Tenneco (TEN) has reported a 6.52 percent rise in profit for the quarter ended Mar. 31, 2015. The company has earned $49 million, or $0.80 a share in the quarter, compared with $46 million, or $0.75 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $54 million, or $0.88 a share compared with $56 million or $0.91 a share, a year ago. Revenue during the quarter dropped 3.39 percent to $2,023 million from $2,094 million in the previous year period. Gross margin for the quarter expanded 42 basis points over the previous year period to 16.66 percent. Total expenses were 94.02 percent of quarterly revenues, down from 94.56 percent for the same period last year. This has led to an improvement of 54 basis points in operating margin to 5.98 percent.
Operating income for the quarter was $121 million, compared with $114 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $175 million compared with $174 million in the prior year period. At the same time, adjusted EBITDA margin improved 34 basis points in the quarter to 8.65 percent from 8.31 percent in the last year period.
“Tenneco delivered a four percent revenue increase excluding currency with growth across our business driven by higher light vehicle volumes including new program launches, incremental commercial truck and off-highway content and higher North America aftermarket sales,” said Gregg Sherrill, chairman and CEO, Tenneco. “Our focus on cost leadership and operational excellence continued to drive higher earnings including record high first quarter EBIT, continued margin expansion and strong cash performance.”
For the second-quarter, Tenneco projects revenue to grow at 5 percent. For the second-quarter, Tenneco forecasts revenue to grow in the range of percent to percent. Tenneco forecasts revenue to grow in the range of 5 percent to 8 percent for the fiscal year 2015.
Operating cash flow remains negative Tenneco has spent $50 million cash to meet operating activities during the quarter as against cash outgo of $140 million in the last year period.
The company has spent $78 million cash to meet investing activities during the quarter as against cash outgo of $91 million in the last year period.
Cash flow from financing activities was $141 million for the quarter, down 38.43 percent or $88 million, when compared with the last year period. It has made net debt repayment of $111 million. It has spent net of $11 million on repurchase of common stocks.
Cash and cash equivalents stood at $288 million as on Mar. 31, 2015, up 7.87 percent or $21 million from $267 million on Mar. 31, 2014.
Working capital increases
Tenneco has recorded an increase in the working capital over the last year. It stood at $715 million as at Mar. 31, 2015, up 6.08 percent or $41 million from $674 million on Mar. 31, 2014. Current ratio was at 1.38 as on Mar. 31, 2015, up from 1.34 on Mar. 31, 2014.
Cash conversion cycle (CCC) has increased to 16 days for the quarter from 15 days for the last year period. Days sales outstanding went up to 52 days for the quarter compared with 50 days for the same period last year.
Days inventory outstanding has increased to 38 days for the quarter compared with 36 days for the previous year period. At the same time, days payable outstanding went up to 74 days for the quarter from 72 for the same period last year.
Debt comes down marginally
Tenneco has recorded a decline in total debt over the last one year. It stood at $1,260 million as on Mar. 31, 2015, down 4.18 percent or $55 million from $1,315 million on Mar. 31, 2014. Total debt was 30.44 percent of total assets as on Mar. 31, 2015, compared with 31.47 percent on Mar. 31, 2014. Debt to equity ratio was at 2.41 as on Mar. 31, 2015, down from 2.47 as on Mar. 31, 2014. Interest coverage ratio improved to 7.56 for the quarter from 6 for the same period last year.
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