Sparton Swings to Loss on Goodwill Charges
SCHAUMBURG, IL -- Sparton today swung to a fiscal fourth quarter net loss of $700,000 on impairment charges due to the potential loss of revenue in its medical business.
The company reported a net profit of of $2.1 million in the year ago quarter. Excluding charges, fiscal fourth quarter adjusted net income was $2.9 million.
For the period ended June 30, the contract electronics manufacturer reported sales of $60.9 million, up 52% from a year ago. The gross profit of $10.4 million, Sparton’s largest quarterly gross profit in over five years. Net sales were boosted by the company's acquisitions of Delphi Medical and Byers Peak, and increased US Navy sonobuoy sales.
Sparton divides revenue into three segments, medical, defense and contract assembly. The EMS group had sales of $14.7 million in the quarter, up 18.5%, and the unit's operating income was $1 million, up from a loss of $961,000 in the prior year quarter.
Sparton took a $16.8 million impairment charge during the quarter after Siemens said it intends to dual-source certain programs during fiscal 2012. "We don’t yet know the ultimate impact this action will have on future results," Sparton CEO and president Cary Wood said, adding the company is "well positioned" to grow its medical segment.
For the year, net sales increased 17% to $203.4 million. Gross profit was up 25%, to $33.2 million. The adjusted net income was $6.6 million, up from $4 million in fiscal 2010.
