Tetra Tech, Inc. (TTEK) has reported an 1.69 percent fall in profit for the quarter ended Jun. 28, 2015. The company has earned $26.21 million, or $0.43 a share in the quarter, compared with $26.66 million, or $0.41 a share for the same period last year.
Revenue during the quarter dropped 8.64 percent to $575.11 million from $629.50 million in the previous year period. Gross margin for the quarter expanded 191 basis points over the previous year period to 14.21 percent. Total expenses were 92.92 percent of quarterly revenues, down from 93.78 percent for the same period last year. This has led to an improvement of 86 basis points in operating margin to 7.08 percent.
Operating income for the quarter was $40.72 million, compared with $39.17 million in the previous year period.
Tetra Tech's Chairman and chief executive officer Dan Batrack commented, "Our business delivered solid performance in the third quarter supported by our water and environmental services for our government and commercial clients. Since the end of last quarter, we were awarded $1.4 billion of new contract capacity with our U.S. federal government clients and backlog in our ongoing operations grew 6%. We continue to improve our operating margin as demonstrated by the 35% increase in operating income, which contributed to a record quarterly cash flow from operations of $109 million."
Operating cash flow improves
Tetra Tech, Inc. has generated cash of $134.10 million from operating activities during the nine month period, up 17.32 percent or $19.80 million, when compared with the last year period. The company has spent $21.97 million cash to meet investing activities during the nine month period as against cash outgo of $17.93 million in the last year period. It has incurred net capital expenditure of $10.22 million on net basis during the nine month period, down 8.22 percent or $0.92 million from year ago period.
The company has spent $55.64 million cash to carry out financing activities during the nine month period as against cash outgo of $34.81 million in the last year period.
Cash and cash equivalents stood at $175.18 million as on Jun. 28, 2015, down 7.25 percent or $13.69 million from $188.87 million on Jun. 29, 2014.
Working capital declines
Tetra Tech, Inc. has witnessed a decline in the working capital over the last year. It stood at $415.57 million as at Jun. 28, 2015, down 8.19 percent or $37.08 million from $452.65 million on Jun. 29, 2014. Current ratio was at 1.91 as on Jun. 28, 2015, down from 1.95 on Jun. 29, 2014.
Days sales outstanding went up to 105 days for the quarter compared with 98 days for the same period last year.
At the same time, days payable outstanding went down to 26 days for the quarter from 27 for the same period last year.
Debt moves up
Tetra Tech, Inc. has witnessed an increase in total debt over the last one year. It stood at $236.22 million as on Jun. 28, 2015, up 15.83 percent or $32.28 million from $203.94 million on Jun. 29, 2014. Total debt was 13.87 percent of total assets as on Jun. 28, 2015, compared with 11.18 percent on Jun. 29, 2014. Debt to equity ratio was at 0.25 as on Jun. 28, 2015, up from 0.19 as on Jun. 29, 2014. Interest coverage ratio improved to 20.10 for the quarter from 15.96 for the same period last year.
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