Cemtrex Signs LOI to Acquire Leading Industrial Manufacturing and Services Company

Cemtrex Inc. (CETX – $2.84), a diversified industrial and manufacturing technology company, signed a Letter of Intent (LOI) to purchase a leading US based industrial manufacturing and services company.

During the past two years, the target company generated average revenues and EBITDA of approximately $23 million and $2.4 million respectively.

Cemtrex’s Chief Executive Officer, Saagar Govil, commented, “With this planned transaction, Cemtrex will be acquiring a company that complements our existing business by being able to provide more value to our customers and obtain margin improvement. We see this deal as being highly accretive in nature and driving an immediate impact for shareholders.”

Cemtrex expects to close the acquisition within 90 days.

Sustained Organic Growth

In the meanwhile, the Company continues to show strong top and bottom-line financial growth. For its third quarter, ended June 30, 2015, Cemtrex’ sales reached $14.66 million compared to $13.45 million in the comparable period of 2014, an increase of 9%. Net income for the third quarter was $898,827, or $0.13 per diluted share, compared to $716,100, or $0.11 per diluted share, for the 2014 period, an increase in net income of 26%.

Three Months Ended
June 30
Nine Months Ended
June 30
Amounts in $000’s
Net Sales
Net Income
Earnings Per Share
Most important income statement data for the quarters and nine months ending June 30, 2015 and June 30, 2014. Source: Company Press Release

Net sales for the nine months ended September 30, 2015 were $42.83 million, compared to $33.97 million in the comparable period of 2014, an increase of 26%. Net income for the nine months was $2,34 million, or $0.35 per diluted share, compared to $1,90 million, or $0.28 per diluted share, in the 2014 comparable period, a very solid 25% increase in net income.

This is yet another quarter of strong sales and earnings growth for Cemtrex. In fact, the Company’s trailing four quarters sales is at record levels and continues to rise.

And this trend seems to continue. A couple of weeks ago, the Company announced that it had received new orders in excess of $4,200,000 across its two business groups: Environmental Products & Systems and Electronics Manufacturing Services.

The Company received approximately $2.5M in new environmental products sales with deliveries expected over the next twelve months for new projects located in Southeast Asia. In addition, the Company received approximately $1.7M in new electronics products orders for a diverse set of existing European customers in medical, industrial, and automation industries with deliveries expected over the next twelve months.

Mr. Govil said, “We are continuing to see demand in both of our important markets where there are overall economic concerns, Europe and Asia. We are confident that with our product portfolio, niche industry segments, and continued demand from our customers we can continue to grow our business despite outside market concerns.”


Cemtrex disclosed little information about the target company. However, knowing that it generated $47.6 million in revenues in fiscal year 2014, the potential impact of the target company is obvious.

We continue to like Cemtrex. The Company grows organically, and it’s always on the lookout for a complimentary acquisition.

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