Revenue during the quarter surged 37.26 percent to $73.90 million from $53.84 million in the previous year period. Gross margin for the quarter expanded 99 basis points over the previous year period to 27.81 percent. Total expenses were 86.97 percent of quarterly revenues, down from 97.92 percent for the same period last year. This has led to an improvement of 1095 basis points in operating margin to 13.03 percent.

Operating income for the quarter was $9.63 million, compared with $1.12 million in the previous year period.

Mr. Xiaoping Zhang, SORL's chief executive officer and chairman, stated, "We are pleased to announce another quarter of robust performance as we posted growth in all lines of our business and achieved margin expansions from top to bottom. Since the Chinese government introduced rigorous regulations on overloading in the truck market to reduce emissions and improve safety, we have been gaining market share with our advanced new products and superior performance. On the cost side, we continued to exceed our goals due to significantly improved economy of scale, strengthened receivables collections and better-than-expected cost control results."

For fiscal year 2017, Sorl Auto Parts forecasts revenue to be $315 million. The company projects net income to be $27.50 million.

The company has spent $14.41 million cash to meet investing activities during the quarter as against cash outgo of $17.37 million in the last year period.

Cash flow from financing activities was $21.25 million for the quarter as against cash outgo of $7.16 million in the last year period.

Cash and cash equivalents stood at $11.46 million as on Mar. 31, 2017, up 87.67 percent or $5.35 million from $6.10 million on Mar. 31, 2016.

Working capital drops significantly
Sorl Auto Parts has witnessed a decline in the working capital over the last year. It stood at $107.82 million as at Mar. 31, 2017, down 37.30 percent or $64.14 million from $171.96 million on Mar. 31, 2016. Current ratio was at 1.69 as on Mar. 31, 2017, down from 2.84 on Mar. 31, 2016.

Cash conversion cycle (CCC) has decreased to 129 days for the quarter from 259 days for the last year period. Days sales outstanding went down to 149 days for the quarter compared with 180 days for the same period last year.

Days inventory outstanding has decreased to 61 days for the quarter compared with 164 days for the previous year period. At the same time, days payable outstanding went down to 81 days for the quarter from 84 for the same period last year.