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SMTC Corporation, a global electronics manufacturing services provider, has announced a revenue of $53.4 million for the third quarter of 2015, down from $55.5 million in the prior year.
The company reports gross profit of 5.8% compared to 8.2% in the prior year. When excluding the effects of the unrealized portion of foreign exchange on derivative financial instruments, adjusted gross profit was 7.3% compared to 9.9% in the prior year. Also included in gross profit was a realized foreign exchange loss on derivative instruments of $1.2 million compared to a loss of $0.1 million in the prior year.
Chief Executive Officer Sushil Dhiman stated, "We experienced margin challenges during the quarter due to product mix, additional costs related to new customer production ramp and realized foreign exchange losses on derivative instruments. However, I am pleased with our new customer revenue of $13.1 million this quarter and respective year to date revenue of $24.9 million. These new customers continue to ramp and are expected to fully replace the revenues lost from two long standing customers by the year end. We are continuing to add to a healthy sales funnel and our new customer wins are expected to contribute to revenue growth in 2016."
Gross profit was $3.1 million, down from $4.6 million in the prior year. The decrease was due to lower revenue, product mix and initial investments required to ramp new customer revenue. This was partially offset by reduced direct labor and overhead charges.
The company has reported a net loss of $1.3 million compared to a net loss of $0.8 million in the prior year. This was mitigated with a reduction in administrative expenses, which were reduced by $0.4 million or 9.1% over the prior year. Administrative expenses also included $0.4 million in professional services related to the merger and acquisition activities. These expenses may or may not occur in the future.
Chief Financial Officer Jim Currie stated, "Strong cash flow from operations and inventory turns improvement has allowed us to reduce our net debt by over $8 million in the last twelve months."
SMTC Corporation, founded in 1985, is a mid-size provider of end-to-end electronics manufacturing services (EMS) including PCBA production, systems integration and comprehensive testing services, enclosure fabrication, as well as product design, sustaining engineering and supply chain management services. SMTC facilities span a broad footprint in the United States, Mexico, and China, with approximately 1,300 employees. 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, computing and communication market segments. SMTC is a public company incorporated in Delaware with its shares traded on the Nasdaq National Market System under the symbol SMTX.
For further information on SMTC Corporation, please visit www.smtc.com.