Magal Security Systems, Ltd. (MAGS) saw its loss widen to $3.70 million, or $0.16 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $0.48 million, or $0.03 a share.
Revenue during the quarter grew 13.74 percent to $14.34 million from $12.60 million in the previous year period. Gross margin for the quarter expanded 214 basis points over the previous year period to 51.70 percent. Operating margin for the quarter stood at negative 5.94 percent as compared to a positive 4.94 percent for the previous year period.
Operating loss for the quarter was $0.85 million, compared with an operating income of $0.62 million in the previous year period.
Commenting on the results, Mr. Saar Koursh, chief executive officer of Magal, said, "Our first quarter is typically a seasonally weak quarter; however, we still achieved revenue growth of 14% over the first quarter of last year. Our net income was negatively impacted by a non-cash financial expense related to a relatively sharp quarterly change in the US dollar/Israeli shekel exchange rate and its effect on our sizable US dollar denominated cash holdings. In addition, we significantly increased our investment in sales and marketing, primarily in the United States. This is because we see many solid opportunities in our end-markets that we intend to capitalize on. We believe that these investments, together with our strong balance sheet, will enable us to pursue many opportunities for growth, and will position Magal well for long-term prosperity."
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