6 and 289 in fiscal 14 fiscal 15 and ttm 16

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28.6% and 28.9% in Fiscal 14, Fiscal 15 and TTM 16 respectively, demonstrating an ability of Management to hold this margin steady. During YTD 16, this margin increased to 29.2%. Fixed manufacturing costs increased $3,443, or 13.4%, from Fiscal 14 to TTM 16 while sales grew from $203,580 to $257,299, or 26.3% during the same period. The tempered increase in these costs during this period of revenue growth drove fixed manufacturing costs as a percentage of revenue down from 12.6% to 11.3%. Fixed manufacturing costs include shop management, utilities, equipment and maintenance which are relatively fixed in nature, creating sustainable leverage expected with future revenue growth. In addition to increased leverage on fixed manufacturing costs, SG&A costs as a percent of revenue decreased from 12.8% to 11.0% of revenue during the Historical Period, indicating leverage on the fixed costs of this cost category. While personnel costs to support the growth of the Company increased 12.4% due to pay increases and performance bonuses, other SG&A costs remained flat. The nature of these expenses contribute to the sustainability of this leverage trend. The combination of revenue growth, stable contribution margins and leverage of the Company's fixed costs increased Reported EBITDA from $10,201 to $20,186, an increase of 97.9%. As a percent of revenue, EBITDA also increased from 5.0% to 7.8%. Insights The Company's ability to increase revenue with nominal fixed costs growth drove the Company's EBITDA margin increase. Continued leverage of the fixed cost structure of the business will allow the Company to grow EBITDA both in total and as a percent of revenue in the future. 14% 15% 16% 17% 18% 19% 20% 0 50,000 100,000 150,000 200,000 250,000 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 TTM gross margin % TTM (000s) Gross margin % TTM Revenues TTM Fixed manufacturing costs $ in thousands Fiscal 14 Fiscal 15 TTM 16 Revenue 203,580 208,107 257,299 Revenue growth -9.2% 2.2% 23.6% Contribution margin 28.8% 28.6% 28.9% Fixed manufacturing costs 25,646 26,709 29,089 Gross margins 16.2% 15.8% 17.6% SG&A costs 25,959 26,738 28,371 SG&A as % of revenue 12.8% 12.8% 11.0% Reported EBITDA 10,201 9,151 20,186 Reported EBITDA % 5.0% 4.4% 7.8%
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© 2016 Grant Thornton LLP | Project Lightning | October 21, 2016 DRAFT 10 Year-over-year net bookings growth materialized into a 23.6% increase in revenue in TTM 16 compared to Fiscal 15. This positions the Company for sustainable growth Insights, opportunities and risks Observations Company Management strategically shifted focus from cost cutting initiatives to topline revenue growth in Apr-15 driven by the new President of the Company, directly impacting the revenue recognized in late Fiscal 15 and TTM 16. From Fiscal 14 to Fiscal 15, the Company increased net bookings from $219,021 to $264,032. Net bookings represent sales orders or contracts signed with customers while backlog represents bookings not yet shipped as of a point in time. The chart at right presents that greater than 70% of bookings are converted to revenue within twelve months. Accordingly, the merits of increased bookings began to materialize into revenue in the latter part of Fiscal 15 and in TTM 16. This increase drove revenue from $203,580
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  • Spring '08
  • McCaffrey
  • Revenue, Grant Thornton LLP

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