Sparton Corporation Reports Fiscal 2018 First Quarter Results

SCHAUMBURG, Ill.–(BUSINESS WIRE)–Nov. 9, 2017–Sparton Corporation (NYSE:SPA) today announced results for the first quarter of fiscal year 2018 ended October 1, 2017.

First Quarter Financial Results and Highlights

Joseph J. Hartnett, Interim President & CEO, commented, “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.”

Joseph G. McCormack, Senior Vice President & 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.”

Consolidated:

  • Net sales of $82.8 million
  • Gross profit margin of 17.6%
  • SG&A expenses of $15.2 million or 18.4% of sales; adjusted SG&A of $12.9 million, 15.5% of sales
  • Loss per share of $0.29, adjusted earnings per share of $0.00
  • Adjusted EBITDA of $2.9 million, a 3.5% adjusted EBITDA margin

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

View the full release of results

 

About Sparton Corporation

Sparton Corporation (NYSE:SPA), 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. Sparton’s Web site may be accessed at http://www.sparton.com/.

Safe Harbor and Fair Disclosure Statement

Safe Harbor statement under the Private Securities Litigation Reform Act of 1995: To the extent any statements made in this release contain information that is not historical, these statements are essentially forward-looking and are subject to risks and uncertainties, including the difficulty of predicting future results, the regulatory environment, fluctuations in operating results and other risks detailed from time to time in Sparton’s filings with the Securities and Exchange Commission (SEC). The matters discussed in this press release may also involve risks and uncertainties concerning Sparton’s services described in Sparton’s filings with the SEC. In particular, see the risk factors described in Sparton’s most recent Form 10K and Form 10Q. Sparton assumes no obligation to update the forward-looking information contained in this press release.


Contact

Investors:
Institutional Marketing Services (IMS)
John Nesbett/Jennifer Belodeau, 203-972-9200
jnesbett@institutionalms.com
or
Company:
Sparton Corporation
Joseph McCormack, 847-762-5812
jmccormack@sparton.com