Lisa Anderson was quoted in the Sports Business Journal about reshoring and the investment in domestic manufacturing and the importance to the future.
“Daktronics’ substantial investment in expanding its manufacturing capabilities at factories in South Dakota and Minnesota, and its snapping up of available inventory at a higher rate than normal to restore some predictability to order fulfillment, depleted the company’s liquidity during the past year-plus from $61.6 million to now $7.7 million heading into the third quarter of the 2023 fiscal year. Following generally accepted U.S. accounting standards (GAAP), Daktronics, which had close to $611 million in revenue in FY22, was required to note in its filing that its financial state raises “substantial doubt about our ability to continue as a going concern.”
Portions of the global supply chain are back in relative order, but that’s not the case for semiconductors or integrated circuits, which are crucial to Daktronics’ business. Most of those products and materials pass through Asia, if they don’t originate there, on their way to the U.S., and the COVID situation in China has sustained supply well beyond the time frame many experts projected. Daktronics’ own Shanghai factory has been closed regularly during the past two years. About 15% of Daktronics’ market is outside of the U.S.; between 10% and 15% of its production comes from factories in Shanghai and another in Ireland.
Hiring difficulties, shipping inconsistencies and inflation have contributed further to the formidable slew of challenges.”
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