The past several years have been favorable to many companies in the U.S. economy, but times have been tough for Jason Industries (JASN.Q). The maker of seating, finishing, and automotive acoustic products has seen its stock plunge since 2014, and Jason has had to engage in a radical transformation in order to find ways to move forward.

Coming into Thursday's first-quarter financial report, Jason Industries investors were prepared for another decline in revenue and a net loss for the quarter. Jason wasn't able to avoid that fate, but it did manage to cushion the blow with less dramatic deterioration than many had expected, and company executives are hopeful about its restructuring efforts. Let's look more closely at Jason Industries and what its results say about its future.

Jason logo.

Image source: Jason Industries.

Jason Industries manages to slow its descent

Jason Industries' first-quarter results weren't strong, but they reflected the company's willingness to fight against tough conditions. Sales dropped 8% to $175.2 million, which was a little less extreme than the consensus forecast among investors for an 11% decline. Net losses narrowed to $1.3 million, and the per-share loss of $0.05 was less than half of what those following the stock had expected to see.

Taking a closer look at the numbers, Jason suffered declines in revenue across the board. The finishing segment fared the best, with sales declining just 2%, and adjusted pre-tax operating income actually rose by roughly a third from year-ago levels. But the components segment took the biggest hit, seeing revenue drop by more than a fifth. Fully 13 percentage points of downward pressure came from the decision to exit certain non-core product lines when Jason decided to close its facility in Buffalo Grove, Illinois. Yet lower rail volumes produced an 8% hit to organic sales, and pre-tax operating profit dropped by about two-fifths.

Elsewhere, Jason's other segments had mixed results. The seating segment suffered a 9% drop in sales, as motorcycle and turf-care related volumes fell. Unfavorable product mixes hit the segment's bottom line, where adjusted pre-tax operating profit fell by a sixth. With acoustics, automotive assembly plant shutdowns contributed to an 8% revenue hit, but pre-tax operating profit inched higher as Jason saw the benefits of productivity gains and cost reductions.

CEO Brian Kobylinski put the results in perspective. "As expected, certain of our end markets remained soft due to inflated levels of channel inventory," Kobylinski said, "and we saw an overall 5% organic sales contraction." However, the CEO also noted that the completion of many cost reduction and margin expansion efforts helped Jason move forward. In particular, the winding down of operations in Brazil was completed, and the company did a sale and leaseback transaction on one of its facilities to generate $5.6 million in cash proceeds. Also, the planned consolidation of components production facilities in Illinois is on track to be done by the end of the year.

What's ahead for Jason Industries?

Looking forward, Jason seems more optimistic about its future than it has been in previous quarters. In the CEO's words, "We are beginning to see the results of our quality, delivery, portfolio optimization, and cost reduction initiatives reflected in our financial performance and the rate of new business awards received in the quarter." The company plans to push into new markets and come up with new products to drive future demand, and it hopes its sales efforts will find new customers even as Jason continues to make itself leaner and meaner operationally.

Jason reaffirmed its full-year guidance for 2017, reassuring those who might have feared a downward revision. Revenue should still finish the year between $650 million and $670 million, and adjusted pre-tax operating income is expected in the range of $64 million to $67 million.

Jason Industries investors didn't appear to immediately respond to the news, as the stock didn't move in pre-market trading following the announcement. Given how far share prices have already fallen, Jason shareholders can only hope that the company's retrenchment efforts will bring a turnaround that will help bolster its fundamental growth potential in the years to come.