Revenue during the quarter dropped 6.62 percent to $95.41 million from $102.18 million in the previous year period. Gross margin for the quarter contracted 93 basis points over the previous year period to 17.73 percent. Total expenses were 98.40 percent of quarterly revenues, up from 97.38 percent for the same period last year. That has resulted in a contraction of 102 basis points in operating margin to 1.60 percent.

Operating income for the quarter was $1.53 million, compared with $2.68 million in the previous year period.

However, the adjusted operating income for the quarter stood at $4.26 million compared to $6.10 million in the prior year period. At the same time, adjusted operating margin contracted 150 basis points in the quarter to 4.47 percent from 5.97 percent in the last year period.

Joseph J. Hartnett, Interim president & chief executive officer, commented, "Our Medical facilities are continuing to perform well while certain Mil/Aero and industrial facilities experienced unexpected delays in a couple of customer programs. As expected, our ECP Segment performance improved significantly over the prior quarter. Overall, while we are not satisfied with the quarter’s results, we are making progress in building a stronger more productive infrastructure while continuing to explore a potential acquisition of the Company."

For the fourth-quarter 2017, Sparton Corporation expects revenue to be in the range of $97 million to $101 million.

The company has spent $4.81 million cash to meet investing activities during the nine month period as against cash outgo of $4.26 million in the last year period.

The company has spent $9.79 million cash to carry out financing activities during the nine month period as against cash outgo of $31.13 million in the last year period.

Cash and cash equivalents stood at $1.03 million as on Apr. 02, 2017, up 23.74 percent or $0.20 million from $0.83 million on Mar. 27, 2016.

Working capital drops significantly
Sparton Corporation has witnessed a decline in the working capital over the last year. It stood at $65.40 million as at Apr. 02, 2017, down 29.61 percent or $27.52 million from $92.92 million on Mar. 27, 2016. Current ratio was at 2.22 as on Apr. 02, 2017, down from 2.50 on Mar. 27, 2016.

Cash conversion cycle (CCC) has decreased to 51 days for the quarter from 102 days for the last year period. Days sales outstanding went down to 50 days for the quarter compared with 52 days for the same period last year.

Days inventory outstanding has decreased to 38 days for the quarter compared with 86 days for the previous year period. At the same time, days payable outstanding was almost stable at 36 days for the quarter, when compared with the previous year period.