SGH Reports Record Full Year 2023 Results

On June 13, 2023, the company entered into an agreement to sell an 81% interest in its SMART Brazil operations. The transaction is expected to close at the end of calendar 2023 or early 2024, subject to required regulatory approvals and satisfaction of customary closing conditions. Accordingly, the SMART Brazil operations are classified as discontinued operations in the accompanying financial statements for all periods presented.

The following discussion relates to the company’s continuing operations, which exclude SMART Brazil.

Fiscal 2023 Highlights for Continuing Operations

• Net sales of $1.44 billion, up 3.3% versus fiscal year 2022
• Record GAAP gross margin of 28.8%, up 80 basis points versus fiscal year 2022
• Record Non-GAAP gross margin of 31.7%, up 250 basis points versus fiscal year 2022
• GAAP EPS of $0.15 versus $0.41 in fiscal year 2022
• Non-GAAP EPS of $2.52 versus $2.65 in fiscal year 2022

Fourth Quarter Fiscal 2023 Highlights for Continuing Operations

• Net sales of $316.7 million, down 12.6% versus the year-ago quarter
• GAAP gross margin of 28.9%, up 290 basis points versus the year-ago quarter
• Non-GAAP gross margin of 31.7%, up 460 basis points versus the year-ago quarter
• GAAP EPS of $1.17 versus $0.18 in the year-ago quarter
• Non-GAAP EPS of $0.35 versus $0.63 in the year-ago quarter

“Throughout fiscal 2023 the team has made significant progress in our transformational journey towards becoming an enterprise solutions company focused on higher quality revenue and improving gross margins. In the fourth quarter, in what remains a challenging global economic environment, non-GAAP gross margin increased to 31.7%, an improvement of 460 basis points from the same period last year, and non-GAAP earnings were $0.35 per share. In addition, we exited the fourth quarter with a strong balance sheet, including cash, cash equivalents and short term investments of $391 million,” commented the Company’s CEO Mark Adams.