Revenue during the quarter dropped 20.11 percent to $42.68 million from $53.42 million in the previous year period. Gross margin for the quarter expanded 268 basis points over the previous year period to 8.51 percent. Operating margin for the quarter period stood at positive 0.38 percent as compared to a negative 1.72 percent for the previous year period.

Operating income for the quarter was $0.16 million, compared with an operating loss of $0.92 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $1.33 million compared with $0.99 million in the prior year period. At the same time, adjusted EBITDA margin improved 125 basis points in the quarter to 3.11 percent from 1.86 percent in the last year period.

Chief executive officer Sushil Dhiman stated, "Although revenue levels have declined from 2015 due to previously disclosed transferring customers, we are encouraged with the momentum of new customer wins and new programs wins. Our medical sector business grew to $8.2 million or 19.2% of revenue this quarter as compared to $3.1 million or 5.7% of revenue in the prior year. Our focus remains to continue to add customers with established product lines in key market segments in support of margin expansion initiatives."

The company has spent $1.47 million cash to meet investing activities during the nine month period as against cash outgo of $1.69 million in the last year period.

The company has spent $3.10 million cash to carry out financing activities during the nine month period as against cash outgo of $5.59 million in the last year period.

Cash and cash equivalents stood at $7.37 million as on Oct. 02, 2016, up 51.29 percent or $2.50 million from $4.87 million on Sep. 27, 2015.

Working capital increases sharply
SMTC Corporation has recorded an increase in the working capital over the last year. It stood at $15.83 million as at Oct. 02, 2016, up 74.74 percent or $6.77 million from $9.06 million on Sep. 27, 2015. Current ratio was at 1.38 as on Oct. 02, 2016, up from 1.16 on Sep. 27, 2015.

Cash conversion cycle (CCC) has decreased to 6 days for the quarter from 54 days for the last year period. Days sales outstanding went down to 34 days for the quarter compared with 51 days for the same period last year.

Days inventory outstanding has decreased to 27 days for the quarter compared with 58 days for the previous year period. At the same time, days payable outstanding went up to 67 days for the quarter from 55 for the same period last year.