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EMS firm SMTC Corp. has reported a revenue of $53.7 million for the for the third quarter of 2018, up by 56% from $34.4 million in the third quarter of 2017.
Sequentially, revenue increased by 20.7% from $44.5 million during the second quarter of 2018. The year-over-year increase from the third quarter of 2017 was the result of strong demand both from existing and new customers in 2018 and well-diversified among the company’s target end-markets. The adoption of the new revenue recognition standard accounted for $1.7 million or 4.8% of the year-over-year revenue increase.
"I am pleased to report another strong quarter, again exceeding our business plan and we’re on track for our first profitable year in more than five years," said Ed Smith, SMTC president and chief executive officer. "In Q3, we continued to see strong demand from customers in the industrial, networking and communications, power and energy, and medical market sectors. To better support our growing global customer base, year to date we have completed capital equipment investment of nearly $5 million dollars in North America, earned AS9100D certification to address the needs of customers in the Avionics, Aerospace, and Defense industries, and received 13485 accreditation that enabled us to move forward with orders from new medical customers.
"We remain focused on executing both in terms of growing the top-line, as well as keeping our costs in check. Our nine-month or year-to-date sales were up 34.5% over last year and our SG&A remains flat compared to last year’s same period, a testament to our attention to supply chain management and excellent customer value proposition."
Gross profit for the third quarter of 2018 was $5.2 million or 9.8% of revenue, compared with $3.0 million or 8.6% of revenue for the third quarter in 2017. Adjusted gross profit for the third quarter of 2018 was $5.1 million or 9.6% as a percentage of revenue, compared to $3.1 million or 9.0% of revenue in the third quarter of 2017. Gross profit for the second quarter of 2018 was $4.3 million or 9.6% of revenue while adjusted gross profit was $4.4 million or 9.8% of revenue.
Net earnings were $0.9 million for the third quarter of 2018, compared to a net loss of $(0.6) million in the third quarter of 2017. The company reported a net loss of $(0.1) million for the second quarter of 2018.
Adjusted EBITDA was $2.4 million in the third quarter of 2018, compared to $1.1 million for the third quarter of 2017 and $1.6 million in the second quarter of 2018. The increase in the third quarter of 2018 compared to the prior quarter was primarily due to higher revenue in addition to improved gross margin and lower administrative expenses relative to the increased revenue.
About SMTC Corporation
SMTC Corporation, founded in 1985, is a mid-size provider of end-to-end electronics manufacturing services (EMS) including printed circuit boards assemblies (PCBA) production, systems integration and comprehensive testing services, enclosure fabrication, as well as product design, sustaining engineering and supply chain management services. SMTC manufacturing facilities span a broad footprint in the United States, China and Mexico. SMTC services extend over the entire electronic product life cycle from the development and introduction of new products through to the growth, maturity and end-of-life phases. SMTC offers fully integrated contract manufacturing services with a distinctive approach to global original equipment manufacturers (OEMs) and emerging technology companies primarily within industrial, networking and computing, power and energy and medical market segments. SMTC is a public company incorporated in Delaware with its shares traded on the Nasdaq National Market System under the symbol SMTX and was added to the Russell Microcap Index in 2018. For further information on SMTC Corporation, please click here.