Strattec Expects 15% to 16% Fiscal 2027 Gross Margin, Cash Flow on Track

Strattec expects fiscal 2027 gross margin of 15% to 16% and is on track for about $40 million in operating cash flow, Senior Vice President and CFO Matthew Pauli said Oct. 30.

Pauli made the comments on the company’s earnings call. He described about $10 million per quarter as a typical operating cash flow pace, while noting that working capital can cause quarterly results to vary.

Strattec generated $10.8 million in operating cash flow for the quarter ended Sept. 27, compared with $11.3 million a year earlier. Net sales were $147.2 million, down $5.2 million year over year. Gross profit totaled $24.3 million.

Gross margin was 16.5%, a decline of 80 basis points from the same quarter a year earlier. Lower volume, premium freight and higher labor costs pressured the margin. Unfavorable foreign exchange totaled $1.4 million and reduced margin by about 90 basis points.

As of Sept. 27, Strattec had $111.8 million in cash and cash equivalents and no debt. The company is an automotive access supplier.