SCHAUMBURG, IL -- Sparton today reported net sales of $107 million for its fiscal fourth quarter ended Jul. 3, down 15.4% year-over-year.

The net loss was $42.1 million, dragged down by a large write-off for goodwill. Adjusted operating income was $5.9 million, and adjusted EBITDA was $10 million for the period. The gross profit margin was 20%.

MDS, the company's contract manufacturing unit, reported revenues fell nearly $10 million from a year ago to $68.7 million. The operating loss at the unit was $61.9 million. The loss includes a goodwill impairment of $64.2 million tied to poor sales from its Hunter Technology acquisition.

Joe McCormack, senior vice president and CFO, said: “We recognized an impairment of goodwill in our MDS Segment as a result of the underperformance of our Hunter Technology acquisition and our inability to achieve sufficient organic revenue growth to offset the loss of a large customer as well as revenue declines due to fluctuation in customer demand across the segment. While we are disappointed in the need for a goodwill write-off, we continue to have positive developments in our financial performance including continued quarter over quarter improvements in our revenues, continued reductions in our SG&A footprint, and strong free cash flows.”

Joseph Hartnett, interim president and CEO, commented: “Our fourth quarter has been a very active one with the ongoing exploration of a potential sale of the Company as well as continuing to implement operational and financial improvements. Our sales pipeline and new program wins continue to show traction as a result of our focus on organic growth initiatives. Additionally, we believe the company is well on its way to building a business model that supports profitable revenue growth through new business development and improved operating performance. ”

For its fiscal year ended July 3, Sparton reported net sales of $419.4 million and a gross profit margin of 19.1%. For the year, the company reported a loss of $38.3 million. Adjusted operating income was $16.3 million, and adjusted EBITDA was $33.5 million.

Sparton guided for fiscal 2017 first-quarter revenues of $97 million to $101 million and a gross profit margin of approximately 18%. Segment revenues are expected to be similar as a percent of the fourth-quarter's operating results.

Register now for PCB West, the Silicon Valley's largest trade show for the printed circuit industry, taking place Sept. 13-15 in Santa Clara: pcbwest.com 

• Prev
• Next