (See NOTE below regarding prior year pension settlement charge).

For the fiscal year ended June 29, 2014, net sales were $348.4 million compared to net sales of $298.2 million during fiscal 2013. Net income for fiscal 2014 was $16.4 million compared to net income of $9.4 million in the prior year period.  Diluted earnings per share for the current year were $4.59 compared to diluted earnings per share of $2.72 in the prior year. NOTE: The prior year included a $2.1 million pre-tax pension settlement charge that reduced diluted earnings per share by $.39.

Frank Krejci, President and CEO commented: "In 2000, we began to transform the Company through the creation of our global alliance, VAST. Since that time, we have also worked to broaden our product portfolio. I am honored to report that as a result of these and other strategic initiatives, STRATTEC set a sales record both this quarter and for this fiscal year, set a quarterly earnings record and set a record for profit sharing among its associates. In addition to these record results, we continue to make significant progress in global coordination and new strategic initiatives. Another recent milestone of note is that STRATTEC's stock was added to the Russell 2000."

STRATTEC designs, develops, manufactures and markets automotive Access Control Products, including mechanical locks and keys, electronically enhanced locks and keys, steering column and instrument panel ignition lock housings, latches, power sliding side door systems, power lift gate systems, power deck lid systems, door handles and related products. These products are provided to customers in North America, and on a global basis through a unique strategic relationship with WITTE Automotive of Velbert, Germany and ADAC Automotive of Grand Rapids, Michigan. Under this relationship, STRATTEC, WITTE and ADAC market each company's products to global customers under the "VAST" brand name. STRATTEC's history in the automotive business spans over 100 years.

Certain statements contained in this release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking words or phrases such as "anticipate," "believe," "could," "expect," "intend," "may," "planned," "potential," "should," "will," and "would."   Such forward-looking statements in this release are inherently subject to many uncertainties in the Company's operations and business environment. These uncertainties include general economic conditions, in particular, relating to the automotive industry, consumer demand for the Company's and its customers' products, competitive and technological developments, customer purchasing actions, foreign currency fluctuations, and costs of operations (including fluctuations in the cost of raw materials). Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are only made as of the date of this press release and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances occurring after the date of this release. In addition, such uncertainties and other operational matters are discussed further in the Company's quarterly and annual filings with the Securities and Exchange Commission.

CONTACT: Pat Hansen
         Senior Vice President and
         Chief Financial Officer
         414-247-3435
         www.strattec.com