Sypris Solutions, Inc. (NASDAQ:SYPR) Q3 2023 Earnings Call Transcript
Sypris Solutions, Inc. (NASDAQ:SYPR) Q3 2023 Earnings Call Transcript November 17, 2023
Operator: Good day and welcome to Sypris Solutions Incorporated Conference Call. Today's call is being recorded. At this time for opening remarks, I'd like to turn the call over to the President and Chief Executive Officer, Mr. Jeffrey Gill. Please go ahead, sir.
Jeffrey Gill: Thank you, Nick and good morning, everyone. Rich Davis and I would like to welcome you to this call, the purpose of which is to review the company's financial results for the third quarter of 2023. For those of you who have access to our PowerPoint presentation this morning, please advance to Slide 2 now. We always begin these calls with a note that some of what we might discuss here today may include projections and other forward-looking statements. No assurance can be given that these projections and statements will be achieved and actual results could differ materially from those projected as a result of several factors. These factors are included in the company's filings with the Securities and Exchange Commission.
An engineer studying the blueprints of a large mechanical construction near a busy city skyline.
And in compliance with Regulation G, you can access our website at sypris.com to review the definitions of any non-GAAP financial measures that may be discussed during this call. With these qualifications in mind, we'd now like to proceed with the business discussion. Please advance to Slide 3. I will lead you through the first half of our presentation this morning, starting with an overview of the highlights for the quarter, to be followed by an update on the outlook for each of our primary markets. Rich will then provide you with a more detailed review of our financial results for the period. Now, let's begin with the overview on Slide 4. We are pleased to report that revenue for the quarter increased 33% year-over-year, reflecting continued strength across each of our business segments, with revenue rising 73.5% for Sypris Electronics and 13.8% for Sypris Technologies on a year-over-year basis.
Gross profit increased 105% for the period, reflecting an increase of 186.8% at Sypris Electronics and 36.2% at Sypris Technologies. Gross margin for the company followed suit, rising by 420 basis points for the quarter, driven by an increase of 710 basis points for Sypris Electronics and by 120 basis points for Sypris Technologies. Backlog for the period increased 8.4% on a consolidated basis which was an important accomplishment following the 33% increase in sales during the period. Backlog for Sypris Electronics increased 9% to $109.5 million at the end of the quarter, up $9 million from the prior year period. The company's financial performance was particularly notable since we bore the negative weight of $800,000 in the form of foreign currency headwinds when compared to the prior year period.
In other words, from an operating standpoint, it was another very positive quarter. As we mentioned previously, we have entered an inflection point, where rapidly rising demand is intersecting with the increasingly availability of material. We believe that the pace of conversion of our backlog in the revenue will continue to accelerate as we now ramp up new programs to full rate production. Turning now to Slide 5. We've been pleased to announce several additional new contract awards during the quarter, more specifically, at Sypris Technologies. In August, we announced an award for 72-inch insulated joints for use in the expansion of the Atoka Water Pipeline for the Oklahoma City Water Utilities Trust. According to new sources, the second Atoka Pipeline is being built to provide Oklahoma City and its surrounding areas with potable water.
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