TORONTO -- Firan Technology Group announced third quarter sales at its PCB unit rose 11.8% year-over-year to $18.3 million.
Growth was spurred by higher sales from its Toronto plant plus the acquisition of Colonial Circuits. The Circuits segment net earnings before corporate and interest and other costs was up 10% to $3.3 million.
Year-to-date, sales were $52.8 million, up from $46.7 million in the same period last year. Net income jumped 176% from a year ago to $1.8 million. The company overcame a cyberattack that slowed production across its North American sites during the period.
Overall sales were $28 million, up 12% over 2018. The company booked $34 million in new orders in the period, over $8 million related to simulator products. Gross margin was 28.3%, up 4.7 percentage points. EBITDA rose 55% to $4.1 million, while trailing 12-month EBITDA was $15.3 million.
Free cash flow was $6 million in the period, inclusive of $1.4 million of additions to plant and equipment, but exclusive of the $3.8 million of net cash consideration paid for the Colonial business. Net debt at quarter end was $0.
FTG closed on its acquisition of Fredericksburg, CA-based PCB fabricator Colonial Circuits on Jul. 15. Colonial Circuits contributed $1.2 million in growth to the PCB unit.
“The third quarter of 2019 was a solid quarter for FTG, particularly as this quarter can be slower due to summer holidays," said Brad Bourne, president and chief executive. "We improved our balance sheet in the quarter and this resulted in $6 million of positive cash flow. We closed the acquisition of Colonial Circuits mid-quarter and this will add much needed capacity for standard circuit board manufacturing freeing up capacity in existing sites for higher-end product and expand our offering for the US defense market.”
Subsequent to quarter end, FTG was the subject of a cyberattack that impacted its systems across North America. This had a negative impact on operations at FTG’s North American sites in September. Each site was impacted differently with reduced operations ranging from a few days to a few weeks, depending on the impact to the site’s infrastructure. Overall lost production is estimated at about 10% of quarterly sales but efforts are underway to mitigate this impact by quarter end. FTG is working with experts to determine the methodology used in the attack and steps to be taken to reduce the chances, and impact, of future attacks. Accelerated investments in network/system is planned in the coming months to address the findings.
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