Sonic Foundry, Inc (SOFO) saw its loss widen to $1.51 million, or $0.34 a share for the quarter ended Dec. 31, 2016. In the previous year period, the company reported a loss of $1.21 million, or $0.28 a share.
Revenue during the quarter went up marginally by 2.38 percent to $9.31 million from $9.09 million in the previous year period. Gross margin for the quarter expanded 191 basis points over the previous year period to 72.09 percent. Operating margin for the quarter stood at negative 16.14 percent as compared to a negative 12.29 percent for the previous year period.
Operating loss for the quarter was $1.50 million, compared with an operating loss of $1.12 million in the previous year period.
Adjusted EBITDA for the quarter stood at negative $0.76 million compared to negative $0.18 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at negative 8.22 percent for the quarter compared to negative 2 percent in the last year period.
“Our operating performance in the first quarter was consistent with our full year plan and guidance. The billings decline from the first quarter of last year was due to a significant transaction in 2016 with a large university in Japan. In the second quarter of this year, this same university will refresh its Mediasite technology installed in 2012 at another campus. This will result in a very strong second quarter for our Japan subsidiary. Recurring revenue grew by 9% year over year and will continue to grow as a percentage of total revenue throughout 2017. We expect strong growth in value added sales from our partners in China, EMEA and Japan in subsequent quarters. A significant portion of this growth will be recurring revenue from annual licenses and cloud services,” said Gary Weis, Chief executive officer of Sonic Foundry.
Operating cash flow turns negative
Sonic Foundry, Inc has spent $0.83 million cash to meet operating activities during the quarter as against cash inflow of $0.90 million in the last year period. The company has spent $0.55 million cash to meet investing activities during the quarter as against cash outgo of $0.08 million in the last year period.
Cash flow from financing activities was $0.77 million for the quarter as against cash outgo of $0.12 million in the last year period.
Cash and cash equivalents stood at $1.08 million as on Dec. 31, 2016, down 59.49 percent or $1.59 million from $2.67 million on Dec. 31, 2015.
Working capital remains negative
Working capital of Sonic Foundry, Inc was negative $4.20 million on Dec. 31, 2016 compared with negative $1.51 million on Dec. 31, 2015. Current ratio was at 0.77 as on Dec. 31, 2016, down from 0.91 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 84 days for the quarter from 142 days for the last year period. Days sales outstanding went up to 114 days for the quarter compared with 111 days for the same period last year.
Days inventory outstanding has decreased to 23 days for the quarter compared with 83 days for the previous year period. At the same time, days payable outstanding was almost stable at 52 days for the quarter, when compared with the previous year period.
Debt comes down
Sonic Foundry, Inc has recorded a decline in total debt over the last one year. It stood at $5.57 million as on Dec. 31, 2016, down 6.68 percent or $0.40 million from $5.97 million on Dec. 31, 2015. Total debt was 18.95 percent of total assets as on Dec. 31, 2016, compared with 18.73 percent on Dec. 31, 2015. Debt to equity ratio was at 1.27 as on Dec. 31, 2016, up from 0.87 as on Dec. 31, 2015. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: [email protected]
