LOUISVILLE, KY -- Sypris Solutions reported second quarter revenue at its electronics unit increased 32.5% sequentially, while gross margin increased to 18.1% from 1.8% a quarter ago.

For the period ended Jul. 2, revenue for Sypris Electronics was $7.2 million, versus $8.7 million a year ago, reflecting the impact of the sale of the CSS business. Gross profit was up 30% to $1.3 million, primarily reflecting a favorable mix in sales of higher-margin products on programs that began ramping in the second quarter, partially offset by an overall decrease in volumes as a result of the CSS sale.

Overall revenue increased 16.8% sequentially to $21.2 million for the quarter, while gross margin expanded to 7.5% from a loss of 3.8% in the first quarter of 2017.

"Sypris Solutions continued to make important progress on several strategic initiatives to regain revenue momentum and better align its cost structure, while diversifying the Company’s book of business, both in terms of customers and markets. Many of those steps have been completed or are nearing completion. As a result, the Company is positioned to achieve a growing and more stable revenue base, along with higher gross profit and a return to profitable operations," the firm said in a press release.

The company raised its revenue guidance for the second half to $42 million to $44 million and confirmed its margin outlook, with gross margin of 15% to 17% and EBITDA margin of 7% to 9%.

“We expect that the progress made last year and during the first half of 2017 will enable the company’s operations to return to profitability by the second half of 2017,” said CEO Jeff Gill said. “The Company’s total manufacturing overhead costs are being reduced, our underperforming and underutilized assets are being divested, significant liquidity has been created and important new business continues to be secured, the most recent of which included the award of four new contracts with Harris Corporation.”

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