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Sparton Corporation has announced consolidated net sales of $82.8 million and gross profit margin of 17.6% for the first quarter of fiscal year 2018 ended October 1, 2017.
"As a result of our recent growth in new program wins, we experienced some interruptions in production and increased inventory levels which is typical with new program introductions. We believe that the backlog from these programs has us positioned for growth in the upcoming quarters and beyond," commented Joseph J. Hartnett, interim president and CEO.
Joseph G. McCormack, senior vice president and CFO, commented, "We experienced net cash outflows and increasing debt in the quarter. This was principally the result of the timing of a payment from the U.S. Navy, significant transaction-related costs as a result of the signing of the merger agreement during the quarter, increasing inventories as a result of the new product introductions, as well as typical year-end compensation related payments. The underlying fundamentals of the business remain unchanged and we expect to return to positive free cash flows and reducing our debt levels in the second quarter."
MDS Segment:
- Gross sales of $55.3 million
- Gross profit margin of 10.8%
- Operating loss of $1.5 million
- Adjusted EBITDA of $3.3 million, a 1.5% adjusted EBITDA margin
- New program wins in Q4 have expected revenue of $11.7 million when fully ramped up into production
- Trailing four quarter new program win revenue of $61.9 million, which continues to support our future organic growth
ECP Segment:
- Gross sales of $30.4 million
- Gross profit margin of 28.3%
- Operating income of $4.1 million
- Adjusted EBITDA of $5.7 million, a 15.4% adjusted EBITDA margin
About Sparton Corporation
Sparton Corporation now in its 118th year, is a provider of complex and sophisticated electromechanical devices with capabilities that include concept development, industrial design, design and manufacturing engineering, production, distribution, field service, and refurbishment. The primary markets served are Medical & Biotechnology, Military & Aerospace, and Industrial & Commercial. Headquartered in Schaumburg, IL, Sparton currently has thirteen manufacturing locations and engineering design centers worldwide. For more information, click here.
