M/A-COM Technology Solutions Holdings (MTSI), a supplier of high performance analog RF, microwave, and millimeter wave products, has recorded an 83.05 percent plunge in profit for the quarter ended Jun. 27, 2014, due to higher expenses and interest cost.
The company earned $1.18 million or $0.02 a share in the third-quarter compared with $6.98 million or $0.15 a share a year ago. Non-GAAP earnings per share came in at $0.33, when analysts expected $0.32.
Revenue during the third-quarter jumped 34.60 percent to $112.36 million from $83.48 million in the last year period.
Gross margin expanded by 216 basis points over the previous year period to 44.69 percent. Total expenses as a percentage of revenues increased to 93.47 percent from 89.39 percent in the same period last year. That has resulted in contraction of 408 basis points in operating margins to 6.53 percent.
The company disclosed operating income of $7.34 million, compared with $8.86 million in the last year period.
John Croteau, chief executive officer of MACOM stated, ''Revenue and earnings per share for the quarter were at the high end of our guidance with strong sequential growth that was broadly distributed across our end markets. Non-GAAP gross margin improved by 240 basis points sequentially and 670 basis points year over year to 51.7%, representing our seventh consecutive quarter of margin improvement.''
For fourth quarter, MACOM expects another quarter of solid growth with revenue expected to be in the range of 112 to 116 million dollars, which would be roughly 5 to 9 percent sequential growth after adjusting for the sale of the CPE business. Non-GAAP gross margin is expected to be between 50 and 53 percent, and non-GAAP earnings per diluted share between 31 and 34 cents, the company said.
Cash Flow
M/A-com Technology Solutions Holdings has generated cash of $9.73 million from operating activities during the nine month period, down 66.94 percent or $19.70 million when compared with the last year period. The company has generated 3.20 cents of operating cash flow in every sales dollar for the nine month period, down from 12.35 cents in the same period last year.
The company has spent $258.10 million cash to meet investing activities during the nine month period, as against cash outgo of $7.17 million in the last year period. It has made net capital expenditure of $15.37 million during the nine month period, which was higher by 114.29 percent or $8.20 million, from a year ago.
The company has generated cash of $311.39 million from financing activities during the nine month period, up 3438.50 percent or $302.59 million, when compared with the last year period. It has borrowed net of $312.42 million through debt during the nine month period.
As on Jun. 27, 2014, the company's cash balance stood at $173.51 million, up 50.05 percent or $57.88 million from Jun. 28, 2013.
Working Capital
M/A-com Technology Solutions Holdings has witnessed an increase in the working capital over the last one year. The company's working capital stood at $269.88 million as at Jun. 27, 2014, up $75.25 million or 38.66 percent from $194.63 million on Jun. 28, 2013. It registered a decrease in current ratio to 3.81 as at Jun. 27, 2014 from 5 on Jun. 28, 2013.
Shares of the company declined $0.33 or 1.63 percent to settle at $19.96 on Tuesday.
