Revenue during the quarter grew 3.46 percent to $804.70 million from $777.80 million in the previous year period. Gross margin for the quarter contracted 158 basis points over the previous year period to 41.73 percent. Total expenses were 86.58 percent of quarterly revenues, up from 86.28 percent for the same period last year. That has resulted in a contraction of 30 basis points in operating margin to 13.42 percent.

Operating income for the quarter was $108 million, compared with $106.70 million in the previous year period.

However, the adjusted operating income for the quarter stood at $123.90 million compared to $127.40 million in the prior year period. At the same time, adjusted operating margin contracted 98 basis points in the quarter to 15.40 percent from 16.38 percent in the last year period.

Vernon J. Nagel, chairman, president, and chief executive officer of Acuity Brands, commented, "Acuity Brands continued to deliver sales growth while initial industry data suggests that the North American lighting market declined modestly during our fiscal second quarter, reflecting continued weakness in smaller, short-cycle projects. Additionally, sales in certain international markets, including Europe and Mexico, were down year-over-year, reducing our overall net sales by approximately 1 percentage point compared with the year-ago period. Our adjusted gross profit margin of 41.7 percent declined 180 basis points compared with the prior year, primarily due to higher manufacturing expenses resulting from increased wages and benefits, inbound freight costs, and quality costs. Like last quarter, we carried a higher manufacturing cost structure into the quarter in anticipation of servicing a greater level of demand than occurred. This higher cost structure negatively impacted both gross profit dollars and margin. Adjusted selling, distribution & administrative ("SD&A") expenses declined 80 basis points year-over-year and represented 26.3 percent of net sales in the second quarter of fiscal 2017 compared with prior year's 27.1 percent. Even though demand was subdued, we have continued to invest in areas we believe have longer-term growth potential. These areas include, among others, the expansion of our lighting and building management solutions portfolios, as well as our Internet of Things software platform that provides customers with a smart infrastructure which enables endless possibilities to enhance the utilization of their space through better human interaction and greater asset and employee productivity."

The company has spent $17.40 million cash to meet investing activities during the first six months as against cash outgo of $655.30 million in the last year period. It has incurred net capital expenditure of $30.40 million on net basis during the first six months, down 26.92 percent or $11.20 million from year ago period.

The company has spent $2.50 million cash to carry out financing activities during the first six months as against cash inflow of $10.20 million in the last year period.

Cash and cash equivalents stood at $463.20 million as on Feb. 28, 2017, up 106.51 percent or $238.90 million from $224.30 million on Feb. 29, 2016.

Working capital increases sharply
Acuity Brands, Inc. has recorded an increase in the working capital over the last year. It stood at $817.10 million as at Feb. 28, 2017, up 68.72 percent or $332.80 million from $484.30 million on Feb. 29, 2016. Current ratio was at 2.49 as on Feb. 28, 2017, up from 1.94 on Feb. 29, 2016.

Cash conversion cycle (CCC) has decreased to 19 days for the quarter from 38 days for the last year period. Days sales outstanding were almost stable at 51 days for the quarter, when compared with the last year period.

Days inventory outstanding has decreased to 34 days for the quarter compared with 54 days for the previous year period. At the same time, days payable outstanding was almost stable at 67 days for the quarter, when compared with the previous year period.