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SEC filingRevenue grew 12% YoY, but net loss widened slightly as operating improvements were offset by higher interest and tax costs.
Operating income improved to a loss of $2.1 million from a loss of $4.8 million in the prior year, a 57% reduction in the operating loss. The improvement reflects better cost absorption on the higher revenue base, as fixed costs were spread over a larger sales volume. Despite this, the operating margin remained negative at -1.7%, indicating that the company has not yet achieved profitability at the operating level.
Net loss for the quarter was $6.8 million, compared to $6.7 million in the prior year, a slight widening of 2.1%. The improvement in operating income was more than offset by higher interest expense and income tax provision. Diluted loss per share was $0.25, compared to $0.23 in the prior year, reflecting the increased net loss.
Net cash used in operating activities was $8.6 million, compared to $3.3 million in the prior year, a significant deterioration. The change was primarily driven by an increase in accounts receivable, inventories, and other operating assets, partially offset by changes in accounts payable and other liabilities. This working capital build consumed cash, reflecting the higher sales volume and associated investment in receivables and inventory.
Capital expenditures were $3.3 million, down from $3.9 million in the prior year, as the company continues to invest selectively. Free cash flow, defined as operating cash flow minus capital expenditures, was negative $11.9 million. The company manages liquidity through its ABL facility, which is limited by a borrowing base derived from accounts receivable and inventory. Management continues to evaluate its global footprint, including potential consolidation actions to improve cost structure.