Key Tronic Corporation (KTCC) has reported an 119.34 percent jump in profit for the quarter ended Oct. 01, 2016. The company has earned $1.79 million, or $0.16 a share in the quarter, compared with $0.82 million, or $0.07 a share for the same period last year.
Revenue during the quarter dropped 7.19 percent to $117.14 million from $126.21 million in the previous year period. Gross margin for the quarter expanded 122 basis points over the previous year period to 8.29 percent. Total expenses were 97.62 percent of quarterly revenues, down from 98.59 percent for the same period last year. This has led to an improvement of 97 basis points in operating margin to 2.38 percent.
Operating income for the quarter was $2.79 million, compared with $1.78 million in the previous year period.
“While we saw a slight slowdown in demand from several customers during the first quarter of fiscal year 2017, new programs continue to ramp and we are excited about our customer diversification and future prospects,” said Craig Gates, president and chief executive officer. “We saw year-over-year improvements in margins as we continue to replace the high risk revenue that was associated with the longstanding customer discussed in previous quarters. We have now fully exited that relationship.”
Working capital increases marginally
Key Tronic Corporation has recorded an increase in the working capital over the last year. It stood at $100.14 million as at Oct. 01, 2016, up 4.52 percent or $4.33 million from $95.81 million on Sep. 26, 2015. Current ratio was at 2.29 as on Oct. 01, 2016, up from 1.95 on Sep. 26, 2015.
Cash conversion cycle (CCC) has decreased to 47 days for the quarter from 75 days for the last year period. Days sales outstanding were almost stable at 53 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 42 days for the quarter compared with 75 days for the previous year period. At the same time, days payable outstanding went down to 49 days for the quarter from 53 for the same period last year.
Debt moves up
Key Tronic Corporation has witnessed an increase in total debt over the last one year. It stood at $48 million as on Oct. 01, 2016, up 13.92 percent or $5.87 million from $42.13 million on Sep. 26, 2015. Total debt was 20.49 percent of total assets as on Oct. 01, 2016, compared with 17.25 percent on Sep. 26, 2015. Debt to equity ratio was at 0.45 as on Oct. 01, 2016, up from 0.43 as on Sep. 26, 2015. Interest coverage ratio improved to 4.74 for the quarter from 3.34 for the same period last year.
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