SPOKANE, WA -- EMS provider Key Tronic reported fiscal fourth-quarter revenue of $52.5 million, up 13.1%  sequentially and down 1.3% from the fiscal fourth quarter of 2005. Net income was $7.1 million, up from $917,000 sequentially and $2.8 million in Q4 2005.

For the fiscal year, revenue was $187.7 million, down 7.5%, and net income was up 55.2% to $9.8 million.

After experiencing slower demand from some of its traditional customers at the beginning of fiscal 2006, the company saw those customers drive stronger than expected sequential revenue growth in the fourth quarter, Ket Tronic said.

For the year the gross margin was 9.2%, up 1.1 points.

President and chief executive Jack Oehlke said, "We have become much more competitive in our pursuit of new business and the new programs we won during fiscal 2006 will contribute revenue in fiscal 2007. In preparation for anticipated growth, we are continuing to expand our production capacity and support infrastructure in Mexico, China and the U.S."

He added that the company is considering "exploring acquisitions."

Key Tronic guided for first quarter 2007 revenue of $50 million to $53 million, and a one-time charge of approximately $500,000 for expenses incurred for a potential acquisition that was not completed.