Revenue during the quarter dropped 7.67 percent to $72.11 million from $78.10 million in the previous year period. Gross margin for the quarter expanded 247 basis points over the previous year period to 33 percent. Total expenses were 94.12 percent of quarterly revenues, down from 95.76 percent for the same period last year. This has led to an improvement of 164 basis points in operating margin to 5.88 percent.

Operating income for the quarter was $4.24 million, compared with $3.31 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $8.37 million compared with $7.74 million in the prior year period. At the same time, adjusted EBITDA margin improved 170 basis points in the quarter to 11.61 percent from 9.91 percent in the last year period.

"During the third quarter, KEYW gained significant momentum from new business awards, with wins totaling $275 million in contract value, including all options. Importantly, the approximately $450 million in total contract value to the company from wins thus far in 2016 represents approximately 73% of total dollars in bids we submitted. We expect to see incremental revenue from these awards beginning in early 2017, after completing contract transitions and start-up activities in the fourth quarter of 2016," said Bill Weber, KEYWs president and chief executive officer. "Our third-quarter financial results were solid, with revenue and adjusted EBITDA margins from continuing operations in line with our forecasts. In addition, KEYW was profitable on a GAAP basis in the third quarter of 2016 after the divestiture of the Hexis and SETA businesses. Im pleased to say that the strategic initiatives we’ve outlined to the investment community are progressing well."

KEYW HOLDING forecasts revenue to be in the range of $290 million to $300 million for fiscal year 2016.

Cash flow from investing activities was $5.33 million for the nine month period as against cash outgo of $33.51 million in the last year period.

Cash flow from financing activities was $2.31 million for the nine month period, down 50.12 percent or $2.32 million, when compared with the last year period.

Cash and cash equivalents stood at $42.50 million as on Sep. 30, 2016, up 70.22 percent or $17.53 million from $24.97 million on Sep. 30, 2015.

Working capital increases
KEYW HOLDING has recorded an increase in the working capital over the last year. It stood at $72.96 million as at Sep. 30, 2016, up 12.49 percent or $8.10 million from $64.86 million on Sep. 30, 2015. Current ratio was at 2.92 as on Sep. 30, 2016, up from 2.64 on Sep. 30, 2015.

Cash conversion cycle (CCC) has decreased to 66 days for the quarter from 82 days for the last year period. Days sales outstanding were almost stable at 70 days for the quarter, when compared with the last year period.

Days inventory outstanding has decreased to 15 days for the quarter compared with 32 days for the previous year period. At the same time, days payable outstanding went down to 19 days for the quarter from 20 for the same period last year.