Revenue during the quarter grew 4.06 percent to $136.66 million from $131.33 million in the previous year period. Gross margin for the quarter contracted 96 basis points over the previous year period to 13.32 percent. Total expenses were 100 percent of quarterly revenues, up from 98.73 percent for the same period last year.

Operating income for the quarter was $0.01 million, compared with $1.67 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $2.60 million compared with $5.30 million in the prior year period. At the same time, adjusted EBITDA margin contracted 213 basis points in the quarter to 1.91 percent from 4.03 percent in the last year period.

"We had a great start to our 90th year at Blue Bird! We delivered solid growth in top-line revenue and unit sales and secured a number of first-time accounts," said Phil Horlock, president and chief executive officer of Blue Bird Corporation. "We are pleased that our gasoline-powered bus is generating excitement in the market and our initial customer-feedback has been very positive. Blue Bird's propane bus continues to be the leading alternative-fuel choice and we are excited to have been awarded the DoE grant to develop an electric school bus, further strengthening our leadership position in alternative fuels. We are pleased to reaffirm our full-year fiscal 2017 net revenue guidance of $980 million - 1,010 million, Adjusted EBITDA guidance of $72 - 76 million and Adjusted Free Cash Flow guidance of $38 - 42 million."

Blue Bird Corp forecasts revenue to be in the range of $980 million to $1,010 million for fiscal year 2017.

The company has spent $2.96 million cash to meet investing activities during the quarter as against cash outgo of $1.67 million in the last year period.

The company has spent $4.15 million cash to carry out financing activities during the quarter as against cash inflow of $7.01 million in the last year period.

Cash and cash equivalents stood at $14.40 million as on Dec. 31, 2016, down 157.82 percent or $39.31 million from $24.91 million on Jan. 02, 2016.

Working capital turns negative
Working capital of Blue Bird Corporation has turned negative to $0.23 million on Dec. 31, 2016 from positive $1.54 million on Jan. 02, 2016. Current ratio was at 1 as on Dec. 31, 2016, down from 1.01 on Jan. 02, 2016.

Cash conversion cycle (CCC) has increased to 18 days for the quarter from 1 days for the last year period. Days sales outstanding went up to 11 days for the quarter compared with 9 days for the same period last year.

Days inventory outstanding has decreased to 28 days for the quarter compared with 49 days for the previous year period. At the same time, days payable outstanding went down to 57 days for the quarter from 59 for the same period last year.