Sanmina Corp (SANM), a leading integrated manufacturing solutions company, has posted a 1.66 percent decrease in profit for the quarter ended Mar. 29, 2014.

The company earned $20.84 million or $0.24 a share in the second-quarter, compared with $21.19 million or $0.25 a share a year ago. Analysts on average had predicted net income of $0.39 a share.

Revenue during the second-quarter grew 3.44 percent to $1,476.71 million from $1,427.64 million in the last year period.

Gross margin expanded by 103 basis points over the previous year period to 8.06 percent.

Total expenses as a percentage of revenues increased to 96.93 percent from 96.79 percent in the same period last year. That resulted in contraction of 14 basis points in operating margin to 3.07 percent.

The company disclosed operating income of $45.30 million, compared with an operating income of $45.80 million in the last year period.

As on Mar. 29, 2014, Sanmina Corp's cash balance stood at $390.62 million, down by 5.18 percent or $21.32 million from Mar. 30, 2013.

"I am pleased with our second quarter results.  Our outlook for revenue growth in the second half of the year remains optimistic as new programs ramp and demand improves across a broad set of customers.  We continue to invest in technology and business processes which offer a distinct advantage to our customers.  As we further diversify our business, we believe our revenue and profitability will continue to improve," stated Jure Sola, chairman and chief executive officer of Sanmina Corporation.

"We may see revenue between $1.50 billion to $1.60 billion in the third quarter fiscal of 2014 and Non-GAAP diluted earnings per share between $0.45 to $0.49," the company said.

Working Capital

Sanmina Corp witnessed an increase in the working capital over the year. It stood at $1005.96 million as at Mar. 29, 2014, up by $82.09 million or 8.89 percent from $923.87 million on Mar. 30, 2013. The company's current ratio increased to 1.82 as at Mar. 29, 2014 from 1.75 on Mar. 30, 2013.

The company's cash conversion cycle (CCC) decreased to 49 days for second-quarter from 53 days for the last year. CCC is a liquidity metric which expresses the length of time (in days) that a company uses to sell inventory, collect receivables and pay its accounts payable. Decreasing or steady CCCs are good for business.

Days' sales outstanding went up to 58 days for second-quarter compared with 56 days for the last year. This indicates the company has extended credit period to clients for making payment.

Days' inventory outstanding was almost flat at 53 days for second-quarter, when compared with the last year period. This suggests the company took less time to convert the inventory into sales.

While days' payable outstanding went up to 62 days for second-quarter from 58 days for the last year. This reflects that the company has made late payment to vendors compared to prior year period.

Debt Position

Sanmina Corp has witnessed a decrease in total debt over the last year. As at Mar. 29, 2014, the company's total debt stood at $642.92 million, down by 13.62 percent or $101.34 million from Mar. 30, 2013.

The company's total debt accounts for 21.29 percent of total assets on Mar. 29, 2014, compared with 25.10 percent on Mar. 30, 2013.

The company witnessed a decline in debt to equity ratio to 0.58 on Mar. 29, 2014 when compared with 0.73 on Mar. 30, 2013.

Interest coverage ratio, which determines how easily a company can pay interest expenses on outstanding debt, has improved to 6.05 from 4.40 in the same period last year.

Shares of Sanmina Corp rose by $1.70 or 9.31 percent to trade at $19.93 on Wednesday.(pre-market  share price of Wednesday).