Key Tronic Corp., the Spokane Valley-based contract manufacturer, says it expects 10 new customers to come on line in its 2009 fiscal year, which began at the end of June, and to contribute strongly to its revenue.


Jack Oehlke, Key Tronics president and CEO, said in the companys recent fourth-quarter and fiscal-year earnings release that eight new customers contributed about 13 percent of the companys total revenue in its 2008 fiscal year. In the current fiscal year, he said, the company expects those eight plus the 10 additional new customers to account for about 40 percent of its revenue. The added businesses from those new customers should offset an anticipated decline in demand from some of its other customers, he said.


The company didnt disclose the names of the new customers it will be serving this year or what types of work it will be doing for them. Key Tronic officials declined to be interviewed until after a shareholder meeting on Oct. 23.


Key Tronic said it expects first-quarter revenue in the range of $45 million to $48 million, with earnings of 2 cents to 5 cents a share. That compares with revenue of $44.6 million and net of $200,000, or 2 cents a share, in the year-earlier quarter.


The companys continued investment in its manufacturing facilities in Mexico provides us with strong competitive advantages in a time of rising labor, fuel, and transportation costs, Oehlke said, adding, We believe Key Tronic is increasingly well-positioned to pursue and win new opportunities for profitable growth in fiscal 2009 and beyond.


For the fourth quarter of its 2008 fiscal year, ended June 28, the company reported revenue of $57.3 million, up 17 percent from the year-earlier quarter, and net income of $2.6 million, or 25 cents a share. That compared with net income of $2.7 million, or 25 cents a share, in the year-earlier fourth quarter, but results from that quarter included the benefit of about $1.5 million from the sale of a facility.


Key Tronics revenue for all of fiscal 2008 was $204.1 million, up from $201.7 million the prior year.


We are pleased with our performance for the fourth quarter and for the year, Oehlke said in the earnings release. Our year-over-year revenue growth was driven by increased demand from new customer programs, which continue to ramp up. For the fourth quarter, we achieved the highest revenue since implementing our EMS (electronic manufacturing services) strategy. He also noted that the company had the strongest gross margins weve seen in years.


Key Tronic was mostly a maker of keyboards and other computer-input devices until about 11 years ago, when it began shifting into contract-manufacturing work. It now makes a wide range of items for other companies, including consumer electronics and plastics, specialty printers and sub-assemblies, household products, game and medical devices, scientific instruments, and educational toys.


The companys headquarters are located at 4424 N. Sullivan, and it employs about 180 people here and about 2,500 overall, counting those who work at its facilities in Texas, Mexico, and China.


Contact Kim Crompton at (509) 344-1263 or via e-mail at [email protected].