TORONTO, ONTARIO -- Firan Technology Group today announced record first-quarter sales of $16.9 million, up 3.8% from a year ago, aided in part by new program wins and a stronger dollar.

The company's Circuits segment sales fell 1.6% from 2015 to $12.5 million on lower demand from a large defense customer, but bookings were strong at that site and sales are expected to recover.

The Circuits segment's earnings before corporate taxes and interest and other costs were $1.4 million, up 16.7%.

Overall net profits were up 6.6% from last year $450,000 for the three months ended Feb. 26. First-quarter earnings before tax rose 46% year-over-year to of $725,000, and gross margins were 22.2%, up 340 basis points from a year ago, setting another record. Margins improved dramatically at the company's PCB operation in Chatsworth, as improved performance and product mix offset decreased sales activity.

Cash flow from operations after investments in capital equipment and deferred development showed a loss of $600,000.

Subsequent to the quarter's end, the firm completed the acquisition of Photo Etch via an asset purchase, to rapidly increase utilization of its Aerospace-Chatsworth facility. The acquisition "provides an opportunity to transition work to the Chatsworth facility and move this site to profitability," FTG said, a transition expected to take approximately six to nine months.

"We started 2016 with very strong operating performance for FTG as a result of past investments in technology, positive impacts from past key new program wins as well as the strengthening of the US dollar," said Brad Bourne, president and chief executive. "Growth is key to FTG to increase utilization across all facilities, particularly the new ones in Chatsworth, California and Tianjin, China. The acquisition of Photo Etch, subsequent to our quarter end, will enable us to transition work to our Aerospace Chatsworth facility more rapidly than planned. Improved utilization will drive profitability due to high contribution margins on incremental revenues."

During the period FTG signed two new sourcing agreements with a leading US-based aerospace customer for its Circuits Toronto and Chatsworth businesses for applications in business, regional and air transport aircraft, and defense and space applications. It also received initial production orders from two large aerospace customers at its FTG Printronics Circuits joint venture in China. The Chatsworth PCB facility received completed certification to MIL-PRF-31032 for rigid-flex boards.

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